June 3, 2026 A historic milestone in the structure of the global financial system: By the end of 2025, gold had overtaken U.S. Treasury bonds as the largest component of global reserve assets. With a share now of around 27 percent—up from 20 percent at the end of 2024—the precious metal has clearly left the U.S. securities, which slipped from 25 to 22 percent, far behind. This shift is more than just a footnote. It is the result of an unprecedented price rally, sustained central bank purchases, and a profound geopolitical realignment. Valuation Effects vs. Physical Demand Gold’s rapid rise to the top is largely driven by price movements. Nominal gains of around 60 percent in 2025 and about 30 percent in 2024 have catapulted the precious metal’s weighting on balance sheets. If we adjust for this extreme price effect and use the prices from late 2023 as a basis, the picture becomes more nuanced: In this scenario, U.S. Treasury bonds continue to dominate significantly with 26 percent, while gold and the euro are tied at 16 percent each. Nevertheless, behind the pure valuation effects lies a solid, physical foundation. Geopolitics dictates purchases Central banks remain the driving force in the physical market. Although their demand recently fell slightly to 863 tons—just below the 1,000-ton mark of the previous three years—the official sector’s appetite remains unquenched. Notably, the largest purchases come from regions that are specifically arming themselves against external conflict risks. Since Russia’s invasion of Ukraine in 2022, certain players have dominated the field: China increased its reserves by more than 350 tons. It was followed by Poland (320 tons), Turkey (220 tons), and India (130 tons). In 2025 alone, Poland once again secured the top spot as the largest buyer with around 100 tons, followed by Kazakhstan, Brazil, China, and Turkey. The motives behind this massive accumulation are structural in nature. Nitesh Shah, chief commodities analyst at WisdomTree, points out that the freezing of Russian central bank assets has set a precedent. The politicization of the U.S. dollar and other G7 currencies offers a massive incentive for many countries to reduce their dependence on these currency areas. Another crucial factor: spiraling government debt. Unlike bonds or fiat currencies , physical gold carries no counterparty risk—it is simply not the liability of another debtor. Structural Limits of Gold Reserves Despite this momentum, the sky is not the limit for gold. At the monetary policy level, the precious metal faces structural hurdles as an official reserve asset compared to major fiat currencies. It is price-volatile, yields no current interest income, and incurs storage costs. The most significant difference from bond markets, however, lies in the lack of elasticity: the physical supply of gold is inherently limited and cannot be expanded at will to respond to short-term shifts in international liquidity. Gold Outlook This paints a complex but extremely solid picture for the gold market. Even though demand has slowed somewhat since the start of the year, the World Gold Council expects central bank purchases of around 850 tons for the current year. Regardless of shifts driven purely by valuation, the precious metal has impressively reinforced its role as an indispensable monetary asset in a world marked by tensions and debt crises. With a share now of around 27 percent—up from 20 percent at the end of 2024—the precious metal has clearly left U.S. securities behind, which slipped from 25 to 22 percent. This shift is more than just a footnote. It is the result of an unprecedented price rally, sustained central bank purchases, and a profound geopolitical realignment. Source： https://goldinvest.de/en/major-shift-in-the-financial-system-gold-overtakes-u-s-treasury-bonds-in-global-reserves

Chapter 1: The Energy Crisis Reshapes Coking Coal Value In 2026, with the Russia-Ukraine war still ongoing and the U.S.-Iran war reigniting, crude oil price centers continued to shift upward. Coupled with persistent geopolitical conflicts in other regions worldwide, energy security demand climbed, driving a systematic revaluation of coking coal value. Moreover, against the backdrop of high oil prices, the cost advantages of coal-based chemicals over oil-based chemicals began to emerge, improving the economics of coal-to-oil substitution and expanding coking coal demand. Coking coal possesses the dual attributes of industrial raw material and energy commodity, supported by both rigid demand and high elasticity to energy prices, with premium capacity far exceeding that of ordinary industrial products. Market perception underwent a fundamental shift, as coking coal gradually shed its subordinate positioning within the steel industry chain and was upgraded to a scarce strategic energy asset. The energy crisis restructured its valuation logic. Pricing broke free from the singular steel supply-demand framework and was incorporated into the global energy price comparison system. Energy and security premiums elevated the valuation center, making it an important target for hedging geopolitical risks and allocating strategic resources. Chapter 2: Global Coking Coal Market Landscape (1) Global Coking Coal Resource Distribution Data source: publicly available data Global coking coal resources account for 13% of total global coal resources, approximately 1,140 billion mt. About 49% are distributed in Europe, 29% in Asia, and 19% in North America. The economically recoverable reserves of coking coal are approximately 500 billion mt, of which high-quality coking coal with low ash and low sulfur content amounts to only about 60 billion mt. Economically recoverable coking coal resources are primarily concentrated in three countries: Russia (42%, approximately 210 billion mt), China (23%, approximately 115 billion mt), and the US (18%, approximately 90 billion mt), with other countries accounting for relatively small shares. (II) Global Coking Coal Production Distribution Data source: publicly available data Global coking coal production in 2025 was approximately 1.1 billion mt, with a highly concentrated production landscape. China ranked first at 514 million mt, accounting for 47% of global production and serving as the core supply pillar, though virtually all output was consumed domestically. Australia (172 million mt) and Russia (98 million mt) ranked second and third, followed closely by the US (59 million mt), Mongolia (54 million mt), and Canada (32 million mt), while India produced 25 million mt and Indonesia produced 11 million mt. These eight countries collectively accounted for 88% of global coking coal production. Data source: World Steel Association, IEA Major producing countries: China firmly held the top global position with absolute volumes rising from 480 million mt (2020) to 514 million mt (2025), achieving the highest global increase of 34 million mt, primarily driven by new domestic mine commissioning and supply security policies. Russia and Mongolia became key growth contributors with increases of 12 million mt and 23 million mt respectively — the former benefiting from post-sanction market redirection and new mine development, while the latter achieved substantial production increases through upgraded border customs clearance with China and railway cost reductions. Australia's capacity remained basically flat. EU countries (Germany, Poland) and Ukraine continued to cut production due to factors such as coal phase-out policies, aging mines, and geopolitical conflicts, while the US, India, Mozambique and other countries achieved capacity growth driven by export demand and downstream industry boost. (III) Analysis of Global Coking Coal Export Trade Data source: publicly available data Global coking coal export trade is highly concentrated in five countries—Australia, Russia, Mongolia, the US, and Indonesia—primarily for the following reasons: Monopolistic resource endowment: Russia accounts for 42% of the world's recoverable coking coal reserves, and the US accounts for 18%. Australia possesses globally scarce high-quality coking coal resources with low ash and low sulfur content. Mongolia and Indonesia also have distinctive coal varieties suited to blending needs. These resource barriers create a supply-side monopoly. Locational and logistics cost advantages: Australia's coking coal producing regions are adjacent to east coast ports, enabling low-cost seaborne access to the world's core steel-producing regions. Mongolia's mining areas border China, with overland logistics providing direct access to the Chinese market. Russia, the US, and Indonesia leverage mature seaborne and cross-border railway networks to achieve efficient coverage of global demand markets. Industrial structure and supply-demand mismatch: Although China holds 23% of the world's coking coal reserves, as the world's largest steel producer, China has extremely rigid coking coal consumption demand, making it the world's largest coking coal importer. In contrast, the five countries mentioned above have limited domestic consumption and surplus coking coal supply. Their industrial structures are centered on resource exports, providing a supply foundation for large-scale exports. Coal quality and global demand matching: The coal varieties from these countries form a complementary supply system. Australian coal is suited to high-end coke demand, Mongolian coal serves as a premium blending raw material, Russian coal covers the full range of varieties, and US and Indonesian coal meet the blending needs of different steelmaking processes. This precisely matches the rigid blending needs of global steel enterprises, forming a stable export pattern. Chapter 3: China's Coking Coal Market (1) Current Supply and Demand of Coking Coal in China Data sources: National Bureau of Statistics (NBS), General Administration of Customs of China, publicly available data Supply side, China's coking coal concentrate production grew steadily, rising gradually from 480 million mt in 2020 to 514 million mt in 2025, with overall supply scale remaining stable and no wild swings observed. Import and export side, imports became the core variable supplementing China's domestic supply: imports briefly declined 24% YoY to 54.768 million mt in 2021, then entered a sustained expansion trajectory, with 2025 imports surging 117% from 2021 to 118 million mt; exports remained at low levels over the long term, once plunging 89% YoY to 92,000 mt in 2021, then gradually rebounding, but the 2025 export volume of 1.175 million mt had minimal impact on the overall market. Demand side, coking coal concentrate demand also maintained mild growth, with 2025 demand reaching 628 million mt, a modest increase from 2020. Demand growth was primarily supported by the concurrent expansion of coke production (coke production reached 502 million mt in 2025). Overall, China's domestic coking coal production growth was unable to fully match demand expansion, with imported resources effectively filling the supply-demand gap. (II) China's Coking Coal Supply-Demand Balance Data source: National Bureau of Statistics (NBS), publicly available data From 2020 to 2025, China's coking coal concentrate market completed a transition from tight supply to a tight balance with a slight surplus, with both supply and demand expanding simultaneously and market operational stability improving significantly. The supply side exhibited a sustained and steady growth trend, with the release of domestic capacity combined with supplementary import resources jointly driving continuous enhancement of supply capability. The demand side maintained mild expansion, primarily supported by rigid production demand from the coke and steel industries, with overall growth notably slower than the supply side. By phase, from 2020 to 2022, the market was in a state of persistent undersupply, with supply gaps appearing in all three years, and the industry was highly reliant on imported resources to fill the supply-demand gap. In 2023, the market reached a structural turning point, achieving a supply surplus for the first time; in 2024, the surplus scale expanded significantly; in 2025, the surplus pulled back, but the market had thoroughly shed its prolonged deficit status. With China's coking coal concentrate supply assurance capability continuing to improve, combined with flexible adjustment of import channels, the market entered a healthy tight balance range where supply was slightly greater than demand. Chapter 4: Global Coking Coal Supply-Demand Balance Data source: IEA, publicly available data From 2020 to 2025, the global coking coal market gradually shifted from maintaining a slight surplus to a slight supply-demand deficit. The long-term tightening of global premium coking coal resources, compounded by multiple external factors such as the restructuring of the global energy landscape triggered by the energy crisis and shifts in national energy policies, ultimately drove the global coking coal market from a relatively loose state in the earlier period to a slight deficit. Chapter 5: Summary Affected by geopolitical conflicts and energy transition, the strategic value of coking coal continued to rise, with energy security premiums becoming prominent, and the overall industry landscape gradually evolving toward a tight supply-demand balance. Global coking coal production is limited, with low-ash, low-sulfur premium resources being particularly scarce. Reserves, capacity, and export trade are all highly concentrated, with a few countries such as Russia, China, the U.S., and Australia controlling the supply side, forming a monopolistic landscape through advantages in resources, logistics, and coal grade complementarity, while the energy crisis brings new opportunities and challenges. Overall, coking coal markets both in and outside China have shifted toward a tight balance, with structural shortages of premium coal grades being a prominent issue. The coking coal market may hold up well throughout 2026.

Around May 23, 2026, import and export data for cobalt and lithium battery industry chain-related products in April were released in a concentrated manner. Data showed that China's spodumene imports in April reached 758,000 mt in physical content, down 9.5% MoM and up 21.7% YoY. Lithium carbonate imports, China imported 32,650 mt of lithium carbonate in April, up 9% MoM and up 15% YoY.......SMM compiled the import and export data for battery materials, as detailed below: Upstream Lithium Concentrates In April 2026, China's spodumene imports reached 758,000 mt in physical content, down 9.5% MoM and up 21.7% YoY, equivalent to approximately 63,000 mt of LCE. Customs data showed that April spodumene imports pulled back MoM from March, reaching 758,000 mt in physical content. By source country, Australian ore port arrivals returned to a relatively normal level, with over 350,000 mt arriving this month, up 38.9% MoM; Zimbabwe's earlier shipments arrived at port this month at 102,000 mt, down 9.2% MoM; South Africa and Nigeria saw some contraction in monthly port arrivals, while ore from Mali had almost no notable port arrivals this month due to shipping schedule impacts. Notably, spodumene powder sold by Brazil in early 2026 arrived at port this month, driving a significant increase in port arrivals from this country. Additionally, after SMM screening, the month's incoming ore was equivalent to 63,000 mt of LCE. Among the incoming ore, lithium concentrates accounted for 67%, edging down MoM, mainly because apart from Australia , ore from other source countries contained some relatively low-grade ore. Source: China Customs, compiled by SMM Spodumene concentrates (CIF China) spot pricing, according to SMM spot pricing, spodumene concentrates (CIF China) spot prices fluctuated upward in April. As of April 30, spodumene concentrates (CIF China) spot prices rose to $2,540/mt, up $221/mt from the month-end price of $2,313/mt in March, a gain of 9.81%. According to SMM, lithium carbonate prices continued to rise in April, and spodumene concentrates prices rose in tandem with salt prices, with gains exceeding those of lithium carbonate itself, causing non-integrated enterprises that purchase externally spodumene concentrates to suffer losses, with spot profitability remaining in deficit. In April, spot circulation of lepidolite concentrates relatively eased. Meanwhile, as lithium carbonate prices rose, processing fees for non-integrated enterprises also increased accordingly, preserving a certain profit margin for their processing operations and enabling these enterprises to achieve spot profitability. However, recently, spodumene concentrates prices adjusted in tandem with lithium carbonate price fluctuations, and the price center shifted downward. According to SMM's latest findings, disrupted by rumors of production resumptions at Jiangxi mines this week, lithium carbonate futures and spot prices declined, further dragging down the overall price center. Currently, lithium mines showed a weak willingness to make shipments, and transactions were mostly concentrated between traders and buyers. Port lithium ore inventory continued to decline. Going forward, attention should still be paid to the potential tight lithium ore supply triggered by high operating rates in the lithium chemicals industry. Lithium ore prices were expected to continue to hold up well. Lithium Carbonate According to customs data, China imported 32,650 mt of lithium carbonate in April, up 9% MoM and up 15% YoY. Of this, 21,000 mt was imported from Chile (65% of total imports), 9,555 mt from Argentina (29%), and 1,100 mt from Indonesia (3%). From January to April, China's cumulative lithium carbonate imports reached 116,000 mt, up 47% YoY cumulatively. In April, China exported 370 mt of lithium carbonate, down 17% MoM and down 50% YoY. From January to April, China's cumulative lithium carbonate exports totaled 1,886 mt, up 7% YoY cumulatively. In April, China imported 17,942 mt of lithium sulfate, up 9% MoM and up 296% YoY. From January to April, China's cumulative lithium sulfate imports reached 58,900 mt, up 121% YoY cumulatively. According to SMM spot quotes, spot lithium carbonate prices generally trended upward in April. As of April 30, the spot lithium carbonate price rose to 177,000 yuan/mt, up 14,000 yuan/mt from 163,000 yuan/mt on March 31, a gain of 8.59%. According to SMM analysis, China's lithium carbonate prices followed a "V-shaped" trend in April, first declining then rising, with the monthly average price up 6% MoM. In the first ten days, geopolitical disruptions in the Middle East intensified global risk-averse sentiment, causing non-ferrous metals and lithium carbonate prices to fluctuate downward. In the mid-to-late period, driven by Zimbabwe's export ban, Jiangxi mine license renewals, and rising costs, prices began to rebound and fluctuate upward, with the price center shifting notably higher by month-end. Upstream and downstream purchasing remained stagnant, with the psychological price spread widening week by week. Upstream producers held prices firm and held back from selling, maintaining high offer prices, while downstream buyers made just-in-time procurement only, with psychological price levels concentrated at 155,000-175,000 yuan/mt, restocking on dips only when prices fell rapidly. In April, spot battery-grade lithium carbonate prices dropped to around 155,500 yuan/mt in the first ten days, then rallied all the way to 177,000 yuan/mt by month-end. As of May 29, domestic spot battery-grade lithium carbonate was quoted at 174,000-181,000 yuan/mt, with an average price of 177,500 yuan/mt. Lithium Hydroxide According to customs data, in April 2026, China imported 6,689 mt of lithium hydroxide, up 9% MoM and up four times YoY. Of this, 2,252 mt were imported from South Korea, accounting for 34% of total imports; 1,706 mt came from Indonesia, accounting for approximately 25% of imports; and the remaining 40% came from Australia and Chile. In April, China exported 5,535 mt of lithium hydroxide, up 76% MoM and up 31% YoY, of which 3,915 mt were exported to South Korea and 864 mt to Japan. Continued sluggish ternary cathode material output outside China limited the absorption capacity for lithium hydroxide in markets outside China, resulting in a slight surplus in markets outside China, which in turn widened the price spread between domestic and overseas markets. Meanwhile, as suppliers outside China had previously signed long-term supply agreements with domestic traders, they were able to continuously dump lithium hydroxide into the Chinese market. Under the combined effect of these factors, the trade pattern of lithium hydroxide continued to reverse (shifting from net exports to net imports). Source: China Customs, compiled by SMM Battery Materials LiPF6 According to China Customs data, in April 2026, China's cumulative LiPF6 exports totaled approximately 868 mt, down approximately 80.9% MoM, while cumulative imports were approximately 96 mt. Export side, China's LiPF6 exports in April 2026 were approximately 868 mt, down approximately 80.9% MoM from March and down approximately 33.2% YoY. Specifically, as the LiPF6 export VAT rebate policy was officially abolished starting April 1, 2026, enterprises rushed to export in advance in March, and electrolyte enterprises outside China built up certain inventory, leading to MoM declines in China's exports to multiple major destination countries in April. Exports to Poland were 337.5 mt (down approximately 80.4% MoM), South Korea 81.804 mt (down approximately 92.56% MoM), Czech Republic 150 mt (down approximately 67.43% MoM), and the US 101.908 mt (down approximately 61.7% MoM). Only exports to Japan increased — 191.37 mt (up approximately 50.77% MoM). Artificial Graphite In April 2026, China's artificial graphite imports were 757 mt, up 12.4% MoM and down 32.9% YoY. Average import price side, in April 2026, the average import price of artificial graphite in China was 75,941 yuan/mt, up 23.1% MoM and up 14.6% YoY. In April 2026, China's artificial graphite exports totaled 45,895 mt, up 22.3% MoM but down 21% YoY. In terms of average export price, in April 2026, the average export price of China's artificial graphite was 9,214 yuan/mt, down 6.6% MoM but up 0.26% YoY. Exports from the top five exporting provinces rose 21% MoM from the previous month, with two provinces seeing export volume increases of over 35% MoM, and another province recording a 20% MoM increase. Import market, orders from downstream power battery enterprises in China gradually recovered in April. Combined with the phased tightness in spot capacity of leading anode enterprises, restocking demand was released, boosting artificial graphite imports to rebound from weakness on a MoM basis. However, import volumes remained down YoY, primarily because China's anode industry had ample overall capacity with supply still in surplus, domestic self-sufficiency continued to strengthen, and the industry's reliance on imported raw materials and finished products steadily declined. Flake Graphite In April 2026, China's flake graphite imports totaled 3,178 mt, down 19% MoM and down 45% YoY. Data source: China Customs, SMM In April 2026, China's flake graphite exports totaled 4,093 mt, down 50% MoM and down 54% YoY. Export market, the flake graphite export tax rebate policy was officially canceled this month, directly squeezing profit margins for foreign trade enterprises and significantly dampening overall export willingness. Meanwhile, the approval pace for flake graphite export licenses slowed down, hindering foreign trade shipments processes. Coupled with weak ex-China end-use demand, multiple bearish factors combined to directly drive a sharp decline in industry export volumes. The import market also continued to weaken. Goods originally intended for exports shifted to domestic sales circulation, with increasingly abundant local supply sources in China. Market enthusiasm for import procurement was insufficient, ultimately causing imports to decline in tandem this month. Phosphate Ore On May 20, 2026, according to customs data, China's phosphate ore imports totaled 207,000 mt in April 2026. April imports rose 13.5% from 182,000 mt in March. Total import value in April was $19.741 million, up 35.7% MoM from $14.552 million in March. The average unit price was $95.5/mt, up 19.6% from $79.9/mt in March. Import commentary: In May, Egypt's phosphate ore exports faced "policy tightening and weakening demand."On May 13, Egypt's Ministry of Petroleum and Mineral Resources announced that it would no longer sign any new phosphate ore export contracts. Previously, Egyptian Prime Minister Mustafa Madbouly stated clearly at a meeting on May 10 that the government was pushing for a transition from raw material exports to the manufacturing of high-value-added products such as phosphate fertiliser. Already signed long-term contracts would not be affected. This is expected to push up import prices and may affect imports. Cobalt Cobalt Hydrometallurgy Intermediate Products In April 2026, China's cobalt hydrometallurgy intermediate products imports were approximately 1,247 mt in physical content, down 26% MoM and down 98% YoY. Among them, imports from the DRC were approximately 945 mt in physical content, down 43% MoM and down 98% YoY. In April 2026, the average import price of China's cobalt hydrometallurgy intermediate products was $17,187/mt in physical content, up 2.63% MoM. It was learned that most miners had completed the Q4 2025 quota approvals, but the Q1 2026 quota approvals slowed down again due to sampling, detection and other procedural issues. In addition, transportation capacity in the DRC was tight. Fleets, driven by economic considerations, prioritised the transport of oil products and chemicals that were in production shortage, followed by other metals with shorter turnover cycles, and cobalt among non-ferrous metals came last, meaning cobalt faced significant transportation capacity issues. Constrained by the above factors, miners mainly focused on building in-transit inventory and had not yet arranged concentrated vessel bookings, and the arrival of large batches of intermediate products at ports may continue to be delayed. Unwrought Cobalt In April 2026, China's unwrought cobalt imports were approximately 1,334 mt, up 39% MoM and up 59% YoY. In April, refined cobalt imports mainly came from Indonesia, Russia, and Madagascar, with imports of 462 mt, 457 mt, and 182 mt respectively. The main reason for the increase this month was that domestic smelters lacked intermediate product raw materials and imported cobalt slabs and cobalt briquettes for re-dissolution to ensure normal production. In terms of average import prices, the average import price of China's unwrought cobalt in April 2026 was $52,724/mt, up 4.72% MoM. Cumulative imports from January to April 2026 totalled 5,916 mt, up 153% YoY cumulatively. Export side, China's unwrought cobalt exports in April 2026 were approximately 218 mt, down 47% MoM and down 95% YoY. By country, China's exports to the US dropped significantly, with April exports to the US at 35 mt, down 87.5% MoM. The main reason was that demand for alloy-grade refined cobalt in the US pulled back in April, and ex-China branded refined cobalt was already sufficient to meet regional demand, with some refined cobalt traders redirecting their destinations from the US back to China. Average export price, the average export price of China's unwrought cobalt in April 2026 was $54,590/mt, up 5.80% MoM. Cumulative exports from January to April 2026 totaled 1,792 mt, down 76% YoY.

[SMM Steel] European carbon prices for December 2026 EUA contracts rose to around €79/t in late May, supported by volatility in energy markets, optimism over a potential EU-UK carbon market linkage, and ongoing discussions on EU ETS reform. Market participants noted that UK carbon prices surged 6% on May 26 to £56.67/t, while EUAs climbed above €79/t on May 27. Meanwhile, six EU countries including Poland, Czech Republic, and Greece called for greater protection for heavy industry through increased free carbon allowances amid high energy costs and geopolitical pressures. The EU is expected to conduct a mid-term ETS review by July 2026.

Walk the bauxite-alumina-aluminum value chain across Central Asia's five republics and the picture resolves quickly: one country runs the whole chain, one runs a piece of it, and three play no meaningful role at all. That picture, however, may be on the verge of a significant shift.

Indian steelmakers have faced ongoing difficulties in procuring metallurgical coke since the country introduced import restrictions, with major producers such as JSW Steel and ArcelorMittal Nippon Steel India also raising concerns. Data showed India’s metallurgical coke imports fell 21% year on year in 2025 to 3.81 million tons, with supplies mainly coming from China, Indonesia, Poland, Japan, and Switzerland.