1. Report Industry Investment Rating No relevant content provided. 2. Core Viewpoints of the Report - The current tight supply of scrap aluminum provides strong support for the market. Despite the serious over - capacity and low operating rate in the recycled aluminum industry, the scrap aluminum supply shortage and the delayed arrival of the scrap peak in 2 - 3 years give a solid foundation to the market. There is a potential for a soft squeeze - out situation in the ADC12 market if the peak - season demand is fulfilled and the spot price is at a premium to the futures price [3][14][19]. - In terms of investment strategies, an arbitrage strategy of going long on AD and short on AL can be considered currently, with profit expected to be realized in October. For unilateral trading, there are opportunities to go long at low prices [3][28]. 3. Summary by Relevant Catalogs 3.1. Research Objects and Purposes - The research objects are 5 recycled aluminum plants and 2 scrap aluminum recyclers in Nantong, Baoying, Kunshan, and Shanghai. The purpose is to discuss aspects such as production capacity, output, scrap aluminum supply and demand, costs, prices, inventory strategies, and hedging intentions after the listing of aluminum alloy futures, and to think about subsequent trading logic [10]. 3.2. Key Research Findings and Analyses 3.2.1. Scrap Aluminum Procurement - Scrap aluminum procurement is tight due to limited imports (US tariff policies, port congestion in Malaysia, and environmental regulations in Thailand), limited domestic scrap aluminum increment but increasing demand, and some large factories only purchasing from large - scale ticket - issuing recyclers to avoid information asymmetry risks [14][17]. 3.2.2. Production and Operation - The surveyed recycled aluminum plants have an operating rate higher than the industry average, with an aluminum liquid direct - supply ratio of over 50 - 60% and a maximum transportation distance of 300km. The ADC12 production ratio is around 40 - 50%, and orders are mainly long - term contracts. There is a potential soft squeeze - out risk in the ADC12 market [18][19]. - The use ratio of raw and cooked aluminum in scrap aluminum is flexibly adjusted according to prices. The natural gas consumption per ton is 80 cubic meters, and the total processing fee is 800 - 1200 yuan/ton. The comprehensive tax burden in Jiangsu and Shanghai is about 2 percentage points higher than that in Anhui, but some enterprises can make up for this cost through local procurement and sales, and product quality premiums [23][24]. - The raw material inventory of surveyed enterprises is generally 7 - 10 days' usage, and the finished product inventory is about 1000 - 1500 tons, with some enterprises having no finished product inventory but a high aluminum liquid direct - supply ratio [25]. 3.2.3. Warehouse Receipts - Currently, surveyed enterprises are open to delivering warehouse receipts but are mostly in a wait - and - see mode, mainly referring to the futures price and basis in September - October. The storage time of ADC12 alloy ingots is limited, and the high standards of futures delivery products may reduce the willingness of downstream enterprises to take delivery from the futures market [27]. 3.3. Investment Recommendations 3.3.1. Arbitrage - Consider the strategy of going long on AD and short on AL. The current price difference between ADC12 and A00 fluctuates between - 1500 yuan and + 500 yuan/ton, and the profit is expected to be realized in October. In the long - term, the price difference between ADC12 and A00 may gradually decrease [28]. 3.3.2. Unilateral Trading - Look for opportunities to go long at low prices. The tight scrap aluminum supply and the potential for a soft squeeze - out situation provide support for long - side trading [3][29]. 3.4. Research Minutes 3.4.1. Aluminum Alloy Plant A - Raw materials are mainly domestic scrap aluminum, with less than 20% imported. The annual production capacity is 24.99 tons, and the annual output is 22 tons. The ADC12 production ratio is over 40%. The enterprise does not stock finished products and sells based on orders [30]. 3.4.2. Aluminum Alloy Plant B - The import ratio of scrap aluminum is 30%, and the domestic ratio is 70%. The designed annual production capacity is 20 tons, and the current annual output is 7 - 8 tons. The enterprise plans to use a new production line for futures delivery products [33]. 3.4.3. Aluminum Alloy Plant C - Raw materials are mainly domestic. The Baoying base has a production capacity of 11.85 tons. The aluminum liquid ratio is over 60%, and the ADC12 ratio in aluminum ingots is less than 35%. The enterprise participates in hedging and has views on industry development [35][36]. 3.4.4. Aluminum Alloy Plant D - The Kunshan production line has a total approved production capacity of 12 tons, and the Anhui production line will focus on delivery. The ADC12 production ratio is 20 - 30%. The enterprise is positive about futures trading [37][38]. 3.4.5. Aluminum Alloy Plant E - The monthly scrap aluminum procurement is 4000 - 5000 tons. The current production capacity is 7 tons, and the monthly output is about 6000 tons. The enterprise is cautious about the increase in ADC12 social inventory [39][41]. 3.4.6. Scrap Aluminum Recycling Enterprise A - It has recycling centers in Shanghai and Fujian, with a large trading volume. It mainly recycles new scrap aluminum from aluminum processing enterprises and conducts business through long - term contracts [42]. 3.4.7. Scrap Aluminum Recycling and Aluminum Alloy Trading Enterprise B - It is a benchmark enterprise in scrap aluminum supply. The monthly ADC12 trading volume is about 1000 tons, and it may participate in delivery in November. It mainly conducts long - term contract business and hedges when purchasing scrap aluminum [44][45].

Report Investment Ratings - Cotton: ★★★, indicating a clearer long - term trend and a relatively appropriate investment opportunity currently [1] - Paper Pulp: ★☆☆, suggesting a bullish/bearish bias with a driving force for price movement, but limited operability on the market [1] - Sugar: ★★★, indicating a clearer long - term trend and a relatively appropriate investment opportunity currently [1] - Apple: ★★★, indicating a clearer long - term trend and a relatively appropriate investment opportunity currently [1] - Timber: ☆☆☆, meaning the short - term long/short trend is in a relatively balanced state, and the market operability is poor, with a focus on waiting and seeing [1] - 20 - rubber: ★☆☆, suggesting a bullish/bearish bias with a driving force for price movement, but limited operability on the market [1] - Natural Rubber: ★☆☆, suggesting a bullish/bearish bias with a driving force for price movement, but limited operability on the market [1] - Butadiene Rubber: ★☆☆, suggesting a bullish/bearish bias with a driving force for price movement, but limited operability on the market [1] Core Viewpoints - The prices of various soft commodities show different trends, and the influencing factors include supply - demand relationships, weather conditions, and macro - economic factors. The investment strategies for different commodities mainly include waiting and seeing, intraday trading, or taking appropriate positions at low prices [2][3][4] Summary by Commodity Cotton & Cotton Yarn - Zhengzhou cotton prices pulled back today. The basis of domestic cotton spot sales was firm, and spot trading was average. The rise in Zhengzhou cotton was due to tight commercial cotton inventories and the possibility of a soft squeeze. Cotton yarn prices rose, but market trading did not improve significantly. As of the end of June, cotton commercial inventory was 2829800 tons, a decrease of 628900 tons from the end of May. Operationally, it is recommended to wait and see or conduct intraday trading [2] Sugar - Last week, US sugar fluctuated. In Brazil, rainfall in the main producing areas in the second half of June affected the sugarcane harvest, and the sugarcane crushing volume decreased year - on - year. The sugar - making ratio increased year - on - year. In China, Zhengzhou sugar fluctuated. In June 2025, China imported 420000 tons of sugar, a year - on - year increase of 392300 tons; imported syrup and premixed powder was 115500 tons, a year - on - year decrease of 103500 tons. Although Guangxi had an increase in production this year, due to the fast sales pace, inventory decreased year - on - year, and the spot pressure was relatively light. It is expected that sugar prices will remain volatile in the short term, and it is recommended to wait and see [3] Apple - The futures price fluctuated. The mainstream spot price remained stable. Early - maturing apples were on the market, and cold - storage apple prices weakened. The demand for apples was low due to the large supply of seasonal fruits and hot weather. As of July 18, the national cold - storage apple inventory was 734100 tons, a year - on - year decrease of 42.55%. The market's trading focus has shifted to the new - season output estimate. It is recommended to wait and see [4] 20 - rubber, Natural Rubber, and Synthetic Rubber - Today, RU&MR rose slightly, and BR rose significantly. The domestic prices of natural rubber and synthetic rubber continued to rise. The global natural rubber supply is gradually entering the high - yield period. The domestic butadiene rubber plant operating rate rebounded last week. The downstream demand improved, the rubber supply increased, the natural rubber inventory increased, and the synthetic rubber inventory decreased. The market sentiment improved, and there were potential policy benefits. The strategy is to go long on rebounds [5] Paper Pulp - Today, pulp prices continued to rise. As of July 17, 2025, the inventory of mainstream ports in China was 2181000 tons, a 0.2 - million - ton increase from the previous period. China's pulp imports in June were still relatively high. Currently, the import inventory is high year - on - year, the pulp supply is relatively loose, and the demand is weak. It is recommended to wait and see or buy lightly at low prices [6] Timber - The futures price continued to rebound, and the mainstream spot price remained stable. As of July 18, the average daily outbound volume of 13 ports in China was 62400 cubic meters, a week - on - week increase of 6.12%. The total port inventory was 3.29 million cubic meters, a week - on - week increase of 70000 cubic meters. Due to poor profits, the shipment volume of New Zealand timber will remain low, but domestic demand is in the off - season. It is recommended to wait and see [7]