On August 12, 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 0.43% by the end of Wednesday's daytime trading but decreased by 0.62% overnight, closing the nighttime session at Yuan 24,195/tonne as of 1 a.m. Thursday, August 13, 2026.
The auction yield on the U.S. 10-year Treasury hit its highest level since the 2007 global financial crisis, and Thursday's 30-year sale is expected to print the highest borrowing cost in 25 years. Market attention is turning to the Jackson Hole symposium later this month, where traders await policy signals from Fed Chair Wash.
U.S. July CPI rose 3.4% YoY, slowing for a second straight month, and gained 0.1% MoM; core CPI rose 0.2% MoM and 2.5% YoY, both in line with expectations. The cooling inflation helps ease bets on further policy tightening, though headline inflation remains above the policy target.
Trump said the U.S. has "complete control" of the Strait of Hormuz, and current negotiations still show divisions; meanwhile, Pakistan indicated the U.S. and Iran are close to some arrangement, while Iran–Oman talks are reported to have entered an advanced stage. The signals are contradictory, and market expectations on a reopening of the waterway keep swinging back and forth, thus the risk premium embedded in overseas aluminum prices is expected to stay elevated.
On August 12, 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 24,370/tonne, up Yuan 270/tonne from the previous day; in South China Yuan 24,490/tonne, up Yuan 220/tonne from the previous day; and in Central Plains Yuan 24,230/tonne, up Yuan 240/tonne from the previous day.
On the fundamentals side, aluminum prices extended a sharp rally this week on macro drivers. On the supply side, domestic primary aluminum supply remains ample, with operating capacity running at elevated levels. On the demand side, high-end manufacturing, power grid investment and exports remain resilient, but traditional processing segments such as extrusions and aluminum foil are relatively weak. Downstream procurement has slowed versus earlier in the period, traders are staying cautious and watching from the sidelines, and overall market turnover has weakened from last week.
SHFE aluminum edged higher in early trading. In the Central Plains market, traders' inventories declined slightly, holding steady at around 180,000 tonnes. The spot premium widened, prompting holders to offload inventory aggressively for cash amid high prices, leading to ample spot availability. While aluminum prices continued their upward trend, downstream fabricators remained cautious due to elevated prices, sticking to just-in-time procurement. Traders, however, turned bullish on the outlook, snapping up discounted material. Overall market turnover was moderate.
In South China, the basis for double-zero aluminum ingot remained elevated. Coupled with spot prices trading more than Yuan 600/tonne above the monthly average, holders were keen to sell, resulting in loose availability. However, buyers focused strictly on dips, leading to generally subdued transaction volumes.
In summary, the softer-than-expected U.S. July nonfarm payrolls data and a partial repair in overseas macro expectations have eased the downside pressure on aluminum prices, allowing the metal to continue its upward trend. However, inventory drawdowns during the seasonal slack have visibly slowed, and together with the ongoing U.S.–Iran conflict and traders holding a 45% implied probability of a September Fed rate hike, this adds some upward constraint to aluminum's rally. Medium- to long-term upside room for aluminum prices still remains.
