After breaking through the 22,000 yuan/ton mark in mid-November, aluminum prices have seen a slight pullback, but the magnitude has been limited. The current fundamentals of the aluminum market are bullish, and prices are expected to maintain a relatively strong trend. Limited Capacity Increase: In 2017, my country's electrolytic aluminum industry implemented supply-side structural reforms, clearly defining a capacity ceiling of 45 million tons. As of October 2025, domestic electrolytic aluminum operating capacity was 44.434 million tons, nearing the capacity ceiling, meaning that the space for further capacity increases is very limited, providing strong support for aluminum prices. In the medium to long term, this capacity ceiling is expected to be difficult to break, and electrolytic aluminum supply will stabilize at around 45 million tons. From a supply perspective, the current proportion of aluminum ingots is low. According to data from Shanghai Metals Market, my country's electrolytic aluminum production in October was 3.7421 million tons, a year-on-year increase of 1.13%, of which molten aluminum accounted for 77.7%, corresponding to an aluminum ingot proportion of only 22.3%. Since aluminum ingots are the deliverable commodity for my country's aluminum futures market, the low proportion of aluminum ingots leads to a tight supply of deliverable commodities, creating conditions for maintaining low inventory levels. Overall, the policy-defined capacity ceiling has limited the increase in electrolytic aluminum supply, while the current supply structure, dominated by molten aluminum and with insufficient aluminum ingots, further strengthens the bullish support for aluminum prices from the supply side. Emerging industries drive consumption growth. Electrolytic aluminum demand is mainly concentrated in three sectors: construction (30%), transportation (20%), and power (16%). In the construction sector, the real estate market is still in a recovery cycle. From January to October, the sales area of commercial housing was 719.82 million square meters, a year-on-year decrease of 6.8%; the completed floor area was 348.61 million square meters, a year-on-year decrease of 16.9%. Although the government has continuously introduced real estate support policies since 2022, residents' willingness to buy houses remains cautious due to the lingering effects of the pandemic and economic cycles. The transportation sector performed steadily, with automobile production and sales reaching 3.359 million and 3.322 million units respectively in October, representing year-on-year increases of 12.1% and 8.8%. From January to October, cumulative production and sales reached 27.692 million and 27.687 million units respectively, representing year-on-year increases of 13.2% and 12.4%. In terms of exports, October's automobile exports reached 666,000 units, a year-on-year increase of 22.9%; from January to October, cumulative exports reached 5.616 million units, a year-on-year increase of 15.7%. It is worth noting that new energy vehicles, due to their lightweight requirements, consume significantly more aluminum than gasoline vehicles, using 220-300 kg of aluminum per vehicle, far exceeding the 150-200 kg used in gasoline vehicles. Data shows that in October, production and sales of new energy vehicles reached 1.772 million and 1.715 million units respectively, representing year-on-year increases of 21.1% and 20.0%, with new vehicle sales accounting for 51.6% of total vehicle sales. From January to October, cumulative production and sales reached 13.015 million and 12.943 million units respectively, representing year-on-year increases of 33.1% and 32.7%, accounting for 46.7% of total sales. Exports also performed strongly, with 256,000 new energy vehicles exported in October, a surge of 99.9% year-on-year; cumulative exports from January to October reached 2.014 million units, a year-on-year increase of 90.4%. Furthermore, the photovoltaic industry continues to see strong demand for electrolytic aluminum, as aluminum alloys are the core raw material for photovoltaic cell frames and brackets. From January to October 2025, the cumulative newly installed photovoltaic capacity nationwide reached 252.87 GW, a year-on-year increase of 39.48%; the newly installed capacity in October alone reached 12.6 GW, a month-on-month increase of 30.43%. Overall, the booming development of new energy vehicles and the photovoltaic industry has effectively offset the drag on electrolytic aluminum consumption caused by the sluggish real estate market. Meanwhile, the application scenarios for electrolytic aluminum continue to expand, with emerging fields such as energy storage, robotics, low-altitude economy, smartphones, and winter sports equipment all using electrolytic aluminum as a core raw material. In the medium to long term, electrolytic aluminum will exhibit a pattern of stable supply and growing demand. Inventory remains low. Regarding social inventory, as of November 24th, the social inventory of electrolytic aluminum in five regions, as compiled by Shanghai Metals Market, was 612,000 tons, a decrease of 7,000 tons from the previous week, compared to 555,000 tons in the same period last year. Benefiting from the low proportion of aluminum ingots and strong consumption of industrial profiles, the social inventory of electrolytic aluminum has remained low, providing effective support for aluminum prices. In summary, on the supply side, the upper limit of electrolytic aluminum production capacity is clearly constrained, coupled with the low proportion of aluminum ingots, providing solid support for prices; on the demand side, although the real estate market is lackluster, the rapid development of emerging industries such as new energy vehicles and photovoltaics has effectively driven consumption growth. Therefore, the current fundamentals are positive, and aluminum prices are expected to maintain a relatively strong trend in the future.