Global Aluminum Market Review – April: Divergent Domestic & Overseas Trends and Marked Spot Structure Disparities The global aluminum market in April featured a core pattern of strength overseas and weakness domestically with diverging trends. The main Shanghai aluminum contract retreated from highs amid fluctuations, while LME aluminum maintained firm momentum supported by low inventories and geopolitical factors, with both markets seeing mild corrections toward month-end. Market drivers this month centered on macro policies, geopolitical conflicts, supply-demand fundamentals and inventory structures, with movements of key indicators further highlighting supply-demand imbalances between domestic and overseas aluminum markets. I. April Aluminum Price Review: Linked Movements with Distinct Strength Differentials Shanghai aluminum and LME aluminum shared similar price rhythms in April, both fluctuating higher initially before retreating. However, notable gaps emerged in upward momentum and correction ranges, with overseas aluminum prices significantly outperforming domestic counterparts. The average Shanghai-LME aluminum ratio dropped from 7.36 in March to 7.03 in April, reflecting stronger overseas aluminum pricing relative to Shanghai aluminum. The main Shanghai aluminum contract trended upward early in the month before softening overall, declining from elevated levels through range-bound trading. It opened lower at RMB 24,715 per ton at the start of the month and consolidated. Driven by escalating Middle East geopolitical tensions and rising LME aluminum prices, it surged to a monthly peak of RMB 25,675 per ton in mid-April. In late April, amid continuous domestic inventory accumulation, weaker-than-expected downstream demand, and risk-averse capital outflows ahead of the May Day holiday, prices corrected steadily. Closing at RMB 24,430 per ton on April 30, the contract recorded a monthly trading range of nearly RMB 1,360 per ton. LME March aluminum traded firmly with mild late-month declines. Opening at USD 3,459 per ton, it climbed to a monthly high of USD 3,672 per ton in mid-April, underpinned by overseas supply disruptions from geopolitical frictions and sustained inventory destocking. Prices edged down later due to fluctuating US-Iran negotiations, hawkish macro sentiment and profit-taking at high levels, settling at USD 3,476 per ton at month-end with a slight monthly loss. Overall, LME aluminum vastly outperformed domestic Shanghai aluminum. In terms of price drivers, geopolitics served as a shared upward catalyst for global aluminum prices, with production cuts and supply disruptions in the Middle East continuously boosting market risk aversion. Price divergence stemmed from dual disparities in macro policies and fundamentals: elevated domestic inventories and sluggish demand consistently capped aluminum price rebounds, while tight overseas inventories and strained spot supplies provided robust support for LME aluminum. II. Key Inventory Indicators: Divergent Inventory Movements and Contrasting Supply-Demand Landscapes As a core gauge of aluminum market supply and demand, domestic and overseas inventory trends diverged sharply in April, directly shaping the relative strength of regional aluminum prices. Domestic aluminum inventories kept rising and stood at a multi-year seasonal high. Social inventories maintained an upward trend throughout April, hitting 1.465 million tons in mid-month, the highest seasonal level in five years. A clear imbalance emerged between rigid supply release and lackluster downstream demand during the traditional peak "Silver April" period, leading to persistent spot market loosening. SHFE warehouse stocks expanded from 420,000 tons at the start of the month to 450,000 tons at month-end. Elevated warehouse stock levels further confirmed ample domestic spot supply, weighing continuously on aluminum prices. Overseas LME aluminum inventories declined steadily to a 20-year low. Total LME aluminum inventories fell from 410,000 tons to 370,000 tons in April, extending months of destocking to historic lows. Noticeable structural divergence persisted in inventory composition: Russian aluminum accounted for approximately 92% of total LME stocks in March, resulting in low market-circulating inventories and increasingly tight physical spot supply, which acted as the fundamental pillar for strong LME aluminum prices. In summary, April’s global aluminum market was governed by contrasting core dynamics: low overseas inventories, geopolitical disruptions and hawkish Federal Reserve policies on the overseas front, versus high domestic inventories, weak real demand and stable growth expectations domestically. This drove pronounced market divergence. Affected by intertwined internal and external factors, the main Shanghai aluminum contract corrected downwards from highs, while LME aluminum remained in a firm trading range, backed by historically low inventories, a tight spot balance and geopolitical risk premiums.

According to customs data, China's aluminum plate/sheet and strip (tariff codes 76061121, 76061129, 76061191, 76061199, 76061220, 76061230, 76061251, 76061259, 76061290, 76069100, 76069200) exports in March 2026 reached 278,200 mt, up 21% MoM and up 3% YoY.

SMM April 29 News: Raw material side, lithium carbonate held up well this week due to supply disruptions from Zimbabwe's latest policy and mine permit renewals in Jiangxi, nickel salt prices fluctuated, the cobalt salt market was sluggish, and prices drifted lower.

[SMM Steel] Iran has halted exports of flat steel products, including plates and HRC, until May 30, following severe damage to its steel industry from ongoing conflict. Around 10 mln mt of annual capacity (25–30%) has been disrupted, impacting major producers such as Mobarakeh Steel Company and Khuzestan Steel Company. The supply shock is expected to tighten global availability, particularly for semis and flat products, while domestic industries face rising input costs. Although imports may partially stabilize Iran’s market in the short term, full production recovery could take 6–12 months or longer, with broader economic and trade impacts anticipated.

SMM April 28 News: Raw material side, lithium carbonate held up well this week due to supply disruptions from Zimbabwe's latest policy and mine license renewals in Jiangxi, nickel salt prices fluctuated.

[Conflict Impact] The outbreak of the Middle East conflict on February 28, 2026, significantly disrupted global aluminum market dynamics, driving increased volatility in aluminum prices. Aluminum prices on the London Metal Exchange (LME) surged alongside escalating tensions, rising from an Official Price of $3,156.5/mt on February 27 to a peak of $3,519.5/mt in early March. Prices later retreated to the $3,200–3,300/mt range in late March, as market sentiment gradually stabilized. On March 28, in response to attacks on Iranian industrial zones, Iran reportedly targeted major regional aluminum producers including Aluminum Bahrain and Emirates Global Aluminum, while Qatar Aluminum declared force majeure. These developments constrained primary aluminum output in the Middle East, tightening market liquidity and increasing supply uncertainty. As a result of supply disruptions, global aluminum availability declined, particularly impacting regions outside China in Asia. Entering April, LME aluminum prices rebounded to $3,400–3,500/mt, breaking above $3,600/mt in mid-April and fluctuating within the $3,500–3,600/mt range. [Shipping Disruptions] The conflict initially disrupted transportation systems across the Middle East, with the Strait of Hormuz being most severely affected. Key aluminum exporters—including the UAE, Saudi Arabia, Qatar, Iran, and Kuwait—faced significant logistical constraints. Exports that traditionally passed through the Strait were heavily restricted, forcing market participants to adopt alternative logistics routes, including land transport to Red Sea ports. These adjustments significantly increased freight costs and extended delivery lead times. In April, the escalation of conflict into the Red Sea region further limited alternative shipping routes. Most Europe–Asia vessels opted to reroute via the Cape of Good Hope, driving both freight costs and transit times higher. According to SMM market research, cargo delivery delays reached 3–5 weeks, while container freight costs surged by as much as 60–70%. [Primary Aluminum and Processing] Reduced Middle Eastern exports tightened primary aluminum supply across major Asian consuming countries, particularly Japan, Thailand, India, and South Korea. In 2024, the Middle East exported 6.408 million mt of primary aluminum and key aluminum products, with these four countries accounting for approximately 20.8% (1.331 million mt). In 2025, exports declined to 6.071 million mt, with imports from these countries totaling approximately 1.215 million mt (~20%). Demand for primary aluminum alloys and billets (notably 6xxx series) remained strong. SMM data shows that following the outbreak of conflict, processing fees for 6063 billets in Southeast Asia rose from $200–250/mt to $250–300/mt, peaking at $300–310/mt. Market feedback indicates a recovery in demand for 6xxx billets, with both domestic and export transactions in Malaysia and Thailand increasing significantly in April. Downstream purchasing sentiment improved, offsetting weaker market conditions observed in January–February. Demand for primary foundry alloys also strengthened. Elevated aluminum prices, reduced Middle Eastern supply, and growth in downstream sectors such as automotive (particularly in Thailand) drove increased enquiries for alloys including A356, AlSi10MnMg, and AlSi10FeMg. Notably, interest in low-carbon aluminum has also increased, reflecting rising alignment with international decarbonization policies such as the EU’s Carbon Border Adjustment Mechanism (CBAM). Against a backdrop of tightening primary supply, importing semi-finished aluminum products from alternative regions may become an increasingly viable option. [Secondary Aluminum] Beyond primary production, the Middle East has also been a significant supplier of aluminum scrap and secondary alloys, serving as an emerging recycling and processing hub prior to the conflict. India and South Korea are key importers of Middle Eastern scrap. In 2024, the region exported 628,000 mt of aluminum scrap, with India and South Korea accounting for 62.6% and 13.5%, respectively. In 2025, total exports rose to 766,000 mt, with imports reaching 489,000 mt (India) and 101,000 mt (South Korea). Amid the conflict, buyers from Japan and South Korea diversified sourcing toward Southeast Asia, particularly Malaysia and Thailand, boosting demand for ADC12 secondary aluminum alloy. This shift supported both Southeast Asian FOB prices and Japan CIF prices. In April, continued conflict escalation drove additional demand from India, with SMM data indicating several thousand tonnes of incremental enquiries and transactions in Southeast Asia. SMM began tracking ADC12 FOB prices in Thailand and Malaysia in March 2026. Prices rose from $3,000/mt on March 2 to $3,365/mt by April 27, marking an increase of $365/mt. Market activity remained robust, with strong exports to Japan, South Korea, and India, alongside steady shipments to China, Singapore, and other regions. Some producers have reportedly secured orders through late June to July. On the raw materials side, rising LME aluminum prices pushed both imported and domestic scrap prices higher. In Thailand, aluminum cable scrap reached THB 115,000–120,000/mt ($3,560–3,710/mt) in April, significantly increasing blending costs for billet producers. As scrap prices climbed, some billet producers reduced scrap usage and increased reliance on primary aluminum. Meanwhile, higher prices for Tense scrap led to reduced trading volumes, prompting ADC12 producers to substitute alternative scrap types, including higher-copper materials, to optimize cost structures. Reduced scrap supply from the Middle East also intensified competition, particularly as India increased procurement from alternative markets, tightening supply and driving prices higher in Southeast Asia. [Outlook] The Middle East conflict has fundamentally reshaped aluminum trade flows across Asia and globally, increasing pressure on Southeast Asia’s aluminum processing sector. If the conflict persists, global aluminum trade is likely to become more regionalized, with tighter raw material availability in Asia and stronger internal circulation in Western markets. China may emerge as a key balancing supplier, as widening domestic-international price spreads could open export arbitrage opportunities for semi-finished aluminum products and secondary alloys. However, Southeast Asia may face mounting pressure from raw material shortages and intensified competition, particularly from India. At the same time, tightening low-carbon policies and Western supply chain reshoring may further challenge regional competitiveness. Conversely, a de-escalation of the conflict and normalization of logistics routes could ease supply constraints, potentially placing downward pressure on aluminum product and secondary alloy prices, gradually returning the market toward pre-conflict conditions. [Notes] The “18 Middle Eastern countries” referenced in this report include: Gulf Cooperation Council (GCC): Saudi Arabia, United Arab Emirates, Qatar, Kuwait, Oman, Bahrain Levant region: Israel, Jordan, Lebanon, Syria, Palestine Other key regional countries: Iran, Iraq, Turkey, Egypt, Cyprus, Libya, Yemen Primary aluminium and related key aluminium products include the following HS codes: 7601 – Unwrought aluminium 7604 – Aluminium bars, rods and profiles 7605 – Aluminium wire 7606 – Aluminium plates, sheets and strip, thickness > 0.2 mm 7607 – Aluminium foil 7608 – Aluminium tubes and pipes

It has become a consensus that domestic demand for new energy vehicles will be under periodic pressure in 2026. However, the industry has not lost its growth momentum but is shifting from past expansion driven by pricing and policy to a growth model supported by products, structural optimization, and markets outside China. At the same time, the rise on the cost side is squeezing profit margins, making the issue of "growing but not profiting" increasingly visible.

SMM Morning Meeting Summary: Overnight, LME copper opened at $13,317/mt, moved sideways after the opening before dipping to a low of $13,168/mt, then the center rose to a high of $13,348/mt, and finally closed at $13,259/mt, down 0.68%, with trading volume at 18,000 lots, a decrease of 809 lots from the previous trading day; open interest stood at 316,000 lots, a decrease of 4,795 lots from the previous trading day, with the overall movement mainly characterized by bulls reducing positions. Overnight, the most-traded SHFE copper 2604 contract opened at 102,670 yuan/mt, fluctuated downward after the opening to a low of 101,780 yuan/mt, then the center rose to a high of 102,880 yuan/mt, and finally closed at 102,550 yuan/mt, down 0.15%, with trading volume at 55,000 lots, a decrease of 51,000 lots from the previous trading day; open interest stood at 186,000 lots, an increase of 1,437 lots from the previous trading day, with the overall movement mainly characterized by bears adding positions.

[SMM Morning Meeting Minutes: Tin Market Maintains Weak Supply-Demand Pattern, Tin Prices Expected to Continue Moving Sideways in a Fluctuating Trend]

Teck Resources warned that rising diesel and freight costs could increase spending at its Chilean copper mining operations during Q2, as global supply tightened. The Canadian mining company said its Chilean operations relied on imported diesel and faced higher fuel and transportation costs due to supply disruptions related to the Strait of Hormuz, although no severe shortages were expected. "We expect freight costs to continue rising in Q2 2026, with explosives costs also increasing accordingly. We will continue to closely monitor developments, such as potential product export bans by major supplying countries, which could further disrupt the market," the company said. The warning highlighted broader supply chain pressures and the risk that government intervention could tighten metals markets, potentially prompting enterprises and strategic stockpiling of copper and zinc as demand strengthened. Alongside the cost warning, the company reported strong Q1 results that exceeded analyst expectations. This was primarily driven by higher copper prices, record sales, and increased production at its flagship mine, Quebrada Blanca (QB), in northern Chile. Production at the newly expanded mine grew 31.2% to 55,500 mt, compared with just 42,300 mt a year earlier when output was constrained by prolonged shutdowns. Despite a maintenance shutdown at the start of the year, performance remained on par with the previous quarter. Total copper production in Q1 reached 140,000 mt, compared with 106,100 mt in the same period last year. The company still plans to produce 455,000 to 530,000 mt in 2026 and 505,000 to 580,000 mt in 2027, while 2025 production is expected to be 453,500 mt, with the QB project expected to contribute 200,000 to 235,000 mt next year. Driven by growing power demand from data centers, artificial intelligence, and national defense, as well as expanding investment in power grid and electronic infrastructure, global copper demand is expected to surge 50% by 2040, benefiting Teck and its peers. Concentrates zinc production fell to 120,300 mt, a decrease of 17,000 mt from the same period last year. (Wenhua Consolidated)