Stable operating rate pattern for PV frames unlikely to change in the short term; production resumptions at aluminium plants outside china accelerate, market sentiment shifts

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PV aluminium extrusion: This week, the operating rate of surveyed PV aluminium frame enterprises remained stable. Some leading PV frame enterprises reported that their current orders were ample and sufficient to keep production running at high levels until month-end.

Downstream, PV module enterprises did not change their procurement strategies because of the recent drift higher in aluminium prices and continued to purchase as needed. According to SMM, frame enterprises had no plans to adjust processing fees in the short term. At the current stage, supply-side and demand-side fundamentals in the industry were relatively balanced, so the operating rate of PV aluminium frame enterprises would continue to run at a steady pace.

Raw material prices: During the period (August 10-13, 2026), the weekly average SMM A00 aluminium ingot price was RMB 24,145 per tonne, up 2 per cent from the previous weekly average price. Overall, macro front, the YoY growth rates of US July CPI and core CPI slowed to 3.4 per cent and 2.5 per cent, respectively, both in line with market expectations.

The mild pullback in inflation eased concerns about further aggressive rate hikes by the US Fed, weakened the short-term momentum for US Treasury yields to shoot up, and eased macro liquidity pressure. Combined with lingering differences over the Middle East situation, these factors provided staged support for aluminium prices. Fundamentals side, aluminium ingot inventory continued to destock, but destocking was expected to slow down in the second half of the month.

Supply side outside China, the UAE's EGA disclosed progress on the resumption of production at the AlTaweelah aluminium smelter. Currently, 18 per cent of the plant's 1,262 electrolysis cells have been restarted, and the pace of the production resumption was faster than the market had previously expected. The previously traded supply tightness premium faced give-back pressure.

Although macro recovery and continued destocking supported higher aluminium prices in the first half of August, due to a shift in market sentiment, aluminium prices are expected to be under pressure at high levels in the short term, and upside room will be suppressed to some extent by production resumption expectations.

Next week, the most-traded SHFE aluminium contract is expected to trade in the range of RMB 23,600-24,450 per tonne; LME aluminium is expected to trade in the range of USD 3,180-3,330 per tonne. Going forward, close attention should be paid to the progress of production resumptions in the Middle East and developments in new project commissioning plans.

Note: This article has been issued by SMM and has been published by AL Circle with its original information without any modifications or edits to the core subject/data.