[Geopolitical Disturbances Marginally Weaken, Accelerating Destocking Supports Aluminum Prices Fluctuating Upward] On the macro front, Trump once again claimed that US-Iran negotiations have entered the "final moment," but the market has become desensitized to his repeated similar statements, and the geopolitical risk premium is marginally weakening. On the fundamentals side, the supply gap outside China is expected to provide strong bottom support for aluminum prices, and expectations of rising energy costs also form a bullish driver for aluminum prices; however, the high inventory pressure in China remains relatively evident, which is expected to limit the upside room for China's aluminum prices, and in the short term, China’s aluminum prices are expected to mainly fluctuate and adjust.

According to SMM, the operating rate of the copper plate/sheet and strip industry in May 2026 was 76.55%, down 1.4 percentage points MoM and up 6.42 percentage points YoY. Of this, the operating rates for large, medium-sized, and small enterprises were 85.11%, 60.71%, and 69.67%, respectively.

Recently, new orders for copper plate/sheet and strip downstream decreased, and demand-side prosperity weakened. The market moved past the previous state of undersupplied spot copper plate/sheet and strip and shortages of certain specifications. The shipment pace of enterprises stabilized, overall inventories returned to normal levels, and the tight supply situation ended completely.

According to SMM, the operating rate of the copper plate/sheet and strip industry pulled back slightly MoM in May, but still surged YoY, with the overall production base of the industry remaining at a high level. Earlier, market demand was released in a concentrated manner, and enterprises’ order intake increased significantly, leading to ample accumulated orders on hand awaiting delivery and sufficient order visibility. This effectively supported enterprises in maintaining a high production schedule pace in May. However, entering mid-to-late May, new market orders gradually decreased and demand weakened marginally. Enterprises had largely used up their previously ample orders on hand, and new orders were insufficient to sustain the high production schedule pace. Most producers chose to sc

[Middle East Situation Calms Temporarily, Aluminum Prices Fluctuate and Adjust at Highs] Amid geopolitical risks in the Middle East, a wait-and-see sentiment in the market is expected to persist. The overseas supply gap is expected to provide strong underlying support for aluminum prices, while expectations of rising energy costs also serve as a bullish driver for aluminum prices. However, high inventory pressure in China remains relatively evident, which is expected to cap the upside room for domestic aluminum prices. In the short term, China's aluminum prices are expected to primarily fluctuate and adjust.

[Geopolitical Risks and Accelerating Destocking Drive SHFE Aluminum Volatile Adjustment] The Middle East geopolitical situation remains volatile, market wait-and-see sentiment is expected to persist, the ex-China supply gap is expected to provide strong bottom support for aluminum prices, US Fed interest rate hikes remain uncertain, and rising energy cost expectations also form a bullish driver for aluminum prices; but high inventory pressure in China remains relatively prominent, which is expected to limit the upside room of domestic aluminum prices, with short-term domestic aluminum prices expected to mainly see volatile adjustment.