On September 28, 2026, in the derivatives market, aluminum futures on the Shanghai Futures Exchange showed slight volatility. The most-traded aluminum contract for November delivery decreased by 0.12% by the end of Monday's daytime trading and fell by 0.33% overnight, closing the nighttime session at Yuan 24,000/tonne as of 1 a.m. Tuesday, September 29, 2026.
Federal Reserve Governor Cook said that over the coming months inflationary pressures will continue to come from the AI investment boom and the Middle East conflict. For aluminum, the Fed's rate-hike finally materializing on September 16, 2026 briefly relieved macro bearish sentiment, but subsequent hawkish remarks by Fed officials and resilient economic data revived expectations of another rate hike this year; together with recurring Middle East tensions, the geopolitical premium kept swinging, leaving aluminum prices oscillating between "rate-hike pressure" and "geopolitical uplift.
On September 28, 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 24,170/tonne, down Yuan 70/tonne from the previous day; in South China Yuan 24,410/tonne, down Yuan 90/tonne from the previous day; and in Central Plains Yuan 24,070/tonne, down Yuan 80/tonne from the previous day.
On the fundamental side, domestic operating capacity remains elevated while the ingot casting ratio stays low, and traders' inventories are still at low levels. On the demand side, the property sector remains weak, though PV and automotive extrusion demand provide some support, with downstream buyers mainly purchasing on rigid demand and showing limited willingness to chase prices higher.
Yesterday, the SHFE aluminum futures trended downward during the morning session. Traders' inventories in the Central Plains market decreased, holding steady at around 120,000 tonnes. The basis remained unchanged. As the holiday approaches, holders accelerated their sales pace, leading to relatively loose circulation of spot supply. Although aluminum prices fell, downstream consumers did not show significant concentrated restocking, focusing instead on rigid demand procurement, while traders entered the market to absorb lower-priced cargoes. Trading sentiment weakened slightly, with overall transactions described as moderate.
As the holiday atmosphere intensified, holders maintained their enthusiasm for selling, keeping spot circulation loose. However, the basis in the South China market remained elevated, resulting in poor enthusiasm from traders to take on cargoes. Downstream terminals continued rigid demand restocking, and overall trading was average.
Overall, low inventories underpin SHFE aluminum, but the peak-season effect is materializing slowly and rate-hike expectations plus geopolitical risks are intertwined, leaving SHFE aluminum range-bound with resistance overhead and support below.
