Aluminum prices rose by 0.78% in November 

Aluminum prices fluctuated in November, rising initially before falling. According to SunSirs' commodity price analysis system, as of November 29, 2025, the average price of domestic aluminum ingots in the East China market was 21,460 RMB/ton, an increase of 0.78% compared to the average market price of 21,293.33 RMB/ton on November 1st; and a decrease of 2.16% compared to the average market price of 21,933.33 RMB/ton on November 13th.

In November 2025, aluminum prices continued the upward trend from the end of October and repeatedly reached new annual highs, while the price of alumina, the raw material, fell from its high levels. As of the end of November, the profit per ton of aluminum was in a relatively favorable position. The strong performance of aluminum prices in November was mainly driven by a combination of factors, including concentrated positive macroeconomic news, continued supply constraints, and low inventory levels. The specific reasons were as follows:

1. Positive factors at the macro level were being released in a concentrated manner

The Federal Reserve's interest rate cut boosted market risk appetite: At the end of October, the Federal Reserve lowered interest rates by 25 basis points as expected, and dovish remarks from Federal Reserve officials in November further fueled expectations of future rate cuts. This series of actions eased global liquidity pressure, leading to increased market risk appetite. Traders became more active in stocking up, and downstream companies took advantage of the price decline to stockpile raw materials, accelerating inventory turnover and creating a favorable market environment for rising aluminum prices.

US-China Tariff Negotiations Eased Export Concerns: On October 30, the US and China reached a consensus in tariff negotiations, agreeing to reduce trade barriers on certain aluminum products.  This not only suspended the 24% reciprocal tariffs but also saw China simultaneously suspend related export control measures. This outcome eased market concerns about restrictions on aluminum product exports, facilitating order fulfillment for aluminum processing companies and indirectly driving up aluminum prices.

Expected costs of easing and stabilizing the Middle East situation: The easing of geopolitical tensions in the Middle East reduced the risk of significant fluctuations in energy prices. Electrolytic aluminum is a highly energy-intensive industry, with energy costs accounting for a very high proportion of its production costs. The expected stability of energy prices provides greater clarity regarding cost expectations for the aluminum industry chain, reducing market panic caused by cost fluctuations and indirectly supporting a stable increase in aluminum prices.

2. Supply-side constraints were a significant problem

Domestic production capacity reached its limit, and regional transportation was hampered: Domestic electrolytic aluminum operating capacity was close to the policy red line of 45 million tons, with a capacity utilization rate of over 96%, leaving almost no room for net new capacity. Furthermore, after the start of the heating season in northern China in November, the efficiency of aluminum ingot transportation from the main production areas in the northwest decreased due to road transport restrictions. This led to a sharp reduction in aluminum ingot arrivals in East China, highlighting a regional supply shortage. Even with the resumption of some capacity through technological upgrades in the southwest, it is difficult to offset the impact of continuous inventory depletion in East China, thus supporting higher aluminum prices.

Ongoing disruptions to overseas supply: Global electrolytic aluminum supply was already inelastic, and in and around November, several supply disruptions occurred overseas. For example, an aluminum plant in Iceland reduced production due to equipment failure, and an aluminum plant in Australia faced the risk of closure due to excessively high electricity costs. These events further tightened global electrolytic aluminum supply, providing strong support for rising international aluminum prices.

3. Low inventory levels amplified price elasticity

The weakening of the inventory's "buffer" function had exacerbated the upward trend in aluminum prices. In November, LME aluminum inventories showed a trend of opening high and then declining, with a cumulative decrease of 19,000 tons throughout the month, a drop of approximately 3.4%; domestic electrolytic aluminum ingot social inventories also showed a trend of initial slight fluctuations followed by a sustained and steady decline, with only a brief period of inventory accumulation in the middle of the month, which did not change the overall downward trend. The persistently low inventory levels had significantly reduced the market's ability to withstand supply fluctuations, and the upward elasticity of aluminum prices had been significantly amplified.

4. Demand from emerging sectors provided long-term support

Although aluminum demand showed a mixed trend in November, with a decline in operating rates in traditional sectors such as construction profiles, demand from the new energy sector remained strong. Global new energy vehicle production is expected to exceed 25 million units in 2025, and newly installed photovoltaic capacity is projected to reach 550 GW. These two sectors were generating significant new demand for aluminum. Simultaneously, the "aluminum replacing copper" trend continues in the power sector, providing a solid foundation for high aluminum prices and underpinning the price increase in November.

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