Search results for Aluminum Processing

December 4, 2025: The weekly operating rate of leading domestic aluminum downstream processing enterprises fell 0.4 percentage points WoW to 61.9%, with the market continuing to show structural divergence. The operating rate of primary aluminum alloy remained stable at 60.2%, as long-term contract deliveries at major enterprises were steady, but high aluminum prices suppressed spot order transactions, with cautious demand side sentiment. The operating rate of aluminum wire and cable pulled back 0.6 percentage points to 62.4%; although supported by power grid orders, insufficient cargo pick-up continuity coupled with weak year-end stockpiling willingness constrained the rebound in operating rates. The operating rate of aluminum extrusion edged down 0.5 percentage points to 52.0%, with construction-grade extrusions remaining sluggish and reduced production schedules in the PV sector dragging on industrial-grade materials, while only automotive and ESS extrusions remained stable. The operating rate of aluminum plate/sheet and strip dropped 1.4 percentage points to 65.0%, pressured by intensified environmental protection-driven production restrictions in Henan and other regions and high aluminum prices, leading to a noticeable decline in construction and packaging orders; although can stock processing fees are expected to increase, this is unlikely to reverse the overall weakness. The operating rate of aluminum foil was recorded at 70.4%, with traditional air-conditioner foil and decorative foil demand weakening, while single-zero packaging foil received slight support from year-end stockpiling, and new energy products such as battery foil provided limited incremental demand. The operating rate of secondary aluminum producers held steady at 61.5%, with leading plants maintaining high utilization rates due to sufficient orders, but small and medium-sized producers faced constraints on capacity release due to high aluminum scrap costs and production cuts at die-casting plants. SMM expects the sector's operating rates to continue weakening in the short term, with rates likely to remain weak and consolidate as the off-season deepens and high aluminum prices persist. Primary aluminum alloy: The primary aluminum alloy industry operated steadily this week, with the operating rate unchanged WoW at 60.2%. Supply side, long-term contract deliveries remained stable, production pace was continuous, and the overall supply landscape showed no significant fluctuations. Demand side, influenced by high aluminum prices, downstream enterprises primarily focused on fulfilling long-term contracts, while spot order purchase willingness was generally cautious, and wait-and-see sentiment prevailed. According to the SMM survey, spot order transaction activity was limited this week, and demand weakened slightly WoW, but the impact on overall industry production schedules was relatively small. Overall, the current market is characterized by stable supply and slow demand. In the high aluminum price environment, downstream purchases have become more rational. It is expected that the industry will continue to operate steadily in the short term, with price fluctuations remaining a key variable affecting the market pace. Aluminum Plate/Sheet and Strip: The operating rate of leading enterprises in aluminum plate/sheet and strip fell 1.4 percentage points WoW to 65.0% this week. On the enterprise operation front, environmental protection-driven production restrictions reemerged in central China. Approaching year-end, air pollution control tasks intensified in Gongyi, Changge, Luoyang, and other areas of Henan, significantly limiting production and transportation, directly impacting local enterprises' production and delivery efficiency. Coupled with constraints from insufficient orders, even if some enterprises attempted to resume production lines, a full production resumption was difficult. Aluminum prices surged rapidly above 22,000 yuan/mt this week, up over 500 yuan/mt WoW. High aluminum prices intensified enterprises' fear of high prices in raw material procurement and finished product shipments, dampening downstream enthusiasm for cargo pick-up and putting overall demand under further pressure. Structural differences in industry orders were significant, with continuous declines in construction and packaging sectors; the curtain wall downstream planned early production cuts wrap-up in December due to poor financial conditions. For can stock, processing fee increase negotiations advanced and have already been transmitted to end-user beverage consumption ahead of time, with results expected soon, but actual demand is unlikely to see substantial improvement before the Chinese New Year. Looking ahead to next week, as the off-season deepens, with environmental protection-related controls and aluminum price rise risks coexisting, and orders lacking strong support, the industry operating rate will continue to contract, with no substantial improvement expected in the short term. Aluminum Wire and Cable: The weekly operating rate for aluminum wire and cable fell 0.6 percentage points WoW to 62.4% this week, ending the previous mild rebound trend. The decline was mainly due to hindered winter project construction progress, weakened expectations for sustained power grid cargo pick-up, coupled with low year-end stockpiling willingness among enterprises, maintaining only normal delivery pace production. From an enterprise operation perspective, feedback from Hebei and Jiangsu indicated limited and unsustainable new matched power grid orders last month, providing weak support; enterprises in Shandong reported tight schedules for overseas EPC projects, with export orders maintaining rigid demand; manufacturers in Sichuan noted good performance in export orders, with orders on hand lasting until March next year. Looking ahead to next week, although export orders show a good trend, domestic enterprises are constrained by high aluminum price fluctuations suppressing downstream operations, persistently weak year-end stockpiling willingness, and no significant order volume increase. The aluminum wire and cable operating rate is expected to continue weak consolidation in December. Aluminum Extrusion: The overall operating rate for the domestic aluminum extrusion industry this week was 52%, down 0.5 percentage points WoW, mainly affected by a decline in orders from the PV sector. In the construction extrusion segment, performance varied across the industry. Some medium and large enterprises in Shandong and Zhejiang maintained stable operating rates supported by export orders, while some small enterprises in central China operated at low levels, with the overall construction sector remaining sluggish. For industrial extrusion, PV extrusion was impacted by reduced downstream module production schedules, dragging down the industry's operating rate. Leading enterprises implemented relatively small production cuts, while some small and medium-sized PV frame manufacturers in east China saw their operating rates drop to 20%–30%. Automotive extrusion, ESS extrusion, and other industrial extrusion segments operated relatively steadily. SMM will continue to monitor order changes across various segments. Aluminum Foil: The operating rate for leading aluminum foil enterprises this week was 70.4%. On the enterprise operation side, as the off-season deepened, demand for traditional products such as air-conditioner foil and decorative foil continued to decline, and leading enterprises saw a simultaneous reduction in orders on hand. Coupled with inventory and capital pressure from previous high aluminum prices, as well as fear of high prices triggered by aluminum prices breaking through 22,000 yuan/mt this week, production pace faced multiple constraints. On the other hand, consumption of single-zero packaging foil improved significantly compared to the summer period. As year-end approached, end-users began stockpiling, and some enterprises launched year-end production sprint plans in December. In the short term, weak demand in traditional consumption areas is difficult to reverse, and upward risks for aluminum prices remain. Only demand for battery foil and brazing foil in the new energy sector provides limited support. The industry's operating rate is expected to remain stable, lacking strong upward momentum in the near term. Secondary Aluminum: The operating rate for leading secondary aluminum enterprises this week remained stable at 61.5%. Currently, leading enterprises have sufficient orders and maintained high production levels. However, the industry as a whole faces multiple constraints. First, aluminum prices surged to a yearly peak in December, dampening downstream willingness to pick up goods. Some die-casting plants saw compressed profit margins due to high raw material costs, even incurring losses, leading to lower operating rates which in turn affected orders for secondary aluminum producers. Second, aluminum scrap prices rose significantly along with aluminum prices during the week, and copper prices on the auxiliary material side broke a new high of 91,245 yuan/mt, exacerbating the risk of losses. In the short term, leading enterprises are expected to maintain high output thanks to their order advantages, but small and medium capacities may continue to shrink, and structural differentiation within the industry is likely to persist.

November 14, 2025: This week, the overall operating rate of leading downstream aluminum processing enterprises in China rose slightly by 0.4 percentage points WoW to 62%, showing a structurally divergent trend across the market. By segment: the operating rate for primary aluminum alloy increased by 0.4 percentage points to 59.8%, as mainstream producers maintained stable production schedules, downstream manufacturing orders grew YoY, and the market remained in the peak season; the operating rate for aluminum wire and cable edged up 0.6 percentage points to 62%, supported by the fulfillment of orders from State Grid and China Southern Power Grid, though capacity utilization stayed low with insufficient order saturation; the operating rate for aluminum extrusion held flat WoW at 52.6%, with automotive and PV extrusions performing steadily while construction extrusions remained sluggish, and high aluminum prices sparking concerns about "steel replacing aluminum"; the operating rate for aluminum plate/sheet and strip remained at 66.0%, with demand from new energy-related sectors supporting full-load operation on some production lines, but environmental protection-related controls and weak off-season demand kept overall performance under pressure; the operating rate for aluminum foil held at 71.1%, with strong orders for new energy-related products like battery foil, but demand for double zero foil, decorative foil, and export packaging foil weakened; the operating rate for secondary aluminum producers increased by 1.5 percentage points to 60.6%, driven by order growth at large sample enterprises, yet tight aluminum scrap supply and persistent losses constrained capacity release across the sector. SMM expects the operating rates in the downstream aluminum processing industry to show a diverging trend in the short term, with aluminum wire and cable supported by grid orders to continue a slight rebound, while aluminum plate/sheet and strip and aluminum foil are likely to gradually decline due to recurring environmental controls and off-season effects. Primary Aluminum Alloy: The primary aluminum alloy industry continued stable operation this week, with the operating rate rising slightly by 0.4 percentage points to 59.8%. Supply side, mainstream enterprises maintained steady production schedules, unaffected by aluminum price fluctuations, with overall production levels continuing to climb and the industry's supply landscape steadily improving. Demand side, downstream manufacturing orders increased from previous levels, driving synchronous growth in demand for primary alloy. Some enterprises reported current orders were higher than before, the operating rate continued to rise, and the growth rate accelerated further WoW. The industry overall remains in the peak season, performing better than the same period last year. The operating rate is expected to maintain a slow upward trend going forward. Aluminum Plate/Sheet and Strip: The operating rate of leading aluminum plate/sheet and strip enterprises was 66.0% this week. In central China, recurring smog led to ongoing environmental protection inspections without signs of easing, putting significant pressure on local producers' operations. Aluminum prices quickly rising above 22,000 yuan/mt this week triggered wait-and-see sentiment among downstream buyers, reducing cargo pick-up enthusiasm. Some enterprises initiated new rounds of processing fee discounts to reduce inventory, reinforcing expectations of weakening demand. Industry orders showed structural differences. By mid-November, demand support from new energy-related sectors like automotive sheet, battery shells, and brazing materials kept production lines at full capacity, but this was insufficient to offset declines in sectors like construction and packaging. Looking ahead to next week, ongoing environmental protection disruptions in Henan, coupled with weak off-season demand, are expected to lead to a continued contraction in the operating rate for the aluminum plate/sheet and strip industry, with the medium and long-term downward trend difficult to reverse. Aluminum Wire and Cable: The weekly operating rate for aluminum wire and cable increased slightly by 0.6 percentage points WoW to 62% this week, showing recovery after last week's decline caused by regional environmental protection-driven production restrictions. The slight rebound was primarily due to State Grid placing overhead line orders this week, coupled with some China Southern Power Grid orders entering the matching phase. Orders from these two major grid operators provided direct support for enterprise production, leading to a slight recovery in operating load. From an operational perspective, although the operating level improved WoW, current capacity utilization remains relatively low, not exiting the low-range operation zone, with production still in a mild recovery state. Regarding industry order dynamics, the continuity of State Grid order tenders and new matching orders from China Southern Power Grid combined to effectively offset the impact of previous weak end-use demand, becoming key drivers supporting the operating rate recovery. Looking ahead to next week, benefiting from continued grid order support, the aluminum wire and cable operating rate is expected to maintain a slight rebound. However, constrained by overall low capacity utilization, significant upward momentum is lacking, and the rate will likely fluctuate rangebound between 62%-63% next week. Aluminum Extrusion: The weekly operating rate for the domestic aluminum extrusion industry was 52.6% this week, unchanged WoW. Recently, aluminum prices have remained high, fostering strong wait-and-see sentiment in the downstream market. Extrusion enterprises generally maintain orders on hand covering about 7 to 10 days, with some better-performing enterprises having orders covering around one month. Despite price pressures, consumption showed some resilience; current operating performance did not show the significant decline previously anticipated by the market. By segment, construction extrusions overall remain sluggish. For industrial extrusions, automotive extrusion is still the relatively better-performing area. However, according to feedback from an enterprise in north-east China, its partner automaker is researching using steel parts to replace aluminum parts. Although such steel parts weigh nearly twice as much as aluminum parts, their cost is only one-third. The enterprise is concerned that persistently high aluminum prices could accelerate the substitution process of "steel replacing aluminum". PV extrusion operations remained generally stable. An enterprise in Anhui indicated that, having concentrated on completing a batch of orders in the first half of the month, its current operating rate basically maintained the level from the end of last month. SMM will continue monitoring order changes across various segments. Aluminum Foil: The operating rate of leading aluminum foil enterprises was 71.1% this week. At the operational level, environmental protection-related controls in Henan forced some aluminum foil producers to adjust production plans. Although leading enterprises did not cut production, high aluminum prices dampened downstream order placement enthusiasm, leading to issues like high inventory and capital tie-up. Industry orders showed significant divergence: demand for battery foil and brazing foil remained robust, with orders fully booked for domestic Q3 and Q4 causing some enterprises to shift packaging foil capacity to battery foil production; orders for double zero foil and decorative foil weakened, and export stockpiling for packaging foil neared its end as concentrated overseas stockpiling in September-October was completed, with export support gradually weakening. Looking ahead to next week, as the off-season deepens, risks of weakening end-use demand persist, and the operating rate for leading aluminum foil enterprises is expected to gradually decline. Secondary Aluminum: The operating rate of leading secondary aluminum enterprises increased by 1.5 percentage points WoW to 60.6% this week, mainly driven by order growth at large sample enterprises. However, capacity release in the sector still faces multiple constraints: persistent pressure on the raw material side: the tight supply pattern for aluminum scrap remained unchanged, with prices rising in tandem with aluminum prices, exacerbating cost pressure for secondary aluminum alloy producers and deepening industry losses; rapid aluminum price increases suppressed demand: although end-use demand was stable with a slight increase, aluminum prices soaring to the high of 22,000 yuan/mt intensified market fear of high prices. Some die-casting plants became more cautious in procurement, enterprises with sufficient inventory focused on digesting existing stock, procurement pace slowed, while low-inventory enterprises only maintained rigid procurement. Reduced new orders at alloy plants constrained upside room for the operating rate. In the short term, the operating rate of leading enterprises is expected to be mainly stable with a slight increase, depending on the improvement in aluminum scrap supply and changes in procurement pace of downstream enterprises under high prices.

In October, the aluminum processing composite PMI fell 6.8 percentage points MoM to 48.9%, dropping below the 50 mark. PMIs for most aluminum processing sectors declined significantly into contraction territory, mainly due to weakening end-use demand and high aluminum prices suppressing activity. By sector, aluminum plate/sheet and strip faced simultaneous pressure on both production and demand, with declining construction sector orders and high aluminum prices fueling wait-and-see sentiment, leading to notable inventory pressure. Aluminum foil saw insufficient supply and demand momentum; double zero foil order declines dragged down the overall performance, with only export stockpiling providing some buffer, while expectations for processing fee increases emerged. Construction extrusions continued to be weighed down by industry sluggishness; the National Day holiday reduced production days, and falling temperatures in northern regions will further impact subsequent project progress. Industrial extrusion barely remained above the 50 mark, with limited support from automotive orders and a sharp drop in PV extrusion production. Aluminum wire and cable experienced poor end-user cargo pick-up and high aluminum prices suppressing the operating rate; although expectations for accelerated State Grid tenders exist, short-term demand release remains uncertain. Primary alloy and secondary alloy maintained expansion, mainly relying on domestic demand recovery and inventory optimization. Driven by the September peak season, primary alloy saw active production scheduling, sustained domestic demand recovery, and significant inventory drawdowns, though enterprises remained cautious about capacity expansion. Secondary alloy benefited from resilient downstream automotive demand, with large plants maintaining high operating rates; although small and medium-sized enterprises were constrained by raw materials and costs, low inventory provided support for the future. By product type: Aluminum plate/sheet and strip: In October, the aluminum plate/sheet and strip PMI was 47.8%, down 11 percentage points MoM, falling sharply into contraction territory. Among the sub-indices, both the production index and the new orders index stood at 45.9%, indicating simultaneous pressure on production and demand. The new export orders index was slightly above the 50 mark at 51.4%, reflecting relative stability in the export market, though insufficient to reverse the overall weakness. In terms of monthly operations, early in the month, supported by the traditional September-October peak season, leading enterprises demonstrated strong production resilience, with new energy-related production lines such as automotive sheet and battery shells operating at near full capacity. However, by mid-to-late October, construction-related segments like curtain wall panels were dragged down by funding chain pressures and a rapid decline in orders, becoming the main factor lowering the operating rate. Meanwhile, aluminum prices rising to the 21,000–21,200 yuan/mt range intensified downstream wait-and-see sentiment, with the purchasing volume index at only 45.9%, indicating more cautious raw material purchasing by enterprises. The product inventory index remained high at 57.8%, highlighting significant destocking pressure. Overall, as the industry approaches the transition period between peak and off-seasons, expectations of weakening demand are strengthening, and the aluminum plate/sheet and strip PMI is expected to remain below the 50 mark in November. Aluminum foil: In October, the aluminum foil PMI was 48.5%, down 14 percentage points MoM, falling sharply into contraction territory. Both the production index and the new orders index stood at 47.5%, pointing to weak momentum on both the supply and demand sides. The new export orders index was 51.1%, benefiting from overseas holiday stockpiling demand for Halloween and Thanksgiving, which provided some cushion for packaging foil and container foil exports. Within the month, enterprise operations showed significant divergence: industrial demand-oriented production lines such as battery foil and brazing foil maintained stable orders, supporting steady operating rates among leading enterprises. However, double zero foil orders declined due to an early end to the peak season, dragging down overall performance. The raw material inventory index was 46.4%, and the purchasing volume index was 46.4%, reflecting cautious stockpiling strategies among enterprises. Notably, the issue of processing fees has emerged; affected by declining yield rates, battery foil processing fees are expected to increase in the new year. As the effect of overseas holiday stockpiling gradually diminishes, the operating rate in the aluminum foil industry is expected to decline slightly, and the aluminum foil PMI is projected to remain below the 50 mark in November. Construction aluminum extrusion: The composite PMI for construction aluminum extrusion in October registered 45.79%, remaining below the 50 mark. According to an SMM survey, although some small enterprises in Hebei and Hunan reported an increase in aluminum formwork orders, the overall industry remained sluggish. Coupled with the fact that construction aluminum extrusion enterprises generally had fewer production days due to the extended National Day holiday, the production index for the month recorded 41.99%, and the new orders index was 43.83%. Regionally, some medium and large building material enterprises in Guangdong and Shandong operated relatively steadily, while some small enterprises in North China reported a decline in building material orders in October. As the seasonal transition occurs, compounded by the impact of falling temperatures in the north on construction progress, related enterprises have weak expectations for November production. The construction aluminum extrusion PMI is expected to remain below the 50 mark in November. Industrial extrusion: The composite PMI for the industrial extrusion industry in October was 50.23%, barely staying above the 50 mark. The production index for the month recorded 48.83%. In late October, some enterprises in East China and South China reported that year-end pushes by downstream automakers led to a slight increase in orders for automotive parts, providing some support to the operating rates of related enterprises. For PV extrusion, major aluminum frame extrusion enterprises in Anhui and Hebei saw production drop by 20–30% this month due to production cuts by downstream module manufacturers. Some solar panel mounting bracket enterprises in Fujian reported that their products are mainly exported to Southeast Asia and Europe, and performance is currently relatively stable. Looking ahead to November, demand for PV extrusion remains weak, while the rail transit and 3C industries are operating steadily, and the automotive, ESS, and power sectors are relatively robust. However, due to the recent high aluminum prices, existing orders for enterprises are mostly maintained at around one week, and expectations for November are generally weak. The industrial extrusion PMI is expected to fall below the 50 mark. Aluminum wire and cable: The PMI for China's aluminum wire and cable industry in October recorded 49.2%, falling below the 50 mark, indicating a pullback in industry sentiment. Poor end-user cargo pick-up and high aluminum prices suppressing operating rates were the main drags. In production, affected by losses and slower shipments, the production index fell sharply by 22.1% MoM to 53.8%. Although the new orders index increased by 5.4% MoM to 53.69%, the order fulfillment pace was hindered by poor end-user pick-up. The finished product inventory index was 47.67%, indicating insufficient willingness among enterprises to build inventory, and the purchasing volume index dropped to 45.34% as operations contracted. High aluminum prices pushed up costs, with the purchase price index at 50.6% squeezing profits and further inhibiting production. As November begins, orders from State Grid will enter the tender opening phase. By year-end, the task of completing 650 billion yuan in power grid investment needs to be fulfilled, and the tender pace is expected to accelerate, which is favorable for enterprises to secure more orders. However, currently, as year-end approaches, project demand performance remains generally tepid, and the release of end-use demand still needs to be awaited. If end-user pick-up and the aluminum price trend do not improve, the industry may remain under pressure. Subsequent attention should be paid to marginal changes in aluminum prices and end-use demand. Primary alloy: In October, the primary aluminum alloy PMI reached 61.1%, up 1.4 percentage points MoM from September, indicating a continued recovery in the industry. Sub-index analysis shows the production index surged to 74.1%, while the new orders index rose to 68.8%, reflecting active production scheduling by enterprises and sustained recovery in domestic demand against the backdrop of the September peak season. New export orders remained at the 50 mark, indicating stable external demand. Notably, the finished product inventory index pulled back to 39.6%. Combined with the purchasing volume index of 58.3%, this suggests effective inventory reduction by enterprises and a more positive stockpiling sentiment. Although auxiliary indicators such as the import index and purchase prices remained at the 50% threshold, the overall structure demonstrated active production and smooth inventory reduction. However, the raw material inventory index held steady at 50.0%, indicating that enterprises remain cautious about expanding production. Against a backdrop of weakened support from previous liquid aluminum conversion and persistent pressure from high aluminum prices, the industry has entered the traditional peak season, but cost-side pressures remain, and the foundation for overall improvement is not yet solid. Looking ahead, as the industry enters the off-season in November, the PMI is expected to pull back slightly but remain above the 50 mark. Secondary alloy: In October, the secondary aluminum industry PMI fell 6.9 percentage points MoM to 54.3%, but remained above the 50 mark. Demand side, orders from downstream sectors such as automotive remained stable with a positive trend. Although the increase was limited, overall demand showed strong resilience. Supply side, the operating rate varied significantly among enterprises. Some, especially large manufacturers, maintained high operating rates, but small and medium-sized enterprises faced multiple constraints: ① Holiday effect: The National Day holiday shortened effective production time; ② Raw material bottleneck: Tight market supply kept enterprise inventories persistently low, making restocking difficult and limiting capacity release; ③ Cost pressure: High raw material prices squeezed profits, and weak finished product price increases forced enterprises to proactively cut production; ④ Policy disruptions: Some enterprises in Henan, Jiangxi, and other regions continued production cuts or suspensions due to policy uncertainty; ⑤ Environmental constraints: Environmental protection warnings in Hebei and other regions triggered localized production restrictions by month-end. Inventory side, both raw material and finished product inventories remained at low levels. Looking ahead to November, expectations of a push for annual targets by end-users at year-end are expected to boost secondary aluminum demand. Coupled with support from low inventory levels, the industry PMI is likely to maintain its expansion trend. The PMI for the aluminum processing industry in October was recorded at 48.9%, as the October peak season fell short of expectations and re-entered contraction territory. This was mainly due to factors such as aluminum prices fluctuating at highs, weak construction demand, and weakening export momentum. Looking ahead to November, the industry is expected to continue its divergent pattern, with the composite PMI likely to decline further to 47.0%. From the perspective of core influencing factors: - On the demand side, the transition from the peak to off-season, coupled with falling temperatures in northern regions, has led to persistently weak demand in construction and some industrial sectors. - On the cost side, aluminum prices fluctuating at highs have suppressed downstream purchase willingness, squeezing enterprise profit margins. - On the structural side, demand in areas such as new energy and automobiles remains relatively stable, providing important support for certain products. Moving forward, close attention should be paid to the impact of aluminum price trends on downstream cargo pick-up sentiment and the marginal improvement in end-use demand.

October 23, 2025: The operating rate of leading downstream aluminum processing enterprises in China this week was 62.4%, down 0.1% WoW, showing a characteristic of "stabilization during the peak season with internal divergence." Specifically, the operating rate for primary aluminum alloy rose 0.6 percentage points to 59.0%, as enterprise production schedules became more aligned, supported by stable restocking from downstream, and is expected to remain stable with a slight upward trend in the short term. The operating rate for aluminum plate/sheet and strip fell 1 percentage point to 67.0%, impacted by declining curtain wall panel orders and high aluminum prices suppressing purchases, with weakening demand expectations strengthening, and it is anticipated to gradually enter the off-season range. The operating rate for aluminum wire and cable increased 0.4% to 64.4%, supported by the high-voltage sector, but tight shipments and slow cargo pick-up by State Grid limited the rebound potential. The operating rate for aluminum extrusion edged up to 53.7%, with automotive extrusion showing relatively robust growth driven by the year-end push for targets, while construction extrusion remained sluggish and PV extrusion faced production cuts. The operating rate for aluminum foil decreased 0.4 percentage points to 71.9%, with export stockpiling for holidays in packaging foil providing a buffer, but orders for some categories have started to weaken. The operating rate for secondary aluminum producers remained at 58.6%, with order resilience still present, but tight raw material supply, profit pressure, and policy uncertainties continued to constrain production flexibility. Considering the performance on both supply and demand sides, SMM expects the operating rate for the downstream aluminum processing industry to continue its stable trend next week. Primary Aluminum Alloy: In the third week of October, the primary aluminum alloy sector continued its stable operation, with the operating rate further increasing 0.6 percentage points to 59.0%, remaining within a reasonable range for the traditional September-October peak season. On the production side, enterprise production schedules became more consistent, with previously cautious enterprises due to order uncertainties largely returning to normal production levels, leading to a more stable supply landscape. On the demand side, the restocking process in downstream manufacturing continued, maintaining stable purchases of primary aluminum alloy, and some enterprises reported improved order visibility, supporting a steady rise in the operating rate. As the peak season effect continues to be released, the sector's operating rate is expected to remain stable with a slight upward trend in the short term, potentially approaching the year's high levels. Aluminum Plate/Sheet and Strip: This week, the operating rate of leading aluminum plate/sheet and strip enterprises fell 1 percentage point MoM to 67.0%. At the enterprise operation level, some enterprises focusing on curtain wall panels, affected by funding chain pressure and rapidly declining orders, were a key factor pulling down the overall operating rate; however, demand in areas such as automotive sheet, battery shells, and brazing materials remained stable, with related production lines operating at full capacity. On the raw material purchasing side, as aluminum prices surpassed the 21,000 mark, downstream wait-and-see sentiment intensified, and enterprises became more cautious in their purchasing attitudes. Industry order dynamics showed no significant fluctuations in core new energy sector orders, but declining orders for other products like can stock and curtain wall panels, combined with purchasing hesitation due to high aluminum prices, further strengthened expectations of weakening demand. As the transition period between peak and off-season approaches, demand for aluminum plate/sheet and strip is expected to decline further after November, and the operating rate of leading enterprises is anticipated to gradually enter the off-season range. Aluminum Wire and Cable: The weekly operating rate for aluminum wire and cable this week rose 0.4% WoW to 64.4%, showing a slight rebound trend. The main reason for the slight increase was strong performance in the high-voltage sector, providing structural support and driving a slight overall improvement. In terms of enterprise operations, although overall operations remained good, shipments tightened significantly compared to the previous period, showing some divergence between operation and shipments; regarding industry order dynamics, although State Grid tender orders are still being issued sequentially and enterprises have ample tender orders on hand, slow cargo pick-up progress by State Grid dragged on industry performance. Looking ahead to next week, considering the support from high-voltage sector operations but the difficulty in quickly resolving shipment pressures, the operating rate is expected to fluctuate rangebound with limited significant rebound, requiring continuous attention to whether prices and scattered orders like distribution networks can fill the demand gap. Aluminum Extrusion: The weekly operating rate for the domestic aluminum extrusion industry this week was 53.7%, up 0.2 percentage points WoW. By segment: the construction extrusion market remained sluggish with no significant positive factors emerging yet. According to feedback from leading enterprises in Shandong and Guangdong, affected by seasonal factors, construction material demand is expected to contract in Q4, with the current operating rate still low and related enterprises cautious about long-term orders and operating rates. The industrial extrusion segment showed divergent trends: medium-sized enterprises in Anhui and Hebei reported significant increases in automotive parts orders due to year-end target pushes from downstream automakers, faster cargo pick-up by downstream enterprises, shortened overall production cycles, leading to higher operating rates; PV extrusion faced adjustments, with some leading enterprises cutting production by about 20% this month, and the operating rate pulling back MoM, but the production pace has now stabilized with orderly production based on orders. Overall, the aluminum extrusion industry currently shows a pattern of "sluggish construction, pressured PV, and relatively robust automotive." According to SMM analysis, the industry operating rate will remain stable in the short term, with close monitoring of order changes in various sub-sectors. Aluminum Foil: The operating rate of leading aluminum foil enterprises this week fell 0.4 percentage points MoM to 71.9%, with the market showing a stable adjustment trend. Industry order dynamics were divergent, with production lines for battery foil and brazing foil basically stable; double zero foil and air-conditioner foil orders showed a declining trend as the peak season ended early, but export stockpiling for overseas holidays like Halloween, Thanksgiving, and Christmas in packaging foil effectively buffered the decline, keeping the overall decrease within a normal correction range. As the support from forward overseas holiday stockpiling gradually weakens and risks of weakening end-use demand persist, the operating rate of leading aluminum foil enterprises is expected to pull back slightly. Secondary Aluminum: The operating rate of leading secondary aluminum enterprises remained at 58.6% this week, flat WoW. Entering mid-to-late October, secondary aluminum enterprise orders were generally stable, without significant growth compared to September, but market demand resilience remained, and the production pace of leading enterprises was temporarily unaffected. However, overall industry operations still faced multiple constraints: tight raw material supply, high prices squeezing profits leading some enterprises to cut production, and continued policy uncertainties in Jiangxi and Anhui causing some capacity to remain idle. Overall, the operating rate for the secondary aluminum industry is expected to drop back slightly in October.

September 30, 2025: The overlapping Mid-Autumn Festival and National Day holidays in 2025 created an 8-day long holiday. An SMM survey of sample enterprises across the entire industry chain of the aluminum processing sector revealed a coexistence of overall production resilience and distinct characteristics of divergence among different segments. The survey covered a total of 87 downstream aluminum processing enterprises, involving a total annual capacity exceeding 13.226 million mt. Data shows that the average holiday duration for the same sample enterprises compared to last year increased by 0.2 days to 1.8 days YoY. Leading enterprises maintained continuous production leveraging their order advantages, while some small and medium-sized enterprises adjusted their holiday arrangements due to demand and cost pressures, presenting a supply-side pattern characterized by "core stability with localized adjustments." Holiday and Production Arrangements Diverge Significantly Across Segments Aluminum Plate/Sheet, Strip and Foil: Prominent Production Continuity, Holiday Disruption Minimized Domestic aluminum plate/sheet, strip and foil enterprises averaged 0.7 days off, basically flat compared to last year, making it one of the most stable segments in terms of holiday production. The core driver stems from stable orders on hand for most enterprises during the September-October peak season, leading to tight production schedules. According to industry operational practices, leading enterprises have established mature holiday production guarantee systems, with preparatory work such as raw material stockpiling completed before the holiday. Combined with years of operational experience without holiday-related shutdowns, production continuity is fully ensured. Only a small number of small and medium-sized enterprises, limited by their order scale, implemented short holidays of 2-3 days, having a negligible impact on the overall industry supply. Aluminum Wire and Cable: Top-Tier Enterprises Maintain Production While Small and Medium-Sized Enterprises Struggle with Costs Aluminum wire and cable enterprises averaged 0.7 days off for the holiday, an increase of 0.7 days YoY, reflecting a trend of "stable production among top-tier enterprises and temporary shutdowns among small and medium-sized ones." Domestic top-tier enterprises are currently in their delivery cycles, with most producing and delivering according to schedule. However, losses resulting from fluctuating raw material prices have led to a decline in production enthusiasm compared to the same period last year. Affected by high in-factory inventory, a small number of enterprises opted for 3–5 days off. Regarding raw material stockpiling, enterprises generally focused on just-in-time procurement, with subdued stockpiling sentiment. During the holiday, the supply side was able to ensure normal shipments to meet production demands. Aluminum Extrusion: Construction Sector Under Pressure, Industrial Sector Shows Resilience Aluminum extrusion enterprises averaged 2.8 days off, an increase of 0.5 days YoY, making it the sector with the longest holiday duration. The industry as a whole was dragged down by fluctuating aluminum prices and weak downstream demand, with the operating rate of sampled enterprises declining slightly by 3.3 percentage points YoY. Some individual companies extended their holidays this year. By sector, construction aluminum extrusion enterprises, affected by the sluggish real estate market, generally took 4-7 days off; industrial aluminum extrusion orders were relatively better, with holiday periods shorter at around 3 days, and some enterprises in east China and south China even maintained normal production. Raw material procurement continued to be primarily driven by rigid demand, making it difficult to witness the heated scenario of concentrated stockpiling. Secondary Aluminum Alloy: Stockpiling Constrained, Production Arrangements Flexibly Adjusted Secondary aluminum alloy enterprises averaged 0.7 days off for the holiday, a decrease of 0.2 days YoY, demonstrating high flexibility in production arrangements. Specifically, enterprises providing direct aluminum liquid supply continued normal production modes or adopted measures such as rotating breaks and moderately reducing production loads; some enterprises planned approximately 3-day holidays, with extensions or reductions of 1 to 3 days compared to last year; a few enterprises had yet to finalize specific holiday plans, pending clarification based on downstream customer demand and order situations. Prior to the holiday, secondary aluminum plants actively stockpiled, but constrained by persistently tight aluminum scrap supply and high prices, overall stockpiling capacity was limited, resulting in minimal actual replenishment of raw materials. Although pre-holiday procurement demand drove a slight recovery in market transactions, overall downstream stockpiling sentiment remained subdued, restricting transaction volume. Aluminum Die-Casting: Holiday Extension Hinders Stockpiling Aluminum die-casting enterprises averaged 3.7 days off, an increase of 0.6 days YoY, ranking highest among all sectors. The extended holiday was mainly due to the dual holiday factor and weaker-than-expected downstream orders, with most companies extending holidays by 1–2 days compared to last year. On the stockpiling side, most enterprises only maintained minimal reserves, while a small number abandoned stockpiling due to delayed procurement and unexpectedly sharp price increases, reflecting the industry's sensitivity to cost fluctuations. Aluminum Wheel Hubs: Export Boost Bolsters Confidence, Leading Enterprises Maintain Stable Production Aluminum wheel hub enterprises averaged 2 days off for the holiday, a reduction of 0.5 days year-on-year, highlighting production resilience. Against the backdrop of the September-October peak season, most companies maintained steady orders on hand. Coupled with the absence of large-scale high-temperature-induced production restrictions during the year, production schedules remained tight. Overseas demand served as the core support, with China's aluminum alloy wheel hub exports reaching 97,900 mt in August, hitting a three-year high for a single month and significantly boosting corporate confidence. Leveraging mature holiday operation systems and sufficient stockpiling, leading enterprises maintained normal production during the holiday; only a small number of companies took 3-8 days off, with the duration shrinking compared to the previous year. Core Industry Characteristics and Post-Holiday Market Outlook From an overall perspective, the aluminum processing industry exhibited three key characteristics during the 2025 National Day holiday: first, the divergence between leading enterprises and small and medium-sized enterprises intensified, with top-tier enterprises maintaining continuous production due to order advantages and operational capabilities, while small and medium-sized enterprises adjusted holiday schedules under cost and demand pressures; second, the demand structure had a significant impact, with export-dependent sectors (such as aluminum wheel hubs) and industrial demand-supported sectors (such as industrial extrusions) demonstrating more stable production, while construction-related segments faced noticeable pressure; third, stockpiling behavior became more cautious, with most sectors, except for leading enterprises, primarily engaging in just-in-time procurement, reflecting a wait-and-see sentiment toward future prices and demand. Looking ahead to the post-holiday market, SMM believes that three key changes require close attention: first, the strength of the September-October peak season, particularly whether demand in the construction sector can be released after the holiday, will directly impact the pace of production resumption in segments such as aluminum extrusions; second, the transmission of aluminum price trends to the production side, as the stability of raw material prices will influence the willingness of small and medium-sized enterprises to resume operations; third, the sustainability of overseas demand, as the continued high growth in export data for products like aluminum alloy wheel hubs is crucial for industry confidence. Overall, while short-term supply stability is supported by leading enterprises, substantial improvement on the demand side remains the core factor for sustaining the recovery trend.

September 12, 2025: This week, the overall operating rate of leading aluminum downstream processing enterprises in China rose 0.4 percentage points WoW to 62.1%, with the "September peak season" effect continuing to strengthen and various sectors showing a stepwise recovery pattern. The operating rate of the primary aluminum alloy sector increased significantly by 1 percentage point to 57.6%, driven by strong capacity release from top-tier enterprises, though small and medium-sized enterprises still faced order gaps. The aluminum wire and cable industry's operating rate edged up 0.4% to 65.2%, as regional environmental protection inspections were lifted, but capacity recovery in Hebei lagged behind expectations, while power grid orders supported higher operating rates at leading firms. The aluminum extrusion operating rate rebounded 1 percentage point to 54%, with accelerated transition from architectural to industrial profiles, processing fees for PV frames hitting bottom and stabilizing, and new orders for automotive extrusion becoming a highlight. The operating rate of leading aluminum plate/sheet and strip enterprises held steady at a high of 68.6%, as the can stock stockpiling cycle neared its end, and demand resilience in automotive/3C sectors stood out. The aluminum foil industry's operating rate remained at a peak level of 71.9%, though peak season order growth fell short of expectations, with stable demand for packaging foil and battery foil. The operating rate of secondary aluminum producers rose slightly by 0.5% to 53.5%, as consumption-side improvements drove the rebound, but raw material shortages and policy factors continued to constrain capacity recovery. SMM believes that, driven by consumption recovery in terminal sectors such as 3C, automotive, and PV, the aluminum processing industry has re-entered its peak season rhythm. Although the real estate sector remains sluggish, ongoing order releases in the new energy sector have effectively offset this, and downstream aluminum consumption is still expected to increase. SMM expects the operating rate of the aluminum processing industry to continue rising in mid-September, but cautions about the impact of high aluminum prices on downstream stocking willingness. Primary alloy: Entering the second week of September, the primary aluminum alloy sector's operating pace showed a steady upward trend, with the operating rate rising another 1 percentage point WoW to 57.6%, as industry capacity release strengthened compared to the first week, and some enterprises significantly boosted production enthusiasm. From actual enterprise operations, some firms reported a notable WoW increase in primary aluminum usage this week, while others feedback indicated a roughly 10% rise in early September operating levels compared to earlier periods, with peak season capacity utilization rates continuing to climb; simultaneously, some enterprises have clear expectations for overall September growth, with subsequent expansion intentions reflected in production planning. By scale, top-tier and large-scale enterprises, leveraging stable order reserves and mature supply chains, maintained consistent capacity release, with primary aluminum procurement and consumption volumes staying high, serving as the core force driving the sector's operating rate higher; though small and medium-sized enterprises were buoyed by the overall market sentiment and saw improved operating willingness, some still faced issues with order instability, downstream procurement pace not fully synchronizing, and actual capacity release lagging behind top-tier firms, requiring further observation of the recovery rhythm. As the peak season deepens, SMM expects the primary alloy industry's operating performance to continue strengthening. Aluminum Plate/Sheet and Strip: The operating rate of leading enterprises in the aluminum plate/sheet and strip sector recorded 68.6% this week. Aluminum prices continued to rise during the week, with spot aluminum approaching the 21,900 yuan mark, reigniting downstream fear of high prices. As the mid-September peak season approaches, market trading sentiment has recovered somewhat, but product performance has diverged significantly. Demand for aluminum plate/sheet and strip from industries such as automotive and 3C remains steadily supportive. Can stock producers reported that stockpiling orders for the Mid-Autumn Festival and National Day period have been largely completed, and production schedules are gradually showing weakness, with an order gap of 10-20% YoY. Overall, if aluminum prices continue to fluctuate at highs and break through the 21,000 yuan mark, it may further suppress downstream order placement and cargo pick-up enthusiasm. Without a significant climb in downstream consumption, this will impact enterprise operating rates. It is expected that the operating rate of leading aluminum plate/sheet and strip enterprises will remain stable or experience a slight rise in the short term. Aluminum Wire and Cable: The operating rate in the aluminum wire and cable industry increased slightly by 0.4 percentage points to 65.2% this week, with leading enterprises showing stable and slightly improved production performance. By region, in Hebei, as environmental protection monitoring for the September 3rd military parade ended, producers gradually resumed operations. However, due to differences in order delivery cycles, the overall operating level did not rebound significantly. From the investment side, the State Grid completed cumulative investments of 270 billion yuan in H1, up 11.7% YoY, but this accounted for less than 50% of the annual plan. Market expectations are strong for investment release in H2 driven by the fourth batch of ultra-high voltage (UHV) tenders. Regarding tender progress, four batches of power transmission and transformation and three batches of UHV tenders have been completed. The pace of power transmission and transformation tenders met expectations, while UHV tenders were slightly below the plan at the beginning of the year. It is expected that the remaining two batches of power transmission and transformation and three batches of UHV tenders will be completed in Q3 and Q4. The industry is currently in a transition phase of "strong expectations, weak reality." Although tendering accelerated in H1, end-user cargo pick-up has not significantly strengthened. SMM expects the operating rate to remain stable at around 65% next week. Aluminum Extrusion: The operating rate of leading domestic aluminum extrusion enterprises rebounded by 1 percentage point MoM to 54% this week. With the arrival of the September peak consumption season, most extrusion enterprises reported improved order situations. It is understood that some medium and large enterprises in Anhui and Shandong are advancing the phase-out and replacement of outdated capacity, which is expected to further increase capacity concentration and provide some support to the overall industry operating rate. From segmented sectors: In architectural extrusion, affected by the continued weakness in the real estate market, new orders in the industry are generally weak, with production mainly relying on orders on hand, leading to sluggish growth in operating rates. Against this backdrop, some small and medium enterprises in Jiangsu and Anhui reported attempting to adjust production layouts to shift into the industrial extrusion field or explore overseas markets for breakthroughs. Meanwhile, some medium and large enterprises in Guangdong and Shandong reported that architectural extrusion still dominates their capacity, mainly because industrial extrusion requires higher technical standards, has relatively lower yield rates, and offers limited profit margins. In industrial extrusion, PV extrusion operations remain stable, with processing fees for PV frames tending to stabilize recently. A large PV frame producer in Anhui stated that its production costs have basically hit bottom, leaving limited room for further compression of processing fees. In automotive extrusion, some enterprises in Anhui, Fujian, and Hebei reported that new orders in battery tray and bumper beam segments performed relatively well, providing some support to operating rates, but a downward trend in industry processing fees has gradually emerged. Overall, the aluminum extrusion industry has shown traditional peak season characteristics in September. However, some enterprises in Guangdong and Fujian reported that current orders on hand can only sustain 7-14 days of production, expressing concerns about the sustainability of subsequent orders. SMM will continue to track the actual fulfillment of orders across various sectors. Aluminum Foil: The operating rate of leading aluminum foil enterprises recorded 71.9% this week. The aluminum foil market remained relatively stable during the week. The current peak season has provided limited overall lift to aluminum foil demand, and the growth rate of enterprise operating rates was not ideal. Demand for products such as packaging foil and battery foil showed no significant changes, and feedback on production schedules for brazing materials indicated no noticeable increase YoY. Overall, in the short term, supported by the peak season, the operating rate of leading aluminum foil enterprises can still maintain a relatively high level. However, downstream end-users, despite being in the peak season, did not provide excess production orders, making the peak season performance less pronounced. Uncertainties persist, and it is expected that the operating rate of leading aluminum foil enterprises will fluctuate upward slightly in the near future. Secondary Aluminum Alloy: The operating rate of leading secondary aluminum enterprises increased slightly by 0.2 percentage points WoW to 55.5%, mainly driven by improvements on the consumption side. Since September, downstream procurement sentiment has recovered slightly, and demand has continued to rebound, but the actual strength of the traditional peak season remains to be verified. However, the overall recovery in industry operating rates is still constrained by factors such as insufficient raw material supply and policy uncertainties. Tight circulation resources of domestic and imported aluminum scrap, coupled with increased demand from scrap utilization enterprises, have led to a continuous rise in aluminum scrap prices. Some enterprises, to ensure order delivery, had to purchase at high prices or even across regions. To avoid losses, manufacturers have become more cautious in taking orders, actively controlling order scale and operating levels. In the short term, the industry operating rate may continue its mild rebound trend, but raw material shortages and policy factors will continue to constrain the flexibility of capacity recovery.

September 5, 2025: This week, the overall operating rate of leading domestic aluminum downstream processing enterprises rose 1 percentage point (ppt) WoW to 61.7%, as the "September peak season" effect gradually emerged, with recovery trends improving across all sectors. The operating rate of primary aluminum alloy producers edged up 0.2% to 56.6%, showing a slow recovery pace during the peak season, as the time-lag effect of policy support transmitting to end-use demand persists, with no clear positive factors driving a significant rise in operating rates. The operating rate of leading aluminum plate/sheet and strip producers surged 1.2 ppts to 68.6%, benefiting from order volume growth in automotive and 3C sectors and a rebound in foreign trade, while higher aluminum prices boosted stockpiling willingness, making it the industry chain's recovery leader. The operating rate of the aluminum wire and cable industry increased 1 ppt to 64.8%, driven by concentrated delivery of power grid orders in Jiangsu and Henan, though small and medium-sized producers in Hebei lagged due to environmental protection-driven production restrictions during the military parade, with the rate expected to exceed 66% next week after capacity release in North China. The operating rate of aluminum extrusion producers rebounded 1 ppt to 53%, as construction extrusion remained weighed down by real estate but was supported by export orders to the Middle East and Africa, while industrial extrusion saw continued PV module installation rush and initial signs of growth in automotive battery tray orders. The operating rate of leading aluminum foil producers maintained steady growth of 0.8 ppts to 71.9%, with packaging foil and decorative foil replacing air-conditioner foil as new drivers, as the industry prepares for the Mid-Autumn Festival and National Day stockpiling cycle. The operating rate of secondary aluminum producers rose significantly by 1.8 ppts to 55.3%, lifted by the end of environmental restrictions and peak-season restocking, though tight aluminum scrap supply and uncertain tax rebate policies continued to constrain capacity release among small and medium-sized enterprises. SMM analysis indicates the aluminum processing industry has entered a "structural peak season," with broader operating rate increases expected by mid-September, focusing on key variables such as power grid construction cycles, PV export performance, and automotive industry order patterns. Primary Alloy: In the first week of September, the operating rate of primary aluminum alloy producers edged up 0.2% WoW to 56.6%, showing a slow recovery pace in the early peak season. With the traditional consumption peak season starting in September, the resumption of primary processing sectors like aluminum billet continued, maintaining the diversion effect on liquid aluminum. Some producers optimized product structures and expanded niche orders to sustain capacity release, but overall operating rate growth remained limited. Feedback from producers showed that top-tier enterprises maintained stable primary aluminum usage WoW, with relatively high capacity utilization rates due to order stability and resource integration advantages, while small and medium-sized producers still faced weak orders, with most reporting no significant improvement in downstream purchase willingness. Actual recovery fell short of expectations, with demand-side constraints remaining the core industry challenge. Although tariff risk disturbances eased and some downstream producers began tentative restocking, providing temporary market support, end-use consumption recovery has yet to meet expectations, and the time-lag effect of policy support transmitting to end-use demand persists. SMM maintains its earlier weak-steady recovery outlook, with no clear positive factors driving a significant operating rate increase in the short term, expecting only gradual improvement ahead. Aluminum Plate/Sheet and Strip: This week, the operating rate of leading aluminum plate/sheet and strip producers rose 1.2 ppts WoW to 68.6%. Aluminum prices hovered at highs, with spot prices fluctuating between 20,600-20,800 yuan/mt. As the "September peak season" began, market sentiment continued to recover, with some producers reporting growth in both domestic and export orders, while raw material and finished goods stockpiling willingness strengthened. Downstream, demand from automotive and 3C sectors remained robust, serving as key drivers for the operating rate increase. Overall, the operating rate is expected to maintain its upward trend in September, with sustained downstream recovery likely to spur new growth. Aluminum Wire and Cable: The operating rate of the aluminum wire and cable industry rose 1 ppt WoW to 64.8%, as leading producers confirmed the gradual pickup in cargo pick-up activity during the peak season. Regionally, top producers in Jiangsu and Henan led the recovery with concentrated power grid order deliveries, while small and medium-sized producers in Hebei lagged due to environmental restrictions during the military parade. Production schedules showed limited new orders but stable support from existing orders, with some producers still in the capacity ramp-up stage due to power grid orders concentrated for October delivery. Procurement-wise, producers mainly consumed in-factory inventory this week, with weak spot market purchases, though restocking for rigid demand is expected to increase. SMM expects the operating rate to exceed 66% next week, as post-parade production resumes in North China and State Grid orders concentrate in H2. Aluminum Extrusion: The operating rate of leading domestic aluminum extrusion producers rose 1 ppt WoW to 53%, with industrial extrusion showing early recovery signs. Construction extrusion remained under pressure from declining housing starts and completions (NBS data), though export orders to the Middle East and Africa provided some support. PV extrusion maintained high operating rates among top producers in Anhui and Hebei, driven by Q3 export installation rush, while small and medium-sized producers saw new order increases but remained cautious due to processing fee pressures. Automotive extrusion stabilized, with some producers in Fujian and Anhui reporting increased battery tray orders, while one medium-sized producer in Anhui expects further volume growth in October-November. Other industrial extrusion sectors, such as radiators and 3C components, saw slight order increases, though smaller specifications limited production boosts. Overall, initial signs of order recovery emerged as the peak season began, with SMM monitoring actual order fulfillment progress. Aluminum Foil: The operating rate of leading aluminum foil producers rose 0.8 ppts WoW to 71.9%, building on last week’s 1.1 ppt increase, further solidifying the recovery trend. Downstream, seasonal demand for air-conditioner foil weakened, while new energy sectors provided stable support via battery foil and brazing foil orders. With the peak season approaching, procurement demand in home decoration and packaging sectors gradually released, boosted by pre-holiday stockpiling, driving order recovery in decorative and packaging foil. Overall, the operating rate is expected to maintain steady growth. Secondary Aluminum Alloy: The operating rate of leading secondary aluminum producers rose 1.8 ppts WoW to 55.3%, showing mild recovery as the traditional peak season began, though order growth fell short of expectations. The increase was driven by seasonal demand recovery and the end of environmental restrictions in Hebei and Jiangxi. However, ongoing challenges include unclear local tax rebate policies, dampening market sentiment, and persistently tight aluminum scrap supply, particularly tense scrap, keeping procurement costs high. In the short term, the operating rate is expected to maintain a gradual upward trend.

August 30, 2025: The PMI of various aluminum processing sectors showed significant divergence in August, with the aluminum plate/sheet and strip industry standing out notably. Its composite PMI surged 17.1 percentage points to 60.5%, marking a strong return to expansion territory. Seasonal stockpiling in downstream sectors such as automotive, 3C electronics, can stock, and curtain wall panels drove MoM order growth for enterprises. Previously idled cast-rolling lines gradually resumed production, boosting operating rates for consecutive periods. Although the industry remained cautious about the September-October peak season and faced localized logistics constraints, overall production was not significantly impacted.The aluminum foil sector’s PMI remained in contraction territory (46.3%) but improved marginally MoM, though overall production and sales momentum stayed weak. Air-conditioner foil was notably dragged down by declining end-user production schedules. However, battery foil and brazing foil orders remained stable, while decorative foil, household foil, and packaging foil consumption improved MoM, with top-tier enterprises stabilizing their production schedules.The architectural extrusion PMI edged up to 47.80%, reflecting weak off-season demand. The positive effects of real estate policies have yet to translate into industrial demand. Small and medium-sized enterprises, burdened by long payment cycles and declining processing fees, showed low willingness to take orders. Export orders performed well, with incremental demand for doors, windows, and curtain walls in Southeast Asia and Africa.The industrial extrusion PMI recorded 48.52%, remaining in contraction. PV frame manufacturers maintained high operating rates due to the export rush effect, but automotive extrusion faced overcapacity and intense "rat race" competition in processing fees, accelerating industry consolidation.The aluminum wire and cable industry’s PMI rebounded significantly to 52.1, re-entering expansion territory, driven by power grid projects’ advance stockpiling for the peak season. However, orders for PV/wind power and enamelled wire remained weak.Primary alloy PMI stood at 59.4%, maintaining robust expansion with strong export performance, though weak domestic demand and trade policy uncertainties warrant attention. Secondary alloy PMI rose 11.5 percentage points MoM to 49.5% but remained below the 50 mark. Demand was suppressed by high-temperature holidays, while aluminum scrap supply tightness, the cancellation of tax rebates, and environmental protection inspections pressured small and medium-sized enterprises, though large firms remained relatively stable. By product category: Aluminum plate/sheet and strip: In August, the PMI for the aluminum plate/sheet and strip sector rose 17.1 percentage points MoM to 60.5%, surging well above the 50 mark. Sub-indices showed both the production index and new orders index closed at a high of 68.9%, while export orders rebounded to 62.0%, reflecting synchronized recovery in domestic and external demand, with enterprises reporting solid order intake. The purchasing volume index rose in tandem to 60.5%, and the raw material inventory index reached 53.5%, indicating active stockpiling by firms to prepare for peak season and improved confidence. On a weekly basis, aluminum prices stabilized within the range of 20,500-20,800 yuan/mt in early-to-mid August, triggering seasonal stockpiling in downstream sectors such as automotive, 3C electronics, can stock, and curtain wall panels. Orders increased MoM from July, and previously idled casting-rolling lines gradually resumed operations, driving consecutive gains in operating rates. Although industry expectations for the September-October peak season remain cautious and localized logistics disruptions occurred temporarily, overall production pace saw no significant disruption. With further recovery in end-use consumption, the PMI for aluminum plate/sheet and strip is expected to maintain a steady upward trend in September. Aluminum foil: The aluminum foil sector's PMI stood at 46.3% in August, remaining in contraction territory but showing marginal improvement from the previous month. Key sub-indices included production and new orders indices both at 43.4%, reflecting persistently weak production and sales momentum, particularly as air-conditioner foil orders contracted YoY due to reduced end-user production schedules, significantly dragging down the sector. The input price index reached 49.9%, nearing the 50 mark, indicating eased cost pressure. Weekly data showed the sector bottoming out in August, supported by stable orders for battery foil and brazing foil, alongside MoM demand recovery in decorative foil, household foil, and packaging foil segments, with top-tier enterprises stabilizing production schedules. Although the air-conditioner foil peak season has passed, weakening demand support, the approaching September-October peak season is expected to generate additional orders from home appliance and new energy end-users. The aluminum foil PMI is projected to return above the 50 mark in September, with market focus on production schedule adjustments and actual restocking intensity. Construction aluminum extrusion: The composite PMI for construction aluminum extrusion edged up to 47.80% in August, remaining below the 50 mark. August was still in the traditional off-season. Despite frequent positive news on real estate stimulus during the period, companies reported it would take time to translate into industry impact. The production index stood at 46.48% this month. According to the SMM survey, most companies reported flat orders MoM. Some small and medium-sized enterprises in Guangxi and Zhejiang reported weak order-taking willingness due to prolonged payment cycles and declining processing fees for construction aluminum extrusion. A medium-sized building materials company in Zhejiang noted a roughly 30% drop in infrastructure-related orders. Although some companies reported nearly stable new orders MoM, the new orders index dipped to 46.48% due to declines at other firms. The new export orders index rose to 51.65%, driven by increased shipments of doors, windows, and curtain walls to Southeast Asia and Africa by companies in Anhui, Hunan, and Shandong. For raw material inventory, most companies maintained only 7-day safety stock, with the raw material inventory index at 44.82%. With the approaching September-October peak season, the construction aluminum extrusion PMI is expected to have further upside room. Industrial aluminum extrusion: The composite PMI for industrial aluminum extrusion recorded 48.52% in August, staying below the 50 mark. Sub-indices showed the production index at 49.84% and new orders index at 46.33%, reflecting off-season effects. Per the SMM survey, most companies reported flat orders MoM, while some voluntarily cut production due to lower processing fees. Leading PV frame manufacturers in Anhui and Hebei maintained high operating rates in August, supported by the export rush ahead of the PV product export tax rebate cancellation. Other industrial extrusion segments like rail transit, radiators, and 3C deep-processing firms reported order increases. Automotive extrusion producers noted stable but slightly weaker production and new orders MoM. A large extrusion company in Shandong stated that overcapacity in automotive extrusion remains hard to reverse, with capacity increasingly concentrated among leading enterprises amid limited market orders. The severe "rat race" competition in processing fees is unlikely to ease, raising concerns about future market prospects. Against the seasonal transition, some Hebei-based companies accelerated end-user cargo pick-ups to avoid logistics controls during the September 3 military parade, reducing finished product inventories. The finished goods inventory index dropped to 45.07%. Overall, industrial aluminum extrusion showed early signs of recovery, with its composite PMI expected to rebound above the 50 mark in September. Aluminum wire and cable: In August, the composite PMI for China's aluminum wire and cable industry registered 52.1%, up 4.4% MoM from July. The PMI's return above the 50 mark indicates the industry has re-entered an expansion cycle, ending two consecutive months of contraction. August marked a critical transition period from the off-season to the peak season for the aluminum wire and cable industry. On one hand, power grid projects resumed construction cycles in September, accelerating end-user cargo pick-up. On the other hand, the "aluminum-for-copper" substitution trend in end-use consumption provided a consumption boost.Breaking down by segment, the production PMI in August reached 58.21%, up 10.5% MoM, primarily due to manufacturers' proactive production stockpiling to alleviate future cargo pick-up pressure. The finished product inventory index stood at 60.3%. As order fulfillment intensified, manufacturers gradually entered a busy production phase, with the operating rate expected to rise further in September. The production PMI is projected to reach 60% in September.Regarding new orders, industry orders remained sluggish in August. PV and wind power orders plummeted due to reduced grid connections following policy deadlines, while enamelled wire orders weakened amid the phase-out of home appliance subsidies. Power grid-related orders saw only sporadic fulfillment during the month.Other aspects: The price center softened slightly during the month, prompting manufacturers to restock raw materials for rigid demand in advance. The raw material inventory index registered 58.42%, up 24% MoM. Looking ahead to September, SMM believes the industry is currently in a preparatory phase before demand expansion. With the approaching power grid construction cycle and annual investment support, aluminum wire and cable demand is expected to see strong incremental growth. The industry PMI is projected to remain above 50 in September. Primary aluminum alloy: In August, the primary aluminum alloy PMI recorded 59.4%. Despite July and August being traditional off-season months, the industry maintained steady performance above the 50 mark. By component, the production index reached 70.2%, and the new orders index stood at 65.4%, both remaining at relatively high levels. This aligns with the overall recovery in the operating rate of primary aluminum alloy in August. While operating capacity in primary processing segments like aluminum billet remained volatile, primary aluminum alloy production continued to gain momentum. Orders, particularly for downstream finished product exports, also showed promising performance, indicating relatively strong production and order activity.The product inventory index registered 53.0%, and the purchasing volume index reached 68.5%, reflecting reasonable inventory levels and active procurement activities. This suggests stable inventory management and raw material procurement practices among enterprises. The new export orders index remained robust at 65.4%, though external demand uncertainties persist, requiring continued monitoring of factors such as Sino-U.S. tariffs. Industry outlook: Although the primary aluminum alloy PMI performed impressively in August and SMM holds a positive outlook for September, challenges remain, including weak domestic demand, trade policy uncertainties, and potential impacts of high aluminum prices. Whether the industry can sustain its strong performance will depend on the actual recovery in demand as the traditional peak season begins in September, as well as changes in external factors. Secondary Alloy: In August, the PMI for the secondary aluminum industry rebounded by 11.5 percentage points MoM to 49.5%, but remained below the 50 mark. Demand side was dominated by off-season sentiment, and some downstream enterprises concentrated their high-temperature holidays from late July to mid-August, further suppressing purchase willingness. After mid-August, demand stabilized and rebounded. Delivery brand companies continued to fulfill previous orders, providing some support to corporate orders. Production showed structural divergence: large enterprises generally maintained high operating rates, though some saw slight production cuts due to high-temperature holidays in the automotive industry. Small and medium-sized enterprises faced widespread pressure, with order contraction compounded by multiple constraints: 1) persistent tight supply of aluminum scrap hindered raw material inventory replenishment; 2) cancellation of tax rebate policies in Anhui and Jiangxi prompted proactive production cuts to mitigate cost risks; 3) environmental protection inspections in Hebei and Jiangxi led to regional production halts. Both finished goods and raw material inventories remained at low levels. With the approach of the September peak season, downstream demand showed mild recovery, and the industry PMI is expected to rise above the 50 mark in September. Brief Review: The PMI for the aluminum processing industry in August was recorded at 53.3%, reflecting a significant improvement over July and signaling a positive transition from off-season to peak season. The aluminum plate/sheet and strip industry emerged as the brightest spot, with simultaneous recovery in domestic and overseas demand driving notable rebounds in orders and production, while stockpiling enthusiasm strengthened, marking the industry's entry into expansion territory. Although the aluminum foil sector remained in contraction territory, marginal recovery trends emerged, with battery foil and packaging foil showing MoM improvements, supported by peak season expectations. The extrusion segment continued to face pressure, with construction extrusion dragged down by sluggish real estate, highlighting survival challenges for small and medium-sized enterprises. Industrial extrusion exhibited structural divergence, with PV orders supporting some firms, but automotive extrusion faced severe overcapacity and intense processing fee competition. The aluminum wire and cable industry benefited from power grid peak season stockpiling in advance, with PMI re-entering expansion territory and production and inventory indices rising sharply, indicating clear demand growth prospects. Primary alloy maintained steady expansion, with production and order indices fluctuating at highs and strong export performance, though domestic demand sustainability remained uncertain. Secondary alloy stayed below the 50 mark, with tight raw material supply and policy changes constraining production for small and medium-sized enterprises, reinforcing industry consolidation trends. Overall, the aluminum processing industry gradually recovered in August amid expectations for the September-October peak season, but recovery pace varied across segments, and the breadth and sustainability of demand recovery require further observation. As end-use consumption continues to recover, the aluminum plate/sheet and strip, wire and cable, and primary alloy sectors are expected to lead industry expansion in September, while marginal improvements are anticipated for aluminum foil and extrusion segments. However, attention must be paid to potential impacts from aluminum price volatility, policy shifts, and external uncertainties on industry recovery.

July 3, 2025: Affected by factors such as the high-temperature off-season, high aluminum prices, insufficient profit margins, and weak downstream demand, the operating rate of the aluminum processing industry this week fell by 0.1 percentage point week-on-week (WoW) to 58.7%. By sector: Primary Alloy: Despite continuous marginal support from aluminum liquid alloying tasks and conversion strategies for aluminum rods, enterprises exhibit low expansion willingness and limited capacity expansion momentum against the backdrop of the off-season. The operating rate may continue to weaken. Aluminum Plate/Sheet/Strip: Faced with the dilemma of insufficient orders and high inventories, producers proactively reduced output, putting pressure on the overall industry operating rate. Aluminum Wire & Cable: Enterprises remain pessimistic about July orders, but the expectation for State Grid order deliveries in the second half of the year remains positive, potentially providing some support to future operating rates. Aluminum Extrusions: Generally experiencing weak new order intake due to the consumption off-season and severe internal competition in processing fees, enterprises face pressure on their operating rates. Aluminum Foil: Terminal demand shows no signs of short-term recovery under the influence of the traditional consumption off-season. The operating rate may continue to decline. Recycled Aluminum Alloy: Pressure on both the demand and cost sides has intensified. Some recycled aluminum enterprises have adopted measures such as short-term furnace maintenance or output reduction. SMM expects the downstream aluminum processing weekly operating rate may fall by 0.4 percentage points WoW to 58.3% next week. Primary Alloy: This week, the operating rate of the primary aluminum alloy industry edged down slightly by 0.2 percentage points WoW to 53.8%, continuing its weak and stable trend. Although aluminum liquid alloying tasks and aluminum rod conversion strategies continue to provide marginal support, constrained by multiple factors including weak terminal demand, insufficient new orders, thin profit margins, and the approaching high-temperature holidays, enterprises exhibit low expansion willingness and limited capacity expansion momentum. Coupled with the uncertainty brought by the approaching July 9th US-China tariff deadline, a substantial industry recovery still awaits the clarification of trade policies and effective mitigation of cost pressures. SMM expects the industry to continue its game pattern dominated by "aluminum liquid allocation with significant demand drag" in the near term, with the operating rate likely to show a continuous weakening trend. Aluminum Plate/Sheet/Strip: This week, the operating rate of leading aluminum plate/sheet/strip enterprises was recorded at 63.8%. Aluminum prices remained high this week, sustaining strong downstream customer wait-and-see sentiment and poor destocking of finished product inventories. Terminal demand remained persistently weak, with key consumption sectors like automotive and electronics starting to show fatigue, leading to a contraction in new order volumes. Regarding processing fees, in Gongyi, due to inventory pressure, processing fees for cast-rolled coils have fallen below cost levels, halving compared to the peak season, leaving no room for further price-for-volume strategies. Producers proactively reduced output facing the dilemma of insufficient orders and high inventories. Although leading enterprises strive to adjust structures to maintain stability, the overall industry operating rate faces significant pressure. With high finished product inventories, the deepening traditional off-season, and persistently high aluminum prices, the aluminum plate/sheet/strip operating rate is expected to continue declining in the short term. Aluminum Wire & Cable: This week, the operating rate of leading aluminum wire and cable enterprises was 61.8%, unchanged from last week. According to enterprise feedback, there is apprehension towards current high prices, and the focus remains on reducing raw material and finished product inventories; industry sentiment towards operating has not improved. Simultaneously, enterprises hold a pessimistic outlook for July orders, and terminal pickup pace has slowed. Looking ahead, although current enterprise operations are weak, backlogged orders still provide some support, limiting significant downside for the operating rate. While July expectations are weak, the outlook for State Grid order deliveries in the second half of the year remains positive, potentially providing some support for future operations. It is expected that the aluminum wire and cable operating rate will maintain its weak trend in the near term. Aluminum Extrusions: This week, the national extruded profiles operating rate fell slightly by 0.5 percentage points WoW to 49.5%. Construction Profiles: Overall operating rate at sample enterprises declined slightly WoW. SMM research indicates that leading enterprises in Central China, South China, and East China all reported weak growth in new orders. Coupled with persistently declining processing fees for powder coating and thermal break profiles, putting pressure on profits, the building profiles operating rate fell again to around 40% this week. Industrial Profiles: Operating rate declined slightly WoW. Some leading PV frame profile enterprises in East China, Southwest China, and Hebei reported relatively saturated orders in the first week of July, with backlogged orders providing some support for the operating rate; a few plants saw a slight WoW increase. However, uncertainty regarding subsequent orders remains high, and output reduction risks persist. Operations are expected to weaken by mid-July. Automotive Profiles: Entering July, some large and medium-sized sample enterprises in East and Central China reported a strong off-season atmosphere, with new orders still weak this week. However, a few East China enterprises reported relatively saturated foreign orders, maintaining operations around 60%. Meanwhile, some enterprises in East China that previously shifted from building to industrial profiles reported severe internal competition in industrial profiles. After comprehensive assessment, they decided to shut down industrial profile lines and optimize staffing. Overall, affected by the consumption off-season, aluminum extrusion enterprises generally face weak new orders and pressure on operating rates. SMM will continue to monitor the actual progress of order fulfillment across sectors. Aluminum Foil: This week, the operating rate of leading aluminum foil enterprises was recorded at 69.6%. Overall aluminum foil market demand continued to weaken, and the industry operating rate remained under downward pressure. By product: Packaging foil demand is weak and mired in price competition. Air-conditioning foil has large scale but relies heavily on price-for-volume strategies to barely sustain. Battery foil saw some enterprises increasing output, but downstream output reduction plans led to weakening orders, insufficient to offset the overall downturn. As the traditional consumption off-season (July-August) sets in, terminal demand shows no signs of recovery. The aluminum foil industry operating rate is expected to continue its downward trend in the short term. Recycled Aluminum Alloy: This week, the operating rate of leading recycled aluminum enterprises remained stable at 53.6%. Entering July, pressure on the demand side for recycled aluminum intensified significantly. The high-temperature off-season and high aluminum prices continued to impact downstream orders, prompting some die-casting enterprises to reduce output. Cost pressures also intensified simultaneously. Prices of key raw materials like scrap aluminum, silicon, and copper collectively rose, continuously pushing up ADC12 raw material costs. However, product selling prices struggled to keep pace, leading to a further widening of theoretical industry losses and significantly increased production and operational pressure on enterprises. Squeezed by both scrap aluminum supply shortages and weak market demand, some recycled aluminum enterprises adopted measures like short-term furnace maintenance or output reduction. Nevertheless, leading sample enterprises managed to maintain current production scales, but future operating rates face downward pressure.

SMM June 29th's News: The Aluminum Sheet/Strip industry PMI composite index remained in contraction territory, with domestic end-user demand weakening further. Downstream customers slowed their pickup pace, finished product inventory indices stayed elevated, compounded by lackluster export recovery. Companies reduced production, necessitating continued monitoring of destocking progress and policy stimulus effects. Aluminum foil producers saw profit margins squeezed by their "price-for-volume" strategy during the month, putting corporate cash flow under pressure. Coupled with downstream production cuts dragging on orders, July is unlikely to see improvement. In construction profiles, companies reported the property market has yet to recover, new orders were severely insufficient, and backlogged orders couldn't support monthly production. Construction aluminum profile PMI is expected to remain below the boom-bust line in July as the sector stays mired in the traditional off-season. For industrial profiles, aside from a few segments with stable customer bases unaffected by the off-season, the off-season atmosphere prevailed elsewhere. Against the backdrop of intense processing fee competition, corporate profitability was squeezed. Little improvement is expected in July, requiring close attention to actual order fulfillment. In aluminum cable/wire, the next delivery cycle has yet to arrive, with insufficient market rigid demand. Cable manufacturers plan to reduce both raw material and finished goods inventories to ease capital pressure. In the primary alloy sector, constrained by the triple pressures of weak traditional off-season demand, unresolved China-US tariffs, and negative feedback from high aluminum prices, industry downward pressure intensified significantly, and the PMI may face further pressure. For recycled alloys, despite the formal listing of cast aluminum alloy futures on June 10 boosting market trading activity, actual terminal consumption remained sluggish and failed to effectively support the market. Details by product type: Aluminum Sheet/Strip: The June China Aluminum Sheet/Strip industry PMI composite index recorded 39.1%, plunging 10.5 percentage points from the previous month, deeply entrenched in contraction. Sub-indices showed both the production index (29.2%) and new orders index (29.2%) were significantly below the boom-bust line, reflecting intensified weakness in domestic end-user demand, particularly a month-on-month decline in construction sector orders. Compounded by high aluminum prices hovering (approaching 21,000 yuan/ton), downstream customers slowed their pickup pace, and the finished product inventory index remained high (60.8%), forcing companies to cut production. Although the new export orders index (42.8%) was higher than the production index, export support was limited. Benefits from China-US consultations only supported sectors like home appliances and kitchen/bathroom, insufficient to offset overall consumption weakness. The purchasing volume index (44.5%) and raw material inventory index (46.1%) indicated cautious restocking by enterprises. Overcapacity and insufficient domestic demand heightened the risk of price wars. Looking ahead, with the off-season deepening and inventory overhang, the aluminum sheet/strip PMI is expected to remain weak. Progress on production cuts, destocking, and policy stimulus effects warrant attention. Aluminum Foil: The June aluminum foil industry PMI composite index was 45.3%, edging down month-on-month but remaining in contraction. Among sub-indices, both the production index (41.2%) and new orders index (41.2%) were below the boom-bust line. The main reason was packaging foil demand plummeting since April, mired in price wars (processing fees as low as 5,800 yuan/ton). Companies' "price-for-volume" strategy squeezed profit margins, and the finished product inventory index (52.8%) remained under pressure. The new export orders index (47.3%) contracted, indicating insufficient export support. Normal production scheduling for battery foil and brazing foil provided partial support, but downstream production cut plans dragged on orders. High aluminum price volatility had limited impact (monthly average price settlement buffered risk), but destocking fell short of expectations, leaving an inventory crisis looming. Aluminum foil demand is expected to weaken overall in July, with the industry PMI forecast to contract further. Processing fees will stay under pressure, and corporate cash flow faces tests. Construction Profiles: The June construction aluminum profiles PMI index edged down to 40.44%, falling below the boom-bust line. The construction profiles industry officially entered its traditional off-season. Most enterprises in Shandong, East China, Hebei, and South China reported significant production declines in June. Companies reported the property market has yet to recover, new orders were severely insufficient, and backlogged orders couldn't support monthly production. This caused the production index to plunge to 29.6% and the new orders index to fall to 37.69%, dragging the purchasing volume index down to 29.15%. Compounded by intense competition in spraying and thermal break processing fees, companies widely adopted low raw material inventories to maintain healthy cash flow, pushing the raw material inventory index down to 34.75%. Overall, the construction profiles industry is expected to remain shrouded in the traditional off-season atmosphere in July, with the construction aluminum profiles PMI continuing below the boom-bust line. Industrial Profiles: The June industrial profiles industry PMI composite index recorded 37.61%, falling sharply below the boom-bust line. Looking at sub-indices: the production index was 30.33%, new orders index 29.0%. According to SMM, leading PV frame manufacturers in East China reported significant output declines in June, coupled with expectations of lower new orders in July, leaving end-of-month production orders unable to connect with next month's. Meanwhile, although other industrial profiles like rail transit, aerospace profiles, and 3C deep processing maintained stable customer bases and normal production during the month, auto parts companies reported intense industry competition persists, with severely insufficient backlogged orders and continuously declining operating rates. Processing companies also indicated current processing fees may decline further, potentially further compressing corporate profitability. Enterprises showed insufficient enthusiasm for raw material stockpiling, with most maintaining only safety stocks. This caused the purchasing volume index to drop to 21.05% and the raw material inventory index to fall to 28.68%. The industrial profiles industry PMI is expected to operate weakly, with the industrial aluminum profiles PMI continuing below the boom-bust line. SMM will continue to monitor actual order fulfillment. Aluminum Cable/Wire: The June domestic aluminum cable/wire industry PMI composite index recorded 40.2%. After running above 50 for four months, the index fell back below 50, indicating a slight industry slowdown. Entering June, the first half State Grid concentrated delivery cycle ended, replaced by slow new order matching. Industry shipment volumes shrank, and corporate operating rates fell noticeably, with the production index recording 37.11%. For new orders, while some State Grid orders saw concentrated bidding openings in early June, the pace of State Grid bidding slowed significantly in mid-to-late June. Consequently, the new orders index recorded 31.42%, indicating a clear month-on-month decline from May. On procurement, aluminum prices trended higher throughout June. However, reduced shipments and lower operating rates weakened rigid demand and slowed procurement pace. Companies are reducing raw material inventories, reflected in the raw material inventory index of 43%. The finished goods inventory index recorded 37.76%, showing companies are currently in a phase of reducing finished goods inventory to ease operational capital pressure. Compounded by the next delivery cycle not yet arriving, companies maintain a wait-and-see attitude. Looking to July, industry shipments are expected to decline further, market rigid demand appears insufficient, and coupled with high aluminum prices, cable manufacturers aim for dual reductions in both raw material and finished goods inventories to alleviate capital pressure. The July 2025 aluminum cable/wire PMI index is expected to operate below the boom-bust line. Primary Alloy: The June primary aluminum alloy PMI recorded 36.5%, falling sharply by 5 percentage points month-on-month from May. It remained below the boom-bust line with deepening contraction, indicating significantly intensified industry downward pressure. The core contradiction lies in weak domestic demand and cost pressure: both the production index (22.9%) and new orders index (22.9%) hit new lows for the year, reflecting off-season domestic demand contraction combined with high aluminum prices severely suppressing terminal pickup willingness and new orders. Simultaneously, the high product inventory index (58.8%) contrasted with the low purchasing volume index (26.5%), highlighting passive inventory accumulation by enterprises, cautious procurement, and capital pressure transmission. On exports, although the new export orders index (50.0%) was flat with the boom-bust line, relying on structural support from alternative channels like Mexico couldn't offset declining US orders and overall weakening external demand. Production within the month showed "stable early, falling later": orders were temporarily stable in early June, but persistently high aluminum prices in mid-to-late June and seasonal factors slowed pickups. Some companies marginally reduced production due to inventory and capital pressures, and most sample firms have planned production cuts for July. Looking ahead, constrained by the triple pressures of weak traditional off-season demand, unresolved China-US tariffs, and negative feedback from high aluminum prices, the industry's weak and stable pattern is hard to break. The PMI may face further pressure, with substantive recovery awaiting clarification on trade policies and effective mitigation of cost pressures. Recycled Alloy: The June recycled aluminum industry PMI edged up month-on-month to 45.0%, but remained below the boom-bust line. Recycled aluminum demand deepened into the off-season in June. Weak terminal order growth constrained ADC12 price upside, while low-priced supply hitting the market further intensified competitive pressure. Despite the formal listing of cast aluminum alloy futures on June 10 boosting market trading activity, actual terminal consumption remained sluggish and failed to effectively support the market. Faced with insufficient new orders and production losses due to high raw material prices, the overall operating rate of the recycled aluminum industry declined again in June. Looking to July, the off-season effect persists. Terminal automakers may reduce production plans due to scheduling high-temperature holidays or facing finished goods inventory pressure. This is expected to further suppress growth in new orders for recycled aluminum plants and their operating levels. The July industry PMI is forecast to remain below the boom-bust line. Brief Commentary: The aluminum processing industry was thick with off-season atmosphere in June, with all sub-sectors generally under pressure. The June aluminum processing industry PMI composite index recorded 40.1%, falling below the boom-bust line, down 9.7 percentage points month-on-month and 1.5 percentage points year-on-year. The main reasons were the strong off-season sentiment combined with high and volatile aluminum prices, leading to weak terminal demand and sluggish new orders, prompting many companies to choose production cuts. By sector: The aluminum sheet/strip industry PMI continued to contract, affected by weak domestic demand, high inventories, and poor exports. Companies have implemented production cuts; subsequent destocking progress and policy effects require attention. Meanwhile, aluminum foil producers faced pressure on both profit margins and cash flow due to their "price-for-volume" strategy, compounded by downstream production cuts dragging on orders. Little improvement is expected in July. For construction profiles, property market weakness caused severe scarcity of new orders. Insufficient backlogged orders couldn't support production, and the sector is deeply mired in the traditional off-season. Its PMI is expected to stay below the boom-bust line. The industrial profiles sector showed divergence: apart from a few segments with stable customers, the overall off-season atmosphere was strong. Fierce competition in processing fees continued to squeeze corporate profits. The outlook for July is similarly pessimistic, requiring close attention to actual order fulfillment. In the aluminum cable/wire market, rigid demand is insufficient as the next delivery cycle hasn't arrived. Manufacturers plan to reduce both raw material and finished goods inventories to ease capital pressure. Primary alloys face the triple pressures of weak traditional off-season demand, unresolved China-US tariffs, and negative feedback from high aluminum prices. Industry downward pressure has intensified significantly, and the PMI may face further pressure. Although trading activity improved in the recycled alloy sector due to the listing of cast aluminum alloy futures, the sluggish actual terminal consumption failed to provide effective market support.

June 29, 2025 News: The composite PMI of the aluminum plate/sheet and strip industry has remained in the contraction territory. The weakening of domestic end-use demand has intensified, with downstream customers slowing down their cargo pick-up pace. The finished product inventories index remains high, and coupled with the lack of significant improvement in exports, companies have cut production. It is necessary to continuously monitor the progress of production cuts and destocking, as well as the effectiveness of policy incentives. For aluminum foil enterprises, the "volume discount" strategy adopted during the month has squeezed profit margins, putting corporate cash flows under pressure. Coupled with production cuts in downstream sectors dragging down orders, there is little hope for improvement in July. In terms of construction extrusion, enterprises report that the real estate market has not yet recovered, with a severe shortage of new orders. Orders on hand are insufficient to support production for the current month. It is expected that in July, the construction extrusion industry will still be under the shadow of the traditional off-season, and the PMI of construction aluminum extrusion will continue to remain below the 50 mark. In terms of industrial extrusion, except for a few sectors with stable customer bases that have not been affected by the off-season, the off-season atmosphere is strong in other areas. Amidst severe cut-throat competition in processing fees, corporate profitability is being squeezed. It is expected that there will still be little hope for improvement in July, and it is necessary to continuously monitor the actual landing of orders. For aluminum wire and cable, the next delivery cycle has not yet arrived, and market rigid demand is insufficient. Wire and cable factories plan to achieve a dual reduction in raw material and finished product inventories to alleviate capital operation pressures. In the primary alloy sector, under the triple pressures of weak demand during the traditional off-season, the pending implementation of China-US tariffs, and the negative feedback from high aluminum prices, the downward pressure on the industry has significantly intensified, and the PMI may face further pressure. In the secondary alloy sector, despite the official listing of cast aluminum alloy futures on June 10, which has increased market trading activity, the actual terminal consumption performance remains sluggish and has failed to effectively support the market. Looking specifically at product types: Aluminum plate/sheet and strip: In June, the composite PMI of China's aluminum plate/sheet and strip industry recorded 39.1%, a significant drop of 10.5 percentage points MoM, deeply entrenched in the contraction territory. Sub-indices show that both the production index (29.2%) and the new orders index (29.2%) are significantly below the 50 mark, reflecting the intensified weakness of domestic end-use demand, particularly a MoM decline in orders from the construction sector. Coupled with the high aluminum prices hovering near 21,000 yuan/mt, downstream customers have slowed down their cargo pick-up pace, and the finished product inventories index remains high (60.8%), forcing companies to cut production. Although the new export orders index (42.8%) is higher than the production index, the boost from exports is limited. The positive effects of China-US consultations only support certain sectors such as home appliances and kitchen and bathroom products, and are insufficient to offset the overall weak consumption. The purchasing volume index (44.5%) and the raw material inventories index (46.1%) indicate that companies are cautious in stockpiling. Overcapacity and insufficient domestic demand have led to an increased risk of price wars. Looking ahead, with the deepening of the off-season and inventory backlogs, the aluminum plate/sheet and strip PMI is expected to continue to operate in the doldrums. It is necessary to monitor the progress of production cuts and destocking, as well as the effectiveness of policy incentives. Aluminum foil: The composite PMI of the aluminum foil industry in June was 45.3%, pulling back slightly MoM but remaining in contraction territory. Among the sub-indices, the production index (41.2%) and the new orders index (41.2%) were both below the 50 mark, mainly due to the sharp decline in demand for packaging foil since April, which was caught in a price war (with processing fees as low as 5,800 yuan/mt). Enterprises' strategy of "volume discount" squeezed profit margins, and the finished product inventories index (52.8%) continued to face pressure. The new export orders index (47.3%) contracted, indicating insufficient export support. Although normal production scheduling of battery foil and brazing foil provided partial support, downstream production cut plans dragged on orders. The impact of high aluminum price fluctuations was limited (with monthly average price settlements buffering risks), but the destocking task fell short of expectations, and the inventory crisis loomed. It is expected that aluminum foil demand will weaken overall in July, with the industry's PMI expected to contract further, processing fees continuing to face pressure, and enterprises' cash flow facing challenges. Construction extrusion: The PMI of construction aluminum extrusion in June pulled back slightly to 40.44%, falling below the 50 mark. The construction extrusion industry officially entered the traditional off-season. Most enterprises in Shandong, east China, Hebei, and south China reported a significant decline in production in June. Enterprises reported that the real estate market had not yet warmed up, with a severe shortage of new orders and insufficient orders on hand to support production in the month, leading to a sharp decline in the production index to 29.6% and the new orders index to 37.69%, pulling down the procurement volume index to 29.15%. Coupled with severe cut-throat competition in processing fees for spray coating and thermal insulation bridge-cut extrusions, enterprises generally adopted low raw material inventories to maintain healthy cash flow, with the raw material inventories index sliding to 34.75%. Overall, it is expected that the construction extrusion industry will remain in the traditional off-season in July, with the PMI of construction aluminum extrusion continuing to stay below the 50 mark. Industrial extrusion: The composite PMI of the industrial extrusion industry in June was recorded at 37.61%, pulling back sharply to below the 50 mark. Looking at the sub-indices, the production index was recorded at 30.33%, and the new orders index at 29.0%. According to SMM, some leading enterprises of PV frames in east China reported a significant decline in production in June, coupled with an expected decline in new orders in July, with production orders at month-end failing to connect with orders for the next month. Meanwhile, although other industrial extrusions, such as those for rail transit, aerospace, and 3C deep processing, had relatively stable customer bases and normal production within the month, enterprises in the auto parts sector reported severe cut-throat competition, a severe shortage of orders on hand, and a continuous decline in operating rates. Processing enterprises reported that current processing fees might decline further, squeezing enterprises' profitability. Enterprises lacked sentiment for raw material stocking, with most maintaining only safe inventories, leading to a decline in the procurement volume index to 21.05% and the raw material inventories index to 28.68%. It is expected that the PMI of the industrial extrusion sector will be in the doldrums in June, and the PMI of industrial aluminum extrusion will continue to stay below the 50 mark. SMM will continue to monitor the actual implementation of orders. Aluminum wire and cable: In June, the composite PMI of the domestic aluminum wire and cable industry was recorded at 40.2%. After operating above the 50 mark for four months, the index fell back below 50, indicating a slight decline in the industry. Since entering June, the concentrated delivery cycle of State Grid in H1 has passed, and the industry has faced slow matching of new orders and a decline in delivery volume. The operating rate of enterprises has dropped significantly, with the production index recorded at 37.11%. Regarding new orders, some State Grid orders were opened for bidding in early June, but the bidding pace slowed down significantly in mid-to-late June. As a result, the new orders index was recorded at 31.42%, indicating a significant decline in new orders this month compared to May. In terms of procurement, the center of aluminum prices continued to rise in June, while enterprises reduced their operating rates due to decreased shipments, leading to weakened rigid demand and a slower procurement pace. Enterprises are reducing their raw material inventories, with the raw material inventory index recorded at 43%. The finished product inventory index was recorded at 37.76%, indicating that enterprises are currently in the stage of reducing finished product inventories to alleviate financial pressure on their operations. Coupled with the fact that the next delivery cycle has not yet arrived, enterprises are maintaining a wait-and-see attitude. Looking ahead to July, industry shipments are still expected to decline, with insufficient rigid demand in the market. Coupled with high aluminum prices, wire and cable manufacturers aim to achieve a dual reduction in raw material and finished product inventories to alleviate financial pressure. It is expected that the aluminum wire and cable PMI index in July 2025 may operate below the 50 mark. Primary aluminum alloy: In June, the PMI of primary aluminum alloy was recorded at 36.5%, a significant drop of 5 percentage points MoM from May, continuing to stay below the 50 mark with a deepening contraction, indicating a significant increase in downward pressure on the industry. The core contradictions lie in weak domestic demand and cost pressures: the production index (22.9%) and the new orders index (22.9%) both hit new lows for the year, reflecting a contraction in domestic demand during the off-season and high aluminum prices, severely suppressing terminal cargo pick-up willingness and new orders. Meanwhile, the high product inventory index (58.8%) contrasts with the low procurement volume index (26.5%), highlighting enterprises' passive inventory buildup, cautious procurement, and financial pressure transmission. In terms of exports, the new export orders index (50.0%) remained flat with the 50 mark, but relied on structural support from alternative channels such as Mexico, which could not offset the decline in orders to the US and the overall weakening of external demand. Monthly operating rates showed a "stable start followed by a decline," with orders remaining stable in the first half of the month, but cargo pick-up slowing down in the mid-to-late month due to sustained high aluminum prices and seasonal factors. Some enterprises marginally reduced their operating rates due to inventory and financial pressure, and most sample enterprises have planned production cuts in July. Looking ahead, the industry's weak and stable pattern is unlikely to break under the persistent triple pressures of sluggish demand in the traditional off-season, unresolved Sino-US tariffs, and high aluminum price feedback. The PMI may face further downward pressure, with substantial recovery awaiting clearer trade policies and effective alleviation of cost pressures. Secondary Alloy: In June, the PMI for the secondary aluminum industry rebounded slightly MoM to 45.0%, but remained below the 50 mark. Demand for secondary aluminum deepened into the off-season in June, with weak growth in end-user orders limiting upside room for ADC12 prices, while low-priced supplies further intensified competitive pressure. Although cast aluminum alloy futures were officially listed on June 10, boosting market activity, actual end-user consumption remained sluggish, failing to effectively support the market. Faced with insufficient new orders and production losses due to high raw material costs, the overall operating rate of the secondary aluminum industry declined again in June. For July, the off-season effect persists, as automakers may cut production plans due to scheduled high-temperature holidays or finished product inventory pressures, further suppressing new order growth and operating rates for secondary aluminum plants. The industry PMI is expected to remain below the 50 mark in July. Brief Review: In June, the aluminum processing industry was deeply entrenched in the off-season, with widespread pressure across segments. The composite PMI for the aluminum processing industry fell below the 50 mark at 40.1%, down 9.7 percentage points MoM and 1.5 percentage points YoY. This was mainly due to the strong off-season sentiment coupled with high aluminum price fluctuations, leading to weak end-use demand and sluggish new orders, prompting many companies to cut production. By segment: The aluminum plate/sheet and strip PMI continued to contract, with companies implementing production cuts due to weak domestic demand, high inventories, and poor exports. Future focus will be on destocking progress and policy effects. Meanwhile, aluminum foil enterprises faced dual pressure on profitability and cash flow due to volume discount strategies, compounded by downstream production cuts dragging orders, with little improvement expected in July. For construction extrusions, the real estate slump resulted in severe shortages of new orders, with insufficient orders on hand to sustain production, leaving the industry mired in the traditional off-season. Its PMI is likely to remain below the 50 mark. Industrial extrusions showed divergence, with strong off-season sentiment prevailing except for a few stable customer segments. Intense competition in processing fees continued to squeeze profits, making the outlook for July equally pessimistic, requiring close monitoring of actual order fulfillment. The aluminum wire and cable market lacked rigid demand as the next delivery cycle had not arrived, prompting manufacturers to plan reductions in raw material and finished product inventories to ease financial pressure. Primary alloys faced triple pressures of weak traditional off-season demand, unresolved Sino-US tariffs, and high aluminum price feedback, with industry downward pressure significantly intensifying, and the PMI likely to face further strain. Although the activity in the secondary alloy sector has increased due to the listing and trading of cast aluminum alloy futures, the sluggish actual consumption at the terminal level has failed to provide effective support for the market. 》Click to view the SMM Aluminum Industry Chain Database (SMM Aluminum Team)

June 19, 2025 News: This week, the downstream aluminum processing sector is experiencing a strong off-season atmosphere, with the weekly operating rate declining by 0.6 percentage points WoW to 59.8%. By segment: Primary aluminum alloy is supported by stable demand for alloy wheel hubs, with most enterprises maintaining a cautiously optimistic attitude. Aluminum plate/sheet and strip production has declined due to high aluminum prices suppressing cargo pick-up, leading to an accumulation of finished product inventories. For aluminum wire and cable, top-tier enterprises remain stable, but small and medium-sized enterprises are affected by the State Grid's delivery cycle transition, high aluminum prices leading to losses, and profit compression, resulting in weaker operating rates. Aluminum extrusion performance is mixed, with weak new orders for building material extrusions, lower operating rates for small and medium-sized enterprises in PV frame production, and large orders in the automotive and rail transit sectors supporting billet production for industrial extrusions, though deep processing and new orders are weak. Aluminum foil production has slightly declined due to low processing fees suppressing demand and destocking pressure. Secondary aluminum production has been forced to cut due to insufficient off-season orders and sustained losses. High aluminum prices suppressing consumption, weak off-season demand, inventory pressure, and losses on the cost side are the main suppressing factors. SMM expects the downstream aluminum processing sector's weekly operating rate to decline slightly by 0.4 percentage points MoM to 60.0% next week. Primary Aluminum Alloy: This week, the operating rate of the primary aluminum alloy industry declined by 0.6 percentage points WoW to 54.2%, mainly due to sustained high aluminum prices in mid-June suppressing end-use consumption, coupled with seasonal slowdown in cargo pick-up. Notably, supported by the temporarily stable performance of the alloy wheel hub sector compared to weak expectations in both exports and domestic demand, most enterprises remain cautiously optimistic about the market outlook, with production rhythm adjustments to be dynamically followed based on order conditions. A few enterprises are maintaining production increase plans in June due to H1 full production assessments and the promotion of liquid aluminum alloying policies. Looking ahead, the industry may continue in a weak and stable pattern, with pressure from the traditional off-season and unresolved Sino-US tariffs on one hand, and the ongoing fermentation of the transmission effect of high aluminum prices on consumption on the other. Substantial recovery awaits clarification of trade policies and relief of cost-side pressure. Aluminum Plate/Sheet and Strip: This week, the operating rate of leading enterprises in the aluminum plate/sheet and strip sector declined by 0.6 percentage points WoW to 65.0%. Aluminum prices surged strongly during the week, approaching the 21,000 yuan mark, strengthening downstream customers' wait-and-see sentiment, slowing cargo pick-up, and continuously increasing finished product inventory levels, prompting some enterprises to temporarily slow their production schedules. Despite relatively stable demand in traditional off-season consumption sectors such as domestic automotive and electronics, the continuous downturn in the construction sector is unable to offset the overall weak domestic consumption, leading to a continuous decline in the sector's overall operating rate. In summary, the continuous accumulation of finished product inventories and downstream customers' on-demand cargo pick-up may further dampen the production enthusiasm of aluminum plate/sheet and strip enterprises. It is expected that the operating rate of leading aluminum plate/sheet and strip enterprises will continue to be in the doldrums in the short term. Aluminum Wire and Cable: This week, the operating rate of leading enterprises in the aluminum wire and cable sector stood at 63.2%, unchanged from the previous week. Despite the stable production performance of top-tier enterprises, which maintained orderly production schedules as planned, there was a noticeable weakening trend in the operating rates of small and medium-sized enterprises, indicating a less optimistic market outlook. This weak performance can be attributed to two main factors: on one hand, the State Grid has just completed a round of centralized delivery cycles. Although the industry is not short of orders, new orders have yet to be matched for delivery. On the other hand, the current spot aluminum prices are at a high level, and there is an inversion between the bid prices submitted by enterprises earlier and the spot prices, compressing profit margins and resulting in relatively insufficient willingness to produce finished products. In terms of orders, in the past week, the list of successful bidders for the joint procurement of low-voltage power cable agreement inventory in the east China and north-east China regions of the State Grid was announced, but orders involving aluminum were relatively few. With the end of the "installation rush", orders for PV alloy cables have weakened significantly, necessitating a wait for the next cycle to restart. Based on the current weakening trend of State Grid and market orders, SMM expects that the operating rate of aluminum wire and cable will remain in the doldrums in the short term. Aluminum Extrusion: This week, the national operating rate for extrusions increased slightly by 1.5 percentage points MoM to 52.5%. In the building materials sector, the overall operating rate of sample enterprises declined compared to the previous week. According to the SMM survey, this week, top-tier enterprises in central China, south China, and east China reported that their operating rates remained almost unchanged from the previous week, benefiting from the support of their own door and window brands. However, due to the high aluminum prices, enterprises generally reported weak new orders. Meanwhile, some sample enterprises reported a temporary suspension of raw material purchases this week. The operating rate for industrial extrusions remained unchanged from the previous week. Some medium-to-large industrial extrusion enterprises in Shandong and south-west China reported receiving large orders (mainly for rail transit and automobiles) recently, with production primarily focused on billets, providing support for operating rates. However, there were relatively few orders for deep processing. Enterprises reported that low operating rates for deep processing in Shandong are a common phenomenon, with billets typically being shipped from factories to deep-processing plants near OEMs for secondary processing. Some enterprises in east China reported that OEMs now require extrusion processors to make further concessions of 3-5% on processing fees to secure their positions as suppliers, further compressing the profits of relevant enterprises. Some small enterprises in Henan reported that only integrated producers can currently withstand the processing fees, with small enterprises still experiencing weak order intake and declining operating rates. This week, the operating rates of sample enterprises for PV frame extrusions continued to diverge. Against the backdrop of high aluminum prices, the purchase sentiment of downstream module manufacturers remained insufficient. Despite some top-tier PV frame extrusion enterprises in east China, south-west China, and Hebei maintaining operating rates unchanged from the previous week due to orders on hand, SMM learned that the operating rates of small and medium-sized PV frame extrusion enterprises in Henan and east China continued to decline, with orders on hand lasting less than a week. SMM will continue to monitor the actual progress of order implementation across various sectors. Aluminum foil: This week, the operating rate of leading aluminum foil enterprises declined slightly by 0.4 percentage points WoW to 70.7%. Despite aluminum prices remaining at highs during the week, aluminum foil products such as battery foil and brazing foil are mostly settled based on monthly average prices, which to some extent mitigates the risks associated with excessive short-term fluctuations in aluminum prices. The impact of aluminum price fluctuations is felt less intensely compared to that of aluminum plates. However, the completion rate of the primary destocking task this month has been overall satisfactory, and the looming destocking crisis has not yet been resolved. Some enterprises have chosen to slow down their production pace. It is expected that the operating rate of aluminum foil enterprises will remain in the doldrums in the subsequent period. Secondary aluminum alloy: This week, the operating rate of leading secondary aluminum alloy enterprises declined by 0.3 percentage points WoW to 53.6%. The decrease in operating rate was mainly constrained by insufficient new orders and pressure from losses. The traditional off-season characteristics are evident, with actual market transactions weakening further compared to last week. Growth in end-user orders has been sluggish, coupled with intensified market competition due to the impact of low-priced supplies, limiting the upside room for prices. The industry as a whole is deeply mired in losses, forcing enterprises to reduce their operating levels to alleviate pressure. In the short term, constrained by weak demand during the off-season and sustained pressure on the cost side, the industry's operating rate is expected to maintain a narrow downward trend. 》Click to view SMM's aluminum industry chain database (SMM Aluminum Team)

On June 5, 2025: As June arrives, the downstream aluminum processing sector is deeply entrenched in the off-season atmosphere, with the weekly operating rate declining by 0.4 percentage points WoW to 60.9%. By segment, the operating rate in the primary aluminum alloy industry has remained relatively stable compared to May. Most enterprises in the industry reported moderate stability in their orders on hand, and there has been no pullback in production operating rates. In the aluminum plate/sheet and strip segment, aluminum prices remained high during the week, leading to strong wait-and-see sentiment among downstream customers. Additionally, as the market transitions between peak and off-peak periods, overall demand weakened, causing operating rates to decline in some sample enterprises. In the aluminum wire and cable segment, as the peak delivery period has passed, enterprise enthusiasm for procurement and production has waned, and market order performance has also weakened and become more fragmented. It is necessary to continuously monitor the arrival of the next delivery cycle and the order performance in market segments such as PV, wind power, automotive wiring harnesses, and infrastructure. This week, the operating rate in the aluminum extrusion segment showed divergence. New orders in various construction material fields were sluggish, leading to a decline in operating rates. Affected by the weak procurement sentiment of downstream component manufacturers, the operating rate of PV frame extrusion plants also declined. Despite the lukewarm performance of the NEV segment, relatively saturated orders in the 3C sector, power pipelines, and rail transit provided some support to operating rates. In the aluminum foil segment, the current industry processing fee has reached the cost floor. Under the pressure of total output assessment, enterprises are compelled to adopt a "volume discount" strategy. Meanwhile, the continuously rising finished product inventories in recent times have become another constraining factor suppressing processing fees. It is necessary to continuously monitor destocking conditions. In the secondary aluminum segment, although aluminum prices stabilized and rebounded during the week, downstream enterprises' procurement willingness remained tepid, and demand continued to slump, with both domestic market and export orders showing varying degrees of decline. SMM expects that the weekly operating rate of downstream aluminum processing may decline slightly by 0.1 percentage point MoM to 60.8% next week.   Primary Alloy: This week, the operating rate of leading enterprises in the primary aluminum alloy industry increased slightly by 0.2 percentage points from the first week of June to 54.8%. In the second week of June, the operating rate in the primary aluminum alloy industry remained largely unchanged compared to May. Currently, most enterprises have good order stability, and there has been no pullback in production operating rates. Given the relatively stable performance of both export data and domestic demand in the downstream aluminum alloy wheel hub segment, several primary alloy enterprises remain optimistic about subsequent operating performance. Whether to adjust production pace will depend on subsequent order conditions. Some enterprises also reported that, influenced by the expectation of reaching full production targets in H1 and the promotion of liquid aluminum alloying, they still have plans to increase production in June. Looking ahead, under the dual constraints of off-season factors and unclear tariff negotiations, coupled with the potential inhibition of consumption performance due to the continuous rise in short-term aluminum prices, which may transmit to the upstream raw material end, the operating rate in the primary aluminum alloy industry may continue to be in the doldrums. A substantive trend reversal awaits the implementation of Sino-US consultation details.   Aluminum Plate/Sheet and Strip: This week, the operating rate of leading enterprises in the aluminum plate/sheet and strip sector decreased by 1 percentage point WoW to 65.6%. Mid-week, aluminum prices continued to surge sharply, strengthening the wait-and-see sentiment among downstream customers, who slowed down the pace of cargo pick-up. Some sample enterprises, constrained by the high aluminum prices, temporarily slowed down their production pace. In terms of exports, positive news emerged from the Sino-US consultation meeting, easing the nerves of domestic aluminum plate/sheet and strip export enterprises. End-users such as home appliances, kitchen and bathroom products, and industrial equipment maintained normal export volumes. However, it was still difficult to offset the overall weak domestic consumption situation, and the operating rate of the entire industry continued to decline. As the off-season in June is about to reach its halfway point, it is predicted that the operating rate of aluminum plate/sheet and strip will continue to be in the doldrums in the subsequent period.   Aluminum Wire and Cable: This week, the operating rate of leading enterprises in the aluminum wire and cable sector stood at 63.2%, down 1% WoW. As we have entered mid-June, the industry has cooled down after experiencing a two-month concentrated delivery cycle. Leading enterprises indicated that, thanks to the implementation of the second batch of ultra-high voltage projects, they expected orders to be replenished, and the operating rate remained resilient. However, with the upward shift in the center of aluminum prices, the production enthusiasm of small and medium-sized enterprises has weakened significantly, with poor procurement efforts and a gradually spreading wait-and-see sentiment. In terms of orders, this week, the bid winners for the first joint procurement in the north-west China region in 2025, as well as the agreement inventories for low-voltage power cables and overhead insulated conductors, were announced. Meanwhile, orders for agreement inventories of overhead insulated conductors in central China and the Sichuan and Chongqing regions were also confirmed. Orders for overhead lines and power cables from wire and cable factories continued to grow. Combining the production schedules and order expectations of the factories, it is expected that the operating rate of wire and cable will remain in the doldrums in the short term. Close attention should be paid to whether the delivery window for ultra-high voltage and power transmission and transformation projects in August will provide strong support for the operating rates of downstream factories.   Aluminum Extrusion: This week, the national operating rate for extrusions increased slightly by 1.5 percentage points WoW to 54.5%. In the building materials segment, the overall operating rate declined compared to last week. According to the SMM survey, leading enterprises in central China and east China reported a decrease in operating rates due to a decline in orders. However, some enterprises in south China reported that building materials were mainly used as reserves and would not halt production due to short-term low expectations. Despite maintaining a low operating rate, they would continue production according to their annual production plans, with finished product inventories increasing slightly. This week, the operating rates of sample enterprises producing PV frames continued to diverge. With the definite production cuts by downstream module manufacturers, the operating rates of some PV frame extrusion enterprises in east China and Hebei continued to decline. However, according to SMM, some small and medium-sized PV frame extrusion enterprises in southwest China maintained a high operating rate, mainly because their coating production line capacity was basically in line with the procurement demand of leading module manufacturers, and their operations remained at full capacity. Some automotive extrusion enterprises in east China reported that the growth in new orders remained sluggish. Although their operating rates remained stable this week, they reported that the production of orders on hand was gradually coming to an end. These enterprises were actively negotiating with customers for new orders to ensure production continuity. Some enterprises in South China reported that they remain optimistic about industrial materials and are confident about securing a significant number of new orders in H2. Regarding other industrial materials, some enterprises in east China reported that their deep-processing production lines are operating at a high rate. Enterprises reported the need to increase the proportion of high value-added products to maintain healthy cash flow, with their extrusion production lines basically operating at around 60%. SMM will continue to monitor the actual progress of order fulfillment in various sectors.   Aluminum foil: The operating rate of leading aluminum foil enterprises was recorded at 70.7% this week. The aluminum foil market remained relatively stable compared to last week. By product, demand for household foil, lunch box foil, and other products continued to decline, with processing fees remaining at a low level with no signs of recovery, and the crisis of finished product inventories loomed large. Battery foil and brazing foil production schedules remained normal, providing support for the industry's operating rate. It is expected that the operating rate of aluminum foil enterprises will fluctuate downward in the subsequent period.   Secondary aluminum alloy: The operating rate of leading secondary aluminum enterprises remained flat MoM, stabilizing at 53.9%. From the perspective of the week, the sample leading enterprises maintained a normal production rhythm, but the overall industry operating rate still faces downward pressure in the short term, mainly due to two factors: First, the demand side remains persistently weak, with downstream enterprises showing significantly low purchase willingness and a sluggish market trading atmosphere. Second, the cost pressure of raw materials has surged, with aluminum scrap prices closely following the rise in aluminum prices, driving up the production costs of secondary aluminum alloy. Currently, the theoretical loss margin in the industry continues to widen, further exacerbating cost-side pressure, prompting some enterprises to choose production cuts and adopt a wait-and-see attitude to cope with market uncertainties. The operating rate of leading secondary aluminum enterprises is expected to remain stable in the short term.   》Click to view SMM Aluminum Industry Chain Database (SMM Aluminum Team)

On June 5, 2025: As June arrives, the downstream aluminum processing sector is deeply entrenched in the off-season atmosphere. The weekly operating rate fell by 0.4 percentage points WoW to 60.9%. By segment, the primary aluminum alloy industry saw relatively small overall changes in operating rates compared to May. Most enterprises in the industry reported moderate stability in orders on hand, with no pullback in operating rates observed in production. In the aluminum plate/sheet and strip segment, aluminum prices remained high during the week, with downstream customers showing strong wait-and-see sentiment. As the market transitioned from peak to off-season, overall demand weakened, leading to a decline in operating rates for some sample enterprises. In the aluminum wire and cable segment, as the concentrated delivery period has passed, enterprises' enthusiasm for procurement and production has waned, and market order performance has also weakened. Continuous attention is needed on the arrival of the next delivery cycle and order performance in market segments such as PV, wind power, automotive wiring harnesses, and infrastructure. This week, the aluminum extrusion segment showed a divergence in operating rates. New orders in various construction material fields were weak, leading to a decline in operating rates. Affected by the sluggish procurement sentiment of downstream component manufacturers, the operating rates of PV frame extrusion plants also declined. Despite the lukewarm performance of the NEV segment, relatively saturated orders in the 3C sector, power pipelines, and rail transit provided some support to operating rates. In the aluminum foil segment, the current industry processing fee has touched the cost floor. Under pressure from total volume assessments, enterprises were forced to adopt a "volume discount" strategy. Meanwhile, the continuously rising finished product inventories have become another constraint factor suppressing processing fees. Continuous attention is needed on destocking. In the secondary aluminum segment, although aluminum prices stabilized and rebounded during the week, downstream enterprises' purchase willingness remained cold, and demand remained sluggish. Both domestic market and export orders declined to varying degrees. SMM expects that the weekly operating rate of the downstream aluminum processing sector may decline slightly by 0.1 percentage points MoM to 60.8% next week. Primary Alloy: This week, the operating rates of leading enterprises in the primary aluminum alloy industry continued to hold steady at last week's level. In the first week of June, the primary aluminum alloy industry saw relatively small overall changes in operating rates compared to May. Most enterprises in the industry reported moderate stability in orders on hand, with no significant changes observed, and no pullback in operating rates in production. As the export data and domestic demand performance of the downstream aluminum alloy wheel hub segment remain relatively stable, several primary alloy enterprises remain optimistic about subsequent operating performance. Whether to adjust production pace will depend on subsequent order conditions. Some enterprises also reported that, influenced by the expectation of reaching full production targets in H1, they still have plans to increase production in June. However, looking ahead, under the dual constraints of off-season factors and escalating Sino-US frictions, the overall operating rates of the primary aluminum alloy industry may continue to exhibit a generally stable with slight fall trend. Substantial trend reversals will depend on the implementation details of Sino-US consultations.   Aluminum plate/sheet and strip: This week, the operating rate of leading enterprises in the aluminum plate/sheet and strip sector decreased by 1 percentage point MoM from the period before the holiday to 66.6%. Aluminum prices remained high during the week, and downstream customers maintained a strong wait-and-see sentiment. Additionally, as the market transitioned from the off-season to the peak season, overall demand continued to weaken, prompting some sample enterprises to ease their production pace. In terms of end-use consumption, aluminum plate/sheet and strip products linked to automotive, home appliance, kitchen and bathroom, and other consumer terminals maintained normal production. However, demand in the construction sector continued to weaken, with production schedules for June orders declining MoM from May. Although orders in the 3C consumer electronics sector grew rapidly, they were insufficient to boost the overall industry's operating rate. With the official start of the June off-season, it is expected that the operating rate of aluminum plate/sheet and strip enterprises will remain in the doldrums in the subsequent period.   Aluminum wire and cable: This week, the operating rate of leading enterprises in the aluminum wire and cable sector stood at 64.2%, down 0.6% MoM. As June began, although the industry's concentrated delivery period had passed, leading enterprises maintained a reasonable production schedule based on their orders on hand, resulting in a slight decline in the operating rate. In terms of orders, the State Grid officially launched the third tender for transmission and transformation line installation materials in early June, involving 128,000 mt of aluminum-core conductor and ground wire orders, with a staggered delivery cycle from August 2025 to March 2026. Meanwhile, the first tender for distribution network agreement inventory in Henan Province was also underway, with scattered provincial grid orders still being released. As the concentrated delivery period has passed, enterprises' enthusiasm for procurement and production has declined, and market order performance has also weakened and become more fragmented. It is necessary to closely monitor the arrival of the next delivery cycle and the order performance in market segments such as PV, wind power, automotive wiring harnesses, and infrastructure. It is expected that the operating rate of aluminum wire and cable enterprises will remain in the doldrums in the short term.   Aluminum extrusion: This week, the national operating rate for extrusions decreased slightly by 1.5 percentage points MoM to 55.5%. In the building materials sector, the overall operating rate declined slightly WoW. According to the SMM survey, as June began, leading building materials enterprises in central China reported that their overall operating rates were lower than the same period last month. Apart from a small number of stable customers, new orders across various building materials sectors were weak. This week, orders for infrastructure, doors and windows, and dealers all declined to varying degrees. Enterprises in other regions, such as Shandong, Hebei, and parts of South China, reported that their building materials production remained largely unchanged from the previous week. This week, the operating rates of sample enterprises in the PV frame sector continued to diverge. Some leading enterprises in east China saw a slight decline in their operating rates WoW, mainly due to weak purchasing sentiment from downstream module manufacturers and enterprises' relatively pessimistic expectations for module production schedules in June. However, according to the SMM survey, some new production capacities of manufacturers in Anhui Province were steadily ramping up and were expected to reach full capacity in H2. Meanwhile, according to the SMM survey, some small and medium-sized enterprises in Anhui and Henan provinces reported that their PV production lines were gradually exiting the market, with only orders from long-established customers being maintained. Their operating rates for PV frames remained at a low level of 30%. This week, some deep-processing enterprises in east China reported an upward trend in the operating rates of their 3C production lines. These enterprises are optimistic about the high added value in the 3C sector and plan to vigorously promote the operation of these production lines. For automotive extrusion sample enterprises, the operating rates remained largely unchanged from last week, with new orders still sluggish. Enterprises hold differing expectations for June production. Some east China parts producers with more complex production processes reported that their June production is expected to increase, with new orders anticipated to be confirmed by mid-June. However, some enterprises in east and south China reported a strong off-season atmosphere in June, with a significant decline in orders on hand as of this week, which is expected to remain difficult to improve in the short term. For other industrial materials, some enterprises in Shandong and central China that produce power pipelines and railway transportation components (such as subway thresholds and subway car bodies) reported that relevant orders are being produced in an orderly manner, with relatively saturated orders on hand. SMM will continue to monitor the actual progress of order fulfillment in various sectors. SMM will continue to monitor the actual progress of order fulfillment in various sectors.   Aluminum Foil: This week, the operating rate of leading aluminum foil enterprises reached 71.6%. By product, battery foil and brazing foil production schedules are proceeding normally, while tobacco foil, pharmaceutical foil, and capacitor foil also showed stable performance. For double-zero packaging foil, the processing fee of leading enterprises has dropped to 5,800 yuan/mt, with a significant cumulative decline since the beginning of the year. Due to pressure from total volume assessments, enterprises are forced to adopt a "volume discount" strategy, indirectly confirming that the current processing fee has touched the cost floor, severely squeezing the industry's profit margins. Meanwhile, the continuously rising finished product inventories in the near term have become another constraint on processing fees. If the destocking effect in June falls short of expectations, processing fees may decline further, and some enterprises may face cash flow challenges. It is expected that the operating rates of aluminum foil enterprises will fluctuate downward subsequently.   Secondary Aluminum: This week, the operating rate of leading secondary aluminum enterprises fell by 0.5 percentage points WoW to 55.6%. Aluminum prices stabilized and rebounded during the week, but downstream enterprises' purchase willingness remained weak, with demand weakness persisting. Both domestic market and export orders declined to varying degrees. Secondary aluminum smelters generally faced difficulties in product shipments and inventory pressure, forcing enterprises to reduce their operating levels. As the Labour Day holiday approaches, some die-casting enterprises anticipate pre-holiday stockpiling, which is expected to drive an improvement in market transactions next week. However, low visibility of terminal orders restricts the intensity of stockpiling. In the short term, the industry's operating rate is expected to decline slightly.     》Click to view SMM Aluminum Industry Chain Database (SMM Aluminum Team)

On May 30, 2025: The composite PMI for the aluminum processing industry in May was recorded at 49.8%, approaching the 50 mark but remaining in contraction territory. It fell by 1.8 percentage points MoM and increased by 8.7% YoY. The main reasons were the arrival of the off-season in May, coupled with the aluminum price fluctuating at highs, weak end-use demand in the industry, and sluggish growth in new orders. By sector, in May, the domestic aluminum plate/sheet and strip industry was affected by weak end-use demand and the seasonal off-season, with both the production index and the new orders index falling below the 50 mark. However, the easing of Sino-US trade tensions spurred a rush in exports for end-use sectors such as home appliances and electronics, boosting production and alleviating the pressure from insufficient domestic demand. The aluminum foil industry contracted overall, with intensified cut-throat competition in processing fees. Enterprises proactively controlled their production pace to cope with the off-season, but high-end products such as battery foil remained relatively stable, supported by the production and sales of new energy vehicles. In May, some construction extrusion enterprises in Shandong, east China, and parts of south China maintained stable production based on orders on hand, but the industry as a whole faced sluggish new orders. Coupled with the continued sluggishness of real estate-related orders and the delayed transmission of the support effect from local governments, there were still doubts about the sustainability of industry demand. In the industrial materials sector, some leading PV frame manufacturers in east China reported that their production had not yet been affected by the 531 period due to their main cooperation with top-tier enterprises, and new orders for June had already been secured, providing support for production this month. However, there were no significant changes in the production of automotive extrusion this month, with new orders being sluggish and orders on hand only sufficient to sustain production until mid-June. Production was expected to remain weak next month. In the aluminum wire and cable sector, despite the delivery of orders as planned by leading aluminum wire and cable enterprises in May, the pace of shipments slowed down. Coupled with the high aluminum prices dampening downstream buying sentiment, procurement was relatively cautious. The primary aluminum alloy industry in May exhibited characteristics of "stability amid pressure and structural transformation," maintaining overall production resilience but with strong wait-and-see sentiment and no rush in exports. The downstream demand for secondary aluminum in May continued the weak trend seen since April, with the off-season characteristics becoming more pronounced. Both domestic and overseas orders showed varying degrees of decline. Specifically, by product type: Aluminum plate/sheet and strip: The composite PMI for the domestic aluminum plate/sheet and strip industry in May was recorded at 49.6%, approaching the 50 mark but remaining in contraction territory. Sub-indices showed that the production index (49.3%) and the new orders index (49.3%) were both slightly below 50%, reflecting the impact of weak domestic end-use demand and the seasonal off-season. The new export orders index (62.1%) was significantly higher than the 50 mark, indicating that exports had become the main support. The easing of Sino-US trade tensions spurred a rush in exports for end-use sectors such as home appliances and electronics, boosting production. However, domestic consumption as a whole weakened, with short-term support expected from the 618 sales promotions. In the market, the orderly progress of export orders alleviated some pressure, but overcapacity and insufficient domestic demand led to intensified competition in can stock processing fees. The enterprises' procurement volume index (56.1%) indicated cautious raw material stockpiling. Looking ahead to June, the export recovery is unlikely to offset the deepening off-season, and the PMI is expected to remain in the doldrums, with attention needed on the implementation of infrastructure policies and changes in overseas trade conditions. Aluminum foil: The composite PMI of China's aluminum foil industry in May registered 47.6%, remaining below the 50 mark, indicating an overall contraction. Sub-indices showed the production index (46.3%) and new orders index (46.3%) weakened simultaneously, reflecting sluggish demand-side growth. The new export orders index (60.7%) provided some support, but the purchasing volume index (47.6%) confirmed weak raw material procurement willingness among enterprises. High-end products like battery foil remained relatively stable, supported by NEV production and sales, while demand for traditional products such as double-zero packaging foil shrank, with intensified cut-throat competition in processing fees. Producers actively controlled production pace to cope with the off-season. Market-wise, eased Sino-US tariffs brought export window benefits, but end-user inventory buildup (e.g., power batteries) and weak domestic demand for air-conditioner foil dampened production enthusiasm. Looking forward, the deepening traditional off-season coupled with uncertainties in overseas order sustainability suggest the PMI will likely maintain a fluctuating and weak trend, with key focus needed on destocking progress in the NEV industry chain and policy support. Construction extrusion: The composite PMI for construction aluminum extrusion in May dropped back slightly to 53.90%, staying above the 50 mark. Producers with proprietary door and window brands maintained stable production, while some enterprises in Shandong, east China, and south China reported steady May output supported by orders from long-established customers. Some firms with infrastructure orders on hand saw slight production increases, pushing the production index to 70.53% and the procurement volume index to 81.56%. However, enterprises in central China and south China that previously relied on government infrastructure projects reported weak new order growth, compounded by limited local infrastructure projects in Shandong, leading the new orders index to slide to 45.88%. According to the SMM survey, producers generally reported limited engineering orders on hand, with real estate-related orders yet to recover. The industry widely doubts demand sustainability, adopting low raw material inventory strategies due to poor long-term order visibility, keeping the raw material inventory index at 50% in May. Overall, without strong new order support, the construction extrusion PMI in June is expected to stay above the 50 mark but with limited upside room. Industrial extrusion: The composite PMI for the industrial extrusion sector in May registered 52.23%, barely staying above the 50 mark. Sub-indices showed the production index at 53.45% and new orders index at 54.70%. SMM learned that some PV frame leaders in east China reported uninterrupted production due to collaborations with top-tier enterprises, unaffected by the 531 period, with June orders already secured, supporting May operating rates. However, some small and medium-sized enterprises in Anhui indicated their PV frame orders on hand could only sustain production until mid-June, with no follow-up orders secured by month-end. Although some enterprises in east and south China reported that some OEMs hinted at an upward demand forecast for June, companies believe the actual demand may deviate from projections and are temporarily reluctant to ramp up production. Overall, the industry still faces dual pressures from high aluminum prices and declining processing fees, with most firms maintaining only safety stock levels. The raw material inventory index for this month stood at 46.48%, remaining below the 50 mark. The industrial extrusion sector's PMI is expected to stay in the doldrums in June, and SMM will continue monitoring actual order fulfillment. Aluminum Wire and Cable: The composite PMI for China's aluminum wire and cable industry in May registered 51, indicating continued expansion. Although top-tier enterprises delivered goods as scheduled, shipment pace slowed, and small and medium-sized enterprises saw reduced production enthusiasm, with the production index at 49.61%. The second batch of ultra-high voltage orders was finalized in May, replenishing orders on hand for leading firms, while new orders for SMEs declined, with the new orders index at 53.38%. The purchasing volume index recorded 43.73%. Despite stable production, persistently high aluminum prices dampened downstream buying sentiment, leading to cautious procurement and further declines in in-plant inventory, with the raw material inventory index at 47.67%. The finished product inventory index was 54.08%, mainly due to slightly slower end-user pick-up pace amid steady production, resulting in a marginal inventory buildup. For June, power grid transmission and transformation orders will provide long-cycle demand support, but new PV installations may weaken, coupled with lackluster infrastructure orders. The aluminum wire and cable PMI is expected to operate below the 50 mark in June 2025. Primary Aluminum Alloy: The primary aluminum alloy PMI in May was 41.5%, down 4.3 percentage points MoM. The sector exhibited "stable yet pressured, structurally transitioning" characteristics, with production and new orders indices at 36.8% and 31.7%, respectively, reflecting pronounced pressure on domestic demand during the off-season. Leading enterprises' operating rates fluctuated rangebound throughout the month—rebounding slightly early month due to weaker aluminum prices and mid-year full production targets, dipping mid-month amid aluminum price rebounds suppressing processing fees and off-season effects, and stabilizing weakly from late month to month-end. April customs data showed significant export market restructuring: wheel hub exports to the US fell 18.3% MoM to 5,200 mt (first time below 30% share), while Mexico channel exports exceeded 10,000 mt for the first time (up 22.7% MoM and 44% YoY), highlighting top firms' success in mitigating trade risks via overseas capacity deployment. The industry as a whole maintained production resilience but was marked by a strong wait-and-see sentiment. Despite signs of easing in Sino-US trade tensions, enterprises remained cautious in assessing the impact of new tariffs, with no significant "rush to export" phenomenon observed for the time being. Looking ahead, under the dual constraints of off-season factors and uncertainty in tariff negotiations, the industry's operating rates may continue to exhibit a generally stable with slight fall trend. A substantive shift in the trend will await the implementation of details from Sino-US consultations. SMM expects the PMI for the primary aluminum alloy industry to remain below the 50 mark in June, with a high probability of continuing to decline. Secondary Alloy: In May, the PMI for the secondary aluminum industry declined slightly MoM to 37.0%, continuing to pull back below the 50 mark. Specifically, downstream demand for secondary aluminum in May remained weak, following the trend since April, with the characteristics of the off-season becoming more pronounced. Both domestic and overseas orders showed varying degrees of reduction. Affected by this, secondary aluminum alloy prices were trapped in a dilemma of being "more likely to fall than rise," while the supply of raw materials remained tight and prices stayed high, leading to a further expansion in production losses for enterprises. Influenced by insufficient orders, losses, and the Labour Day holiday, secondary aluminum production in May declined. In terms of inventory, enterprises faced significant sales pressure, leading to a continuous accumulation of finished product inventories. Due to fluctuating aluminum prices and increased difficulty in procuring aluminum scrap, enterprises maintained low levels of raw material inventories. Looking ahead to June, the off-season effect in the secondary aluminum industry will further deepen, and the industry's PMI is expected to remain below the 50 mark. Brief Commentary: In May, the aluminum processing industry entered the off-season, with insufficient demand and weak domestic demand affecting most sectors, showing significant structural differentiation. The PMI for the aluminum processing industry in May was recorded at 49.8%, down 1.8 percentage points MoM and up 8.7% YoY, still in contraction territory. The main reasons were the off-season combined with high aluminum prices fluctuating at highs, and weak end-use demand leading to sluggish new orders. By sector: aluminum plate/sheet and strip production and new orders were below the 50 mark, but a rush to export was expected to alleviate domestic demand pressure; aluminum foil experienced an overall intensified contraction, with relatively stable demand for battery foil; some enterprises in the construction extrusion sector maintained stable production, but new orders were weak, and orders related to real estate had not yet recovered; in the industrial materials sector, some leading PV frame extrusion enterprises' operating rates were supported by cooperation with leading companies, but some automotive extrusion orders were only maintained until mid-June; the aluminum wire and cable sector saw an overall slowdown in shipments, with high aluminum prices suppressing downstream procurement; the primary aluminum alloy sector showed stability under pressure, with a strong wait-and-see sentiment overall; the secondary aluminum sector saw a continuous reduction in both domestic and overseas orders, with the characteristics of the off-season becoming more pronounced. Looking ahead to June, disruptions in the overseas trade environment are expected to persist, and domestic end-use demand may remain weak. Under the traditional off-season, this may further suppress production enthusiasm. Continuous attention should be paid to changes in overseas market risks and actual production conditions in various sectors. 》Click to view the SMM Aluminum Industry Chain Database (SMM Aluminum Team)