On April 10, KMG announced the acquisition of 45% of a recycling and remelting plant near Charleston, South Carolina. Previously, Glencore provided funding for the facility in exchange for marketing rights. The remaining 55% of the shares will be held by Alumicore, who will also operate the plant. This cooperation further consolidates the position of Glencore in actively supporting a resilient and sustainable aluminum supply chain in the United States. Through holding 30% of Century Aluminum, the largest primary aluminum producer in the United States, Glencore has become an important investor in the industry.

[Ceasefire Unlikely to Resolve Supply Weakness; Aluminum Prices Retain Strong Support at High Levels] Overall, the two-week ceasefire news was unable to reverse the firm pattern underpinned by substantive supply damage and low inventory. Expectations of tangible supply contraction triggered by attacks on Middle Eastern aluminum smelters, combined with low global inventory and the recovery of peak-season demand in China, will provide strong upward momentum for aluminum prices. In the near term, aluminum prices are expected to hold up well.

[SMM Cast Aluminum Alloy Morning Comment: Weak Demand, ADC12 Spot Continued to Weaken] Spot side, the ADC12 market continued in the doldrums yesterday. Affected by aluminum prices being in the doldrums and poor demand-side performance, market sentiment turned cautious. Most market participants slightly lowered their quotes, while a few enterprises held prices steady and took a wait-and-see approach. Currently, low-priced resources increased, the transaction center shifted downward, and prices showed a passive pullback pattern. In the short term, against the backdrop of marginally weakening cost support and limited demand improvement, ADC12 prices are expected to remain in the doldrums.

[SMM Cast Aluminum Alloy Morning Comment: Weaker Aluminum Prices Weigh on the Market, ADC12 Remains in the Doldrums] Spot side, the ADC12 market continued to fluctuate downward. Affected by the widening decline in aluminum prices, market sentiment turned cautious, and most enterprises lowered their quotations; a few enterprises temporarily held prices steady and stayed on the sidelines with support from costs. As the Qingming Festival holiday approaches, downstream stockpiling demand fell short of expectations, with procurement still mainly driven by rigid demand, and transaction performance showed no obvious improvement. Coupled with market expectations of weakening demand in April, ADC12 prices are still facing some downward pressure in the short term, and the market remains in the doldrums.

[Concerns Over Supply Shortfalls Triggered by Attacks on Middle Eastern Aluminum Plants Give Aluminum Prices Strong Upward Momentum] Overall, expectations of a substantive supply contraction triggered by attacks on Middle Eastern aluminum plants, combined with low global inventory and a recovery in peak-season demand in China, will provide strong upward momentum for aluminum prices. In the short term, aluminum prices are expected to break out of their trading range and hold up well.

First, a review of the price trend of secondary aluminum alloy in March: Futures market: The most-traded cast aluminum alloy contract showed pronounced volatility in March—surging sharply in early March to a high of 24,565 yuan/mt; retreating from highs from mid-March, with a low of 22,230 yuan/mt; and rebounding again at month-end, forming an overall "N"-shaped pattern. Entering April, the market shifted to moving sideways, with prices trading in the 23,500–24,000 yuan/mt range. Spot market: Strength in aluminum prices in early March drove ADC12 sharply higher, while in mid-to-late March it fluctuated downward under pressure from pulling back aluminum prices and weakening demand, before rebounding slightly at month-end. As of April 3, SMM ADC12 was quoted at 24,600 yuan/mt, up a cumulative 700 yuan/mt from early March. Price spread: After mid-March, A00 aluminum prices pulled back, while ADC12, supported by costs, saw relatively limited declines, and the price spread widened for a time; at month-end, A00 rebounded on Middle East disruptions, but weakening ADC12 demand caused it to struggle to catch up, and the price spread narrowed rapidly. It has now pulled back to within 100 yuan/mt, at a relatively low level for the same period. Cost side, according to the latest SMM data, the theoretical total cost of the ADC12 industry rose to 23,560 yuan/mt in March, up 4.7 percentage points MoM from February. By cost structure, aluminum scrap cost per mt rose to 21,344 yuan, with its share edging up to 90.6%, remaining the absolutely dominant cost component; affected by the lower center of copper prices, copper cost per mt pulled back to 826 yuan, with its share falling to 3.5%; silicon cost per mt also slipped slightly to 484 yuan, accounting for 2.1%. Overall, driven by higher aluminum prices and rising prices of compliant supply, aluminum scrap prices followed the gains quickly, further lifting its share in total costs. During the same period, the industry's theoretical ADC12 profit was about 694 yuan/mt, and the industry as a whole remained in the profitable range. Entering April, aluminum scrap will still be the core factor driving ADC12 cost fluctuations, and its price trend will closely track the primary aluminum market. At the same time, affected by constraints on compliant supply, industry costs are expected to likely remain elevated and move sideways in April. Supply side, the operating rate of the secondary aluminum alloy industry came in at 53.8% in March, rebounding sharply by 22.4 percentage points MoM and edging down by 1.3 percentage points YoY. After the Lantern Festival, enterprises generally resumed work and production, while the simultaneous recovery in downstream demand and the continued improvement in new orders significantly lifted the operating rate. However, the rebound was still constrained by multiple factors: cost pressure is expected to remain difficult to ease in the short term in April, the strength of the recovery in end-use demand remains uncertain, industry orders are expected to weaken somewhat, and the operating rate will likely pull back slightly from March while remaining broadly stable. Demand side, although downstream enterprises gradually resumed work and production in March, order recovery in end-use sectors such as automobiles fell short of expectations, and the traditional peak-season effect of "Golden March" failed to fully materialize. Downstream profit margins were already limited, leaving buyers highly sensitive to raw material prices. Acceptance of high-priced ADC12 declined markedly, price transmission remained sluggish, and negative market feedback gradually emerged—transactions failed to keep pace during the price upswing, while restocking willingness also remained cautious during the price pullback, with overall procurement mainly focused on small-lot purchases for immediate needs. In addition, some die-casting enterprises reliant on the Middle East market saw export orders decline due to hindered transportation, further weighing on demand performance. Overall, demand in March was weaker than in the same period last year, market wait-and-see sentiment was relatively strong, and prices lacked effective support. Entering April, recovery on the consumption side remained slow, downstream profits stayed under pressure, and although just-in-time procurement continued, the suppressive effect of high prices gradually emerged. Some enterprises may respond by cutting production, and overall demand is expected to be generally stable with slight fall. On the supply side, some small and medium-sized enterprises suspended production temporarily at the beginning of the month, and the operating rate dropped back slightly, leaving limited short-term incremental supply. Overall, the market’s primary contradiction has shifted to insufficient consumption momentum, with a lack of upward impetus, making it difficult for prices to sustain the uptrend. Going forward, attention should focus on the recovery of actual post-holiday orders, aluminum price trends, and changes in macro sentiment: if demand remains weak, the price center is expected to edge lower slightly; if downstream demand improves at the margin or aluminum prices strengthen, prices are likely to receive temporary support.

[Worsening Supply Concerns and Gradual Demand Recovery Stabilize the Center of Aluminum Prices with Geopolitical Premiums ]Overall, the market's core focus in the period ahead is on whether key aluminum smelters in the Middle East will further expand production cuts. If the cuts continue to materialize, they will provide strong upward momentum for global aluminum prices, coupled with support from expectations of a gradual release of demand during China’s peak season. In the short term, aluminum prices are expected to remain in a high-level consolidation pattern.

[SMM Cast Aluminum Alloy Morning Comment: Slightly Pessimistic Demand Expectations Cap Upside Room for ADC12 Prices]: On Thursday, ADC12 market prices remained largely stable. Downstream procurement is currently staying cautious, and overall market transactions were mediocre. Some enterprises are pessimistic about April order expectations, with wait-and-see sentiment intensifying and demand continuing to provide weak support for prices. The market’s primary contradiction has shifted from raw material cost-driven factors to insufficient consumption momentum. The increase in finished alloy ingot prices has clearly lagged behind the raw material side, and industry profit margins have consequently narrowed.

[[Weekly Review of Aluminum Scrap and Secondary Aluminum]]Secondary Aluminum Market Consolidated at High Levels, Intensifying the Tug-of-War Between Cost Support and Weak Demand

[China’s Aluminum Ingot Inventory Continues to Build Up, Aluminum Prices Remain in a High-Level Consolidation Pattern ]Overall, the geopolitical situation in the Middle East remained the core factor affecting the global aluminum market. A series of production cuts and damage incidents at Middle Eastern aluminum plants is expected to provide strong upward momentum for aluminum prices in and outside China, coupled with support from expectations of a gradual release of peak-season demand in China. In the short term, aluminum prices are expected to remain in a high-level consolidation pattern.