Key Data Points

As of 2026-08-08, LME aluminium closed at $2,622.0 per tonne, while the main SHFE aluminium contract settled at 24,040 yuan per tonne. Spot premiums in East China stood at -30 yuan per tonne, while the Central Plains region recorded a premium of -140 yuan per tonne, and the Foshan area saw a spot premium of 85 yuan per tonne. The LME aluminium cash premium (0-3) was $3.2 per tonne.

Supply: By 2026-08-08, electrolytic aluminium production capacity reached 45.772 million tonnes, a weekly increase of 20,000 tonnes. Operating capacity was 45.481 million tonnes, unchanged week-on-week, with an industry utilisation rate of 98.03%.

Demand: According to data from Mymetal, weekly aluminium rod production was 348,000 tonnes, a weekly change of +1,300 tonnes. Aluminium plate, sheet, and foil production totalled 390,300 tonnes, a weekly change of -200 tonnes. Data from Shanghai Metals Market (SMM) shows that the operating rate for leading aluminium cable companies was 62.00% (unchanged week-on-week), for aluminium plate companies was 69.00% (unchanged), for aluminium foil companies was 70.10% (a decrease of 0.50%), and for aluminium profiles was 51.60% (a decrease of 0.40%).

Inventories: As of 2026-08-07, SMM reported social inventories of electrolytic aluminium ingots in China at 930,000 tonnes, a weekly change of -20,000 tonnes. Aluminium rod inventories stood at 124,000 tonnes, a weekly increase of 4,000 tonnes. By 2026-08-08, LME aluminium inventories were 256,400 tonnes, and SHFE warrant inventories were 307,008 tonnes.

Profitability: As of 2026-08-08, the weighted average production cost for the electrolytic aluminium industry was approximately 16,151 yuan per tonne, with an immediate production profit of 7,829 yuan per tonne.

Alumina

As of 2026-08-08, the main alumina futures contract settled at 2,699 yuan per tonne. In the spot market, prices were 2,730 yuan/tonne in Shanxi, 2,740 yuan/tonne in Henan, 2,710 yuan/tonne in Shandong, 2,765 yuan/tonne in Guizhou, and 2,625 yuan/tonne in Guangxi. The imported alumina price (FOB) was $346 per tonne.

Supply: As of 2026-08-08, Aladdin data shows total national alumina production capacity at 120.72 million tonnes, with operating capacity of 96.75 million tonnes, a weekly increase of 700,000 tonnes, and an operating rate of 79.32%.

Costs: As of 2026-08-08, the quoted price for Guinean bauxite was $71.0 per dry metric tonne, with a freight cost of $36.0 per tonne. The domestic northern bauxite price index was 620 yuan per tonne, and the southern bauxite price index was 575 yuan per tonne. Freight rates have risen again, and long-term contract prices for August may increase month-on-month.

Inventories: As of 2026-08-08, total national alumina inventories were 6.441 million tonnes, a weekly change of +43,000 tonnes. Electrolytic aluminium plant raw material inventories stood at 3.916 million tonnes, a weekly change of +24,000 tonnes. Platform and port inventories were 1.611 million tonnes, a weekly change of -9,000 tonnes. Port inventories were 684,000 tonnes, a weekly change of -2,000 tonnes. Alumina plant finished product inventories were 230,000 tonnes, unchanged week-on-week. Warrant inventories were 265,785 tonnes.

Profitability: As of 2026-08-08, based on an imported ore price of $72.0 per tonne, the total production cost for marginal high-cost enterprises was 2,984 yuan per tonne, resulting in a production loss of -254 yuan per tonne. Using domestic ore, the total production cost was 2,754 yuan per tonne, with a production loss of -24 yuan per tonne. The alumina import parity profit/loss was -288 yuan per tonne.

Aluminium Alloy

As of 2026-08-08, the main futures contract settled at 23,550 yuan per tonne. Jiangxi Baotai quoted 23,400 yuan per tonne, and the procurement price for civilian scrap aluminium was 18,100 yuan per tonne.

Inventories: Social inventories of aluminium alloy stood at 15,000 tonnes, unchanged week-on-week. Factory inventories were 75,000 tonnes, a weekly decrease of 1,000 tonnes.

Costs: The theoretical total cost for ADC12 alloy was 23,708 yuan per tonne, with a theoretical loss of -108 yuan per tonne.

Strategy Analysis

Aluminium: The US nonfarm payroll data has been released, and the positive macro impact from the data being significantly below expectations has already been priced in. The future price of aluminium may now face fundamental tests. Export data for July showed a month-on-month decline but continued year-on-year growth, consistent with our earlier expectations. August is in the domestic consumption off-season, and both macro and micro data have not shown signs of improvement in domestic demand. Furthermore, spot premiums have begun to decline, putting the short-term pace of destocking to the test. The market will now look to the traditional peak season of September and October to gauge the strength of consumption. If domestic demand remains weak, the transmission of high aluminium prices downstream will again face difficulties. Currently, processing fees for aluminium rods and bars are continuously declining. Our view of sustained destocking in the future remains unchanged, but the absolute level of inventories remains high, which will limit the upside potential for aluminium prices. However, arbitrage opportunities between aluminium alloy and aluminium are worth noting. With the repair of domestic/international price ratios, the tight supply of scrap aluminium, and the possibility of the import window for aluminium alloy opening later, the alloy sector is likely to face greater pressure.

Alumina: With the relaxation of alumina export restrictions from Indonesia, spot prices in the overseas market have begun to weaken. On the fundamental side, the positive factors for alumina have faded. Although supply is difficult to increase further on a month-on-month basis, the market remains in a state of surplus, and alumina lacks upward momentum. Cost support remains strong, with ocean freight rising to $35-37 per tonne and current bauxite CIF prices around $70 per tonne. However, long-term contract prices for August may increase. Shipments from Guinea remain low due to the rainy season and significant fluctuations in crude oil prices. Additionally, on the domestic ore side, supply remains scarce due to the flood season and environmental inspections, with the rainy season potentially impacting tailings and thus alumina production. At present, domestic spot market prices are approaching the highest marginal cash cost of production, leaving limited room for further downside. The short-term outlook for alumina remains a range-bound oscillation, suggesting a strategy of swing trading or using options.

Risks: 1. Unexpected disruptions to overseas ore supply. 2. Unexpected macroeconomic policy shifts.