SMM

[SMM Aluminum Morning Meeting Summary: Macro Easing Expectations Heat Up, Aluminum Prices Still Have Rebound Potential] On the macro front, Trump's pressure on the US Fed to cut interest rates, coupled with a potential change in its leadership, has strengthened easing expectations. Additionally, the potential tariff hike on India may disrupt the global supply chain. Domestically, seven departments have jointly promoted financial support for the high-end development of the manufacturing industry, with a clear goal of establishing a financial system adapted to green and intelligent manufacturing by 2027, which is a medium and long-term positive for the demand growth of aluminum in new energy, high-end equipment, and other fields. On the supply side, the operating aluminum capacity in China has remained stable, with the proportion of liquid aluminum pulling back and an increase in casting ingot volume, leading to more marketable supplies and a continuous inventory buildup in social inventory, which has suppressed the upward movement of aluminum prices. On the demand side, the off-season atmosphere persists downstream, with spot purchasing as needed and spot premiums struggling to rise. The PV, NEV, and home appliance sectors are still in the off-season. Despite the decline in aluminum prices, there has been no significant improvement trend in the orders on hand at processing plants. In terms of inventory, aluminum ingot and aluminum billet inventories continue to accumulate, with strong expectations for further inventory buildup. In the short term, spot premiums and discounts are in the doldrums, and it is expected that aluminum prices will remain under pressure. However, with the heating up of macro easing expectations, after the end of the seasonal off-season and the implementation and transmission of policies, aluminum prices still have rebound momentum. Whether subsequent prices can break through will depend on observing the inventory trend and consumption recovery signals during the transition period from the off-season to the peak season in August.