March production was broadly in line with expectations, increasing by 63,700 mt from February on a MoM basis to a record high.

[SMM Copper Wire and Cable Operating Rate Flash] According to SMM, the operating rate of China’s major copper wire and cable enterprises was 71.99% in March, up 16.18 percentage points MoM and down 1.61 percentage points YoY. Among them, the operating rate of large enterprises was 77.48%, that of medium-sized enterprises was 49.73%, and that of small enterprises was 47.26%. The operating rate is expected to rise 0.64 percentage points MoM to 72.63% in April.

Recently, China's manganese-based battery materials market has been characterized by cost-driven divergence and gradual demand recovery. Battery-grade manganese sulfate and trimanganese tetroxide have strengthened on the back of rising raw material and freight costs; electrolytic manganese dioxide remains stable; and lithium manganate is steady amid volatile lithium carbonate prices, awaiting a demand rebound in April.

Q1 SHFE Aluminum Price Review (By Stage) January: Market traded on Fed rate-cut expectations, decoupled from fundamentals Fundamentals: Spring Festival low season + demand vacuum + inventory accumulationAluminum prices rose continuously and hit a historical high for the period, squeezing downstream profit margins and weighing on primary aluminum demand.Environmental production restrictions in some regions constrained raw material consumption.Social inventories of primary aluminum kept accumulating. By the end of January, SMM social aluminum ingot inventory rose to 782,000 tonnes, the highest level for the same period in nearly three years. Macroeconomics: The Federal Reserve was in a rate-cut cycle in January. The U.S. dollar weakened notably, and large capital inflows into commodity futures boosted broad commodity prices.Coupled with positive domestic consumption-boosting policies, aluminum prices were well supported. February: Market traded on Fed rate-hold expectations, decoupled from fundamentals Fundamentals: Aluminum prices traded in a weak range.Domestic downstream fabricators sharply reduced purchases due to the Spring Festival holiday, while smelters raised ingot-casting activity, leading to continued accumulation in primary aluminum social inventories.After the holiday, SMM social aluminum ingot inventory climbed to 1.108 million tonnes. High inventory provided little upward support for aluminum prices. Macroeconomics: Diminished U.S. rate-cut expectations drove the DXY stronger. Profit-taking capital outflows triggered a pullback in aluminum prices, reinforcing the weak sideways pattern. March: Market swung between Middle East supply disruptions and demand headwinds Intensive long-short competition drove aluminum prices into a “rally – correction – rebound” volatile structure. Supply side: Frequent overseas production cuts continued to roil the market.Mozal entered maintenance. Qatar Aluminum announced it would halt further cuts and maintain 60% operating rate.Alba Bahrain shut down Lines 1, 2 and 3 under controlled and safe conditions, with market rumors later emerging that Line 4 may also face production cuts or shutdowns.EGA suffered severe facility damage, with the extent still under assessment; the market expects large-scale production cuts or shutdowns.Worsening concerns over global supply shortages became the key driver of periodic aluminum price gains. Escalating Middle East conflicts and safety concerns over shipping through the Strait of Hormuz heightened uncertainty over global primary aluminum supply, injecting sustained geopolitical risk premium and supporting high price levels. Demand side: Rising stagflation fears boosted risk aversion, pressuring aluminum prices to correct and limiting upside. Downside risks in overseas demand became prominent, as downstream fabricators faced multiple constraints:(1) High aluminum prices significantly suppressed purchasing willingness and restrained demand realization;(2) Shortages of natural gas, crude oil and other energy resources forced some fabricators to cut or halt production;(3) Sharply rising freight and smelting costs squeezed downstream margins, further dampening demand indirectly.

Recently, China’s manganese-based battery materials market has shown an overall pattern of cost-driven dynamics, product differentiation, and gradually recovering demand. Manganese sulphate and Mn3O4 were supported by rising upstream raw material costs and freight rates, with prices trending upward; MnO2 remained stable; LMO held steady amid fluctuations in lithium carbonate, awaiting a recovery in demand in April.

I. Review of SHFE Aluminum Price Trends in Q1 2026 (by Stage) January: The market’s core trading logic deviated from fundamentals and centered on macro expectations for US Fed interest rate cuts Fundamentals: Chinese New Year off-season + demand vacuum + inventory buildup Aluminum prices continued to climb and hit a record high for the period, while downstream profit margins came under pressure, leading to weaker demand for primary aluminum. Repeated environmental protection-driven production restrictions in some regions constrained demand for raw materials. Aluminum social inventory continued to accumulate. As of end-January, SMM aluminum ingot social inventory rose to 782,000 mt, a high for the same period in the past three years. Macro front: In January, the US Fed was in an interest rate cut cycle, and the US dollar weakened significantly. Large amounts of capital flowed into the commodities futures market, driving broad commodity prices higher; together with favorable support from China’s consumption stimulus policies, this jointly supported aluminum prices. February: The market’s core trading logic deviated from fundamentals and centered on macro expectations for the US Fed to keep interest rates unchanged Fundamentals: Aluminum prices were generally in the doldrums. Affected by the Chinese New Year holiday, procurement demand from China’s downstream processing enterprises dropped sharply, aluminum plants showed stronger willingness to cast ingots, and aluminum social inventory continued to accumulate. After the Chinese New Year holiday, SMM aluminum ingot social inventory rose to 1.108 million mt. Elevated inventory levels struggled to provide effective upward support for aluminum prices. Macro front: Cooling expectations for US Fed interest rate cuts pushed the US dollar index higher, and profit-taking outflows triggered a pullback in aluminum prices, further reinforcing their weak and rangebound trend. March: The market’s core trading logic repeatedly switched between supply-side disruptions in the Middle East and demand-side suppression. The tug-of-war between longs and shorts intensified, dominating aluminum prices in a volatile pattern of “surge - correction - rebound.” Supply side: I. Production cut events occurred frequently on the overseas supply side, and disruptions continued to intensify. Mozal entered maintenance status. Qatar Aluminium Smelter announced its decision to stop further production cuts and maintain a 60% operating rate. Aluminium Bahrain initiated shutdowns of Production Lines 1, 2, and 3 under controlled and safe conditions, and the market later heard that Line 4 might also face production cuts or suspension. EGA’s aluminum plant facilities suffered severe damage, and the extent of the damage was still under assessment. The market expected it to undergo large-scale production cuts or suspensions. Ongoing concerns over continued tightening on the overseas supply side became the core driver pushing aluminum prices higher in stages. II. As the Middle East conflict continued to escalate, shipping security in the Strait of Hormuz drew widespread market attention, further increasing uncertainty over global aluminum supply and continuously injecting a geopolitical risk premium into aluminum prices, supporting prices fluctuating at highs. Demand Side: 1. From a macro perspective, concerns over stagflation continued to intensify, risk-off market sentiment picked up, dragging aluminum prices into a pullback and limiting upside room. 2. Hidden concerns on the demand side outside China became more prominent. Some downstream processing enterprises were constrained by multiple factors, triggering market concerns over weak demand: 1) high aluminum prices significantly suppressed downstream purchase willingness, hindering demand release; 2) shortages of energy resources such as natural gas and oil put some processing enterprises under pressure to reduce or suspend production; 3) costs such as freight rates rose sharply, and together with higher smelting costs, further squeezed the profit margins of downstream enterprises, indirectly suppressing demand release. Source: SMM

SMM News on March 31: According to SMM statistics, China’s aluminum production in March 2026 (31 days) was up 1.6% YoY and up 10.7% MoM. This was mainly driven by the recovery in calendar days and the gradual resumption of production by downstream enterprises after the Chinese New Year. Operating rates across downstream industries moved higher overall, and the proportion of liquid aluminum rebounded in tandem, up about 9.3 percentage points MoM to 73.7%, exceeding expectations at the beginning of the month. The main reason was that some aluminum plants saw considerable liquid aluminum sales, while sentiment toward casting ingot was weaker than expected at the beginning of the month. Based on SMM data on the proportion of liquid aluminum, China’s aluminum casting ingot volume in March was up 5.3% YoY and down 18.1% MoM. Capacity changes: As of month-end March, SMM statistics showed that China’s existing aluminum capacity was about 46.209 million mt, with no MoM change. Production forecast: Entering April 2026, as the peak season deepens, downstream enterprises are expected to see gradually stronger demand for primary aluminum. The proportion of liquid aluminum is expected to edge higher. Overall, the proportion of liquid aluminum is expected to rise 1.8 percentage points to 75.5%. [Data source statement: Except for publicly available information, all other data is processed and derived by SMM based on public information, market communication, and SMM’s internal database models, and is for reference only and does not constitute decision-making advice.]

SMM News, March 31: According to SMM statistics, China’s aluminum production in March 2026 (31 days) was up 1.6% YoY and up 10.7% MoM. The month was mainly supported by the recovery in calendar days and the gradual resumption of production by downstream enterprises after the Chinese New Year. Operating rates across downstream sectors generally increased, and the proportion of liquid aluminum also rebounded, up about 9.3 percentage points MoM to 73.7%, above expectations at the beginning of the month. The main reason was that some aluminum plants saw considerable liquid aluminum sales, while sentiment for casting ingot was weaker than expected at the beginning of the month. Based on SMM data on the proportion of liquid aluminum, China’s aluminum casting ingot volume in March was up 5.3% YoY and down 18.1% MoM. Capacity changes: As of month-end March, SMM statistics showed that China’s existing aluminum capacity was about 46.209 million mt, with no MoM change for the time being. Production forecast: Entering April 2026, as the peak season deepens, downstream enterprises’ demand for primary aluminum is expected to gradually strengthen. The proportion of liquid aluminum is expected to edge up. Overall, the proportion of liquid aluminum is expected to rise by 1.8 percentage points to 75.5%. [Data source statement: Except for public information, all other data is processed and derived by SMM based on public information, market communication, and SMM’s internal database models, and is for reference only and does not constitute decision-making advice.] Source: SMM

[China Iron Ore Brief Review: Iron Ore Concentrate Prices in the Tangshan Region May Hold Up Well] In Shandong, the pre-tax dry-basis price of 64-grade alkaline fines at mines and beneficiation plants fell by 5 yuan to 894 yuan, and steelmakers lowered prices in tandem. Most miners maintained normal production, with no significant inventory buildup and basically no inventory at most operations. Steelmakers continued to purchase under long-term contracts, mainly purchasing as needed while maintaining low inventory operations. On the news front, external market disruptions remained unabated, and imported ore prices stayed at a relatively high level, which may provide some support for domestic iron ore

SMM News, March 31: According to SMM statistics, total aluminum production outside China in March 2026 edged up 0.2% YoY, while daily average production fell 2.7% MoM, mainly due to widespread production cuts and shutdowns at aluminum plants in Mozambique and the Middle East during March. According to an announcement on Hydro's official website, Qatalum smelter in Qatar initiated an orderly shutdown on March 3, and announced on March 12 that it had decided to stop further production cuts and maintain a 60% operating rate. On March 16, according to South32's official website, Mozal Aluminium (Mozal) was confirmed to have entered maintenance status on March 15, involving 580,000 mt of capacity. On March 15, according to an announcement on Alba's official website, Alba initiated the shutdown of Lines 1, 2, and 3 under controlled and safe conditions, involving capacity equivalent to 19% of its total capacity of 1.623 million mt, or about 310,000 mt; around March 25, the market reported that its Line 4 might also see production cuts or shutdowns, involving 320,000 mt of capacity; on March 28, according to an announcement on Alba's official website, its aluminum plant facilities were hit on March 28, the extent of equipment damage was still being assessed, and it would maintain operational flexibility and employee safety. On March 28, according to EGA's official website, facilities at its Al Taweelah aluminum plant suffered severe damage, with the extent of the damage still under assessment. The market expects large-scale production cuts and shutdowns there, and the plant has aluminum capacity of about 1.55 million mt. Looking ahead to April 2026 , although the Mount Holly aluminum plant in the US and the Grundartangi aluminum plant in Iceland are expected to begin resuming production, production resumptions at Spain's San Ciprián aluminum plant continue to advance, and operating capacity at new aluminum projects in Indonesia and Angola is expected to continue ramping up, given the large scale of production cuts and shutdowns at aluminum plants in the Middle East and Mozambique in March and the further emergence of their impact, aluminum production outside China in April is expected to decline significantly both YoY and MoM. Overall, if the situation in the Middle East proves difficult to ease, monthly aluminum production is expected to shift into sustained negative YoY growth from Q2 to Q4 2026. Continued attention should be paid to subsequent announcements from relevant aluminum plants in the Middle East and trends in global aluminum inventory.