Global Aluminum Market Review – April: Divergent Domestic & Overseas Trends and Marked Spot Structure Disparities The global aluminum market in April featured a core pattern of strength overseas and weakness domestically with diverging trends. The main Shanghai aluminum contract retreated from highs amid fluctuations, while LME aluminum maintained firm momentum supported by low inventories and geopolitical factors, with both markets seeing mild corrections toward month-end. Market drivers this month centered on macro policies, geopolitical conflicts, supply-demand fundamentals and inventory structures, with movements of key indicators further highlighting supply-demand imbalances between domestic and overseas aluminum markets. I. April Aluminum Price Review: Linked Movements with Distinct Strength Differentials Shanghai aluminum and LME aluminum shared similar price rhythms in April, both fluctuating higher initially before retreating. However, notable gaps emerged in upward momentum and correction ranges, with overseas aluminum prices significantly outperforming domestic counterparts. The average Shanghai-LME aluminum ratio dropped from 7.36 in March to 7.03 in April, reflecting stronger overseas aluminum pricing relative to Shanghai aluminum. The main Shanghai aluminum contract trended upward early in the month before softening overall, declining from elevated levels through range-bound trading. It opened lower at RMB 24,715 per ton at the start of the month and consolidated. Driven by escalating Middle East geopolitical tensions and rising LME aluminum prices, it surged to a monthly peak of RMB 25,675 per ton in mid-April. In late April, amid continuous domestic inventory accumulation, weaker-than-expected downstream demand, and risk-averse capital outflows ahead of the May Day holiday, prices corrected steadily. Closing at RMB 24,430 per ton on April 30, the contract recorded a monthly trading range of nearly RMB 1,360 per ton. LME March aluminum traded firmly with mild late-month declines. Opening at USD 3,459 per ton, it climbed to a monthly high of USD 3,672 per ton in mid-April, underpinned by overseas supply disruptions from geopolitical frictions and sustained inventory destocking. Prices edged down later due to fluctuating US-Iran negotiations, hawkish macro sentiment and profit-taking at high levels, settling at USD 3,476 per ton at month-end with a slight monthly loss. Overall, LME aluminum vastly outperformed domestic Shanghai aluminum. In terms of price drivers, geopolitics served as a shared upward catalyst for global aluminum prices, with production cuts and supply disruptions in the Middle East continuously boosting market risk aversion. Price divergence stemmed from dual disparities in macro policies and fundamentals: elevated domestic inventories and sluggish demand consistently capped aluminum price rebounds, while tight overseas inventories and strained spot supplies provided robust support for LME aluminum. II. Key Inventory Indicators: Divergent Inventory Movements and Contrasting Supply-Demand Landscapes As a core gauge of aluminum market supply and demand, domestic and overseas inventory trends diverged sharply in April, directly shaping the relative strength of regional aluminum prices. Domestic aluminum inventories kept rising and stood at a multi-year seasonal high. Social inventories maintained an upward trend throughout April, hitting 1.465 million tons in mid-month, the highest seasonal level in five years. A clear imbalance emerged between rigid supply release and lackluster downstream demand during the traditional peak "Silver April" period, leading to persistent spot market loosening. SHFE warehouse stocks expanded from 420,000 tons at the start of the month to 450,000 tons at month-end. Elevated warehouse stock levels further confirmed ample domestic spot supply, weighing continuously on aluminum prices. Overseas LME aluminum inventories declined steadily to a 20-year low. Total LME aluminum inventories fell from 410,000 tons to 370,000 tons in April, extending months of destocking to historic lows. Noticeable structural divergence persisted in inventory composition: Russian aluminum accounted for approximately 92% of total LME stocks in March, resulting in low market-circulating inventories and increasingly tight physical spot supply, which acted as the fundamental pillar for strong LME aluminum prices. In summary, April’s global aluminum market was governed by contrasting core dynamics: low overseas inventories, geopolitical disruptions and hawkish Federal Reserve policies on the overseas front, versus high domestic inventories, weak real demand and stable growth expectations domestically. This drove pronounced market divergence. Affected by intertwined internal and external factors, the main Shanghai aluminum contract corrected downwards from highs, while LME aluminum remained in a firm trading range, backed by historically low inventories, a tight spot balance and geopolitical risk premiums.

[Conflict Impact] The outbreak of the Middle East conflict on February 28, 2026, significantly disrupted global aluminum market dynamics, driving increased volatility in aluminum prices. Aluminum prices on the London Metal Exchange (LME) surged alongside escalating tensions, rising from an Official Price of $3,156.5/mt on February 27 to a peak of $3,519.5/mt in early March. Prices later retreated to the $3,200–3,300/mt range in late March, as market sentiment gradually stabilized. On March 28, in response to attacks on Iranian industrial zones, Iran reportedly targeted major regional aluminum producers including Aluminum Bahrain and Emirates Global Aluminum, while Qatar Aluminum declared force majeure. These developments constrained primary aluminum output in the Middle East, tightening market liquidity and increasing supply uncertainty. As a result of supply disruptions, global aluminum availability declined, particularly impacting regions outside China in Asia. Entering April, LME aluminum prices rebounded to $3,400–3,500/mt, breaking above $3,600/mt in mid-April and fluctuating within the $3,500–3,600/mt range. [Shipping Disruptions] The conflict initially disrupted transportation systems across the Middle East, with the Strait of Hormuz being most severely affected. Key aluminum exporters—including the UAE, Saudi Arabia, Qatar, Iran, and Kuwait—faced significant logistical constraints. Exports that traditionally passed through the Strait were heavily restricted, forcing market participants to adopt alternative logistics routes, including land transport to Red Sea ports. These adjustments significantly increased freight costs and extended delivery lead times. In April, the escalation of conflict into the Red Sea region further limited alternative shipping routes. Most Europe–Asia vessels opted to reroute via the Cape of Good Hope, driving both freight costs and transit times higher. According to SMM market research, cargo delivery delays reached 3–5 weeks, while container freight costs surged by as much as 60–70%. [Primary Aluminum and Processing] Reduced Middle Eastern exports tightened primary aluminum supply across major Asian consuming countries, particularly Japan, Thailand, India, and South Korea. In 2024, the Middle East exported 6.408 million mt of primary aluminum and key aluminum products, with these four countries accounting for approximately 20.8% (1.331 million mt). In 2025, exports declined to 6.071 million mt, with imports from these countries totaling approximately 1.215 million mt (~20%). Demand for primary aluminum alloys and billets (notably 6xxx series) remained strong. SMM data shows that following the outbreak of conflict, processing fees for 6063 billets in Southeast Asia rose from $200–250/mt to $250–300/mt, peaking at $300–310/mt. Market feedback indicates a recovery in demand for 6xxx billets, with both domestic and export transactions in Malaysia and Thailand increasing significantly in April. Downstream purchasing sentiment improved, offsetting weaker market conditions observed in January–February. Demand for primary foundry alloys also strengthened. Elevated aluminum prices, reduced Middle Eastern supply, and growth in downstream sectors such as automotive (particularly in Thailand) drove increased enquiries for alloys including A356, AlSi10MnMg, and AlSi10FeMg. Notably, interest in low-carbon aluminum has also increased, reflecting rising alignment with international decarbonization policies such as the EU’s Carbon Border Adjustment Mechanism (CBAM). Against a backdrop of tightening primary supply, importing semi-finished aluminum products from alternative regions may become an increasingly viable option. [Secondary Aluminum] Beyond primary production, the Middle East has also been a significant supplier of aluminum scrap and secondary alloys, serving as an emerging recycling and processing hub prior to the conflict. India and South Korea are key importers of Middle Eastern scrap. In 2024, the region exported 628,000 mt of aluminum scrap, with India and South Korea accounting for 62.6% and 13.5%, respectively. In 2025, total exports rose to 766,000 mt, with imports reaching 489,000 mt (India) and 101,000 mt (South Korea). Amid the conflict, buyers from Japan and South Korea diversified sourcing toward Southeast Asia, particularly Malaysia and Thailand, boosting demand for ADC12 secondary aluminum alloy. This shift supported both Southeast Asian FOB prices and Japan CIF prices. In April, continued conflict escalation drove additional demand from India, with SMM data indicating several thousand tonnes of incremental enquiries and transactions in Southeast Asia. SMM began tracking ADC12 FOB prices in Thailand and Malaysia in March 2026. Prices rose from $3,000/mt on March 2 to $3,365/mt by April 27, marking an increase of $365/mt. Market activity remained robust, with strong exports to Japan, South Korea, and India, alongside steady shipments to China, Singapore, and other regions. Some producers have reportedly secured orders through late June to July. On the raw materials side, rising LME aluminum prices pushed both imported and domestic scrap prices higher. In Thailand, aluminum cable scrap reached THB 115,000–120,000/mt ($3,560–3,710/mt) in April, significantly increasing blending costs for billet producers. As scrap prices climbed, some billet producers reduced scrap usage and increased reliance on primary aluminum. Meanwhile, higher prices for Tense scrap led to reduced trading volumes, prompting ADC12 producers to substitute alternative scrap types, including higher-copper materials, to optimize cost structures. Reduced scrap supply from the Middle East also intensified competition, particularly as India increased procurement from alternative markets, tightening supply and driving prices higher in Southeast Asia. [Outlook] The Middle East conflict has fundamentally reshaped aluminum trade flows across Asia and globally, increasing pressure on Southeast Asia’s aluminum processing sector. If the conflict persists, global aluminum trade is likely to become more regionalized, with tighter raw material availability in Asia and stronger internal circulation in Western markets. China may emerge as a key balancing supplier, as widening domestic-international price spreads could open export arbitrage opportunities for semi-finished aluminum products and secondary alloys. However, Southeast Asia may face mounting pressure from raw material shortages and intensified competition, particularly from India. At the same time, tightening low-carbon policies and Western supply chain reshoring may further challenge regional competitiveness. Conversely, a de-escalation of the conflict and normalization of logistics routes could ease supply constraints, potentially placing downward pressure on aluminum product and secondary alloy prices, gradually returning the market toward pre-conflict conditions. [Notes] The “18 Middle Eastern countries” referenced in this report include: Gulf Cooperation Council (GCC): Saudi Arabia, United Arab Emirates, Qatar, Kuwait, Oman, Bahrain Levant region: Israel, Jordan, Lebanon, Syria, Palestine Other key regional countries: Iran, Iraq, Turkey, Egypt, Cyprus, Libya, Yemen Primary aluminium and related key aluminium products include the following HS codes: 7601 – Unwrought aluminium 7604 – Aluminium bars, rods and profiles 7605 – Aluminium wire 7606 – Aluminium plates, sheets and strip, thickness > 0.2 mm 7607 – Aluminium foil 7608 – Aluminium tubes and pipes

Strait of Hormuz disruptions and Iran tensions are driving up aluminum prices and premiums. Aluminium Bahrain and Qatalum have cut output, while feedstock is tight. Rerouting via Port of Sohar or Saudi ports raises costs and delays. Buyers are turning to China, India, Russia, Canada, and scrap to offset risk. Prolonged disruption could reduce Middle East market share and reprice it as higher-risk supply.

[SMM Weekly Review of Aluminum Prices: Strong Support and Pressure Points Coexist, SHFE Aluminum to Maintain Volatile Consolidation in the Short Term]

[SMM Analysis: Module Factory Purchase Demand Declines, PV Frame Profile Operating Rate Under Pressure] This week, the operating rates of sampled PV frame enterprises continued to diverge. The operating rates of some leading enterprises in east China declined slightly WoW, mainly due to the sluggish purchase sentiment of downstream module factories and the enterprises' relatively pessimistic expectations for module scheduled production in June. However, according to SMM, some manufacturers in Anhui are steadily ramping up their newly invested capacity, which is expected to reach full production in H2. Meanwhile, according to SMM survey, some small and medium-sized enterprises in Anhui and Henan reported that their PV production lines are gradually exiting the market, retaining only orders from some long-established customers. Their PV frame operating rates remain at a low level of 30%.

》Check SMM aluminum product quotes, data, and market analysis SMM News on June 4: Today, the most-traded SHFE aluminum 2507 contract opened at 20,005 yuan/mt, with a high of 20,110 yuan/mt, a low of 19,975 yuan/mt, and closed at 20,075 yuan/mt, up 0.43%. Trading volume was 97,500 lots, and open interest was 190,000 lots. SMM Commentary: Although the increase in US steel and aluminum tariffs to 50% is bearish, China's direct aluminum semis exports to the US have been restricted by high tariffs for years, so the actual incremental impact is limited. It mainly affects overall market sentiment, suppressing global aluminum trade liquidity, particularly impacting countries highly dependent on US exports, and exacerbating regional supply surplus pressure in the short term. On the fundamental side, domestic aluminum smelters' operating capacity remains stable. Notably, some aluminum smelters in north China have increased the proportion of liquid aluminum used in alloying, reducing casting ingot volumes and affecting the arrival of goods in major consumption areas. On the demand side, some downstream sectors are showing expectations of an off-season slowdown. Demand for PV aluminum is decreasing, and automotive aluminum demand is expected to weaken in mid-to-late June. Construction aluminum demand remains lukewarm, but currently benefits from orders from State Grid, keeping the operating rate of aluminum wire and cable high. Overall, short-term market sentiment may suppress aluminum prices due to tariff impacts. Meanwhile, domestic aluminum ingot inventory has declined more than expected, supporting aluminum prices and spot premiums. Although some sectors are showing expectations of a weakening off-season, the overall decline is better than expected, and demand resilience remains. It is expected that the most-traded SHFE aluminum contract will maintain a fluctuating trend in the short term, with solid support below. If macro pressures do not escalate significantly, prices may show mild strength. Today, the most-traded alumina 2509 contract opened at 3,036 yuan/mt, with a high of 3,086 yuan/mt, a low of 3,010 yuan/mt, and closed at 3,063 yuan/mt, up 0.89%. Trading volume was 316,000 lots, and open interest was 300,000 lots. SMM Commentary: According to SMM statistics, alumina's weekly operating capacity continued to rebound, reaching 86.67 million mt/year as of last Thursday, up MoM, further alleviating spot supply pressure and slowing the rise in spot prices. Recent overseas alumina transactions have been sluggish, with relatively small price fluctuations. As domestic prices continue to rise, alumina imports have shifted from losses to profits, and the domestic alumina import window is gradually opening. In the short term, with the gradual resumption of production from some alumina maintenance and production cuts, alumina supply pressure is expected to gradually ease. The average profit of the alumina industry has entered a profitable state, and the market has strong expectations for alumina production resumptions. Alumina futures prices have taken the lead in pulling back, which may drive spot prices weaker. Subsequent attention should be paid to changes in the capacity of domestic alumina enterprises and the supply of imported alumina. [The information provided is for reference only. This article does not constitute direct advice for investment research and decision-making. Customers should make decisions cautiously and should not replace their own independent judgment with this information. Any decisions made by customers are not related to SMM.]

Overnight, LME copper opened at $9,566.5/mt, dipping to a low of $9,557.5/mt shortly after the opening bell.

Recently, news has been circulating widely in the market that an energy giant has established aluminum positions exceeding 1 million mt on the London Metal Exchange (LME). The scale of this position is staggering — as of May 15, LME aluminum inventory stood at only 397,300 mt (with Rusal accounting for approximately 90% of it), and the giant's position is 2.5 times larger than the existing inventory. Affected by this, the near-month contracts of LME aluminum have shifted from a contango structure with futures premiums of $28 to a slight backwardation structure with spot premiums, intensifying market concerns about the rise in near-month contract prices of LME aluminum. Many investors are beginning to wonder if LME aluminum will replicate the previous strong backwardation trend of LME copper, which was triggered by changes in global trade flows due to tariff policy risks.

Recently, news has been circulating widely in the market that an energy giant has established aluminum positions exceeding 1 million mt on the London Metal Exchange (LME). The scale of this position is staggering—as of May 15, LME aluminum inventory stood at only 397,300 mt (with Rusal accounting for approximately 90% of it), and the giant's position is 2.5 times larger than the existing inventory. Affected by this, the near-month LME aluminum contract has shifted from a futures contango structure of $28 to a slight spot premium (back) structure, intensifying market concerns about a rise in the near-month LME aluminum contract price. Many investors are beginning to wonder if LME aluminum will replicate the previous strong back rally in LME copper, which was triggered by tariff policy risks that led to changes in global trade flows.​ SMM believes that despite the uncertainty surrounding the 232 aluminum tariffs, which has introduced volatility into the global aluminum trading landscape and, coupled with the continuous drawdown of inventory, has led to repeated shifts in short-term trading expectations, from the perspective of overseas aluminum fundamentals, the LME back structure does not have the conditions to be sustained for an extended period.​ In terms of spot market performance, spot premiums for aluminum ingots globally are mostly on a downward trend, particularly in Asia. Influenced by expectations of the off-season, there is no shortage of aluminum ingots in the market, which poses an obstacle to the continuation of the back structure.​ From the perspective of open interest logic, market participants holding large spot positions typically maintain a certain amount of short hedging positions in the futures market. It can thus be inferred that the primary purpose of the operation on the LME this time may be for futures/futures market arbitrage, rather than a simple bet on a unilateral rise in aluminum prices.​ Regarding tariff policies, even if there is a breakthrough in negotiations between China and the US on the 232 steel and aluminum tariff issues, leading to changes in global aluminum trade flows, it will still be difficult to support a strong back structure. The reason is that the US currently still has a portion of hidden aluminum ingot inventory and has not yet faced a situation of supply depletion.​ On the international front, the end of the Russia-Ukraine war does not mean the end of Western sanctions on Russian metals. There is a high degree of uncertainty regarding the lifting of sanctions on Russia, which brings higher capital cost pressures and risks.​ Currently, trade frictions triggered by global tariffs still exist, and the low inventory situation has further strengthened the resilience of aluminum prices. However, the subsequent off-season pressure on the demand side limits its upside potential. If China and the US make substantive progress in the 232 steel and aluminum tariff negotiations, global aluminum trade flows will be reshaped, supply pressures in markets outside the US are expected to be alleviated, and market sentiment will also be boosted. However, fundamentally, this will still be difficult to bring about a substantive reversal in overseas aluminum fundamentals. Market participants need to closely monitor relevant developments and cautiously respond to the complex changes in the LME aluminum market. [The information provided is for reference only. This article does not constitute direct advice for investment research and decision-making. Clients should make decisions cautiously and should not replace their own independent judgment with this information. Any decisions made by clients are not related to SMM.] 》Subscribe to view historical spot prices of SMM metals

Check SMM's aluminum product quotes, data, and market analysis SMM, May 16: Today, the most-traded SHFE aluminum 2507 contract opened at 20,220 yuan/mt, with a high of 20,220 yuan/mt, a low of 20,090 yuan/mt, and closed at 20,130 yuan/mt, down 0.45%. Trading volume was 83,100 lots, and open interest was 204,000 lots. SMM Commentary: Favourable macro front provides bottom support for aluminum prices, while low inventory further strengthens price resilience. As of May 16, inventories in Guangdong, Wuxi, and Gongyi were 238,000 mt, 168,000 mt, and 53,000 mt respectively, totaling 459,000 mt, down 3,000 mt from the previous day. However, the off-season pressure on the demand side limits upside room. If a breakthrough is achieved in the US-China negotiations on the Section 232 steel and aluminum tariffs, the global aluminum trade flow will be reshaped, and supply pressure in markets outside the US is expected to ease, further boosting market sentiment and supporting aluminum prices. Today, the most-traded alumina 2509 contract opened at 2,995 yuan/mt, with a high of 2,996 yuan/mt, a low of 2,872 yuan/mt, and closed at 2,890 yuan/mt, down 3.51%. Trading volume was 951,000 lots, and open interest was 343,000 lots. SMM Commentary: Maintenance and production cuts at alumina enterprises in south China were concentrated this week, with operating capacity decreasing by 2.9 million mt/year on a MoM basis, further tightening spot supply. In addition, alumina enterprises have been facing losses in recent months, with a strong intention to refuse to budge on prices. Coupled with maintenance and production cuts, spot supply has tightened, leading to a significant rebound in spot prices. In the futures market, alumina futures have rebounded strongly, driven by the alumina fundamentals turning to a deficit, as well as news on domestic alumina enterprises' production dynamics, the revocation of mining rights of several miners in Guinea, and favourable macro news. In the short term, due to the concentrated maintenance and production cuts, alumina spot supply is expected to remain tight, and prices are expected to hold up well. As alumina maintenance ends and new capacity is released, combined with the alumina profit recorded at 153 yuan/mt according to SMM's daily cost-profit model, the market has certain expectations for alumina production resumptions. Subsequent attention should be paid to the maintenance, production cuts, and production resumptions of alumina enterprises. [The information provided is for reference only. This article does not constitute direct investment research and decision-making advice. Clients should make decisions cautiously and not rely on this as a substitute for independent judgment. Any decisions made by clients are not related to SMM.]