[U.S.-Iran Conflict Sees Dramatic Reversal, ECB Rate Hike Weighs on Metal Prices] 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 create a bullish driver for aluminum prices; this Thursday, the destocking pace of China's aluminum ingot social inventory noticeably accelerated, effectively alleviating the previous high inventory pressure. However, China's high inventory pressure remains relatively pronounced and is expected to limit the upside room for domestic aluminum prices. In the short term, domestic aluminum prices are expected to mainly undergo volatile adjustments.

[SMM Cast Aluminum Alloy Morning Comment: Supply Contracts While Off-Season Demand Suppresses the Market] Overnight, the aluminum alloy 2608 contract retreated after a rapid rise in the night session, opening at 23320, hitting a high of 23355, then fluctuating downward to a low of 23235, and closing at 23240, edging down 30 points (a decline of 0.13%).

[SMM Aluminum Alloy Daily Comment] Today, the price center of ADC12 continued to move upward, with SMM ADC12 quotations rising to 24,000 yuan/mt. Raw material procurement and compliance operation costs remained high, causing a significant squeeze on corporate profits and driving manufacturers to raise prices to pass on cost pressure; meanwhile, supply tightened somewhat, enterprises' finished product inventories were low, and spot cargo supply was tight. With limited demand support, the actual transaction capacity after the price increases still faced a test.

[SMM Cast Aluminum Alloy Morning Comment: May Auto Market Domestic Demand Under Pressure, Exports Strong; Narrowing Price Difference Between A00 Aluminum and Scrap Tightens Raw Material Supply] The ADC12 market traded steadily on Wednesday, with the SMM ADC12 price remaining flat at 23,900 yuan/mt. This week, cast aluminum alloy futures diverged from SHFE aluminum, with cast aluminum futures steady to firm while SHFE aluminum fell below the 24,000 yuan/mt mark. In the spot market, A00 aluminum prices declined for consecutive sessions, but ADC12 prices remained firm. The spread between the two has returned to positive territory, ending the inversion since April, underscoring the resilience of alloy prices.

[Aluminum Ingot Social Inventory Destocking Accelerates Significantly, Relative High Level Still Caps Aluminum Price Upside Room] 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. This Thursday, the destocking pace of China’s social inventory of aluminum ingots accelerated notably, effectively easing the earlier high inventory pressure. However, China’s high inventory pressure remains relatively prominent, which is expected to cap the upside room for domestic aluminum prices. In the short term, domestic aluminum prices are expected to mainly fluctuate and consolidate.

[SMM Aluminum Alloy Daily Comment] Today, the SMM ADC12 price remained flat at 23,900 yuan/mt. This week, cast aluminum alloy futures diverged from SHFE aluminum futures, with the former strengthening steadily while the latter fell below the 24,000 yuan/mt mark. In the spot market, A00 aluminum prices continued to decline, while ADC12 prices remained firm. Today, the price spread between the two returned to positive territory, ending the inversion that had persisted since April, highlighting the resilience of alloy prices.

[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.

[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.

[SMM Cast Aluminum Alloy Morning Comment: Overnight cast aluminum bottomed out, traded narrowly, with declining volume and insufficient upward momentum] Overnight, the cast aluminum alloy 2608 contract opened at 23,065 yuan/mt, dipped to a low of 22,915 yuan/mt during the session, and closed at 229,995 yuan/mt, edging up 10 yuan/mt or 0.04%.

[SMM Aluminum Alloy Daily Commentary] On the futures side, the cast aluminum alloy 2608 contract opened at 22,935 yuan/mt today, surged to a high of 23,175 yuan/mt, dipped to a low of 22,780 yuan/mt, and closed at 22,985 yuan/mt, edging down 0.52% intraday. On the spot side, the overall atmosphere for price adjustments in the secondary aluminum alloy market was cautious today. The SMM ADC12 price remained flat at 23,900 yuan/mt. Affected by the pullback in aluminum prices and futures, some enterprises chose to follow the market and lowered prices by 100 yuan/mt. However, most enterprises, considering that the cost side of aluminum scrap still provided certain support and that the adjustment range of raw material prices was relatively limited, maintained a wait-and-see stance.