[China Inventory Continued to Decline This Week, Aluminum Prices Moving Sideways with LME Outperforming SHFE in the Short Term] If the US-Iran ceasefire agreement materializes, it would significantly ease Middle East supply concerns, but recurring military frictions leave the peace outlook uncertain, and the short-term geopolitical premium tends to converge but has not fully dissipated. The rigid supply gap outside China supported a relatively strong LME aluminum pattern. China's inventory continued to decline but remained at historically high levels, capping the upside elasticity of SHFE aluminum, and the divergence between LME and SHFE is expected to persist in the short term. Going forward, key areas to watch include whether China's inventory drawdown accelerates, whether the US-Iran agreement can be formally signed, further clarity on the US Fed's interest rate path, and whether China is further tightening regulations on aluminum capacity operations. Overall, aluminum prices are expected to move sideways in the short term with LME outperforming SHFE.

[SMM Aluminum Express News] Contact Energy has signed a non-binding power supply agreement with Rio Tinto to support the restart of the idle Line 4 potline at the New Zealand Aluminum Smelter in Tiwai Point. The restart would require around 50 MW of additional electricity and add approximately 30,000 tpy of aluminum production, while supporting development of Contact’s Southland Wind Farm. Rio Tinto estimates the project could generate around NZ$100 million annually in additional export revenue for New Zealand.

Rio Tinto announced that it had officially commenced commissioning of its $1.5 billion low-carbon aluminum smelter expansion project located in Quebec, Canada. The mining giant expected that the project would be fully operational by the end of this year, with all 96 new electrolysis pots at Complexe Arvida up and running by then. Upon completion, the smelter's annual primary aluminum capacity would increase by approximately 160,000 mt, and total aluminum production using low-carbon AP60 smelting technology would reach 220,000 mt. The AP60 expansion project would provide strong support for ELYSIS — a joint venture co-founded by Rio Tinto and Alcoa — in its transition toward carbon-free aluminum electrolysis technology.

[China Inventory Continued to Decline This Week, Aluminum Prices Show LME Outperforms SHFE in the Short Term] China inventory continued to decline this week but at a modest pace, limiting the upside elasticity of SHFE aluminum, with the divergence between domestic and overseas markets expected to persist in the short term. Key areas to watch going forward include whether China inventory destocking accelerates, whether the US-Iran deal can be formally signed, further clarity on the US Fed's rate path, and whether China is further tightening regulations on aluminum capacity operations. Overall, aluminum prices are expected to continue moving sideways in the short term, with LME outperforming SHFE.

SMM May 29 News: According to SMM statistics, China's aluminum production in May 2026 (31 days) was up 2.1% YoY and up 3.8% MoM. Although the pace of China's end-use demand recovery remained slow, the widening aluminum supply gap outside China significantly boosted domestic aluminum semis export demand, which in turn provided effective support for liquid aluminum consumption in China, driving apparent consumption to maintain positive growth. The proportion of liquid aluminum in China edged up, with the monthly proportion up 1.1 percentage points MoM to 76.5%, slightly above expectations at the beginning of the month, with the core incremental growth coming from export orders strengthening beyond expectations. Based on SMM's proportion of liquid aluminum calculation data, China's aluminum casting ingot volume in May declined 1.2% YoY and fell 0.9% MoM. Capacity changes: As of month-end May, SMM statistics showed China's existing aluminum capacity at approximately 46.209 million mt, with no MoM change. Production forecast: Entering June 2026, overall, as demand in markets outside China recovers, China's aluminum semis export orders are expected to continue improving, supporting a slight rebound in the proportion of liquid aluminum. Overall, the proportion of liquid aluminum is expected to rise 0.1 percentage points to 76.6%. [Data source statement: Data other than public information is derived from public information, market communication, and SMM's internal database models, processed by SMM for reference only and does not constitute decision-making advice.] Data source: SMM

SMM News, May 29: According to SMM statistics, the total output of primary aluminum overseas in May 2026 fell year-on-year by 9.9%, mainly due to large-scale production cuts at aluminum smelters in the Middle East. The average daily overseas output edged up 0.4% month-on-month, supported by production resumptions at smelters in the US, Spain and Iceland, as well as ramping-up output from new projects in Indonesia. As revealed in the Q4 and full-year financial report of Vedanta Aluminium for Fiscal Year 2026, Balco Aluminium Plant has launched the first production run on India’s most advanced 525kA primary aluminum production lines. The plant’s total production capacity has expanded to 1 million metric tons, and the project is expected to enter a steady output ramping phase. Looking ahead to June 2026, production resumptions at aluminum smelters in the US and Iceland will continue. Driven by high price levels, new primary aluminum projects in Indonesia will accelerate construction, and some are expected to commence power connection and commissioning gradually. The expanded capacity at Balco in India will keep ramping up. Overall, overseas primary aluminum output will remain in year-on-year decline in the short term, while the average daily output will maintain month-on-month growth amid ongoing production resumptions and capacity ramping of new projects. Market participants shall keep a close eye on official announcements from aluminum producers across the Middle East, Indonesia and India.

In May, China's aluminum fabrication industry recorded an overall PMI of 50.8%, barely staying above the 50 mark but pulling back significantly by 3.1 percentage points from April. Industry sentiment slid from the edge of expansion territory toward the critical threshold, with structural divergence intensifying further.

Aluminum Deutschland said Germany’s aluminum industry remained under pressure in Q1 2026, with recycled aluminum production falling 3% YoY to 684,564 tones and semi-finished aluminum output declining 1% YoY to 568,688 tones. Remelter production dropped 4%, while extruded products fell 4% amid weak demand from construction and automotive sectors. At the same time, 85% of companies reported aluminum scrap shortages, while 66% described order conditions as poor. Around 57% of companies do not expect business conditions to improve by the end of 2026. The industry also warned of risks linked to high energy costs, tight scrap supply and production relocation, with some companies already implementing layoffs, capacity cuts and overseas shifts.

Dear User, Greetings! Based on publicly available information such as irregular reports from listed enterprises and public market communications, SMM has made partial revisions to China's monthly primary aluminum production data. The affected data points are as follows: (I) Primary Aluminum Supply Data Newly Added Indicator - SMM: Aluminum Production: Others - a12871215 Dates Affected: 2023-Jan 2026 Note: Changes were caused by revisions to China's primary aluminum production; ex-China primary aluminum production is only revised irregularly in line with listed enterprise reports SMM: Aluminum Production: Total: Monthly - a10004408 Dates Affected: 2023-Jan 2026 Note: Changes were caused by revisions to China's primary aluminum production; ex-China primary aluminum production is only revised irregularly in line with listed enterprise reports SMM: Proportion of Liquid Aluminum: Aluminum Production: Monthly - a10124317 Dates Affected: 2023-Jan 2026 Note: Changes were caused by revisions to China's primary aluminum production; ex-China primary aluminum production is only revised irregularly in line with listed enterprise reports SMM: Operating Aluminum Capacity: Monthly - a10146955 Dates Affected: 2023-Jan 2026 Note: Changes were caused by revisions to China's primary aluminum production; ex-China primary aluminum production is only revised irregularly in line with listed enterprise reports SMM: Aluminum Operating Rate: Monthly - a10146957 Dates Affected: 2023-Jan 2026 Note: Changes were caused by revisions to China's primary aluminum production; ex-China primary aluminum production is only revised irregularly in line with listed enterprise reports SMM: Aluminum Operating Rate: YoY: Monthly - a10004254 Dates Affected: 2023-Jan 2026 Note: Changes were caused by revisions to China's primary aluminum production; ex-China primary aluminum production is only revised irregularly in line with listed enterprise reports (II) Aluminum Balance Data SMM: Aluminum Balance: Production: Monthly - a10004370 Dates Affected: 2023-Jan 2026 Note: Changes were caused by revisions to China's primary aluminum production SMM: Aluminum Balance: Apparent Consumption: Monthly - a10004372 Dates Affected: 2023-Jan 2026 Note: Changes were caused by revisions to China's primary aluminum production SMM: Aluminum Balance: Annualized Capacity: Monthly - a10004373 Dates Affected: 2023-Jan 2026 Note: Changes were caused by revisions to China's primary aluminum production SMM: Aluminum Balance: End-Use Consumption: Monthly - a10004375 Dates Affected: 2023-Jan 2026 Note: Changes were caused by revisions to China's primary aluminum production SMM: Aluminum Balance: End-Use Consumption Growth: Monthly - a10004376 Dates Affected: 2023-Jan 2026 Note: Changes were caused by revisions to China's primary aluminum production SMM: Aluminum Balance: Inventory/Consumption: Monthly - a10004377 Dates Affected: 2023-Jan 2026 Note: Changes were caused by revisions to China's primary aluminum production SMM: Aluminum Balance: Production YoY: Monthly - a10004378 Dates Affected: 2023-Jan 2026 Note: Changes were caused by revisions to China's primary aluminum production SMM: Aluminum Balance: Cumulative End-Use Consumption Growth: Monthly - a10004379 Dates Affected: 2023-Jan 2026 Note: Changes were caused by revisions to China's primary aluminum production SMM: Aluminum Balance: Cumulative Production Growth: Monthly - a10004380 Dates Affected: 2023-Jan 2026 Note: Changes were caused by revisions to China's primary aluminum production (III) Aluminum Balance Data - Demand Derived from Processed Products SMM: China Aluminum Balance: Production: Monthly - a12858073 Dates Affected: 2023-Jan 2026 Note: Changes were caused by revisions to China's primary aluminum production SMM: China Aluminum Balance: Primary Aluminum Balance: Monthly - a12858084 Dates Affected: 2023-Jan 2026 Note: Changes were caused by revisions to China's primary aluminum production (IV) Alumina Balance Data SMM: Alumina Balance: End-Use Consumption: Monthly - a10004384 Dates Affected: 2024-Jan 2026 Note: Changes were caused by revisions to China's primary aluminum production, resulting in changes to China's alumina consumption SMM: Alumina Balance: Balance Value: Monthly - a10004385 Dates Affected: 2024-Jan 2026 Note: Changes were caused by revisions to China's primary aluminum production, resulting in changes to China's alumina consumption SMM is committed to ensuring data accuracy and has made the above revisions to historical data accordingly. We sincerely apologize for any inconvenience this may cause. SMM Aluminum Research Team May 28, 2026 Aluminum Division

Rio Tinto plans to restart the idle Line 4 potline at the New Zealand Aluminum Smelter (NZAS) in Tiwai Point and has signed a letter of intent with Contact Energy for a power purchase agreement. If finalized, the potline could resume operations in 2030. The line has been idle since 2020 and is expected to add about 30,000 tones of aluminum production annually once fully operational. Rio Tinto said the restart could contribute around NZD 100 million (about USD 59 million) annually to the local economy while strengthening New Zealand’s aluminum industry and energy cooperation.