SMM News, July 15: Metal market: As of the midday close, domestic base metals showed mixed performance, with SHFE copper rising 0.57%, SHFE aluminum edging down, SHFE lead falling 1.8%, SHFE zinc up 0.45%, SHFE tin up 1.36%, and SHFE nickel down 0.43%. Furthermore, aluminum casting most-traded futures edged down, alumina most-traded rose 0.89%, lithium carbonate most-traded fell 2.33%, silicon metal most-traded fell 0.35%, and polysilicon most-traded futures fell 1.04%. Ferrous metals all rose. Iron ore rose 1.13%, rebar rose 1.24%, hot-rolled coil rose 1.09%, and stainless steel rose 0.76%. Coking coal and coke: The most-traded coking coal contract rose 2.12%, and the most-traded coke contract rose 1.1%. Overseas base metal market: As of 11:42, LME metals nearly all rose. LME copper rose 0.28%, LME aluminum rose 0.49%, LME lead fell 0.32%, LME zinc rose 0.73%, LME tin rose 0.28%, and LME nickel edged up. Precious metals: As of 11:42, COMEX gold fell 0.8%, and COMEX silver fell 0.67%. Domestic precious metals: SHFE gold rose 0.18%; SHFE silver most-traded rose 1.03%. Furthermore, as of the midday close, platinum most-traded futures rose 2.35%, and palladium most-traded futures rose 3.6%. As of the midday close, the most-traded Europe shipping futures contract rose 2.78% to 2,572.5 points. As of 11:42 on July 15, some futures midday quotes: Spot and Fundamentals Copper: Today, Guangdong #1 copper cathode spot against the front-month contract: High-quality copper was quoted at 80 yuan/mt, flat with the previous trading day; standard-quality copper was quoted at a discount of 20 yuan/mt, flat with the previous trading day; SX-EW copper was quoted at a discount of 80 yuan/mt, flat with the previous trading day. The average price of Guangdong #1 copper cathode was 105,205 yuan/mt, up 1,100 yuan/mt from the previous trading day, and the average price of SX-EW copper was 105,095 yuan/mt, up 1,085 yuan/mt from the previous trading day. Spot market: Guangdong inventory ended a two-session rising streak and fell again today, mainly due to reduced arrivals... Macro Front Domestic: [National Bureau of Statistics (NBS): H1 GDP rose 4.7% YoY; national economy operated within a reasonable range; new momentum grew rapidly] The National Bureau of Statistics (NBS) released data showing that, according to preliminary estimates, H1 GDP reached 69,570.4 billion yuan, up 4.7% YoY at constant prices. By industry, the value added of the primary industry was 3,152.2 billion yuan, up 3.7% YoY; the secondary industry was 25,047.3 billion yuan, up 3.9%; and the tertiary industry was 41,370.9 billion yuan, up 5.2%. By quarter, Q1 GDP grew 5.0% YoY and Q2 grew 4.3%. On a QoQ basis, Q2 GDP rose 0.9%. Overall, the national economy operated within a reasonable range in H1, with new quality productive forces cultivated and strengthened and high-quality development progressing toward new heights of quality. At the same time, we must recognize that external instabilities and uncertainties are mounting, the contradiction between strong supply and weak demand in China remains pronounced, and the foundation for economic improvement still needs consolidation. In the next phase, we will adhere to the principle of seeking progress while maintaining stability, improving quality and efficiency, intensify counter-cyclical and cross-cyclical adjustments, continue to expand domestic demand and optimize supply, enhance growth and revitalize existing assets, focus on building a strong Chinese market, accelerate the cultivation and strengthening of new momentum, step up efforts to stabilize employment, enterprises, markets, and expectations, and promote the effective improvement of quality and reasonable growth of quantity in the economy. [PBOC reverse repo operations achieved a net injection of 911.5 billion yuan on the day] The PBOC conducted 426.5 billion yuan of 7-day reverse repo operations and 1,400 billion yuan of 6-month outright reverse repo operations today. With 15 billion yuan of 7-day reverse repos and 900 billion yuan of outright reverse repos maturing today, the operations resulted in a net injection of 911.5 billion yuan on the day. US dollar: As of 11:42, the US dollar index extended the previous trading day's decline, falling 0.11% to 100.83. Data: A key turning point signal emerged in US inflation. June CPI recorded its first MoM decline in six years, while core inflation was basically flat, prompting the market to dramatically scale back bets on a July rate hike by the US Fed. On Tuesday, data released by the US Bureau of Labor Statistics showed that the June Consumer Price Index (CPI) rose 3.5% YoY, below market expectations of 3.8% and a significant pullback from the prior reading of 4.2%. Core CPI rose 2.6% YoY, also below expectations of 2.8% and the prior reading of 2.9%. (Wall Street See) According to CME "FedWatch": The probability of the US Fed holding rates steady in July is 84.5%, while the probability of a cumulative 25-basis-point rate hike is 15.5%. For September, the probability of holding rates steady is 42.2%, the probability of a cumulative 25-basis-point hike is 50%, and the probability of a cumulative 50-basis-point hike is 7.8%. (Jin10 Data APP) Fed Chairman Walsh stated that he places equal emphasis on the Fed's employment and inflation mandates—a point he has repeatedly stressed since assuming the role of Fed Chairman. "In the mandate you have given us, we do not favor one part over the other," Walsh told members of the House Financial Services Committee. "Price stability and full employment are not trade-offs. I am committed to achieving both. When later asked if he supported targeted measures to address the unemployment rate and employment opportunity gaps between Black and White Americans, Walsh stated: "The US must not leave anyone behind. Economic opportunity is critical to the trajectory of growth for the US over the next five to ten years, meaning every American needs the opportunity to be productive." (Jin10 Data APP) A CICC research note indicated that US June CPI fell 0.4% MoM on a seasonally adjusted basis, with YoY growth pulling back to 3.5%; core CPI was flat MoM and up 2.6% YoY, both below market expectations. The decline in energy prices was the main driver of cooling inflation. Looking ahead, as tensions escalate again between the US and Iran, the outlook for energy inflation remains uncertain. Meanwhile, the AI inflation effect is gradually materializing, with upstream hardware supply-demand mismatch, rising prices for software and related products, and AI capex boosting aggregate demand all potentially making core inflation stickier. For policy, the cooling inflation data in June supports the Fed holding rates steady at its July meeting, but recent remarks by Waller suggest [1] the Fed is reassessing the possibility of a "preventive rate hike." We maintain our base case of no rate hikes for the year, but flag that the bar for hiking has already fallen. If one or two hotter-than-expected inflation prints emerge, it could push the Fed to further discuss rate hike options. A CITIC Securities research note stated that US June CPI came in below expectations across the board, retail gas prices fell, core services inflation was flat MoM, and the second-round inflation effect was minimal. CITIC Securities believes US inflation is not sticky, noting that headline CPI YoY has definitively passed its cycle peak and is expected to trend mildly downward in Q3, hit bottom in September, rise to a secondary peak around year-end, and then decline rapidly next March. CITIC Securities still expects the Fed to stay on hold for the full year, sees room for derivative-priced rate hike expectations to be revised further down, considers US Treasuries currently unsuitable for allocation-based opportunities—with short-dated bonds better than long-dated ones—and believes the US dollar index faces difficulty sustaining upward momentum but has support, while the technology-driven theme in US equities retains its appeal. On the data front: Today will see the release of figures including China's June total electricity consumption YoY, China's June total electricity consumption, the US June PPI annual rate, the US June PPI monthly rate, the US July New York Fed Empire State Manufacturing Index, the Eurozone May industrial output MoM rate, Canada's May wholesale sales MoM rate, and the Bank of Canada's interest rate decision as of July 15. Additionally, attention needs to be paid to: the National Bureau of Statistics (NBS) releasing the monthly report on residential selling prices in 70 large and medium-sized cities; the State Council Information Office holding a press conference on the state of the economy; the State Council Information Office holding a press conference to brief on the execution of monetary policy and financial statistics for H1 2026; the National Energy Administration releasing total electricity consumption data around the 15th of each month. Fed Governor Barr spoke on artificial intelligence at the Fed’s annual financial inclusion conference; 2027 FOMC voting member and Chicago Fed President Goolsbee participated in a fireside chat; Fed Governor Lisa Cook delivered remarks at the Fed’s annual financial inclusion conference; Fed Governor Bowman also spoke at the same conference; permanent FOMC voting member and New York Fed President Williams gave a speech; Fed Chair Warsh attended the Senate Banking, Housing, and Urban Affairs Committee hearing on the Fed’s Semi-annual Monetary Policy Report; Bank of England Governor Bailey spoke; the Bank of Canada announced its interest rate decision and monetary policy report, and Bank of Canada Governor Macklem and Senior Deputy Governor Rogers held a monetary policy press conference. ASML published its Q2 2026 financial report. Crude oil: As of 11:42, both benchmarks rose, with WTI up 1.02% and Brent up 1.32%. Despite improved risk sentiment from cooling inflation, the crude oil market remains driven by geopolitics. The US announced the reinstatement of a naval blockade on vessels transiting Iranian ports and coastal areas, with escalating Middle East tensions supporting oil prices. Meanwhile, the US and European refined product markets are historically tight, heightened Middle East strains have fanned fuel supply concerns, and high oil prices continue to pressure consumers. Goldman’s Privorotsky believes Brent around $85 itself is manageable, the real story is in refined products, distillates rather than crude oil are the true inflation signal, and heating oil futures have hit new highs since the conflict erupted, highlighting tightness in the product market, with any further disruption disproportionately hitting inflation. (Wall Street CN) Additionally, Iran’s Islamic Revolutionary Guard Corps said in a statement on the 15th that as long as the US continues attacks on Iran, the region will not export “a drop of oil” or natural gas. (Xinhua) Spot market overview: ► ► ► ► ► ► ► ► ► ► ► ► ► ►

Next week, the market will see the release of important macroeconomic data, including the US June unadjusted CPI annual rate, China’s Q2 GDP annual rate, and the US June PPI annual rate. Additionally, the US Fed will release the Beige Book on economic conditions. It is reported that the US launched a new round of strikes against Iran this week, leading to a sharp drop in shipping traffic through the Strait of Hormuz, but a US official indicated that both sides are still holding “technical negotiations” on the nuclear issue. Mixed macro signals are expected to continue disrupting base metal market trading. LME lead, affected by ongoing macro disruptions, continued its consolidation pattern. Meanwhile, the decline in LME lead inventories slowed, and LME Cash-3M contango widened further, with the latest quote at -$44.34/mt. Additionally, in Southeast Asia, high-grade lead ingots maintained a high premium, while trading for low-grade material was difficult, and polarization persisted. With the interplay between high inventories and high premiums and no new drivers emerging, LME lead is expected to maintain a range-bound consolidation pattern, trading within $1,885-1,915/mt. SHFE lead, driven by production cuts at smelters alongside increased downstream cargo pick-up, continued destocking of lead ingot inventories, providing certain support to lead prices this week. However, next week, as the most-traded SHFE lead 2607 contract approaches delivery, some on-site inventory may shift to delivery warehouses, making sustained destocking of lead ingots unlikely. Attention should be paid to the pace of invisible inventory converting to visible inventory and the risk of lead prices retreating after rapid rises. The most-traded SHFE lead contract is expected to trade within 15,900-16,250 yuan/mt next week. Spot lead price forecast: 15,850-16,050 yuan/mt. On the demand side, lead-acid battery market demand was relatively weak, with downstream enterprises producing based on sales and maintaining limited demand for lead ingots. On the supply side, primary lead smelters had expectations of resuming production after maintenance, while secondary lead smelters saw increasing maintenance. The production divergence is expected to make secondary lead prices outperform primary lead, reducing the likelihood of secondary refined lead trading at spot discounts. In the primary lead market, focus will remain on the reduction in available spot supply due to delivery and its impact on spot discount levels.

SMM July 2 news: Metal markets: As of midday close, base metals on the domestic market mostly fell. SHFE copper and SHFE aluminum each fell within 0.2%. SHFE lead fell 0.72%. SHFE zinc fell 1.04%. SHFE tin rose 0.15%. SHFE nickel fell 0.41%. In addition, the most-traded cast aluminum futures fell 0.97%, while the most-traded alumina futures rose 0.21%. Lithium carbonate most-traded futures extended gains from the previous three trading days, rising another 1.26%. Silicon metal most-traded futures fell 0.18%. Polysilicon most-traded futures rose 0.36%. Ferrous metals mostly fell. Iron ore rose 0.54%. HRC and rebar fell within 0.5% each, and stainless steel fell 0.92%. Coking coal and coke: the most-traded coking coal contract rose 0.28%, and the most-traded coke contract fell 0.96%. In overseas base metal markets, as of 11:39 am, LME metals nearly all fell. LME copper fell 0.31%, LME aluminum fell 0.19%, LME lead was flat at $1,866.5/mt. LME zinc fell 0.2%, LME tin edged lower, and LME nickel fell 0.4%. In precious metals, as of 11:39 am, COMEX gold fell 0.16% and COMEX silver rose 0.03%. In domestic precious metals: SHFE gold rose 1.28%; the most-traded SHFE silver contract rose 2.06%. In addition, as of midday close, the most-traded platinum futures rose 5.12%, and the most-traded palladium futures rose 2.82%. As of midday close, the most-traded European route container freight futures fell 2.12% to 2,561 points. As of 11:39 am on July 2, midday futures quotes for select contracts: Spot and Fundamentals Aluminum: In the morning session, the trading center of the SHFE aluminum 2606 contract was higher than that of the same period on the previous trading day. Warrant cargoes continued to flow out of the market, and circulating spot supply was generally ample. Downstream only saw sporadic restocking, and with bearish sentiment spreading in the futures market, end-user purchase willingness was overall weak. Mainstream transactions were at parity to a premium of 20 yuan/mt over the SHFE aluminum 2607 contract... Macro Front Domestic: [The mandatory national standard "Safety Requirements for Combined Driving Assistance System of Intelligent and Connected Vehicles" was officially released] On June 27, the mandatory national standard "Safety Requirements for Combined Driving Assistance System of Intelligent and Connected Vehicles" (GB 47955—2026), organized, formulated and centralized by the Ministry of Industry and Information Technology, was approved and released by the State Administration for Market Regulation and the National Standardization Administration, and is scheduled to be officially implemented on January 1, 2027. 《Safety Requirements for Intelligent Connected Vehicles—Combined Driver Assistance Systems, grounded in the needs of industry development and regulatory oversight in China, takes into account technical feasibility, product compatibility, and practical implementability, and establishes a safety indicator framework with clear requirements, comprehensive dimensions, and alignment with national conditions. First, it fully considers different product forms and technical routes, proposing applicable safety requirements for three types of combined driver assistance system products: basic single-lane, basic multi-lane, and navigation driver assistance. Second, based on China’s road traffic characteristics, it sets out baseline requirements to ensure the safe operation of combined driver assistance systems across dimensions such as functional requirements, data recording, and vehicle manufacturer safety assurance. Third, recognizing the core positioning of these systems as "assistance" in driving, it puts forward requirements for user usage and operation in areas such as human-machine interaction, usage instructions, and user training, providing a foundational guarantee for proper coordination between users and systems. Fourth, in line with the practical needs of China’s industry management, it builds a multi-tiered evaluation approach encompassing field tests, road tests, and document inspections to comprehensively assess system safety capabilities. The PBOC conducted ¥288.5 billion in 7-day reverse repos today, with an operation rate of 1.4%, unchanged from the previous level. Today, ¥370.5 billion in reverse repos matured. US Dollar: As of 11:39, the US dollar index fell 0.03% to 101.39. Fed Chairman Warsh said Wednesday that inflation expectations and inflation risks have both declined in recent weeks, while reiterating the Fed’s commitment to bringing inflation down to the 2% target. "In the first few weeks of this period, inflation expectations have pulled back, and inflation risks have also eased," Warsh said. "If households, the business community, or financial markets think the Fed is comfortable with inflation above 2%—well, they are likely to be disappointed: we will ensure price stability in the US." Fed Chairman Warsh sidestepped questions on whether the Fed might raise rates at its July meeting. "I hope that when we meet in four weeks, we can have a robust 'internal family debate,'" he said. "When we close the doors and sit down together, we will have a vigorous debate. But beyond that, I have no further information to share." Warsh made the remarks at the ECB’s annual policy conference in Sintra, Portugal; this was his first public appearance since his inaugural press conference at the Fed last month. Since then, investors have begun to anticipate more rate hikes from the Fed, but the market currently sees the likelihood of a first hike this month at less than 50%. According to CME "Fed Watch": The probability that the US Fed will keep rates unchanged in July is 71.7%, and the probability of a cumulative 25-basis-point rate hike is 28.3%. The probability that the Fed will keep rates unchanged by September is 36.1%, the probability of a cumulative 25-basis-point hike is 49.8%, and the probability of a cumulative 50-basis-point hike is 14.1%. (Jin10 Data APP) On the data front: US manufacturing expanded for a sixth consecutive month in June, with the war-driven surge in input costs easing. Printing, electrical equipment, and textiles led the gains, while paper products, furniture, and wood products contracted. Market attention has now shifted to Thursday's US employment report. Julien Lafargue, chief market strategist at Barclays Private Bank and Wealth Management, noted that with Warsh prioritizing inflation, the June non-farm payrolls data is "unlikely to change rate expectations on its own." He added that hiring related to the FIFA World Cup is expected to distort the data. (Wall Street Insights) Data front: Today will see the release of the US June unemployment rate, US June seasonally adjusted non-farm payrolls, US initial jobless claims for the week ended June 27, US June average hourly earnings year-over-year, US June average hourly earnings month-over-month, US May factory orders month-over-month, Switzerland June CPI month-over-month, eurozone May unemployment rate, among other data. Additionally, watch for: the Ministry of Commerce's regular press conference for the first week of July, and 2027 FOMC voting member and San Francisco Fed President Daly’s participation in a conference on the Spanish economy. Due to the US Independence Day holiday (July 3), the US June non-farm payrolls data will be released earlier on July 2 (Thursday) at 20:30 Beijing time. US stock markets will be closed on July 3 (Friday). Trading in precious metals, energy, foreign exchange, US Treasury, and equity index futures contracts on CME will end early at 01:00 Beijing time on July 4. Trading in Brent crude oil futures contracts on ICE will end early at 01:30 Beijing time on July 4. Investors are advised to take note. (Jin10 Data APP) Crude oil: As of 11:39, oil prices in both markets extended their decline from the previous two trading sessions, with WTI down 1.4% and Brent down 1.24%. International crude oil prices pulled back due to progress in Middle East peace talks. (Wall Street Insights) As supply through the Strait of Hormuz rebounded, OCBC Group Research lowered its quarterly crude oil forecasts through the end of Q2 2027. Two OCBC strategists noted in a research report: "With the signing of a memorandum of understanding between the US and Iran, shipping and crude oil supply through the Strait of Hormuz have rebounded."They also said, "Market expectations that crude oil supply would return to normal quickly pushed oil prices back to pre-conflict levels, rekindling oversupply rhetoric." OCBC cut its Brent crude price forecast for Q3 2026 from $85 to $75 per barrel, Q4 2026 from $80 to $75, Q1 2027 from $75 to $73, and Q2 2027 from $75 to $71. (Jin10 Data APP) Increasing energy flows through the Strait of Hormuz prompted UBS to cut its 2026-2027 oil price forecast. UBS now expects Brent crude to average $84 per barrel this year, down $9 from its previous forecast. The bank also cut its 2027 oil price forecast from $85 to $75 per barrel. UBS said, "The decline in geopolitical risk and the rapid rebound in supply led to a larger price drop than we had expected." The bank expects oil prices to rebound slightly to $80 per barrel in H2 this year as floating storage in the Gulf region normalizes and demand recovers. UBS also believes risk premiums will be higher because the path to normalization may remain bumpy. UBS said, "The need to replenish inventories should continue to support prices through the end of 2027, but the required magnitude of stock rebuilding is smaller than the 1 billion barrels we previously expected." (Jin10 Data APP) Spot Market Overview: ► ► ► ► ► ► ► ► ► ► ► ► ►

Next week, due to the Qingming Festival in the Chinese market, SHFE will not conduct night session trading on the evening of April 3; outside China, due to Good Friday, exchanges including the LME will be closed for one day on April 3. In terms of macroeconomic data, key releases are expected to include China’s official manufacturing PMI for March, US ADP employment for March, US retail sales MoM for February, and US ISM manufacturing PMI for March. LME lead, current geopolitical tensions outside China remained prominent, shipping cycles lengthened, and crude oil prices rose, all of which had a significant impact on the base metal market. For lead, consumption in the Middle East was relatively stagnant, supply chains were disrupted, and transportation cycles for lead ingot and lead-acid batteries lengthened. Meanwhile, China’s lead ingot import arbitrage remained favorable, and overseas lead ingot continued to flow into the Chinese market. This week, LME lead ingot inventory fell by nearly 1 kt, and the LME Cash-3M contango narrowed to -$34.62/mt, providing support for lead prices. LME lead is expected to trade at $1,880-1,930/mt next week. SHFE lead, lead ingot inventory was destocked, including inventories at lead smelters and social warehouses, and lead prices showed signs of stabilizing after the decline. However, the lead ingot import window is currently open, while lead-acid batteries will enter the traditional off-season in April, limiting expectations for lead consumption. In addition, some secondary lead smelters recently resumed production and raised output, while new maintenance plans are also scheduled for April. With bullish and bearish factors coexisting in fundamentals, lead prices are expected to continue to fluctuate rangebound. If lead smelter maintenance is implemented as planned, lead prices may have a chance to rise relatively. The most-traded SHFE lead contract is expected to trade at 16,300-16,700 yuan/mt next week. Spot price forecast: 16,250-16,550 yuan/mt. With the traditional off-season for lead-acid batteries approaching in April, downstream enterprises mostly maintained purchasing as needed, with limited procurement enthusiasm. Supply side, both primary lead and secondary lead enterprises saw output increases, and imported lead continued to flow into China, so spot lead premium trading may be difficult to sustain for long.

[SMM Tin Midday Review: AI Macro Sentiment Recedes Again, Triggering Market Downward Pressure, the Most-Traded SHFE Tin Contract Falls Over 5%]

On November 26, the Shanghai Metals Expo (SME) 2025, organized by SMM Information & Technology Co., Ltd. and SMM Trading Center Co., Ltd., wrapped up successfully in Shanghai, China!