China’s aluminum inventories fell 11% in one week, as demand recovered while aluminum billets remained weak
Citi estimates that China’s apparent aluminum consumption rose 1% week on week from 15 October to the 22nd, while combined aluminum ingot and billet inventories fell to 897 thousand tonnes. However, total inventories remained 2% higher than in the same lunar-calendar period, and year-to-date billet consumption was still contracting.
Original source：Citi ResearchFirst published on Unhidea：Original source date：
Key takeaway
Citi’s high-frequency data point to a weekly improvement in Chinese aluminum demand, but billet inventories and cumulative consumption are weaker than the overall figures, showing structural differences in the recovery.
Did the inventory decline coincide with an improvement in consumption?
According to Mysteel data, as of 22 October 2026, combined Chinese aluminum ingot and billet inventories stood at 897 thousand tonnes, down 11% week on week. Aluminum production over the same period was 874 thousand tonnes, unchanged week on week: this round of destocking was not accompanied by a weekly contraction in overall production.
Citi estimates that China’s overall apparent aluminum consumption from 15 October to the 22nd was 1.003 million tonnes, up 1% week on week, 9% year on year on a calendar basis and 14% compared with the same lunar-calendar period. Citi also noted that consumption that week exceeded the levels in the corresponding lunar-calendar periods of 2022–2025, providing historical comparisons that also support the assessment of improving demand.
Citi places greater weight on the combined inventory measure for aluminum ingots and billets because it captures changes in more types of inventory, making it more representative for estimating overall aluminum demand than observing ingots alone. The demand assessment here is based on estimates of apparent consumption.
After destocking, were inventories already below last year’s level?
The answer depends on the comparison window. Combined aluminum ingot and billet inventories fell 5% year on year on a calendar basis, but remained 2% higher than in the same lunar-calendar period. A pronounced weekly inventory draw and inventories still slightly above the same lunar-calendar period last year can therefore both be true.
The differences are mainly between product types: aluminum ingot inventories were 608 thousand tonnes, down 10% week on week, 10% year on year on a calendar basis and 14% year on year on a lunar-calendar basis. Billet inventories were 289 thousand tonnes, down 11% week on week, but still 8% higher year on year on a calendar basis and 24% higher on a lunar-calendar basis. Although billet inventories also fell, they remained more plentiful relative to last year.
There was also divergence within aluminum ingot inventories: producer inventories were 77 thousand tonnes, up 18% year on year on a calendar basis, while inventories in the market were 531 thousand tonnes, down 13% year on year. Despite the decline in total inventories, inventory trends differed between producers and the market circulation channel.
Can one week’s recovery characterize demand for the year to date?
From the start of the year through the period covered by the report, China’s overall apparent aluminum consumption was 38.3 million tonnes, up 3% year on year on a calendar basis; aluminum production over the same period was 37.3 million tonnes, up 2.9% year on year. Cumulative consumption and production grew at similar rates, while the 9% year-on-year rise in consumption for the single week was stronger than the year-to-date trend.
The recovery in aluminum billets was more limited: apparent consumption that week was 367 thousand tonnes, up 2% week on week, flat year on year on a calendar basis and up 12% on a lunar-calendar basis. But year-to-date consumption was only 13.5 million tonnes, down 3.4% year on year. The improvement that week had yet to change the pattern of contracting cumulative consumption.
The supply side reflects the same divergence: aluminum billet production that week was 351 thousand tonnes, down 3% week on week; year-to-date production was 14.3 million tonnes, down 2.8% year on year. Overall aluminum production and consumption both grew, while cumulative billet production and sales both declined. This coexistence is key to understanding the scope of the current demand recovery.
