[Destocking Inflection Point Largely Confirmed; Aluminum Prices Continue LME Outperforms SHFE Pattern] On the macro front, the US and Iran plan to sign a letter of intent to formally end hostilities and launch 30-day negotiations, though the trajectory of geopolitical risks remains to be seen. The US Fed meeting minutes were far more hawkish than expectations, with most policymakers supporting policy tightening, and expectations of liquidity tightening are overall bearish for metal prices. Recently, the heads of state of the US and Russia have made concentrated visits to China, which is expected to yield preliminary outcomes in trade and economic areas. On the fundamentals side, the supply gap and low inventory outside China still provide bottom support, but elevated inventory levels in China remain the core factor suppressing significant price rallies. Coupled with weak trading performance in the spot market, this further limits the upside room for aluminum prices. In the short term, aluminum prices are expected to continue the LME outperforms SHFE pattern, fluctuating at highs.

[SMM Aluminum Price Weekly Review: Geopolitical Risk Trajectory Remains Uncertain, Destocking Provides Limited Support for Aluminum Prices]

[Tightening Liquidity Expectations Strengthen, Aluminum Prices Under Pressure with Short-term Fluctuations] On the macro front, the US and Iran plan to sign a letter of intent to formally end hostilities and initiate 30-day negotiations, with geopolitical risk trends still remaining to be seen; the US Fed meeting minutes were far more hawkish than expectations, with most policymakers supporting policy tightening, and tightening liquidity expectations are overall bearish for metal prices. On the fundamentals side, supply gaps outside China and low inventory still provide bottom support, but inventory at high levels in China remains the core factor suppressing significant price rallies. Additionally, weak spot market transaction performance further limits upside room for aluminum prices. Aluminum prices are expected to continue the pattern of LME outperforms SHFE, fluctuating at highs in the short term.

[Will Refined Zinc Maintain Net Imports in April with Exports Increasing in May?] According to the latest customs data, refined zinc imports in April 2026 were 6,000 mt, down 8,400 mt or 58.27%% MoM, and down 78.62% YoY. Cumulative refined zinc imports from January to April were 49,000 mt, down 61.98% YoY cumulatively. Refined zinc exports in April were 3,900 mt, down 16.22% MoM and up 59.21% YoY.

[Middle East Geopolitical Risks Cool Down, Aluminum Prices Under Pressure in the Short Term] On the macro front, US President Trump once again signaled readiness for war against Iran, claiming military action was prepared, while Iran issued a tough warning that it would "open a new front." Geopolitical conflict risks escalated again, with market risk-aversion sentiment pushing up risk premiums. China's inventory at high levels remains the core factor suppressing significant price rallies. Additionally, weak spot market transactions further limited the upside room for aluminum prices. In the short term, aluminum prices are expected to continue the pattern where the overseas market outperforms the domestic market, fluctuating at highs.

[Middle East Geopolitical Risks Cool Down, Aluminum Prices Under Pressure in the Short Term] On the macro front, Trump announced the cancellation of the originally planned military strike against Iran, as negotiations mediated by relevant countries made progress, easing market concerns over an escalation of Middle East conflicts. High inventory levels in China remain the core factor suppressing significant price rallies. Additionally, weak trading performance in the spot market further limits the upside room for aluminum prices. In the short term, aluminum prices are expected to continue the pattern of LME outperforms SHFE, fluctuating at highs.

[Easing China-U.S. Trade Tensions Combined with Ex-China Supply Gap — LME Outperforms SHFE in Aluminum Prices] The macro front received positive signals as China-U.S. trade negotiations yielded preliminary results. Both sides agreed to continue implementing prior tariff arrangements and to establish a Trade and Investment Council, which is expected to facilitate tariff reductions on certain products. The marginal easing of trade frictions is set to improve export expectations for aluminum semis and end-use products, providing bullish support for market sentiment. However, inventory at high levels in China remains the core factor suppressing significant price rallies. Coupled with weak spot market trading performance, this further limits the upside room for aluminum prices. In the short term, aluminum prices are expected to continue the pattern of LME outperforming SHFE, fluctuating at highs.

[Macro Tailwinds and Inventory Pressure Coexist, Limiting Upside Room for Aluminum Prices] Current macro tailwinds are being released in a concentrated manner, the global rigid supply gap for aluminum has been confirmed, and China’s aluminum ingot inventory has entered initial destocking. Multiple positive factors are providing support for aluminum prices. However, inventory at high levels in China remains the core factor suppressing a sharp price surge. In addition, spot market trading has been relatively weak, and expectations for US Fed interest rate hikes this year have been heating up, further limiting upside room for aluminum prices. Going forward, attention should be paid to whether China’s aluminum ingot inventory can maintain sustained destocking, thereby easing the pressure that inventory at high levels exerts on aluminum prices.

[SMM Aluminum News Flash] On May 14, LME aluminum inventory was recorded at 346,500 mt, down 2,250 mt from the previous day, a decrease of 0.65%. Over the past week, LME aluminum inventory decreased by a cumulative 11,700 mt, a decline of 3.27%. Over the past month, LME aluminum inventory decreased by a cumulative 49,500 mt, a decline of 12.49%.

[SMM Aluminum Price Weekly Review: Positive Factors Still Provide Support, but Upside Room for Aluminum Prices Remains Limited]