1. Report Industry Investment Rating No information provided in the content. 2. Core Viewpoints - In 2026, alumina prices are expected to decline with reduced volatility due to a more relaxed ore supply and a slightly oversupplied production capacity [1][29][92] - The growth rate of domestic electrolytic aluminum production will slow down significantly as the operating capacity approaches the ceiling, and imports are expected to increase to offset the supply - demand gap. The downstream demand for aluminum is undergoing a structural transformation [2][45][92] - The price of aluminum alloy will still be pegged to the price of aluminum in 2026, but its seasonal performance will be weaker than before [3][53][93] - The price of aluminum and aluminum alloy is expected to show an upward trend in 2026, driven by factors such as global economic recovery, new - energy transformation, and power construction [3][93] 3. Summary by Relevant Catalog 3.1 2025 Market Review - In 2025, aluminum prices showed a trend of oscillating upward breakthrough, divided into three stages: oscillating upward from January to mid - March, oscillating downward from mid - March to early April, and oscillating upward from early April to November. The price fluctuations were affected by various factors such as policies, tariffs, inventory changes, and macro - events [6][7][8] 3.2 Supply Side 3.2.1 Bauxite - Domestic bauxite production increased slightly in 2025, with a growth rate of 5.2% from January to November. However, production was restricted in some areas due to safety and environmental regulations. Imported bauxite increased significantly, with imports from January to October reaching 171 million tons, a year - on - year increase of 30.4%. The price of imported bauxite decreased due to increased supply. There were some disturbances in the supply from Guinea, and the political situation in Guinea may affect future supply policies [14][16][18] 3.2.2 Alumina - In 2025, alumina production increased, with output from January to October reaching 78.222 million tons, a year - on - year increase of 9.56%. The price first declined, then rebounded, and then fell again. New production capacity was limited in 2025, mainly from Guangxi Huasheng Phase II, Shandong Chuangyuan New Materials, and Hebei Wenfeng. In 2026, new overseas production capacity will be mainly in India, Indonesia, and Vietnam. Alumina production capacity is expected to be slightly oversupplied in 2026, and prices will be determined by cost, showing an oscillating downward trend [22][24][29] 3.2.3 Electrolytic Aluminum - In 2025, the built - in and operating capacity of domestic electrolytic aluminum increased slightly, with production from January to October reaching 36.8908 million tons, a year - on - year increase of 2.57%. Many enterprises resumed production due to improved profitability, while some enterprises carried out technical upgrades and maintenance, resulting in production cuts. New production capacity mainly came from Shuangyuan Aluminum, Chalco Qinghai, and others. In 2026, new domestic production capacity will mainly come from Huomeihongjun Zhalv Phase II and Tianshan Aluminum. Overseas production capacity increased in 2025, mainly in Indonesia, Russia, and other countries, and is expected to increase by 1.8 million tons in 2026. The growth rate of domestic electrolytic aluminum production will slow down significantly in 2026, and imports are expected to increase [30][35][45] 3.2.4 Aluminum Alloy - Although the import of scrap aluminum was liberalized in 2024, there was no significant increase in 2025 due to factors such as the cancellation of export tax rebates, tariff differences, and tightened trade policies in some countries. The production of recycled aluminum alloy increased steadily, and the listing of aluminum alloy futures promoted production. After the listing of the futures, the production of cast aluminum alloy increased significantly, suppressing the price difference between ADC12 and A00, and the seasonal effect was weakened [48][50][52] 3.3 Demand Side 3.3.1 Real Estate - In 2025, the real estate market continued to decline. In 2026, the real estate market is expected to continue to bottom out, and the demand for aluminum in the real estate sector will continue to decrease. However, urban renewal and affordable rental housing will support part of the aluminum demand [54][56][58] 3.3.2 Infrastructure - In 2025, the issuance of local government special bonds increased, but part of the funds was used for debt repayment, resulting in a slowdown in infrastructure investment growth. The investment in the power grid reached a new high. In 2026, with the increase in special bond quotas and the promotion of power grid construction, the demand for aluminum in infrastructure is expected to increase by 5% [59][61][69] 3.3.3 Automobile - In 2025, the automobile market had good production and sales performance, with new - energy vehicle penetration exceeding 50%. In 2026, although consumption policies are expected to be strengthened and export demand is optimistic, factors such as the reduction of new - energy vehicle purchase tax exemption and the implementation of new battery standards may lead to flat demand for aluminum in the automobile industry [70][72][75] 3.3.4 Photovoltaic - In 2025, the new installed capacity of photovoltaic increased significantly in the first half of the year but decreased sharply after June due to the "430 New Policy" and "531 New Policy". In 2026, the new installed capacity of domestic photovoltaic is expected to decline significantly, and although the overseas new installed capacity is expected to grow at a rate of 25%, the overall demand for aluminum in the photovoltaic industry is expected to decrease [76][79][82] 3.3.5 Aluminum and Aluminum Product Exports - In 2025, the net export of aluminum products decreased, mainly due to the cancellation of export tax rebates and the imposition of tariffs. The export of aluminum products increased. In 2026, due to the continuation of policies and the strengthening of the domestic aluminum price, the net export of aluminum and aluminum products is expected to decline [83][85][86] 3.4 Inventory and Supply - Demand Balance - In the first half of 2025, aluminum inventories decreased significantly, while in the second half, they increased seasonally. In 2026, the domestic electrolytic aluminum market is expected to have a shortage of 100,000 tons [88][90][91] 3.5 2026 Outlook - Alumina prices are expected to decline with reduced volatility; the growth rate of domestic electrolytic aluminum production will slow down, imports will increase, and downstream demand will transform; the price of aluminum alloy will be pegged to aluminum with weaker seasonality; the price of aluminum and aluminum alloy is expected to rise [92][93]

Investment Rating - The investment rating for the non-ferrous metals industry is optimistic [1]. Core Insights - The industry is entering a "low TC" era, with copper smelting enterprises facing significant challenges and the need for transformation [2]. - The report highlights that TC/RC has dropped to negative levels, indicating a tightening supply of copper concentrate [8][12]. - The report discusses the impact of recent production cuts from major copper mines, which have led to a significant reduction in supply [12][18]. - The profitability of smelting enterprises is under pressure, with many operating at a loss, relying on by-product revenues for survival [15][18]. - Future policies are expected to focus on controlling copper smelting capacity to prevent excessive competition and promote industry consolidation [22][23]. Summary by Sections Section 1: TC at a Decade Low - TC/RC has reached negative values, with imported copper concentrate TC around -42 USD/dry ton as of November 2025 [8]. - Major copper mines have experienced production cuts, leading to a total reduction of 570,000 tons in supply [12]. - Smelting enterprises are currently facing losses, with by-products like sulfuric acid becoming crucial for profitability [15][18]. Section 2: Future Outlook on TC - The report anticipates that TC will remain low over the next two years, with a projected supply gap of around 500,000 tons in 2026 [29]. - Policies are being developed to set a "capacity ceiling" for copper smelting to enhance industry structure and efficiency [22][23]. - The pricing model for copper smelting may shift, with companies like Freeport considering individual contract pricing to maintain profitability [25]. Section 3: Strategies for Smelting Enterprises - Smelting enterprises are encouraged to extend their supply chains and reduce costs through technological advancements and operational efficiencies [36][41]. - The report emphasizes the importance of increasing the recycling of copper and optimizing the use of by-products to enhance profitability [41][42].

Investment Rating - The report maintains a positive outlook on the metals and new materials industry, despite short-term interest rate cut expectations suppressing market performance [3]. Core Views - The report highlights that the high prosperity trend in the sector remains unchanged, with a focus on the recovery potential of precious metals and stable supply-demand dynamics in industrial metals [4][5]. Weekly Market Review - The Shanghai Composite Index fell by 3.90%, while the Shenzhen Component Index dropped by 5.13%. The non-ferrous metals index decreased by 6.75%, underperforming the CSI 300 Index by 2.98 percentage points [5][6]. - Year-to-date, the non-ferrous metals index has risen by 65.71%, outperforming the CSI 300 Index by 52.53 percentage points [7]. Price Changes - Industrial metals and precious metals saw price fluctuations, with LME copper down by 0.69% and COMEX gold down by 0.53% [4][14]. - Lithium prices increased significantly, with lithium spodumene up by 17.84% and battery-grade lithium carbonate up by 6.90% [4][16]. Precious Metals - The report notes that the U.S. non-farm payrolls exceeded expectations, impacting gold prices. The long-term outlook for gold remains positive due to ongoing central bank purchases and a low current gold reserve in China [4][19]. - The report suggests focusing on companies like Shandong Gold, Zhaojin Mining, and Zijin Mining for potential investment opportunities in the precious metals sector [4][17]. Industrial Metals - Copper demand is expected to remain strong, with supply disruptions anticipated due to a recent landslide at Freeport's Grasberg mine, potentially reducing global copper supply by about 2.2% [4][29]. - The report recommends关注 companies such as Zijin Mining, Luoyang Molybdenum, and Tongling Nonferrous Metals for copper investments [4][17]. Aluminum - The aluminum sector is expected to see a tightening supply-demand balance, with domestic production capacity constraints. The report suggests关注 companies like China Aluminum and Xinjiang Zhonghe for investment [4][42]. - The report indicates that the average profit in the electrolytic aluminum industry is approximately 5,489 yuan per ton, with costs decreasing slightly [4][44]. Steel - The steel production is on the rise, with a decrease in inventory levels. The report highlights the importance of monitoring supply adjustments and export demand [4][18]. - Companies like Baosteel and Shagang Group are identified as stable dividend-paying stocks worth关注 [4][18]. Key Company Valuations - The report provides detailed valuations for key companies in the non-ferrous metals and steel sectors, indicating potential investment opportunities based on their earnings and price-to-earnings ratios [4][17][18].

Investment Rating - The report maintains a positive outlook on the metals and new materials industry, particularly highlighting the performance of the gold sector [3][4]. Core Insights - The report indicates that the gold sector is expected to benefit from rising interest rate cut expectations, with a long-term trend of central bank gold purchases anticipated due to low current gold reserves in China [4][23]. - The industrial metals segment shows a mixed performance, with copper prices expected to remain strong due to supply constraints and increasing demand from sectors like home appliances and power grid investments [4][36]. - The aluminum market is projected to experience a long-term upward trend in prices, supported by tightening supply-demand dynamics and potential policy support [4][49]. Weekly Market Review - The Shanghai Composite Index fell by 1.18%, while the non-ferrous metals index rose by 2.12%, outperforming the Shanghai Composite by 2.93 percentage points [5][11]. - Precious metals saw a significant increase, with gold prices rising by 3.52% and silver by 1.87% [4][17]. - Year-to-date performance shows precious metals up by 60.89%, aluminum by 23.36%, and copper by 60.11% [11][12]. Price Changes and Key Company Valuations - The report details price changes for various metals, with copper at $9,898 per ton, aluminum at $2,601 per ton, and gold at $3,640 per ounce [17][20]. - Key companies in the sector include Zijin Mining, Shandong Gold, and Huayou Cobalt, with respective valuations and earnings projections provided [20][21]. Supply and Demand Analysis - Copper supply is tightening, with domestic social inventory increasing to 141,000 tons, while demand remains robust with operating rates for copper products showing slight increases [36][49]. - The aluminum sector is experiencing a rise in downstream processing rates, with a current operating rate of 61.70% [49][51]. - Steel production is affected by short-term production limits in Hebei, leading to a decrease in output and an increase in steel prices [4][73].

Core Viewpoint - The rapid expansion of alumina production capacity has led to significant industry challenges, including supply-demand imbalance, price declines, and resource dependency, necessitating the establishment of a production capacity "ceiling" for alumina to ensure market stability and sustainable development [1] Group 1: Industry Challenges - The alumina industry is facing severe overcapacity issues due to rapid production capacity expansion [1] - This overcapacity has resulted in supply-demand imbalances and declining prices within the industry [1] - The industry is also grappling with increased resource dependency as a consequence of these challenges [1] Group 2: Proposed Solutions - It is recommended to draw lessons from the successful experiences of the electrolytic aluminum industry [1] - Establishing a scientifically planned production capacity ceiling is suggested to control alumina output [1] - Strengthening policy regulation and promoting industrial structure optimization are essential for addressing these challenges [1] - The establishment of an exit mechanism is proposed to rationally manage alumina production capacity [1] - These measures aim to ensure market stability and support the green and sustainable development of the industry [1]

Report Industry Investment Ratings - Aluminum: Neutral [7] - Alumina: Cautiously Bearish [7] - Aluminum Alloy: Neutral [7] Core Views - The further rise of aluminum prices requires the resonance of macro - improvement and strong micro - consumption. In the current off - season, there is a slight increase in social inventory, with a small accumulation expected in July. Long - term attention should be paid to the price increase driven by stronger - than - expected consumption under the background of supply constraints [4]. - For alumina, the supply pressure at home and abroad remains unchanged in the long term. Although the delivery risk has been alleviated, it still needs to be vigilant [6]. - For aluminum alloy, it is in the off - season, and the price increase space in the spot market is limited. Attention should be paid to cross - variety arbitrage opportunities [6]. Summary by Related Content Aluminum - **Price and Inventory Data**: On July 3, 2025, the Yangtze River A00 aluminum price was 20,860 yuan/ton, up 50 yuan/ton from the previous trading day. The SHFE aluminum main contract closed at 20,680 yuan/ton, up 15 yuan/ton, with a trading volume of 114,240 lots and a position of 281,092 lots. As of July 3, 2025, the domestic electrolytic aluminum ingot social inventory was 474,000 tons, and the LME aluminum inventory was 356,975 tons, up 350 tons from the previous day [2]. - **Market Analysis**: The spot market transaction premium is still falling, and social inventory shows signs of accumulation. The supply of the electrolytic aluminum industry is limited by the production capacity ceiling, and the industry profit is rich. The smelting profit has expanded to 4,000 yuan/ton in the off - season. In the short term, beware of price drops due to inventory accumulation; in the long term, pay attention to price increases driven by stronger - than - expected consumption [4]. Alumina - **Price and Inventory Data**: On July 3, 2025, the SMM alumina price in Shanxi was 3,080 yuan/ton, in Shandong was 3,080 yuan/ton, and in Guangxi was 3,180 yuan/ton. The Australian alumina FOB price was 361.6 US dollars/ton. The alumina main contract closed at 3,026 yuan/ton, up 28 yuan/ton, with a trading volume of 336,450 lots and a position of 279,051 lots. The alumina warehouse receipt was 21,000 tons [2][3]. - **Market Analysis**: The cost side remains stable, and the new project of Guangtou is about to be put into production. The supply pressure at home and abroad remains unchanged in the long term. Although the delivery risk has been alleviated, it still needs to be vigilant [5][6]. Aluminum Alloy - **Price and Inventory Data**: On July 3, 2025, the purchase price of Baotai civil aluminum scrap was 15,300 yuan/ton, and the purchase price of mechanical aluminum scrap was 15,400 yuan/ton, both unchanged from the previous day. The total inventory of aluminum alloy was 108,800 tons, up 2,100 tons week - on - week [3]. - **Market Analysis**: It is in the off - season, and the price increase space in the spot market is limited. The cost side supports the price, and attention should be paid to cross - variety arbitrage opportunities [6].

Report Information - Report Title: Aluminum Daily Report [1] - Report Date: May 30, 2025 [2] - Research Team: Non-ferrous Metals Research Team [3] - Researchers: Yu Feifei, Zhang Ping, Peng Jinglin [3] 1. Report Industry Investment Rating - No relevant information provided 2. Core Viewpoints - Aluminum prices rose on the 29th due to the US court's action on Trump's tariffs, which alleviated international trade concerns. The Shanghai Aluminum futures closed at 20,200, up 0.25%, with the total open interest of the index increasing by 12,079 to 526,165 lots. [8] - In the spot market, inventory in East China has been decreasing, leading to strong price support from suppliers. Pre-holiday restocking by downstream buyers and low expected arrivals have tightened supply, keeping spot premiums high. [8] - Alumina prices have fallen below 3,000 yuan/ton due to reduced disruptions at Guinea's mines and improved profitability for alumina plants. However, political instability in Guinea remains a risk. [8] - On the supply side of electrolytic aluminum, there are no significant changes, and capacity constraints limit pressure. On the demand side, inventory decreased by 46,000 tons to 511,000 tons on Thursday compared to the previous week, providing some support for aluminum prices. However, the approaching off-season, high smelting profits, and the inhibitory effect of high prices on end-users may limit the upside. It is advisable to avoid risks before the holiday. [8] 3. Summary by Relevant Catalogs 3.1 Market Review and Operation Suggestions - **Market Performance**: Aluminum prices turned up again, with the Shanghai Aluminum futures closing at 20,200, up 0.25%, and the total open interest of the index increasing by 12,079 to 526,165 lots. [8] - **Spot Market**: In East China, inventory has been decreasing, leading to strong price support from suppliers. Pre-holiday restocking by downstream buyers and low expected arrivals have tightened supply, keeping spot premiums high. The spot premium in East China was 110 yuan/ton, 40 yuan/ton in Central China, and -40 yuan/ton in South China. The import loss was around -1,100 yuan/ton. [8] - **Alumina Market**: Disruptions at Guinea's mines have eased, and improved profitability for alumina plants has increased the expectation of rising production capacity. Prices have fallen below 3,000 yuan/ton, but political instability in Guinea remains a risk. [8] - **Electrolytic Aluminum Market**: On the supply side, there are no significant changes, and capacity constraints limit pressure. On the demand side, inventory decreased by 46,000 tons to 511,000 tons on Thursday compared to the previous week, providing some support for aluminum prices. However, the approaching off-season, high smelting profits, and the inhibitory effect of high prices on end-users may limit the upside. It is advisable to avoid risks before the holiday. [8] 3.2 Industry News - **Emirates Global Aluminium (EGA)**: EGA plans to invest $4 billion in an aluminum plant in Oklahoma, USA. The plant is expected to have an annual capacity of 600,000 tons of primary aluminum, with construction starting in late 2026 and completion in 2030. EGA will also cooperate with RTX and Tawazun Council on a gallium project. The location depends on securing a competitive long-term power supply agreement and favorable investment incentives and tax credits. [9][10] - **Norsk Hydro**: Due to the challenging market environment, Norsk Hydro will close its Birtley extrusion plant in the UK at the end of May. The plant has an annual capacity of about 12,000 tons and employs about 100 people. Customers and production activities have been transferred to other plants. [10] - **Hong Kong Exchange**: The London Metal Exchange (LME) has approved the addition of three more warehousing facilities in Hong Kong, bringing the total to seven. The first four facilities will start operating in July. [10] - **Guinea**: The Guinean transitional authorities have classified several mining rights as strategic reserve areas, including concessions, industrial and semi-industrial mining licenses, and exploration licenses for bauxite, iron, gold, diamonds, and graphite. [10]

Investment Rating - The industry investment rating is "Positive" for the electrolytic aluminum sector, indicating an upward trend in aluminum prices for 2025 [2][34]. Core Insights - The report highlights that the destocking of electrolytic aluminum is occurring earlier than in previous years, leading to a tightening supply-demand balance, which is expected to support aluminum prices [3][4]. - The average profit for the electrolytic aluminum industry has significantly improved, transitioning from losses at the end of the previous year to substantial profits in early 2025, driven by falling costs of alumina and electricity [3][18]. - The demand structure for aluminum is undergoing transformation, with significant growth expected in the new energy and power sectors, which will offset declines in the real estate sector [15][34]. Summary by Sections Supply and Demand Dynamics - As of February 2025, the domestic electrolytic aluminum production capacity reached 45.17 million tons, nearing its ceiling, with an operating capacity of 43.98 million tons and a utilization rate of 97.4% [15][34]. - The total inventory of electrolytic aluminum (ingots and rods) decreased by 25,100 tons compared to the previous week, indicating a shift towards destocking earlier than in past years [3][4]. Cost Analysis - The price of alumina has dropped significantly, with a reported price of 3,381 RMB/ton as of March 6, 2025, down 41.4% from its peak in December 2024, leading to a reduction in electrolytic aluminum production costs by approximately 4,597 RMB/ton [18][29]. - The price of coal has also decreased, with Q5500 coal prices falling to 700 RMB/ton, resulting in a corresponding drop in electricity costs for aluminum production [29][30]. Investment Recommendations - The report suggests focusing on companies with significant cost improvements and stable performance, such as Yun Aluminum, Tianshan Aluminum, and China Aluminum, as potential investment opportunities [34][35].