[SMM Analysis] Weak Downstream Consumption Increases Pressure on Ex-China Steel Trading Price spread model, the price inversion of Chinese steel relative to overseas markets (India, Japan, Turkey, Black Sea) deepened further in late May. In particular, Chinese resources were cheaper compared to Indonesia, and the price spread was "narrowing at an accelerating pace." For pure ex-China inter-regional price spreads, India's decline was more pronounced compared to other regions, as weak domestic demand drove aggressive low-price bidding. Segment-wise, steel procurement sentiment in Southeast Asia became more cautious last week, with coil prices weakening. In Vietnam, coated steel and steel pipe prices began to slow down after a prolonged rally, and buyers became increasingly cautious about restocking ahead of the rainy season. Meanwhile, due to weak demand and growing pressure from low-priced imports, Formosa Ha Tinh Steel, a subsidiary of Taiwan's China Steel Corporation, also cut its HRC quotations by $5-10/mt to $598-603/mt CIF Vietnam. Although some Vietnamese downstream steel mills continued to raise or maintain prices due to earlier increases in raw material costs and tight spot supply, some producers had begun to limit orders or delay quotations while waiting for a clearer market direction. Notably, Indonesian HRC quotations remained competitive with relatively active exports, with FOB prices at around $565/mt. According to SMM survey, recent transaction prices to Vietnam were around $585/mt CFR. Turkey market: As the Middle East was set to enter a long holiday mid-week, most market participants had already exited early. According to SMM survey, no clear large-volume transactions were seen in the Turkish steel scrap market last week. Meanwhile, as domestic rebar demand remained sluggish, steel mills pushed their target purchase prices for European HMS 1&2 (80:20) scrap below $400/mt CFR to pass on the pressure. The recent euro depreciation and slight correction in ocean freight rates opened up some discount room for European sellers to a certain extent, but judging from actual market transactions, sellers still found it difficult to accept such low prices. At the same time, US exporters continued to hold prices firm at $420/mt CFR. In addition, mainstream quotations for Turkish domestic HRC remained at $660-675/mt EXW. Due to exchange rate fluctuations and high production costs, steel mills were striving to hold prices firm, but downstream buyers remained cautious in purchasing, with expected psychological prices 15-20 $/mt lower. Copyright and Intellectual Property Statement: This report is independently created or compiled by SMM Information & Technology Co., Ltd. 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Futures: The London Metal Exchange was closed on May 25 for a UK bank holiday and resumed trading on May 26. Overnight, the most-traded SHFE lead 2607 contract opened at 16,755 yuan/mt, briefly touched a high of 16,775 yuan/mt before pulling back, then moved sideways around the 16,700 yuan/mt level, and finally closed at 16,710 yuan/mt, down 0.27%. On the macro front: Guinea, the world's largest bauxite-producing country, will announce export control measures in June. China responded to the fact that no heavy rare earth had been exported to Japan for four months: China prohibits the export of dual-use items to Japanese military users and for military purposes in accordance with laws and regulations, aiming to stop Japan's "remilitarization" and nuclear ambitions. China responded to the prospect of a US-Iran deal: since the door to dialogue has been opened, it should not be closed again; the momentum of easing should be maintained, the general direction of political settlement should be upheld, and a solution that addresses the concerns of all parties should be reached through dialogue and consultation. : In the Jiangsu, Zhejiang, Shanghai market, a small volume of warrant-based cargoes were quoted. Suppliers mainly shipped cargoes self-picked up from primary lead smelter production sites. Due to supply differences between northern and southern markets, quotations in the northern market were firmer. On the secondary lead front, smelter losses were repaired and shipment enthusiasm increased, with secondary refined lead quoted at premiums of -50~0 yuan/mt ex-works against SMM #1 lead. As lead prices strengthened, downstream enterprises showed weakened purchasing enthusiasm. Some continued to purchase warrant-based cargoes from nearby warehouses, while those with rigid demand leaned toward lower-priced secondary lead cargoes. In terms of inventory: on May 25, LME lead was closed; LME lead inventory stood at 286,475 mt as of May 22. SMM lead ingot social inventory across five regions totaled 70,100 mt, down 3,200 mt from May 18 and down 3,200 mt from May 21. Lead price forecast for today: Recently, apart from individual social warehouses where lead ingot inventory declined due to downstream enterprises picking up goods, other social warehouses saw slight increases due to inventory transfers by suppliers and arrivals of imported lead. After concentrated dip-buying by downstream enterprises during the lead price pullback last week, lead prices rebounded in recent days, and downstream enterprises' purchasing enthusiasm weakened notably. In addition, as secondary lead smelter losses were repaired, smelters actively shipped at discounts. Secondary refined lead was quoted at premiums of -50~0 yuan/mt ex-works against SMM #1 lead price, while in contrast, primary lead was quoted at premiums of +0~+75 yuan/mt ex-works against SMM #1 lead price. Some downstream enterprises with rigid demand leaned toward secondary lead. Going forward, the destocking of lead ingot social inventory is expected to continue to slow down, and resistance above lead prices remains evident. Data source disclaimer: Data other than public information is derived from public information, market communication, and SMM's internal database models, processed by SMM for reference only and does not constitute decision-making advice.

1. Procurement Conditions The purchaser of this procurement project, Ansteel Powder Material Carbonyl Nickel Powder (AGGZZBHGXHD260525290651), is the Tender Management Office of the Procurement and Supply Center of Ansteel Group Engineering Technology Development Co., Ltd. The funds for the procurement project are self-raised. The project has met the procurement conditions and is now open for public inquiry and comparison. 2. Project Overview and Procurement Scope 2.1 Project Name: Ansteel Powder Material Carbonyl Nickel Powder 2.2 Conversion to other procurement methods upon procurement failure: No conversion 2.3 For details of the procurement content, scope, and scale of this project, please refer to the attachment "Material List Attachment.pdf". 3. Bidder Qualification Requirements 3.1 Joint bids are not permitted for this procurement. 3.2 This procurement requires bidders to possess the following qualifications: (1) Manufacturing business license (2) Distribution business license 3.3 This procurement requires bidders to meet the following registered capital requirements: Manufacturing registered capital: 2 million yuan or above Distribution registered capital: 2 million yuan or above 3.4 This procurement requires bidders to possess the following performance requirements: Supply performance of similar products after January 1, 2022 (contracts and corresponding invoices). 3.5 This procurement requires bidders to meet the following capability requirements, financial requirements, and other requirements: Financial requirements: See attachment for details (if required) Capability requirements: See attachment for details (if required) Other requirements: See attachment for details (if required) 3.6 For projects subject to mandatory tendering by law in this procurement, bids submitted by persons subject to enforcement for dishonesty shall be invalid. 4. Acquisition of Procurement Documents 4.1 All interested bidders are requested to log in to the Ansteel Smart Tender and Bid Platform at http://bid.ansteel.cn from 14:00 on May 25, 2026 to 13:00 on June 2, 2026 (Beijing time, the same hereinafter) to download the electronic procurement documents. Click to view tender details:

SMM News, May 25: Metals market: As of the midday close, base metals on the domestic market mostly rose. SHFE copper gained 1.06%. SHFE aluminum fell 0.47%. SHFE lead rose 0.06%, SHFE zinc rose 0.34%. SHFE tin gained 1.22%. SHFE nickel rose 0.23%. In addition, the most-traded casting aluminum futures fell 0.54%, the most-traded alumina futures rose 0.37%. The most-traded lithium carbonate futures rose 0.58%. The most-traded silicon metal futures rose 1.07%. The most-traded polysilicon futures rose 0.48%. Ferrous metals all rose. Iron ore gained 0.25%, rebar rose 1.23%, hot-rolled coil rose 1.03%, and stainless steel edged up. Coking coal and coke: the most-traded coking coal contract and the most-traded coke contract hit the daily limit up with gains of 7.97% and 7.99%, respectively. Overseas base metals: The London Metal Exchange (LME) was closed on May 25 for the UK bank holiday and will resume trading on May 26. Precious metals: as of 11:38, COMEX gold rose 0.86% and COMEX silver gained 2.44%. Domestic precious metals: the most-traded SHFE gold futures rose 0.64% and the most-traded SHFE silver futures rose 2.27%. In addition, as of the midday close, the most-traded platinum futures fell 0.2% and the most-traded palladium futures rose 0.01%. As of the midday close, the most-traded Europe containerized freight index contract fell 3.36% to 2,901 points. As of 11:38 on May 25, midday futures quotes for selected contracts: Spot and fundamentals Copper: Today, #1 copper cathode spot prices in North China against the front-month contract were reported at an average discount of 360 yuan/mt to a discount of 280 yuan/mt. The average price fell 10 yuan/mt from the previous trading day, and the average transaction price was 105,230 yuan/mt, up 1,035 yuan/mt from the previous trading day. Macro front Domestic: [Huawei Announces Semiconductor Tao's Law] On May 25, Huawei officially announced a new law in the semiconductor field. "Tao's Law" proposes replacing "geometric scaling" with "temporal scaling," achieving new breakthroughs in transistor density and system performance through logic folding technology. This marks the first time China has proposed a new principle guiding industrial development in the global semiconductor field. By 2031, high-end chip transistor density based on this law is expected to reach the equivalent level of the 1.4nm process node. (People's Daily) [PBOC Reverse Repo Operations Result in Net Injection of 257 billion yuan Today] The PBOC conducted 258 billion yuan of 7-day reverse repo operations in the open market, with an operation rate of 1.40%, unchanged from the previous day. 1 billion yuan of reverse repos matured today. On the US dollar: As of 11:38, the US dollar index fell 0.3% to 99.03. Kevin Hassett, chief economic adviser to US President Trump, said he believes that the eventual decline in oil prices will create room for the Fed to cut interest rates. "We again expect that once a deal is reached, energy prices will plunge," Hassett said. "When that happens, the Fed will have plenty of room to take the right action and lower interest rates." He emphasized that he respects the Fed's independence and praised Kevin Warsh, who was sworn in as Fed Chairman last Friday. Although the surge in US fuel prices caused by Iran's closure of the Strait of Hormuz poses a growing political risk to Trump and his Republican Party in the November midterm elections, Hassett believes that the accelerating inflation is mainly driven by energy prices. "If you look at the last few data reports, energy prices are absolutely concerning, but core prices have barely moved at all," he said. "I think once we see energy prices pull back, due to declining energy prices, you may actually see negative inflation." (Jin10 Data) According to CME's "FedWatch": the probability that the Fed will keep interest rates unchanged in June was 97.3%, and the probability of a cumulative 25-basis-point rate hike was 2.7%. The probability that the Fed will keep interest rates unchanged in July was 84.8%, the probability of a cumulative 25-basis-point rate hike was 14.8%, and the probability of a cumulative 50-basis-point rate hike was 0.3%. (Jin10 Data) On data: Today, data including China's year-to-date installed power generation capacity in April and its year-on-year rate will be released. In addition, attention should be paid to: 500 billion yuan of 1-year medium-term lending facility (MLF) and 1 billion yuan of 7-day reverse repos will mature today. In addition, it is worth noting that due to the Memorial Day holiday, US stock markets will be closed for one day on May 25 (Monday); CME's precious metals and US crude oil futures contract trading will end early at 02:30 Beijing time on the 26th, and US stock and US Treasury futures contract trading will end early at 01:00 Beijing time on the 26th. Due to the Buddha's Birthday holiday, Hong Kong stock markets will be closed for one day on May 25 (Monday), with both southbound and northbound trading suspended; South Korean stock markets will also be closed for one day on the same day. In addition, due to the Spring Bank Holiday, the UK stock market will be closed on Monday, May 25; trading of ICE Brent crude oil futures contracts will end early at 01:30 Beijing time on May 26. Investors are advised to take note. (Jin10 Data) Overseas exchange closure arrangements are as follows (all in Beijing time): Crude oil: As of 11:38, oil prices in both markets fell, with WTI down 5.92% and Brent down 5.32%. Rising expectations of a US-Iran deal boosted global risk sentiment, putting oil prices under pressure. The direct catalyst for the oil price decline was signs of improvement in actual transit conditions through the Strait of Hormuz. According to Iran's Islamic Republic News Agency citing a statement from the Islamic Revolutionary Guard Corps, 33 vessels — including oil tankers, container ships, and other commercial vessels — passed through the Strait of Hormuz within 24 hours on Sunday after receiving authorization from the IRGC Navy. (Wallstreetcn) The Washington Post reported on May 24 that the US and Iran had reached agreement on a framework for a memorandum of understanding (MOU), which, once signed, would fully restore shipping through the Strait of Hormuz within 30 days. Citing an anonymous senior US government official, the report said the US and Iran had developed an MOU "framework" that includes a 60-day ceasefire extension to allow both sides to reach a "final agreement" on permanently ending hostilities with Iran, during which the Strait of Hormuz would be demined and reopened. The official said the MOU includes a "commitment" that Iran will not possess nuclear weapons. Over the next two months, the US and Iran will discuss the "mechanism" for implementing this commitment. However, neither side signed any agreement on May 24. (Xinhua) Trump said on social media on Saturday that a US-Iran deal was largely done, including the opening of the Strait of Hormuz, and told US representatives not to rush into a deal. But on Sunday he said the deal was "not fully done yet." US Secretary of State Marco Rubio had previously said there could be "some good news" on the Hormuz issue in the coming hours. Iran remained cautious. Iran's Tasnim News Agency warned that the draft agreement could still collapse due to US obstacles on several key terms — including Iran's demand for unfreezing assets. (Wallstreetcn) Spot market overview: ► ► ► ► ► ► ► ► ► ► ► ► ► ►

1 Tender Conditions The bid inviter for this tender project, Ansteel Powder Materials Ultra-High Power Graphite Electrodes (AGGZZBHGZHD260525290631), is the Tender Management Office of the Procurement and Supply Center of Ansteel Group Engineering Technology Development Co., Ltd. The project funds are self-raised. The project has met the tender conditions, and open tendering is now conducted. 2 Project Overview and Tender Scope 2.1 Project Name: Ansteel Powder Materials Ultra-High Power Graphite Electrodes 2.2 Conversion to other procurement methods upon tender failure: No conversion 2.3 The tender content, scope, and scale of this project are detailed in the attachment "Material List Attachment.pdf". 3 Bidder Qualification Requirements 3.1 Joint venture bidding is not permitted in this tender. 3.2 This tender requires bidders to possess the following qualification requirements: (1) Production-type quality management system certification (2) Production-type business license 3.3 This tender requires bidders to meet the following registered capital requirements: Production-type registered capital: 5 million yuan and above 3.4 This tender requires bidders to possess the following performance requirements: Supply performance of similar products after January 1, 2022 (one contract and corresponding invoice) 3.5 This tender requires bidders to possess the following capability requirements, financial requirements, and other requirements: Financial requirements: See attachments for details (if applicable) Capability requirements: See attachments for details (if applicable) Other requirements: See attachments for details (if applicable) 3.6 This tender requires that for projects subject to mandatory tendering by law, bids from persons subject to enforcement for breach of trust shall be invalid. 4 Obtaining Tender Documents 4.1 All parties interested in bidding are requested to log in to the Ansteel Smart Tender and Bid Platform at http://bid.ansteel.cn to download the electronic tender documents from 13:00 on May 25, 2026 to 13:00 on June 15, 2026 (Beijing time, the same hereinafter). Click to view tender details:

Nickel Ore " Indonesia Officially Issues Presidential Decree Requiring Designated State-Owned Enterprises to Monopolize Strategic Resource Exports Starting This June " 1. Price Dynamics and HMA Revisions The Indonesian nickel ore price remained stable this week. The Ministry of Energy and Mineral Resources (ESDM) has officially released the Nickel Mineral Benchmark Price (HMA) for the second half of May 2026. Nickel HMA: $18,849.3/dmt (up $1047.15 or 5.88% from $17,802.14 in early May). Cobalt HMA: $55,854/dmt. Iron Ore HMA: $1.58/dmt. Chrome Ore HMA: $6.37/dmt. Current port-delivered prices for 1.6% grade pyrometallurgical ore (saprolite) stand at $77.8-80.8/wmt. In contrast, 1.2% grade hydrometallurgical ore (limonite) is priced at approximately $28-33/wm.. 2. Supply-Demand Fundamentals and Weather Impacts For pyrometallurgical ore, unseasonal, abnormally heavy rainfall in the Central and South Sulawesi regions (Morowali and surrounding mining areas) has severely disrupted land transportation and barge transshipment. A series of micro-earthquakes (reaching up to magnitude M$1.9$) that occurred near Morowali between May 17 and 18 further exacerbated this impact. The combination of highly saturated soil moisture and minor crustal tremors has significantly increased the risk of landslides and slope instability, forcing mines to slow down their extraction and heavy-truck transportation pace for safety reasons. Therefore, even though the approval rate of regulatory quotas (RKAB) has reached approximately 90%, the spot supply of high-grade ore remains tight. To cope with exorbitant costs and tight supply, smelters are actively adopting cost-reduction strategies. These include blending low-grade ores into raw materials to lower the overall grade, promoting a unified premium pricing model of "HPM + USD $7–$10/wmt," and implementing standardized benchmarks for the chemical specifications of pyrometallurgical ore (Cobalt 0.05%, Iron 20%, Chrome 1%) to eliminate additional premiums for individual ore components. Meanwhile, the hydrometallurgical nickel ore market continues to suffer a severe disconnect from official pricing. The price of low-grade hydrometallurgical ore is under severe pressure and has completely failed to follow the upward trend of the new HPM. This price depression is primarily driven by the dual contraction of smelter operating rates and immediate raw material demand, with the core trigger being a potential production cut in Mixed Hydroxide Precipitate (MHP) caused by a sulfuric acid supply shortage in May. Against a backdrop of relatively stable inventory levels, MHP refineries are leveraging this low-capacity operating environment to aggressively suppress procurement bids, causing hydrometallurgical ore prices to continue hovering at low levels. 3. SMM Internal Estimates The new pricing formula has led to increased price divergence and amplified volatility, particularly influenced by higher associated cobalt content in certain ores. SMM calculations show that the new HPM for 1.2% grade limonite is approximately $49.95, significantly higher than current market assessments. The new HPM for 1.6% grade saprolite is $70.83; the inclusion of higher cobalt content in the new formula has markedly amplified price fluctuations. While actual market transaction prices currently remain above this benchmark, the gap is steadily narrowing. 4. Regulatory Quotas (RKAB) and Market Outlook According to the ESDM, RKAB approvals for 2026 have reached approximately 90%. SMM statistics indicate that the total approved quota for Indonesian nickel ore stands at roughly 240 million wmt. The macroeconomic and policy focus of the market has recently shifted, primarily concentrating on the following two major export and contract regulatory policies: DSI's Full Takeover of the Export Mechanism: The Indonesian government has confirmed that starting January 1, 2027, DSI will fully take over the export business of coal, palm oil, and ferroalloys. This policy will facilitate a smooth transition of the export mechanism in two phases. Since ferroalloys (including ferronickel, NPI, etc.) fall within the scope of this takeover, the market is closely evaluating the impact of this transition period on the export logistics and compliance costs of Chinese-funded smelters. Crackdown on Under-Invoiced Long-Term Contracts: The Indonesian government emphasized that it will honor existing, valid long-term export contracts to maintain commercial credit. However, at the same time, the government will strictly investigate and punish long-term contracts suspected of "under-invoicing" (low-price customs declarations). It is reported that relevant Indonesian departments will soon hold consultations with major industry associations to ensure a smooth policy transition while plugging loopholes that lead to tax revenue losses from underpricing. Nickel Pig Iron " Supply-Demand Price Gap Widens; Short-Term Prices to Fluctuate within a Range " The average price of SMM 10-12% NPI average price fell by RMB 5.7 per nickel unit week-on-week to RMB 1140.3 per nickel unit (ex-works, tax included), while the Indonesia NPI FOB index dipped by USD 1.37 USD per nickel unit to an average of USD 146.52 per nickel unit. Downstream purchasing sentiment dropped even more visibly, intensifying the divide in market mindsets between buyers and sellers. On the supply side, existing NPI production cutbacks, coupled with recent disruptions from Indonesian export policy updates, have gradually tightened spot availability. Consequently, upstream producers are holding back cargo to defend their asking prices, generally keeping their offers firm. Sellers only slightly softened their quotes under the weight of weak futures markets, and their willingness to offload cargo at lower price levels remains low. This expectation of tighter market supply provides a solid floor for prices. On the demand side, pressure remains acute. The stainless steel market lacks upward momentum, forcing steel mills to adopt a highly cautious procurement stance centered strictly around hand-to-mouth restocking. Furthermore, as the price-to-performance advantage of stainless steel scrap expands, downstream buyers are pushing hard for discounts. Target buying prices remain heavily clustered between RMB 1,120 and 1,130/mtu, leaving a massive spread against upstream asking prices that makes reconciling the two sides very difficult. Market Outlook: While expectations of tightening supply will support spot prices, the weak futures market and competitive pricing from alternative raw materials will continue to cap upside gains. Accordingly, high-nickel pig iron prices are expected to exhibit a high-level, range-bound volatile trend next week.