Key spot market data shows a mixed picture across China's major trading hubs. In East China, A00 aluminum was priced at 24,350 yuan per tonne, up 270 yuan from the previous session, with spot premiums over futures holding steady at 10 yuan per tonne. The Central Plains region saw A00 aluminum at 24,210 yuan per tonne, with the spot discount widening by 10 yuan to minus 130 yuan. In Foshan, A00 aluminum reached 24,550 yuan per tonne, a gain of 250 yuan, though the spot premium narrowed by 20 yuan to 215 yuan.
On the futures side, the main Shanghai aluminum contract opened at 24,040 yuan per tonne on September 3, 2026, and closed at 24,370 yuan, up 310 yuan from the prior close. The session range spanned a high of 24,425 yuan and a low of 24,000 yuan, with total trading volume of 229,600 lots and open interest of 256,847 lots.
Inventory data indicates continued drawdowns across major storage categories. Social inventories of electrolytic aluminum ingots stood at 815,000 tonnes, down 22,000 tonnes from the prior period. Warrant inventories contracted by 6,045 tonnes to 228,144 tonnes, while LME aluminum stocks fell 250 tonnes to 245,975 tonnes.
In the alumina market, spot prices were recorded at 2,700 yuan per tonne in Shanxi, 2,675 yuan in Shandong, 2,710 yuan in Henan, 2,605 yuan in Guangxi, and 2,750 yuan in Guizhou. Australian alumina FOB prices settled at $350 per tonne. The main alumina futures contract opened at 2,700 yuan and closed at 2,725 yuan, a gain of 9 yuan, or 0.33 percent, with a high of 2,730 yuan and a low of 2,688 yuan. Trading volume reached 147,389 lots with open interest of 127,844 lots.
Aluminum alloy prices also advanced, with Baotai quoting 18,100 yuan per tonne for civilian recycled aluminum and 18,300 yuan for mechanical recycled aluminum, both up 100 yuan from the prior day. The ADC12 alloy price rose 200 yuan to 23,700 yuan. Alloy social inventories totaled 20,000 tonnes, while in-plant stocks reached 69,900 tonnes. The theoretical total production cost stood at 23,802 yuan per tonne, leaving a theoretical profit of just 98 yuan per tonne.
Electrolytic aluminum analysis: After the Federal Reserve adopted a dovish tone on CPI and PPI, rate hike expectations eased slightly from 63 percent to 60 percent, though macro-driven trading may remain volatile. Fundamentals continue to offer solid support to the market. Domestic spot trading has weakened under the dual pressure of traders attempting to hold prices firm and rising absolute price levels, with aluminum rod processing fees falling noticeably.
At the micro level, aluminum prices are caught between short-term supply tightness and long-term oversupply expectations. The current global supply shortage remains unchanged, inventories are declining both domestically and internationally, and overseas spot premiums have begun to recover. However, the prospect of overseas smelter restarts and new capacity in the long run creates oversupply concerns that cap the upside for aluminum prices. Yet the timing of any actual surplus remains difficult to predict and could still be subject to change, meaning a bearish stance on aluminum prices is not warranted at this stage.
Absolute inventory levels are still likely to decline toward relatively low points, while the proportion of aluminum going into liquid metal remains at elevated levels.
Alumina outlook: A 30,000-tonne alumina cargo traded at $349 per tonne FOB Australia, down $1 from the previous transaction. Cost-side support remains robust and well-defined, with bauxite arrivals at ports still declining month-on-month and ocean freight costs staying high. Although alumina smelters have been reluctant to accept higher raw material prices, it is now largely clear that bauxite prices have found their floor.
The alumina market continues to show relative strength overseas and weakness domestically, but the export window has not yet opened, limiting any relief for domestic oversupply pressures. Alumina supply continues to expand and social inventories keep building, which similarly constrains any price rebound. With futures trading at a premium to spot, near-term pressure could emerge. The alumina market is expected to maintain its range-bound trading pattern, with tactical trading or options strategies recommended.
Key risks: Unanticipated overseas policy disruptions, unexpected shifts in liquidity conditions, and new supply disturbances in overseas mineral production remain the primary factors to watch.
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