SMM, July 18: Metals market: Last Friday's overnight domestic base metals nearly all rose. SHFE copper rose 0.15%, SHFE aluminum rose 0.22%, SHFE lead rose 0.69%, SHFE zinc fell 0.85%, SHFE tin rose 1.57%. SHFE nickel fell 0.28%. Additionally, the most-traded alumina futures rose 1.64%, and the most-traded cast aluminum futures rose 0.67%. Most ferrous metals fell in last Friday's overnight session. Stainless steel fell 0.3%, iron ore fell 0.46%, rebar fell 0.35%, hot-rolled coil fell 0.36%. Coking coal and coke: the most-traded coking coal contract rose 1.34%, and the most-traded coke contract rose 0.56%. In overseas metals last Friday overnight, LME base metals mostly fell. LME copper fell 0.11%. LME aluminum fell 0.33%, LME lead rose 0.96%. LME zinc fell 1.48%. LME tin rose 0.73%. LME nickel fell 0.38%. In precious metals last Friday overnight : COMEX gold rose 0.77%, but its weekly performance was down, falling 2.2% for the week; COMEX silver rose 0.06%, posting two consecutive weekly losses, down 6.56% for the week. The most-traded SHFE gold contract rose 0.67% last Friday overnight, but recorded two consecutive weekly declines, falling 3.07% for the week; the most-traded SHFE silver contract rose 1.05%, but declined for two straight weeks, down 7.85% for the week. Data from the World Gold Council showed that gold prices weakened in June, erasing earlier gains, and H1 ended with a decline. Despite outflows in June, Chinese market gold ETFs still achieved significant inflows in H1, pushing total AUM slightly higher to 243 billion yuan, with total holdings increasing by 29 mt to 277 mt. In June, Chinese market gold ETFs saw outflows of 15 billion yuan, marking the weakest monthly performance on record. (From Wallstreetcn APP) As of 8:45 on July 18, last Friday's overnight closing prices: Macro front China: [Ministry of Finance and Two Other Departments Adjust Consumption Tax Policy for Certain Batteries] On July 17, the Ministry of Finance announced that starting from September 1, 2026, mercury-free primary batteries, nickel-metal hydride batteries (also known as NiMH batteries), lithium primary batteries, lithium-ion batteries, and all-vanadium flow batteries will be subject to a consumption tax at a rate of 2%; starting from September 1, 2027, these battery products will be subject to a consumption tax at a rate of 4%. Starting from April 1, 2027, solar cells (also known as solar cells) will be subject to a consumption tax at a rate of 2%; starting from April 1, 2028, solar cells will be subject to a consumption tax at a rate of 4%. From September 1, 2026 to December 31, 2028, consumption tax will be exempted for sodium-ion batteries, solid-state batteries, fuel cells, as well as for perovskite cells, tandem cells, and gallium arsenide cells among solar cells. [MIIT: Automotive Producers Required to Firmly Resist Irrational Competition and Strengthen Product Testing, Verification, and Safety Assessment] On July 17, the Equipment Industry Department I of the Ministry of Industry and Information Technology (MIIT) convened a symposium for key automotive producers, deploying efforts to further regulate competition order in the automotive industry, enhance production conformity and quality safety levels of automotive products, and carry out key tasks such as safety risk and hazard investigations and inspections and supervision of automotive products. (from Wall Street CN app) [Ministry of Housing and Urban-Rural Development: Advance Urban Renewal with High Quality and Intensify the Implementation of the Renovation of Old Urban Residential Communities] On July 17, the Party Leadership Group of the Ministry of Housing and Urban-Rural Development held an expanded study session of the theoretical study center group. The meeting stressed that carrying out urban work in the new era and on the new journey is a glorious mission with arduous tasks. It called for advancing urban renewal with high quality, promoting urban governance with high efficiency, and building “four-good” construction of good houses, good residential communities, good neighborhoods, and good urban districts to high standards. It emphasized intensifying efforts to implement livelihood-related projects such as the renovation of old urban residential communities, the construction of complete communities, the improvement of property service quality, the environmental remediation of back alleys and lanes, the development of pocket parks, and the opening and sharing of green spaces. It called for making great efforts to solve the most pressing difficulties and problems faced by the people, such as the installation of elevators, parking, and charging, striving to make people’s urban life more convenient, comfortable, and beautiful, and seizing the momentum to open up a new landscape in the modernization and construction of people-oriented cities. (China Construction News) [The “Several Measures to Further Promote the Development of ‘AI+Manufacturing’ in Shanghai” Issued] The Shanghai Municipal Commission of Economy and Informatization has issued the “Several Measures to Further Promote the Development of ‘AI+Manufacturing’ in Shanghai.” It mentions promoting breakthroughs in key and core technologies. Support will be provided for breakthroughs in technologies such as knowledge graph integration and text-to-3D parts design, focusing on frontier fields including industrial vertical large models, AI programming large models, physical AI, industrial agents, industrial software, and the industrial Internet, with a maximum support of 20 million yuan. For the R&D of comprehensive security solutions for industrial large models and agents, a maximum support of 10 million yuan will be provided. The measures aim to reduce the cost of using intelligent elements. Industrial intelligent computing cloud platforms are encouraged to provide manufacturing enterprises with low-code agent development platforms and free trials of industrial agents, distribute platform token trial coupons, and introduce computing power benefit packages for enterprises. Support will be given for renting non-affiliated intelligent computing resources to carry out the R&D and application of industrial large models and industrial agents, with a maximum subsidy of 40 million yuan. Support will be provided for the deployment of industrial vertical applications by calling on third-party large models or adopting privately deployed third-party large models, with a maximum subsidy of 5 million yuan. Support will also be given for the procurement of high-quality corpora to facilitate the R&D and application of industrial vertical large models, industrial AI agents, etc., with a maximum subsidy of 5 million yuan. (Jin10 Data App) In terms of the US dollar: Last Friday overnight, the US dollar index rose 0.03% to 100.76. On the weekly chart: the US dollar index fell, dropping 0.2% for the week. According to the latest survey, US consumer sentiment surged to a five-month high in early July, boosted by falling gasoline prices. The survey results released on Friday showed that the University of Michigan's preliminary consumer sentiment index for July rose to 54.4 from 49.5 in June, compared to market expectations of 51. From June through early July, gasoline prices fell steadily, effectively easing household budget pressures. However, renewed tensions in the Middle East have since begun to push oil prices higher and clouded the inflation outlook further. The survey's coverage period was from June 23 to July 13, though the report noted that more than 70% of responses were completed before the US carried out airstrikes on Iran in early July. The improvement in consumer confidence was broad-based across age and income groups as well as political party affiliations. (from Wall Street News App) US housing starts surged in June after a sharp decline in the previous month, driven primarily by a rebound in apartment construction. Official data released on Friday showed that housing starts increased 19% to a 1.43 million annualized rate, the highest level since March and exceeding economists' expectations. Multifamily housing starts jumped more than 76% to a 532,000 annualized rate, following a nearly 40% plunge the previous month. Meanwhile, single-family housing starts fell 0.2%, declining again after builders experienced an overall sluggish spring. The rebound in multifamily construction underscores the month-to-month fluctuations in the data, especially in the apartment sector. However, high home prices and high mortgage rates have been suppressing demand for single-family homes, and these factors may also be supporting apartment demand. At the same time, single-family homebuilders have generally been facing high inventory and weak demand. This has forced many builders to entice buyers through sales incentives. Simona Mocuta, chief economist at State Street Global Advisors, said the US dollar has been supported this year by safe-haven inflows and market pricing of US Fed rate hikes, but these factors have already been priced into the exchange rate, so the dollar is set to resume its multi-year depreciation trend. Her baseline forecast is that the US Fed will keep interest rates unchanged for the entire year, but Mokuta says the risk of one rate hike remains. Even if a hike occurs, it has already been priced into the US dollar and would thus have little additional impact; if a hike fails to materialize, it would weaken the US dollar. As concerns over the US fiscal outlook persist, the US dollar will return to its long-term depreciation trend. (from Wallstreetcn APP) On the macro front: This week will see the release of China's one-year loan prime rate as of July 20, Germany's June PPI MoM, Canada's June CPI MoM, US June Conference Board Leading Index MoM, Switzerland's June trade balance, UK ILO unemployment rate for the three months to May, UK June public sector net borrowing, UK June unemployment rate, UK June claimant count change, Germany's July ZEW economic sentiment index, Eurozone's July ZEW economic sentiment index, US ADP employment change for the week ending July 4, UK June CPI MoM, UK June RPI MoM, China's June SWIFT RMB global payment share, Australia's seasonally adjusted unemployment rate for June, UK July CBI industrial orders balance, Eurozone's ECB deposit facility rate as of July 23, Eurozone's ECB main refinancing rate as of July 23, Canada's May retail sales MoM, US initial jobless claims for the week ending July 18, Eurozone's July consumer confidence index flash estimate, UK July GfK consumer confidence index, Japan's June core CPI YoY, Germany's August GfK consumer confidence index, UK June seasonally adjusted retail sales MoM, France's July manufacturing PMI flash estimate, Germany's July manufacturing PMI flash estimate, Eurozone's July manufacturing PMI flash estimate, UK July manufacturing PMI flash estimate, UK July services PMI flash estimate, US July S&P Global manufacturing PMI flash estimate, US July S&P Global services PMI flash estimate, and US June new home sales annualized, among other data. Additionally, this week: The ECB will announce its interest rate decision; ECB President Lagarde will hold a press conference on monetary policy. On the crude oil front: Last Friday, both crude oil futures surged in overnight trading, with WTI up 4.46% and Brent up 4.78%. On the weekly chart: WTI futures posted a second straight weekly gain, rising 14.51% for the week; Brent futures also rose for a second consecutive week, jumping 16.12% for the week. On Friday, the Middle East situation further deteriorated, and escalating geopolitical tensions drove crude oil sharply higher. Data released by international services provider Kpler on the 17th showed that vessel traffic through the Strait of Hormuz continued to weaken on the 16th, with the confirmed number of ships passing through the strait that day dropping to 8, the lowest level in nearly three weeks. (From Wallstreetcn APP) IEA Executive Director Birol Fatih warned on the 16th that if oil shipments via the Strait of Hormuz are not restored within weeks, global energy security will be in jeopardy. According to UK sources, Birol said at an event held by the Council on Foreign Relations that oil supply security remains a key concern, and if the situation in the Strait of Hormuz does not improve in the coming weeks, the world should be worried. He said the measures taken by some countries "cannot last forever"; even if the US significantly increases oil production, it will be far from enough to offset the supply gap caused by the blockage in the Strait of Hormuz. (CCTV News) Oilfield services company Baker Hughes said US energy firms this week added oil and natural gas rigs for the fifth consecutive week, the first such streak since early June, bringing the total count to its highest since April 2025. As an early indicator of future output, the total rig count rose by 7 to 588 in the week to July 17. Baker Hughes said this week's increase pushed the total rig count up by 44 rigs, or 8%, compared to the same period last year. Baker Hughes said oil rigs rose by 7 to 452 this week, the highest since May 2025; natural gas rigs were unchanged at 126, and miscellaneous rigs were unchanged at 10. (From Wallstreetcn APP) Notably: NYMEX WTI August crude oil futures will be affected by contract rollover, with the final floor trading completed at 2:30 on July 22 and the final electronic trading completed at 5:00 AM. Please pay attention to the exchange's expiry and rollover announcements to manage risks. In addition, for some trading platforms, the WTI contract expiry is typically one day earlier than the official NYMEX expiry; please be attentive. Recommended Reading:

The global overseas primary aluminum spot market faced overall downward pressure this week, with spot premiums in Japan, Southeast Asia, South Korea and the US all falling week-on-week. The Asian market was weighed down by weak downstream purchasing sentiment amid the traditional consumption off-season. Ample circulating supply stemming from concentrated cargo arrivals in the US compounded the bearish sentiment. Meanwhile, the LME curve briefly flipped into a Backwardation (B) structure this week. Elevated capital costs prompted traders to step up sell-downs, pushing spot offers lower across regions and dragging down transaction benchmarks. I. Weekly Comparison of Key Global Spot Premiums II. Regional Spot Transaction & Market Commentary (I) Asian Market: Sluggish Off-Season Buying, Wide Disparity Between Long-Term Benchmark QMJP and Spot Prices Japan Market Japan’s spot market remained sluggish this week, with downstream buyers only placing sporadic orders to meet immediate operational needs and no large-scale restocking activities. The Q3 QMJP benchmark price was set at USD 395/mt, sharply diverging from actual spot transaction prices ranging from USD 330–350/mt, resulting in steep discounts against the quarterly benchmark across the market. Southeast Asia, South Korea and Indonesia Spot premiums in Thailand and South Korea retreated in tandem as traders showed strong willingness to offload inventories. Overseas end-user demand for Indonesian primary aluminum stayed muted, while downstream players remained reluctant to accept high prices, driving down local ex-factory offers and concluded transaction prices. Across Asian trading channels, the temporary Backwardation structure on the LME aluminum curve, paired with higher capital costs and inventory pressure, encouraged holders to cut offers to liquidate stocks. Coupled with feeble downstream demand, spot prices faced additional downward pressure. (II) US Market: Concentrated Cargo Arrivals from Multiple Regions Weigh on Premiums Easier spot prices in Europe previously diverted some Canadian aluminum ingots to the US, alongside a portion of Indonesian primary aluminum shipments. Concentrated cargo arrivals boosted market supply substantially. Despite rigid underlying demand in the US, the surge in available supply kept DDP premiums under mild week-on-week downward pressure. III. Core Macro Drivers Shaping Overseas Spot Markets End-User Demand: Off-Season Drags on Asian Buying Sentiment Southeast Asia and Japan entered their traditional demand off-season. Downstream fabricators only purchased materials on an as-needed basis without proactive stockpiling, and market acceptable price levels kept sliding, leaving spot transactions without solid support. Trading Flows: High Capital Costs Fuel Traders’ Inventory Liquidation The temporary Backwardation structure on the LME aluminum curve lifted holding costs for metal traders. Most market participants opted to cut prices to sell stocks and recover capital, flooding the market with available material and further depressing spot premiums. IV. Brief Market Outlook In the near term, the off-season in Asia is far from over, and traders retain strong incentives to liquidate inventories, which will keep overseas primary aluminum spot premiums subdued. Market participants will closely monitor the commissioning timeline of Indonesian aluminum projects and restocking activities among overseas downstream manufacturers going forward.

Overseas rare earth markets diverged this week between light and heavy types. Driven by the uptrend in China, terbium oxide and terbium metal prices rose, while light rare earths remained stable. Trading-wise, heavy rare earths saw few transactions due to export controls. On the industrial front, U.S. companies accelerated domestic recycling and purification, while European and Japanese firms advanced R&D on magnetic material recycling and rare-earth-free alternative technologies. Meanwhile, Indo-Pacific and South Korean players actively restructured supply chains, and resource development and processing projects were intensively launched in locations such as Malaysia, Thailand, and Brazil. The global “de-risking” layout for rare earths continued to deepen.

Japan’s Green Investment Promotion Organization has released the final results of its 28th utility-scale solar auction, selecting 29 projects with a combined capacity of 89.2MW, slightly below the planned 91MW. The selected projects range from 350kW to 29.5MW. The lowest bid was JPY 0/kWh, submitted for eight projects between 400kW and 2MW, likely reflecting projects that had secured private PPAs and participated in the auction mainly to obtain grid connection. The highest bid was JPY 7.89/kWh, while the average final price came in at JPY 6.74/kWh, below the JPY 9.60/kWh ceiling.

First Quantum Minerals is considering selling a minority stake in its Taca Taca copper mine project in Argentina. The move comes as major global mining companies and strategic investors race to secure future copper supply.According to US media reports, the company has initiated this potential sale process.Potential bidders include Japan's Mitsubishi Corp. and Mitsui & Co., among others.

[SMM Aluminum Express News] Australia, Japan, the US and Alcoa have reached a final investment decision to develop a gallium production facility at Alcoa's Wagerup alumina refinery in Western Australia. The project will recover gallium from the existing Bayer process without requiring additional bauxite mining, supporting supply diversification for the critical mineral while adding value to the refinery's existing alumina operations.