Futures: Last Friday, the LME lead 3M contract opened at $1,890.5/mt, drifted lower during the Asian session, and after dipping to $1,881.0/mt, consolidated in a narrow range at low levels. It then gradually rebounded during the European session, and surged late in the session to a high of $1,896.5/mt, finally closing at $1,895.5/mt, up 0.26%. Open interest increased by 3,720 lots to 183,969 lots on the day. On Friday night, the SHFE lead 2609 contract opened at 15,840 yuan/mt in the night session. After briefly touching a high of 15,855 yuan/mt early on, it quickly fell, bottoming at 15,740 yuan/mt, then consolidated and rebounded. In the latter half, it traded in the 15,820-15,840 yuan/mt range, and finally closed at 15,805 yuan/mt, down 0.22%. Night-session open interest decreased by 1,185 lots to 37,951 lots. It should be noted that the 2608 contract was in the delivery period. Prices and open interest of near-month contracts were susceptible to disruptions from delivery and contract rollover, and the subsequent trend of the 2609 contract still required close tracking of the pace of fund position shifting. Overall, after SHFE lead retreated from highs, it had yet to show clear rebound momentum. On the macro front: The situation in the Middle East continued to escalate. Iran said US forces had been expelled and were not allowed to enter the strait; Syrian sources said Yemen’s Houthi forces launched an attack on a US drone; and the Israel Defense Forces launched strikes on southern Lebanon over the weekend. Rising geopolitical tensions could lift crude oil and inflation expectations, and affect risk appetite for nonferrous metals via the US dollar and expectations for US Fed policy. US President Trump demanded a significant reduction in the scale of US–South Korea joint military exercises. Today, focus was on the impact of Middle East developments and crude oil price changes on macro sentiment. PBOC: In the first seven months, cumulative growth in aggregate financing to the real economy totaled 22.25 trillion yuan, and RMB loans increased by 10.38 trillion yuan. National Development and Reform Commission (NDRC): Starting from 24:00 on August 14, China’s retail price caps for gasoline and diesel were lowered by 230 yuan/mt and 220 yuan/mt, respectively. Zhongwei Semiconductor: Net profit in 2026 H1 was 172 million yuan, up 98.48% YoY. Spot fundamentals: SHFE lead reversed and pulled back, and suppliers’ willingness to sell declined somewhat, while quotations for warrant cargoes also decreased. In addition, EXW cargoes from primary lead smelters were quoted in line with the market, with mainstream producing areas quoted at parity against the SMM #1 lead average price ex-works, and discounted cargoes decreased somewhat. For secondary lead, smelters’ willingness to quote declined, market circulating cargoes decreased, and some smelters held back from selling at low prices; secondary refined lead was quoted at discounts of 100-0 yuan/mt against the SMM #1 lead average price ex-works. Downstream enterprises mainly purchased as needed. Approaching the weekend, some rigid-demand restocking increased somewhat, but overall wait-and-see sentiment remained strong, and spot market transactions saw limited improvement. Inventory: On August 14, LME lead inventory fell by 1,700 mt, or 0.41%, to 412,675 mt; according to SMM, as of August 13, SMM five-location social inventory of lead ingots stood at 75,200 mt, up 2,400 mt from August 10. Today’s Lead Price Forecast: This week marks the delivery period for the SHFE lead 2608 contract. Ahead of delivery, lead ingots saw an on-schedule inventory buildup, dragging lead prices lower. However, it is worth noting that maintenance among primary lead enterprises increased in mid-to-late August, mainly among delivery brand enterprises, which may support a rebound in lead prices. Meanwhile, consumption in the lead-acid battery market was mediocre, while just-in-time procurement demand from downstream enterprises was moderate, which can be regarded as a neutral factor. In summary, SMM expects lead prices to rebound after probing lows.

★ Macro ★ 01 ★★ [National Development and Reform Commission (NDRC): Solidly Advancing Carbon Peaking Actions] The main venue event for National Ecology Day 2026 was held yesterday in Hulunbuir, Inner Mongolia Autonomous Region. Zhou Haibing, Deputy Director of the National Development and Reform Commission (NDRC), said that we must solidly advance carbon peaking actions, carry out comprehensive evaluation and assessment of carbon peaking and carbon neutrality in a scientific manner, accelerate adjustments and optimization of the industrial structure, energy structure, and transportation structure, and ensure the carbon peaking target is achieved on schedule. It is understood that the 15th Five-Year Plan period is a critical and decisive phase for achieving the carbon peaking target. The “15th Five-Year Plan Carbon Peaking Action Plan” has laid out several major initiatives, including interprovincial power mutual support, clean substitution for coal consumption, energy conservation and carbon reduction in key industry, low-carbon and zero-carbon heating and cooling and green lighting, construction of zero-carbon transport corridors, and enhancement of foundational capabilities for carbon peaking and carbon neutrality. The overall targets are: by 2030, China’s CO2 emissions per unit of GDP will be reduced by 17 compared with 2025, the share of non-fossil energy in energy consumption will reach 25, and the carbon peaking target will be achieved on schedule. 02 ★★ [In the Next 10 Days, South China May See the Most Precipitation; Next Week, the High-Temperature Zone in Jiangnan and South China Will Expand] As the remnant vortex of “White Dolphin” moves eastward into the sea, rainfall in east China and other areas will gradually weaken. However, the rain will not exit the stage; the remnant vortex will later move northward, leading to some strengthening of rainfall in the eastern part of north-east China. Tomorrow and the day after, there will be significant rainfall in eastern Liaoning, eastern Jilin, and eastern Heilongjiang. Next week, the subtropical high will strengthen again and extend westward, and China’s distribution of rain and heat will once again be controlled by it—South China on the southern side of the subtropical high will see heavy rainfall under the influence of a monsoon trough or low pressure; from Jiangnan to Huanghuai under the control of the subtropical high, hot and muggy weather will develop and increase in succession. Over the next 10 days, South China may be the area with the most precipitation in China. According to the Central Meteorological Observatory’s medium-term forecast, over the next 10 days, cumulative precipitation in Jiangnan, South China, south-west China, and the eastern and northern parts of north-east China and other areas will be 50–90 mm; in parts of the western Sichuan Basin, Guangxi, Guangdong, and Yunnan, it will be 100–150 mm, with localized areas along the southern coastal areas of South China exceeding 250 mm. In most of the above areas, precipitation will be 50% to 100% higher than the climatological average for the same period, and in some areas more than double. ★ Industry and Downstream ★ 01 ★★ [H1 Coal Supply Was Adequate; Energy Use Is Guaranteed for the Summer Peak] According to information from the China Coal Industry Association, in H1 this year, the national daily average production of raw coal by industrial enterprises above designated size reached 13.07 million mt, the second-highest level for the same period in history, and coal has continued to play its stabilizing role as the main energy source. At present, China has entered the peak period of energy use for summer peak-load support. Temperatures in most regions nationwide were higher than the average for the same period in normal years, and some regions experienced intermittent high-temperature heat waves. To proactively respond to extreme weather and ensure coal supply for summer peak-load support, the coal industry fully leveraged the advantages of large modern coal mines and intelligent coal mines, and nationwide coal production and supply remained stable and orderly. Experts said that in H2, China’s macro economy will continue to maintain steady and relatively rapid growth; “AI+” application scenarios will become increasingly widespread; energy use for big data and computing power will continue to increase rapidly, boosting sustained growth in energy consumption demand. Coal will still be the mainstay and an important backstop force for the secure and stable supply of energy nationwide. 02 ★★ [First-Time Homebuyers in Seoul, South Korea Hit a New High in More Than Four Years] A report showed that the number of first-time homebuyers in Seoul, South Korea reached a new high in four years and eight months. According to data released on the 16th by the Supreme Court of South Korea’s Real Estate Registration Information Plaza, a total of 7,552 homebuyers in Seoul completed ownership transfer registration for their first home (multi-family housing) last month. This was the highest level in four years and eight months since the heated housing market period in November 2021 (7,886 people). 03 ★★ [Minor Adjustment to Home-Swap Purchase Policies for Non-Shanghai Registered Residents and Overseas Individuals? Shanghai Real Estate Transaction Center Hotline Responds] In response to market reports that Shanghai had updated the implementation guidelines related to home-swap purchases, on August 15, a reporter called the Shanghai Real Estate Transaction Center hotline “962269” for inquiries. Regarding home-swap purchases by residents without Shanghai household registration, hotline staff said that no new policy had been introduced. According to the hotline staff, a non-Shanghai registered resident household that sells its only property may swap for one home anywhere in the city; the property owner before and after the transaction must remain the same, and no social insurance or individual income tax payment certificates are required. This guideline has been implemented since May 28, 2024. For multiple homes, when a non-Shanghai registered resident household or an adult single person sells part of the properties under their name (i.e., having two or more homes under their name) and purchases a home again, the number and location of the homes purchased must match those of the homes sold—if a home outside the Outer Ring Road is sold, the purchase can only be made outside the Outer Ring Road; if a home inside the Outer Ring Road is sold, the purchase can only be made inside the Outer Ring Road, and submission of social insurance or individual income tax payment certificates is exempted. This guideline has been implemented since February 26, 2026. Regarding home-swap purchases by overseas individuals, hotline staff said that after an overseas individual sells all properties under their name in Shanghai, they may swap and purchase one home in the city, exempt from submitting a foreigner residence permit (work category), a local labor contract continuously valid for one year prior to the home purchase date, and social insurance and individual income tax payment certificates for one continuous year prior to the home purchase date, but they must still sign a self-occupancy commitment letter for overseas individuals purchasing a home. This methodology took effect on July 29, 2026. ★ Other Hot Topics ★ ⭕ [US Fed Has a 67.5% Probability of Keeping Rates Unchanged in September] According to CME “FedWatch,” the probability that the US Fed will keep rates unchanged through September was 67.5%, while the probability of a cumulative 25-bp rate hike was 32.5%. The probability that the US Fed will keep rates unchanged through October was 53.3%, while the probability of a cumulative 25-bp rate hike was 39.8% and that of a cumulative 50-bp rate hike was 6.8%. ⭕ [Iran Says It Has Reached an Agreement With Oman on a Passage Plan for the Strait of Hormuz] Iranian Foreign Ministry spokesperson Baghaei said on August 15 local time that, despite US obstruction, talks between Iran and Oman were still progressing actively, and the two sides had reached an agreement on a passage plan for the shipping lane in the Strait of Hormuz. ⭕ [PBOC: Broad Money (M2) Balance at Month-End July Was 35.551 Trillion Yuan, Up 7.7% YoY] PBOC data showed that at month-end July, the balance of broad money (M2) was 35.551 trillion yuan, up 7.7% YoY. The balance of narrow money (M1) was 11.546 trillion yuan, up 4% YoY. The balance of currency in circulation (M0) was 1.482 trillion yuan, up 11.6% YoY. Net cash injection in the first seven months was 725.5 billion yuan. ⭕[Ministry of Emergency Management Deploys 13 Drainage Teams to Carry Out Drainage Operations in Zhoukou, Henan] To assist with drainage work in the urban area of Zhoukou, Henan, the Ministry of Emergency Management deployed a total of 13 drainage forces from Henan, Shaanxi, Jiangsu, Anhui, Shandong, Hunan, and other places, including the Ministry of Emergency Management’s Engineering Emergency Rescue Center for Natural Disasters (China Aneng), eight national work-safety emergency rescue drainage forces, the Shaanxi mobile drainage team, as well as XCMG Group, Jiaozuo Huayu, Hunan Diwo, and others, with a total drainage capacity of about 220,000 m³/hour, rushing urgently to Zhoukou, Henan. All of the above rescue forces arrived by 9:00 a.m. on the 16th and were put into drainage operations.

Copper is trading near record levels at around $14,500/t, while tightness in the London Metal Exchange market has intensified sharply. The August–September spread has widened to around $370/t, while the cash-to-three-month backwardation has reached approximately $434/t, highlighting increasingly strong demand for immediately available metal.​ The tightening market structure has coincided with a prolonged decline in exchange inventories. LME copper stocks have fallen for 42 consecutive days to 204,975 tonnes, with nearly half of the remaining material reportedly already earmarked for withdrawal. The combination of falling inventories and widening nearby premiums points to mounting pressure in the physical market.​ At the same time, copper flows are becoming increasingly fragmented geographically. Metal has been redirected toward the US amid expectations of possible 15–30% tariffs on refined copper, while demand for deliverable units in China has also strengthened as smelters face tighter feedstock availability following the DRC’s concentrate export restrictions.​ Supply-side constraints are adding to the pressure. Chilean copper production remains around 5.5 million tonnes per year, while Indonesia’s 342,000-tpy Gresik smelter is currently offline, reducing refined supply availability. These developments come as concentrate markets remain tight and smelter operating conditions stay under pressure.​ The increasingly pronounced backwardation suggests that the immediate issue for the copper market is not simply high prices, but access to physical metal. BMI currently expects 2026 copper prices to average around $13,500/t, while maintaining a view of strong upside risks. If LME inventories continue to decline, competition for warehouse metal could intensify further, increasing the risk of additional volatility in nearby contracts.

UN Economic Commission for Africa executive secretary Claver Gatete has called on the Southern African Development Community (SADC) to move from raw mineral exports toward local processing and value addition, calling the region a testing ground for Africa's broader mineral strategy. Demand for critical energy transition minerals including lithium could more than triple by 2030 under net-zero scenarios, with Africa holding about 30% of global reserves but just 1% of lithium output, the smallest share among minerals cited. Zimbabwe was named SADC's primary lithium resource holder, alongside the DRC (cobalt), South Africa (platinum, manganese) and Zambia (copper), with Gatete pointing to Zimbabwe's unprocessed lithium export ban as a policy model for the region. Minerals contribute about 10% of SADC's GDP, 25% of exports and 20% of government revenues, but only 7% of direct employment. SMM View: Gatete's remarks lend regional policy weight to Zimbabwe's ongoing beneficiation push, reinforcing the rationale behind its concentrate export ban as domestic sulfate capacity comes online.

China Sulphuric Acid Market Continued to Hit Bottom, Weak Demand Dragged Down the Price Center [SMM Sulphuric Acid Weekly Review]

The Democratic Republic of Congo is investigating uranium contamination in cobalt exports after researchers estimated that thousands of tonnes of the radioactive metal likely left the world’s largest cobalt-producing nation over the past two decades. The government said it would test cobalt hydroxide exported largely to China and establish a working group to assess findings published July 30 in Nature Communications and examined in a Financial Times and Lighthouse Reports collaborative investigation. Kinshasa also plans to consult the International Atomic Energy Agency (IAEA) about arranging a technical support mission, while domestic authorities will assess potential health and environmental risks over the next 60 days and make their findings public. “The government of the Democratic Republic of Congo has taken careful note” of the findings, officials said. The investigation comes as demand for cobalt, a key material in some lithium-ion batteries, has made DRC’s Copperbelt central to global supply chains. Uranium occurs naturally alongside copper and cobalt ores across the region and can remain attached to cobalt minerals as they move through mining and processing.