[Copper] On Friday, SHFE copper closed lower amid sideways movement, with accelerated position reduction in the delivery month. Today, spot copper prices fell to 78,205 yuan. The premium for Shanghai copper rapidly pulled back to 80 yuan, while the premium in Guangdong dropped to 155 yuan. In April, the highlight of domestic and overseas trade exports remained in ASEAN, where production maintained strong momentum during the reciprocal tariff exemption period. In the first four months, domestic imports of unwrought copper reached 1.742 million mt, down 3.9% year-on-year. Despite extremely low processing fees, copper concentrate imports remained stable, with a cumulative increase of 7.8% in the first four months. Consider shorting the SHFE 2507 contract or participating in calendar spreads between near-month contracts amid the rebound. [Aluminum and Alumina] Today, SHFE aluminum fluctuated rangebound, with spot aluminum in east China trading on par with futures, while spot aluminum in south China traded at a discount of 45 yuan. Yesterday, social inventories of aluminum ingots and aluminum billets in east China fell by 16,000 mt and 9,000 mt, respectively, compared to Monday, with total inventory remaining at the lowest level for the same period in recent years. Amid the shadow of trade wars, demand faces seasonal weakness and pressure from trade frictions. SHFE aluminum faces strong resistance in the 20,000-20,300 yuan range, corresponding to the upside gap. However, since the beginning of the year, aluminum market demand has exceeded expectations. Monitor inventory and spot feedback after price pullbacks, and maintain a cautiously bearish stance without excessive pessimism. Recently, the capacity under maintenance and production cuts in the alumina sector has continued to rise, leading to a temporary reduction in production and a decline in industry inventory. However, once profits recover, capacity will resume on a large scale, and new capacities in Shandong and Hebei will gradually produce finished products. The transaction price of Guinea bauxite at the cost side has fallen from $110 at the beginning of the year to $75, with the average cost of alumina dropping to around 2,900 yuan. This week, spot alumina transactions have slightly increased. In the short term, the rebound height of the futures market will be limited by the surplus outlook and cost collapse. Consider shorting on rallies when futures trade at a premium. [Zinc] The spot import window for zinc has opened, and with the gradual supplementation of overseas zinc elements, domestic zinc ingot supply is unlikely to be tight. Progress in Sino-US tariff negotiations has been sluggish, keeping demand under pressure. The domestic peak season has ended, and the probability of simultaneous weakness in domestic and overseas demand is high. As consumption trickles down, maintain short positions in SHFE zinc from previous highs. [Lead] Profits at secondary smelters are poor, leading to reduced production. Primary smelters in north and south China have enterprises planning maintenance, supporting lead prices. The tight supply of raw materials remains unchanged, with secondary lead operating at a loss and insufficient enthusiasm for raising prices to purchase. Scrap battery suppliers are unwilling to sell at low prices, keeping scrap battery prices stable. Downstream purchase willingness is mediocre. SMM 1# lead is trading at a discount of 110 yuan/mt to near-month futures, with a price difference between primary metal and scrap of 25 yuan/mt. The import window remains closed, and the tug-of-war between costs and consumption continues. Temporarily, view SHFE lead as fluctuating rangebound in the 16,300-17,000 yuan/mt range. [Nickel and Stainless Steel] SHFE nickel fluctuated rangebound, with mediocre market trading activity.On the spot market, the premium for Jinchuan nickel fell to 2,250 yuan, the premium for imported nickel was 100 yuan, and electrodeposited nickel traded at a discount of 50 yuan. Supply side, the shipment volume of nickel ore from the Philippines increased significantly compared to earlier periods, replenishing smelters' nickel ore inventory. NPI prices continued to decline, with domestic acceptance of high-priced nickel ore decreasing. The impact of Indonesia's new policy on costs may gradually be absorbed by the market. The quoted price for high-grade nickel pig iron (NPI) stood at 962 yuan per mtu, having fallen by nearly 7% over the past month. In terms of inventory, nickel pig iron inventory increased by 4,200 mt to 28,400 mt, refined nickel inventory decreased by 560 mt to 44,000 mt, and stainless steel inventory decreased by 10,000 mt to 975,000 mt. SHFE nickel is at the tail end of another rebound, with bears gradually gaining strength. [Tin] The weighted average of SHFE tin continued to oscillate above 260,000 yuan and the 250-day moving average (MA250). Currently, there is a tight supply of tin concentrate raw materials. Domestic refined tin output fell MoM in April, with a particularly large YoY decline. However, both supply and demand in the tin market are weak, primarily supporting domestic spot prices. Today, SMM tin was quoted at 262,200 yuan, with a real-time premium of 770 yuan over the delivery month. It is expected that tin prices will mainly complete a right-shoulder oscillation pattern in May, with significant resistance above. Short positions can be held against 265,000 yuan. (Source: Guotou Junan Futures)

【Futures Market Review】The most-traded SHFE nickel contract closed at 126,320 yuan/mt during the daytime session, up 0.57%. The most-traded stainless steel contract closed at 12,790 yuan/mt, up 0.39%. 【Industry Performance】In the spot market, the spot price of Jinchuan nickel was adjusted to 127,875 yuan/mt, with a premium of 2,250 yuan/mt. SMM refined nickel was priced at 126,925 yuan/mt. The average price of imported nickel was adjusted to 125,875 yuan/mt. The average price of battery-grade nickel sulphate was 28,050 yuan/mt, with a premium of 2,325 yuan/mt (Ni contained) over nickel briquette. The profit margin for producing nickel sulphate from nickel briquette was -3.5%. The ex-factory price of 8-12% high-grade NPI was 974 yuan/mtu, and the profit margin of 304 stainless steel cold-rolled coil was -7.85%. SHFE refined nickel inventory stood at 30,332 mt, while LME nickel inventory was 204,252 mt. SMM stainless steel social inventory accumulated to 999,400 mt. NPI inventory in major domestic regions was 24,173.5 mt. 【Market Analysis】The futures market continued to fluctuate upward during the day, mainly following the overall market trend. Fundamentals side, there was no significant fluctuation recently. Despite intensified losses for some NPI producers, production remained stable. However, NPI quotations have approached the level of the early-year fluctuation range. Tsingshan recently tendered 970 yuan/mtu for May, and the subsequent downside room is relatively limited. The nickel sulphate chain price remained relatively stable, with MHP prices generally stable with a slight rise, providing some support. Downstream new energy still has short-term restocking demand, and the medium and long-term new energy chain is expected to rise. The Indonesian royalty is about to be implemented, which may bring slight positive feedback to the futures market, but the subsequent upward momentum is lacking. It is crucial to monitor whether there will be further disturbances from a macro perspective. Under the premise of tariff concerns, it is recommended to focus on short-term trading for the 06 contract.

After a sharp decline on the first day after the holiday, SHFE nickel returned above 120,000 as shorts took profits and exited the market. Futures prices then steadily rebounded, gradually filling the previous gap. Indonesia has announced a new policy on nickel product royalties. What impact will this have on the nickel market? How should we view Indonesia's multiple policy adjustments this year? What is the current supply and demand situation for nickel? What factors in the fundamentals are worth paying attention to? After consecutive rebounds, does SHFE nickel still have room for further upside? Webstock Inc.'s [Institutional Diagnosis] section invites SHFE nickel futures experts to provide in-depth insights. [Institutional Diagnosis]: Indonesia has announced a new policy on nickel product royalties. What impact will this have on the nickel market? How should we view Indonesia's multiple policy adjustments this year? Gu Jing, Senior Analyst at Yide Futures Investment Consulting Department: The increase in tax rates for raw materials and smelting products directly raises production costs. Based on the HMA price of nickel at $15,534.62/mt in the second period of March 2025, the cost of nickel ore with a grade of 1.6%-2.0% will increase by $1.1-1.8/wmt. Assuming the rise in mining costs is fully passed on to smelting, coupled with the increase in smelting tax rates, the cost of NPI will rise by $420/mt (metal content), and the cost of nickel matte will increase by $411/mt (metal content). The cost of MHP using low-grade nickel ore remains unaffected. After nearly two years of surplus, nickel prices have been fluctuating at the bottom. As the world's largest supplier of nickel, Indonesia has recently introduced multiple policies aimed at helping nickel prices break out of the low valuation range, ensuring more rational use of nickel resources, and thereby increasing domestic tax revenue. Jiang Xinbin, Senior Metal Analyst at Zheshang Futures Research Center: Indonesia's nickel product royalty policy has recently been implemented. The core of this policy is to implement a progressive tax rate increase for products at various stages of the nickel industry chain. The new policy significantly raises the tax burden on nickel ore and its downstream products, directly lifting the cost center of the nickel industry chain and supporting nickel prices: based on the current HMA, the royalty for nickel ore has been increased from a fixed 10% to 14%, potentially driving NPI costs up by $180-200/mt. In 2025, Indonesia has frequently introduced policies, from the SIMBARA system and HMA price adjustments to the new royalty policy. Behind these moves is not only Indonesia's long-term strategy to enhance resource revenue and strengthen the voice of related industries but also a stopgap measure by the Indonesian government to cope with the huge costs of Prabowo's "flagship project." Xia Peng, Head of Nonferrous and New Energy Group at Chuangyuan Futures Research Institute: The Indonesian government's 2025 Government Regulation No. 19 is an update based on the 2022 Regulation No. 26, mainly increasing the cost of nickel ore usage, with the royalty levied only once during the industry chain process. The royalty rate for nickel ore with a grade below 1.5% remains at 2%, while the rate for ore above 1.5% has been increased from 10% to 14%-19% (with progressive increases based on different HMA nickel prices). The impact on nickel prices is mainly reflected in the upward shift in costs. As a resource-exporting country, the new Indonesian government, which took office last October, has adjusted its mineral policies primarily to alleviate fiscal pressure. [Institutional Diagnosis]: What is the current supply and demand situation for nickel? What factors in the fundamentals are worth paying attention to? Gu Jing, Senior Analyst at Yide Futures Investment Consulting Department: On the supply side, the rainy season in the main mining areas of the Philippines has ended, and ore output has seasonally rebounded, with a noticeable increase in ship departures, up YoY. The import of Philippine ore to Indonesia has significantly increased, easing the tight ore supply in the later period. Indonesian NPI smelting production remains high, while high-grade nickel matte production stays low due to tight high-grade ore supply, and MHP production remains high. Domestic refined nickel production also maintains a high schedule. On the demand side, the cumulative YoY decline in ternary power battery installations is significant, leading to reduced demand for high-grade nickel matte and MHP. The recent implementation of new battery standards has constrained end-use consumption, making it difficult to drive up intermediate product prices through downstream orders in the short term. In the stainless steel sector, both 200-series and 300-series production remain high, with nickel consumption maintaining a high growth rate of over 10%. However, stainless steel inventory pressure is expected to be significant in the later period. Overall, the nickel industry remains in a surplus. The recent implementation of Indonesia's tax policies has provided strong support for prices, and future attention should be paid to whether there will be any unexpected performance on the demand side. Jiang Xinbin, Senior Metal Analyst at Zheshang Futures Research Center: On the supply side, the hype around Indonesia's BNBP policy for nickel ore has subsided, and the imminent resumption of production by major nickel pig iron (NPI) producers continues to tighten supply in Indonesia, with high domestic trade premiums supporting ore prices. In terms of primary nickel, domestic smelters have low nickel ore inventories, and some companies are still in maintenance periods, keeping overall NPI production low. Indonesian NPI production remains high in April, and the pullback in nickel prices has driven the conversion of high-grade nickel matte back to NPI, likely extending the surplus. Recent MHP production cuts are expected to marginally tighten refined nickel supply. Overall, Indonesia's nickel supply remains relatively loose. On the demand side, stainless steel demand is recovering slowly, with a slow destocking pace, and traders are pessimistic about future orders, indicating a generally weak demand. Future supply-side attention should focus on the shipping pace of Philippine nickel ore and Indonesia's domestic nickel ore trade, while demand-side attention should be on stainless steel inventory and order dynamics. Xia Peng, Head of Nonferrous and New Energy Group at Chuangyuan Futures Research Institute: From a fundamental perspective, the current supply and demand situation in nickel smelting remains challenging. As of April 17, LME refined nickel inventory stood at 204,500 mt, the highest since September 2021. Last Friday, SMM reported domestic refined nickel social inventory at 43,300 mt, indicating no shortage of refined nickel, the trading target in the futures market. The main point of contention since the Chinese New Year has been the disruptions in Indonesian nickel ore supply. In 2024, Indonesia accounted for 60% of global primary nickel production, showing a high concentration. Moreover, MHP capacity in the smelting sector continues to expand, making nickel ore relatively scarce compared to smelting capacity. The anchor for futures pricing lies in the ore sector. Last year, the slow issuance of RKAB in Indonesia, combined with low smelter ore inventories, the rainy season, and the Indonesian Ramadan in March, created a short-term supply-demand mismatch, driving nickel ore prices and subsequently nickel prices slightly higher. As we approach May, seasonal recovery in nickel ore supply from Indonesia and the Philippines may slightly ease the tight ore supply, with a focus on nickel ore price changes. [Institutional Diagnosis]: After consecutive rebounds, does SHFE nickel still have room for further upside? Gu Jing, Senior Analyst at Yide Futures Investment Consulting Department: Currently, with the easing of macro sentiment, the LME market has fully recovered from the decline caused by reciprocal tariffs, and the market has already reacted to the adjustment of Indonesia's PNBP tax rates. The current surplus continues, with high inventory levels exerting downward pressure. We believe that further upside in the futures market will require further improvement in the supply and demand fundamentals. Jiang Xinbin, Senior Metal Analyst at Zheshang Futures Research Center: After the Qingming Festival, SHFE nickel prices rebounded from low levels, approaching the middle of the previous trading range. From a fundamental perspective, on the supply side, although the implementation of Indonesia's nickel product royalty policy has pushed the price center higher, the overall supply of primary nickel remains rigidly growing, with high inventory pressure for Class 1 nickel still present. On the demand side, stainless steel is significantly dragged down by weak end-use consumption in real estate and infrastructure, with cautious market procurement and pessimistic order expectations making it difficult to form strong support. Overall, the global nickel market remains in a supply-demand surplus, and SHFE nickel's upside room for continued rebound in the short term is limited, with sideways movement expected. Attention should be paid to changes in Indonesia's industrial policies and the macro environment. Xia Peng, Head of Nonferrous and New Energy Group at Chuangyuan Futures Research Institute: This year, we have been closely monitoring changes in Indonesia's mineral policies, particularly whether there will be adjustments to nickel ore quotas. Information from the Indonesian Nickel Association shows that the Indonesian government has allocated 298 million mt of nickel ore quotas for 2025, which is estimated to meet the nickel ore consumption for 2025 based on this year's smelting production. Global primary nickel supply and demand remain in surplus. However, since December last year, government officials have repeatedly stated in public that they plan to reduce this year's nickel ore quotas to stabilize nickel prices. If the quota is cut to 220 million mt as suggested by the Ministry of Energy and Mineral Resources officials at the end of February, the global primary nickel supply and demand will completely reverse this year, shifting from surplus to shortage. Over the past decade, the Indonesian government has adjusted its mineral policies multiple times, making it difficult to predict future policy directions. It is recommended to closely monitor changes in Indonesian nickel ore prices.

【Copper】 On Thursday, SHFE copper rebounded sharply, as the new US President's shift in stance on reciprocal tariffs boosted risk assets. However, the negative sentiment surrounding tariffs is unlikely to dissipate fundamentally, and the copper market is expected to transition into a slow and fluctuating decline. The support level for SHFE copper during this phase is at 71,000 yuan, near the gap from the March rally last year. Domestic spot prices rose to 75,000 yuan today, with the premium narrowing to 30 yuan ahead of delivery. SMM social inventory decreased by 31,500 mt to 267,200 mt this week. The tight supply of domestic primary and secondary copper raw materials, coupled with the resistance to decline, indicates that short-term demand remains. Technically, LME copper faces resistance at $9,300, while SHFE copper's corresponding level is 76,500 yuan. The extent of the rebound warrants attention. 【Aluminum & Alumina】 Today, SHFE aluminum followed the broader commodity rebound. Aluminum ingot and billet social inventories decreased by 30,000 mt and 13,000 mt respectively compared to Monday, with total aluminum market inventories at a low for the same period in recent years. Apparent consumption is strong, and the fundamentals are relatively robust among non-ferrous metals. In the short term, macro factors dominate commodity trends, and the volatility in US policies has increased market fluctuations. SHFE aluminum is expected to fluctuate, with support at the 19,000 yuan limit-down level from Monday, and resistance at the 20,000 yuan psychological barrier and the annual moving average. Spot alumina indices across regions have successively fallen below 2,900 yuan. While the increasing maintenance activities have improved the April balance, the surplus outlook remains unchanged. As companies gradually face cash losses, larger-scale production cuts are anticipated. This week's low point in the futures market corresponds to a cost expectation equivalent to ore prices falling to around $70. Alumina remains in a weak and fluctuating state, but the downside may be limited. 【Zinc】 The US tariff policy has fluctuated again, leading to an upward revision in risk assets. However, the prospects for tariff negotiations are not optimistic, and funds are inclined to take profits. SHFE zinc's weighted open interest decreased by 17,500 lots to 208,600 lots. Downstream buyers are purchasing on dips, and SMM zinc social inventory has dropped to 102,100 mt, with the 0-2 month price spread widening to 515 yuan/mt. Pessimistic sentiment on the consumption side has somewhat eased. In the short term, SHFE zinc may fluctuate within the 22,000-23,000 yuan/mt range. However, the CZSPT group expects domestic mine TC to rebound to 4,500 yuan/mt in June, and imported mine TC to rise to $60-70/dmt. The expectation for increased production remains strong after smelters return to profitability. The pressure for a downward shift in zinc's price center persists, and the strategy of shorting on rebounds continues. 【Lead】 The US tariff policy remains uncertain, and the pessimistic expectations on the consumption side have slightly improved. Shorts significantly reduced their positions, leading to a notable rebound in SHFE lead. SMM's #1 lead price rose by 250 yuan/mt to 16,700 yuan/mt, shifting to a discount of 75 yuan/mt against the near-month futures. The price spread between primary metal and scrap increased by 125 yuan to 25 yuan/mt. SMM lead social inventory stands at 69,500 mt, with little overall change. With lead prices at low levels, primary and secondary lead smelters are reluctant to sell, and some downstream buyers are cautious about price increases. However, overall consumption is in the off-season, providing limited support for high lead prices. After the inversion between primary and scrap lead was resolved, downstream buyers tend to purchase low-priced secondary lead. Lead ingot supply is not tight. SHFE lead is expected to fluctuate within the 16,300-17,000 yuan/mt range, with limited operability, and a wait-and-see approach is recommended. 【Nickel & Stainless Steel】 SHFE nickel consolidated at low levels, with lackluster market activity. Jinchuan's premium rebounded to 2,900 yuan, while Russian nickel's premium stood at 200 yuan, and electrodeposited nickel's premium at 150 yuan. High-grade NPI prices retreated, and Indonesian ore continues to influence raw material pricing, with the latest offer at 1,024 yuan per mtu, down 10 yuan for the week. In terms of inventory, NPI inventory decreased by 2,500 mt to 20,000 mt, refined nickel inventory dropped by 1,400 mt to 46,000 mt, and stainless steel inventory fell by 1,000 mt to 980,000 mt. Technically, SHFE nickel rebounded, with resistance in the 12.3-12.5 range, awaiting a better short position. 【Tin】 SHFE tin recovered the losses from the night session, as Alphamin's move to resume mining operations overnight dragged LME tin down. Amid significant fluctuations in supply and demand variables, SHFE tin reclaimed 255,000 yuan. Spot tin remained firm today at 256,200 yuan, and the substantial tightness in tin resource supply is unlikely to ease in April. Tin prices are transitioning into a fluctuating phase, with a tendency for social inventory destocking this week. A wait-and-see approach is recommended.