On August 11, 2026, in the derivatives market, aluminum futures on the Shanghai Futures Exchange showed slight volatility. The most-traded aluminum contract for September delivery edged up by 0.89% by the end of Tuesday's daytime trading and increased by 0.58% overnight, closing the nighttime session at Yuan 24,320/tonne as of 1 a.m. Wednesday, August 12, 2026.
Chicago Fed President Austan Goolsbee said the biggest problem facing the economy is inflation. Goldman Sachs expects the US July core CPI to rise 0.19% month-on-month and headline CPI to rise just 0.05% MoM, both below market consensus, mainly dragged down by lower gasoline prices and cooling shelter inflation. HSBC argues that if the data comes in line with the benign forecast, it would act as a catalyst for dialing back expectations of further Fed rate hikes.
Data from the SHFE show that aluminum inventories continued to decline in the week ended August 7, falling 2.9% week-on-week to 435,739 tonnes, marking a fresh four-and-a-half-month low. SHFE aluminum stocks have now posted eight consecutive weeks of drawdowns. Meanwhile, LME data indicate that aluminum inventories have been on a persistent downtrend since last November; last week's continued outflows pushed total holdings to a new historic low of 253,400 tonnes.
On August 11, 2026, Mysteel's daily price assessment showed that the market price for A00 aluminum with a minimum purity of 99.7% in China was Yuan 24,100/tonne, up Yuan 110/tonne from the previous day; in South China Yuan 24,270/tonne, up Yuan 110/tonne from the previous day; and in Central Plains Yuan 23,990/tonne, up Yuan 100/tonne from the previous day.
The current SHFE aluminum market is in a pattern of strong-side oscillation underpinned by low inventories, relieved by macro de-rating, yet constrained by seasonal demand weakness. The cooling of Fed rate-hike expectations provides macro support for the valuation repair of non-ferrous metals, while the synchronized drawdown of inventories at home and abroad builds a hard floor for prices.
However, the firm price tone is not driven by a broad-based recovery in terminal demand: in August's traditional consumption off-season, compounded by high-temperature stoppages and maintenance at downstream plants, construction aluminum extrusions remain persistently soft under the drag of the real estate sector, and downstream buyers turn cautious as prices spike higher, market activity is dominated by rigid-need procurement and trader-to-trader flows.
SHFE aluminum traded in a narrow range in early session. In the Central Plains market, traders' ingot inventories edged up and held near 190,000 tonnes. The basis was unchanged; holders showed stronger willingness to offload stock for cash, leaving spot supply relatively ample. With aluminum prices maintaining an upward bias, downstream firms picked up material on dips, while traders stepped in to absorb discounted cargoes. Overall physical trading was steady with a firmer tone.
In South China, the basis ran at elevated levels and the absolute price center shifted higher again. A large volume of monthly average term-contract material flooded into the spot market. Although South China's aluminum ingot traders' inventory kept drawing down, the combination of a high basis and a rising absolute price weakened buyers' appetite, so overall turnover there was relatively soft.
In summary, the US non-farm payrolls data boosted the non-ferrous metals sector, and the aluminum market extended its upward trend. The sharp rise in aluminum prices suppressed the release of downstream demand. However, the speed of inventory destocking in the off-season clearly slowed, and together with persistent US-Iran tensions, market concerns over inflation risk increased, putting some upward pressure on aluminum prices. Medium to long-term upside room for aluminum prices remains intact.
