Report Summary 1) Report Industry Investment Rating No specific industry investment rating is provided in the given content. 2) Core Views - For building materials (成材): Expected to move in a range with a downward - shifting center of gravity, and run in a weak and volatile manner. The market is in a situation of weak supply and demand, with pessimistic market sentiment, and this year's winter storage is sluggish, providing little price support. The view is for volatile consolidation [1][3]. - For aluminum ingots: The price is expected to run in a short - term range. In the short term, the fundamentals are stable, but macro - overseas interference events repeatedly affect market sentiment. The price is currently in a high - level shock, and future attention should be paid to the inventory - consumption trend [4]. 3) Summary by Related Catalogs Building Materials - Production suspension impact: Yunnan - Guizhou short - process building steel enterprises' production suspension during the Spring Festival is expected to affect a total of 741,000 tons of building steel production. In Anhui, 1 out of 6 short - process steel mills stopped production on January 5, and most of the rest will stop production around mid - January, with a daily production impact of about 16,200 tons during the suspension period [2][3]. - Real estate transaction data: From December 30, 2024, to January 5, 2025, the total transaction (signing) area of newly - built commercial housing in 10 key cities was 2.234 million square meters, a 40.3% decrease from the previous period and a 43.2% increase year - on - year [3]. - Market situation: The price continued to decline in a volatile manner yesterday, reaching a new low recently. The market is in a situation of weak supply and demand, with no significant highlights in the near term, and this year's winter storage is sluggish, providing little support for prices [3]. - Later focus: Macro - policies and downstream demand [3]. Aluminum - Supply - side situation: After entering October, due to the peak season of downstream processed materials demand, the proportion of direct aluminum water supply is expected to increase, resulting in low aluminum ingot production and reduced market supply, which supports the aluminum price [3]. - Demand - side situation: In early October, the overall performance of the aluminum processing industry was in line with seasonal characteristics, but there was obvious internal differentiation. The overall industry showed resilience, but the "Golden September and Silver October" in the demand side was lackluster, and the high aluminum price and order differentiation restricted the short - term upward space of the operating rate. High prices will gradually suppress downstream purchasing, leading to a marginal weakening of demand and limiting the upward space of aluminum prices [3]. - Inventory data: On October 13, the inventory of electrolytic aluminum ingots in domestic mainstream consumption areas was 650,000 tons, an increase of 1,000 tons from last Thursday and 58,000 tons from last Monday [3]. - Later focus: Macro - expectations, geopolitical crises, mine resumption, and consumption release [4].

Group 1 - In 2024, China's bauxite production is expected to be approximately 93 million tons, remaining stable compared to 2023 due to environmental regulations and mining restrictions [1] - China's alumina production is projected to reach about 85.52 million tons in 2024, reflecting a year-on-year growth of 3.9% [2] - The output of electrolytic aluminum in China is estimated to be around 44.01 million tons in 2024, showing a year-on-year increase of 4.6% [4] Group 2 - China's recycled aluminum production is anticipated to be about 10.5 million tons in 2024, continuing its growth trend despite previous slowdowns [5][8] - The production of aluminum processing materials in China is expected to be around 64.6 million tons in 2024, with a year-on-year growth of 4.2%, accounting for 67.15% of the global total [9]

Investment Rating - The report maintains an "Outperform" rating for the aluminum industry [4]. Core Viewpoints - The aluminum processing material production in China is expected to grow by 4.4% in 2024, with a compound annual growth rate (CAGR) of 3.9% from 2020 to 2024, indicating stable growth [1][2]. - Despite a 6% drag on aluminum demand from the real estate sector, the production of industrial aluminum profiles has historically surpassed that of construction aluminum profiles for the first time, compensating for the decline in construction aluminum [1][11]. - The outlook for 2025 suggests that while the growth rate of new energy vehicles may slow and the photovoltaic sector may not see additional aluminum demand, investment in the power sector is expected to maintain high growth, benefiting the home appliance sector [1][11]. - 2025 is projected to be the peak year for China's primary aluminum supply, with supply growth expected to be less than 2%, likely leading to a supply-demand gap in the aluminum industry, which may sustain or even create new highs in aluminum prices and smelting profits [1][11]. Summary by Sections Aluminum Production Trends - In 2024, China's aluminum processing material production is projected to reach 49 million tons, a year-on-year increase of 4.4%, with significant contributions from aluminum plates, foils, and wires [2]. - From 2020 to 2024, the total increase in aluminum production is expected to be 6.9 million tons, with aluminum plates contributing 42%, aluminum extrusions 28%, and aluminum foils 18% [2]. Industrial Aluminum Profiles - The production of industrial aluminum profiles is expected to reach 11.7 million tons in 2024, marking a 23% year-on-year increase, which compensates for the decline in construction aluminum profiles [6][11]. - The growth in industrial aluminum profiles is primarily driven by the photovoltaic and new energy vehicle sectors, with photovoltaic aluminum profiles contributing 40% to the increase [5][11]. Aluminum Plates and Foils - The production of aluminum plates is expected to increase by 2.9 million tons from 2020 to 2024, with the fastest growth seen in automotive body panels, which have a CAGR of 38% [7][11]. - The production of battery foils and air conditioning foils has shown significant growth, with battery aluminum foil production expected to have a CAGR of 59% from 2020 to 2024 [14].