The European Commission has officially released the updated steel import quota volumes for the upcoming period starting July 1, 2026. The new regulations maintain the restrictive 15% cap per country for several hot-rolled and cold-rolled categories to prevent market flooding by specific exporters. Total quota volumes remain relatively stable, but adjustments have been made to specific country allocations for wire rods and galvanized sheets. These measures reinforce the EU's protectionist stance, likely keeping domestic steel prices elevated by limiting the availability of cheaper non-EU alternatives amid slow regional demand recovery

The overseas secondary aluminum market continues to exhibit structural divergence. Elevated scrap prices provide strong cost support, but cautious downstream procurement and weak transaction follow-through are dampening demand-side momentum. As a result, prices remain firm while trading activity stays subdued.【SMM Analysis】

[Stagflation Expectations Heat Up Combined with China Inventory Buildup, Divergence Between SHFE and LME Aluminum Continues] Overall, geopolitical risks outside China persisted and supply tightened, keeping LME aluminum prices on a relatively strong footing; high inventory levels in China combined with weak demand limited SHFE upside room, with a clear divergence between SHFE and LME price trends.

According to SMM data, as of April 24, social inventory of aluminum ingots in China's major consumption regions stood at 1.465 million mt, up 42,000 mt WoW, maintaining an inventory buildup trend for multiple consecutive weeks, with the pace of buildup widening again WoW. Weekly warehouse withdrawals rebounded slightly by 14,200 mt WoW to 115,200 mt, but the improvement in withdrawals fell short of the recent increase in arrivals, indicating clearly insufficient momentum for inventory drawdown..

[Inventory Trends Diverge Significantly in and outside China; Aluminum Prices Continue LME-Outperforms-SHFE Pattern] Negotiations in the Middle East experienced repeated twists and turns, and geopolitical risks had not yet fully been cleared. However, the widening supply gap outside China and the steady drawdown of LME inventory jointly supported LME aluminum prices in holding up well. In China, social inventory of aluminum ingots remained at elevated levels, with the strength of demand recovery and the pace of inventory drawdown becoming the core variables influencing SHFE price trends.

According to SMM statistics, on April 23, aluminum billet inventory in China's major consumption areas totaled 278,000 mt, down 14,000 mt WoW from last Thursday, smoothly falling below 280,000 mt, largely in line with expectations at the beginning of the month. In terms of warehouse withdrawals, aluminum billet warehouse withdrawals totaled 49,000 mt last week, down 5,000 mt WoW, mainly because aluminum prices once again rose above 25,000, and downstream buyers again adopted a wait-and-see attitude.