On August 25, 2026, in the derivatives market, aluminum futures on the Shanghai Futures Exchange showed slight volatility. The most-traded aluminum contract for October delivery dropped by 0.13% by the end of Tuesday's daytime trading but increased by 0.74% overnight, closing the nighttime session at Yuan 23,975/tonne as of 1 a.m. Wednesday, August 26, 2026.
With US consumer confidence falling to its lowest level of the year, July new-home sales hitting a six-month low, and high mortgage rates compounded by gasoline and cost-of-living pressures, the core overseas demand for aluminum, building extrusions, automotive bodies and lightweight components, is directly weakened, pulling down expectations for foreign primary aluminum demand. Yet the soft data also reinforces Fed rate-cut bets, with a weaker dollar and lower Treasury yields underpinning LME aluminum's financial valuation; at the same time, elevated oil prices lift aluminum's energy costs, while low LME inventories and domestic destocking provide physical support. With bulls and bears offsetting each other, aluminum prices sit in a mildly soft-but-rangebound setup, hard to fall sharply or break out.
On August 25, 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 23,740/tonne, down Yuan 60/tonne from the previous day; in South China Yuan 23,900/tonne, down Yuan 60/tonne from the previous day; and in Central Plains Yuan 23,670/tonne, down Yuan 50/tonne from the previous day.
In the early session yesterday, SHFE aluminum edged lower. Traders' inventories in the Central Plains market posted a slight increase, holding near 160,000 tonnes. As the basis widened, the traders showed greater willingness to sell, keeping spot supply relatively ample with offers flat against the benchmark. With aluminum prices falling, downstream buyers stuck to rigid demand procurement, slowing their purchasing pace versus earlier sessions. Traders entered the market, prioritizing low-priced cargoes and covering contracts as needed. Caution prevailed in trading, with overall turnover mediocre.
In South China, the basis ran at elevated levels while bonded warehouse inventories kept drawing down; ex-warehouse spot offers stayed relatively firm. Downstream end-users maintained rigid demand purchases with no visible shift in buying sentiment, and overall turnover was moderate.
Driven by macro headwinds, aluminum prices trended lower, unlocking pent-up downstream demand. Despite the ongoing consumption off-season, downstream enterprises have maintained high operating rates and resilient demand, sustaining consistent traders' inventory drawdowns. Room for a medium-to-long-term aluminum price rally still remains.
