On August 21, 2026, in the derivatives market, aluminum futures on the Shanghai Futures Exchange showed slight volatility. The most-traded aluminum contract for October delivery rose by 0.34% by the end of Friday's daytime trading and increased by 0.91% overnight, closing the nighttime session at Yuan 23,835/tonne as of 1 a.m. Monday, August 24, 2026.
Trump distancing himself from instructing Bessent to intervene in the bond market, while arguing that economic growth alone will resolve the debt issue, combined with the US August composite PMI flash rising beyond expectations to a four-year high, provides aluminum prices with a bullish backstop that is "macro-sentiment repair-led, with a structural mismatch in real-economy demand pull."
On one hand, the sovereign-credit concerns triggered by the Treasury's expanded long-dated bond buyback are eased by the White House's stance, the dollar index softens, US Treasury yields retreat after spiking, and the pressure on the financial attributes of base metals is released, giving LME and SHFE aluminum overnight support and a rebound.
On the other hand, the PMI structure shows "strong services, flat manufacturing" rather than across-the-board industrial overheating, so aluminum's direct demand side is not directly ignited by the data; with the domestic market still transitioning from the off-season toward the September-October peak season and low inventories plus supply constraints limiting downside depth but peak-season orders not yet materializing, the macro side only offers downside protection rather than a breakout driver. Aluminum prices overall extend a range-bound bias to the upside, with the height of any rebound capped by the off-season inertia on the fundamentals side.
On August 21, 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 23,680/tonne, up Yuan 80/tonne from the previous day; in South China Yuan 23,850/tonne, up Yuan 140/tonne from the previous day; and in Central Plains Yuan 23,620/tonne, up Yuan 90/tonne from the previous day.
On the fundamental side, domestic aluminum operating capacity has already hit the 45 million-tonne policy ceiling with no room for further expansion. Coupled with a high molten aluminum-to-water ratio that suppresses ingot casting, traders' inventories of aluminum ingots have surprisingly drawn down below 900,000 tonnes during the off-season. Supply rigidity and low inventories form a solid floor for aluminum prices. However, the demand side remains in a transitional window between the off and peak seasons, and actual consumption has not strengthened in tandem with the macro sentiment repair.
In early trading of Last Friday, SHFE aluminum moved upward. Traders' inventories in the Central Plains market edged up slightly, holding around 160,000 tonnes. Basis strengthened continuously as sellers controlled their shipping pace, tightening spot supply circulation somewhat. With aluminum prices recovering and moving higher, downstream enterprises maintained their purchasing pace, while traders entered the market in sync, remaining optimistic about future prices and prioritizing access to lower-priced cargoes. Trading activity was brisk, with deals done at a fair pace.
In South China, the basis against the front-month contract rose to Yuan 170/tonne. Periodical traders actively offloaded cargoes against the elevated basis. As absolute prices rebounded during the day, downstream end-users showed strong buying interest below the Yuan 24,000/tonne level, and overall transactions were fairly decent.
In summary, the combination of macro sentiment repair, supply rigidity, and low inventories provides a solid floor for aluminum prices. However, the "strong services, flat manufacturing" PMI structure limits real-economy demand pull, and actual consumption has yet to show meaningful recovery during the domestic off-to-peak season transition. Aluminum prices are expected to maintain a range-bound bias to the upside in the near term, with a decisive breakout requiring confirmation from September-October peak-season order fulfillment and sustained inventory drawdowns.
