[SMM Analysis]Weak Supply-Demand Pattern; Secondary Aluminum Prices Were Expected to Come Under Pressure and Pull Back in April

Overall, cost support remained strong, supply tightened while demand stayed stable. As tender prices became clear, aluminum fluoride prices were generally raised by around 800 yuan/mt in line with the guidance. Going forward, close attention should be paid to dynamic changes in raw material costs and adjustments in downstream procurement pace.

[SMM Nickel Flash News] Based on the cash cost of high-grade NPI calculated using nickel ore prices from 25 days earlier, profits at high-grade NPI smelters came under pressure during the week, with the sector as a whole remaining in a state of losses or marginal profitability. It is expected that next week, prices of auxiliary materials on the raw material side may remain flat, while the decline in nickel ore prices will likely be limited. High-grade NPI prices will still be under pressure amid back-and-forth negotiations between upstream and downstream, and smelter profits will be unlikely to see any significant improvement.

On April 2, 2026, the White House ushered US steel trade policy into "Version 2.0." This strategic shift goes beyond simple tariff hikes. It uses full-value taxation and melt-and-pour traceability to block low-end imported raw materials, while applying structural tariff reductions to finished products to ease manufacturing inflation. Ultimately, this two-pronged approach aims to forcibly bring the global supply chain back to domestic US steel production.

This week, stainless steel spot prices fell slightly more than production costs, further worsening the inversion between stainless steel mill prices and costs. Taking 304 cold-rolled products as an example, based on raw material prices on the day, the full cost profit margin was -1.19% this week; calculated based on raw material inventory costs, the margin was -0.55%. Nickel-series raw material costs, high-grade NPI prices remained in the doldrums this week. Although nickel ore prices are currently holding firm and NPI traders are broadly bullish, SHFE nickel futures have been weak recently, while downstream stainless steel prices have struggled to rise. Stainless steel mills themselves are under heavy cost pressure and have shown low acceptance of high-priced raw materials, resulting in sparse market transactions recently; affected by this, high-grade NPI traders have faced considerable transaction pressure, and the price center edged lower slightly. As of this Friday, high-grade NPI with a grade of 10-12% fell by 2 yuan per nickel unit to 1,081.5 yuan/nickel unit. Stainless steel scrap market, stainless steel scrap prices were stable this week, and the decline in finished stainless steel prices did not transmit to the steel scrap market, while prices of substitute furnace charge also remained stable. Tightness in tax invoices eased, the economic advantage of steel scrap became more evident, and high stainless steel mill production schedules drove higher consumption, lifting market transactions and easing inventory pressure. However, finished product prices struggled to rise, limiting upside room for steel scrap prices, which are expected to remain stable in the short term. As of this Friday, the price of 304 off-cuts in Shanghai rose by 100 yuan/mt, with the latest quote at around 10,150 yuan/mt. Chrome-series raw material costs, high-carbon ferrochrome prices dropped back slightly this week. Although some ferrochrome producers recently reported maintenance and production cuts, and stainless steel production schedules for April remained high, leaving retail spot supply in the ferrochrome market relatively tight, stainless steel mills had built relatively ample ferrochrome raw material inventories earlier. Meanwhile, high port inventories of chrome ore recently caused some loosening in chrome ore spot prices. In addition, ferrochrome capacity has already reached a high level, the rainy season in south China is approaching, and ferrochrome producers outside China are resuming production. With ferrochrome producers lacking confidence in the outlook, ferrochrome prices still faced some downward pressure. As of this Friday, high-carbon ferrochrome prices in Inner Mongolia fell 25 yuan/mt (50% metal content) WoW to 8,625 yuan/mt (50% metal content).

Precious metal prices fluctuated in consolidation today, and the spot-futures price spread between TD and the most-traded SHFE silver contract showed no obvious change for the time being, while significant differences still existed in spot market quotations. In the Shanghai market, during the morning session, mainstream quotations from suppliers of standard silver ingots were at premiums of 60-80 yuan/kg against TD, or at premiums of 0-30 yuan/kg against the SHFE silver 2604 contract. Some smelters quoted cargoes self-picked up from production site at a premium of 50 yuan/kg against TD, but due to sluggish downstream consumption, actual transactions were sparse. The spot silver ingot market was quoted but saw little trading, with a strong holiday atmosphere.

Today, spot prices of North China #1 copper cathode against the front-month contract were reported at a discount of 160 yuan/mt to a discount of 100 yuan/mt, with the average price down 30 yuan/mt from the previous trading day, and the average transaction price up 135 yuan/mt from the previous trading day to 96,045 yuan/mt.

Refined Cobalt: This week, spot refined cobalt prices trended downward under the influence of capital flows and macro sentiment. Supply side, mainstream smelters kept ex-factory prices stable; after spot prices fell, traders' sentiment to hold prices firm strengthened, and spot-futures price spread quotations were raised to above parity. Demand side, lower spot prices improved downstream purchasing sentiment and slightly lifted transactions, but affected by fluctuations in related metals, downstream buyers remained cautious and mainly made just-in-time procurement. This week, the DRC announced an extension of cobalt intermediate product export quotas for Q4 2025, increasing export uncertainty; the structurally tight raw material situation in China remained unresolved, providing bottom support for cobalt prices. Cobalt Intermediate Products: This week, cobalt intermediate product prices edged up. The DRC announced its quota extension policy, under which Q4 2025 quotas can be extended by up to one month, and Q1 2026 quotas can be extended to the end of June; it is understood that the core reason for the current slow approval process for intermediate products is the lack of local detection personnel. Supply side, some miners sold small volumes of futures cobalt intermediate products this week, with quotations above $25.9/lb. Demand side, most smelters remained on the sidelines as cobalt salt prices struggled to catch up and available-for-sale intermediate products were scarce, and actual transactions were sluggish. Overall, based on the current pace of shipments, large-volume arrivals of cobalt intermediate products at port may be delayed to June-July. After downstream orders become clear and procurement demand is released, intermediate product prices will still have upside room. Going forward, continued attention should be paid to export progress in the DRC and the pace of downstream demand recovery. Cobalt Sulphate: This week, the spot market for cobalt sulphate operated steadily, with no significant price fluctuations, and overall continued to move sideways within a narrow range. Supply side, the continued tightness in raw materials supported smelter quotations, with the mainstream quotation range stable at 95,000-98,000 yuan/mt. At the beginning of the week, a small number of enterprises made low-priced shipments at 91,000-95,000 yuan/mt due to financial reporting and funding pressure, but these enterprises have now basically completed cash realization. Demand remained mediocre, as downstream enterprises were still cautious about expectations for subsequent orders, and their own raw material inventory remained ample, resulting in low purchasing enthusiasm. They only purchased small volumes of low-priced cargoes as needed, and overall market trading activity was weak. In the short term, the market remained in an inventory digestion cycle, with buyers and sellers in a stalemate, making large price swings unlikely. In the long term, uncertainty over raw material supply from the DRC will still support the cost side. As downstream inventories are effectively depleted, cobalt sulphate prices are expected to gradually rebound and recover.

[SMM Rare Earth Price Flash] As of now, driven by the rise in futures prices, neodymium praseodymium oxide has seen small-volume transactions by some traders at 730,000-740,000 yuan/mt. Driven by rising raw material prices, coupled with tender procurement of Pr-Nd alloy by major magnetic material plants, metal quotations were also raised to 900,000 yuan/mt, with actual transactions following up. The latest market quotation for gadolinium oxide was 230,000 yuan/mt, and quotations for gadolinium iron were also raised to 215,000-220,000 yuan/mt, driven by downstream tender procurement.

[Silicon Metal Price Center Remained in the Doldrums]: This week, the silicon metal market stayed weak, with the transaction center for some silicon metal grades edging lower. As of April 2, SMM east China prices were oxygen-blown #553 silicon at 9,000-9,200 yuan/mt, down 100 yuan/mt WoW; 441# silicon at 9,300-9,400 yuan/mt, down 50 yuan/mt WoW; and 3303# silicon at 10,100-10,300 yuan/mt, down 100 yuan/mt WoW. In the futures market, the most-traded silicon metal contract remained weak, with the SI2605 contract closing at 8,300 yuan/mt on Thursday, down 435 yuan/mt WoW. Spot declines were narrower than futures prices, and the advantage in supplier shipments shifted from silicon enterprises to trading firms engaging in both spot and futures market. During the week, market prices were under pressure, while procurement volume from some downstream users and export traders increased, with transactions in some grades remaining moderate.