[Weekly Guangdong Contract Rollover Spot Premiums/Discounts Declined] This week, Guangdong premiums and discounts fell by about 55 yuan/mt WoW. As of Friday, mainstream 0# zinc spot premiums in Guangdong were at a discount of 60 yuan/mt, and the Shanghai-Guangdong price spread widened...

SMM February 27: After the holiday, downstream battery enterprises resumed work at a slow pace, with weak purchase willingness for lead ingots, leading to a sluggish lead price trend. Secondary lead enterprises were under pressure and incurred losses, with low enthusiasm for spot order shipments and limited offers. The current ex-factory price was at a discount of 50-0 yuan/mt to the SMM #1 lead average price. Although downstream enterprises gradually resumed work, they mainly focused on digesting pre-holiday inventory, and lead ingot procurement was expected to see limited improvement next week. Supported by the steady to rising scrap battery prices, secondary lead production costs remained high while ex-factory prices were weak, resulting in sustained losses for smelters. As of February 27, 2026, the theoretical comprehensive profit/loss for large enterprises was -344 yuan/mt, and for small and medium-sized enterprises was -558 yuan/mt (by-product revenue in the model excluded tin and antimony), indicating significant profit pressure across the industry. 》Order to View SMM Metal Spot Historical Prices

Futures: Overnight, LME lead opened at $1,965/mt, fluctuating downward during the Asian session; it dipped to $1,948.5/mt upon entering the European session, but then rose due to a weakening US dollar index, touching a high of $1,976.5/mt before finally settling at $1,974.5/mt. Overnight, the most-traded SHFE lead 2603 contract opened at 16,665 yuan/mt, briefly touched a low of 16,560 yuan/mt early in the session, then rebounded as bears reduced positions, reaching a high of 16,680 yuan/mt before finally settling at 16,665 yuan/mt, up 0.48%, forming a doji star. On the macro front: As markets awaited a series of US economic data, a weaker US dollar made dollar-denominated commodities more attractive to overseas buyers; spot gold extended gains. The White House's Hassett predicted worsening employment: AI boosts productivity, reduces labor demand. Alphabet planned to raise about $15 billion by issuing US dollar bonds. China's Ministry of Commerce held a symposium with automakers: Multiple measures to promote the expansion and quality improvement of auto consumption. The Shanghai, Shenzhen, and Beijing Stock Exchanges announced a package of measures to optimize refinancing. Seven departments including the Ministry of Human Resources and Social Security provided administrative guidance on employment to leading platform companies and courier firms. Three departments including the Ministry of Finance issued an announcement on tax incentives for re-exported cross-border e-commerce goods. : SHFE lead stopped falling and stabilized, but as the Chinese New Year holiday approached, logistics vehicles halted in some regions, leading to reduced shipments and quotations from suppliers. Only some cargoes self-picked up from primary lead smelters were quoted at premiums of 0-50 yuan/mt against the SMM #1 lead average price ex-works. In the secondary lead sector, more smelters were on holiday and reluctant to sell at low prices, with most enterprises suspending quotations; a few secondary refined lead offers were at discounts of 25 yuan/mt to premiums of 50 yuan/mt against the SMM #1 lead average price ex-works. Downstream enterprises generally entered the year-end wrap-up phase, with minimal inquiries, resulting in thin trading in the spot market. Inventory: On February 9, LME lead inventory decreased by 100 mt to 232,750 mt. As of February 9, SMM lead ingot social inventory across five regions rose to a five-month high. Today's lead price forecast: With previously in-transit lead ingots by rail concentratedly arriving at warehouses, social inventory of lead ingots increased significantly, mainly reflected in Jiangsu and Zhejiang region warehouses. Last week, lead prices fell, prompting lead-acid battery enterprises to conduct relatively concentrated stockpiling of lead ingots, leading to a noticeable decline in lead smelters' in-factory inventory. This week being the last before the Chinese New Year, the final batch of lead-acid battery enterprises will enter the holiday state, further weakening lead consumption. Meanwhile, with the start of the Spring Festival travel season, migrant workers have returned to their hometowns, and the number of vehicles in operation has gradually decreased. Currently, some regions no longer support road transportation. It is expected that the growth momentum of social inventory for lead ingots will slow down, and the inventory buildup of lead ingots is anticipated to be more reflected in the smelters' plant inventories. Overall, lead prices are in the doldrums ahead of the holiday. Data Source Statement: Except for publicly available information, other data are processed by SMM based on public information, market communication, and SMM's internal database model, for reference only and do not constitute decision-making advice.

[POSCO and SK On Form Lithium Alliance for Battery Cooperation] POSCO and SK On have signed a long-term lithium supply agreement, aiming to stabilize the battery materials supply chain. According to a statement released by the two companies on Wednesday, POSCO will supply up to 25,000 mt of lithium from this year until 2028 under the agreement. This supply is sufficient to produce batteries for approximately 400,000 EVs. The lithium will be produced by POSCO Argentina at the Salar del Hombre Muerto salt flat in Salta Province, Argentina, and supplied to SK On's EV battery projects in Europe and North America. SK On is also considering using the material for ESS. Source: https://pulse.mk.co.kr/ [Cornwall's Geothermal Revolution: Extracting Green Energy and Lithium from Granite] The UK's renewable energy sector has achieved a significant leap forward, with a pioneering mini power station in Cornwall officially commencing operation, successfully using underground hot granite to produce zero-carbon electricity and extract high-value battery-grade lithium. Led by Geothermal Engineering Ltd., the project innovatively combines green power generation with critical minerals extraction, is expected to revitalize the region's historic mining economy and supply electricity to thousands of households via the power grid. For East Africa, a region rich in geothermal potential (particularly the Kenyan Rift Valley), the dual extraction technology provides an attractive model. If African energy producers can adopt this approach, simultaneously obtaining electricity and high-profit minerals from geothermal wells, it will significantly enhance the economic feasibility of green energy projects across the continent. Source: https://streamlinefeed.co.ke/ [Zimbabwe Bans Lithium Exports: Global Supply Chain Crisis Emerges] Zimbabwe's recent decision to implement a comprehensive ban on lithium exports marks a watershed moment for the global critical minerals market, highlighting the growing influence of resource nationalism on international supply chains. This policy shift reflects a broader trend: mineral-rich countries are prioritizing domestic value creation over raw material exports, fundamentally altering the landscape of the global battery metals market. The impact extends far beyond a single country; its ripple effects will run through international supply chains, from EVs to renewable energy infrastructure. When countries with significant mineral reserves impose export restrictions, the resulting market dynamics can permanently alter the entire industry's price structures, investment flows, and strategic planning. Zimbabwe's recent decision to suspend mineral exports is a prominent example of this phenomenon. This southern African country, which supplied approximately 10% of the world's lithium resources in 2024, has effectively cut off external supply of its battery metal resources, forcing international buyers to scramble for alternative sources, while domestic processing capacity remains severely underdeveloped. Source: https://discoveryalert.com.au/ [Atlantic Lithium Acquisition Proposal Rejected: 2026 Strategic Value Preservation Strategy] When mature miners pursue mergers and acquisitions during market recovery periods, the core of their strategy shifts from acquiring distressed assets to preserving strategic value. The lithium industry exemplifies this dynamic—during phases of rebounding commodity prices, pre-production developers increasingly tend to reject acquisition proposals, prioritizing long-term value creation over immediate liquidity events. Furthermore, understanding broader critical minerals strategies is essential when assessing these complex market dynamics. Market participants observed that spodumene concentrate prices rebounded from a cyclical low of $800/mt in October 2025 to approximately $1,900/mt by February 2026, a 137.5% increase within four months. This rapid recovery has created a significant valuation gap between acquirers' offers and target companies' intrinsic value assessments. The case of Atlantic Lithium's rejected acquisition proposal demonstrates how pre-production lithium developers evaluate conditional non-binding acquisition offers based on the medium and long-term demand fundamentals in the EV and BESS sectors. Enterprises in the late-stage permitting phase generally believe that current market conditions do not fully reflect the full potential of their asset portfolios. Source: https://discoveryalert.com.au/ [Indian Company Deploys Non-Lithium Multi-Ion Battery System] Mumbai-based battery technology developer Gegadyne Energy stated that its delivery of the first non-lithium multi-ion chemistry battery packs to two of the world's largest material handling original equipment manufacturers marks a true "inflection point" for the forklift industry. Gegadyne has completed the first commercial deployment of its non-lithium multi-ion chemistry battery packs with Linde Material Handling India and the Godrej & Boyce Group. The company claims that this battery, with a cycle life exceeding 5,000 cycles, can be charged from 0% to 100% in 15 minutes, thereby "completely eliminating" dependence on the lithium supply chain. Designed for forklifts, cranes, and warehouse equipment, the battery operates effectively within a temperature range of -40°C to 65°C. Source: https://www.forkliftaction.com/

【SMM Scrap Aluminium Market Analysis】Southeast Asia's Secondary Aluminum Industry Trapped in "Margin Squeeze": Raw Material Surge Forces ADC12 Plant Cuts, Industry May Enter "Lunar New Year Mode" Early February 2026 marked a period of unprecedented regulatory volatility for the global secondary aluminum and scrap markets. Driven by a confluence of tariff upheavals, aggressive decarbonization mandates, and stringent environmental crackdowns, the traditional flow of aluminum scrap is being fundamentally redrawn. As the United States implements sweeping new import surcharges, the European Union weighs restrictive export measures, and Southeast Asian hubs like Malaysia tighten their borders against contaminated materials, market participants are facing mounting compliance costs and disrupted arbitrage windows. This review examines the key policy shifts that defined the ex-China aluminum recycling sector this month and their immediate implications for global trade flows. The United States: How the 10% Surcharge Disrupts Secondary Aluminum Following the United States Supreme Court’s ruling, which invalidated Trump’s IEEPA tariffs on February 20, 2026, many trade goods found themselves navigating a complicated and chaotic new regulatory landscape. Within hours of the ruling, President Trump pivoted to Section 122 of the 1974 Trade Act, levying a 10% blanket global import surcharge that went into effect on February 24, replacing the former country-based tariffs. There have also been threats made by President Trump to raise this surcharge to the statutory maximum of 15%, which could further disrupt global trade and U.S. imports. Even though most primary aluminum products will not see a huge change due to already being burdened by the 50% Section 232 tariffs, the secondary aluminum market, which formerly enjoyed a 0% tariff under Section 232, might now be caught in the newest 10% blanket import surcharge. The US Geological Survey’s Mineral Commodity Summaries 2026, published in February 2026, estimated an increase in imported scrap into the US in 2025, reaching roughly 890,000 metric tons, which is approximately a 27% increase compared to 2024. Even though scrap imports only make up roughly 20% of the US’s total scrap consumption, a blanket import surcharge will likely affect a significant portion of total scrap imports for the active period of the Section 122 policy. This is especially true as the policy remains highly volatile and faces the risk of being increased or challenged in the near future. Europe: The "Scrap Leakage" Debate and Impending Export Controls The EU aluminum recycling sector is also on edge following the closure of the EU’s public consultation in late January. Currently, trade measures are widely expected to be unveiled and launched during Spring 2026, aimed at curbing what the EU terms "aluminum scrap leakage." European Aluminum, as one of the biggest supporters of trade measures to control scrap leakage, cites outflows exceeding 1.3 million tons annually that could instead be utilized domestically to meet decarbonization and net-zero targets. In February, the Bureau of International Recycling (BIR) released statements opposing these trade measures, stating that "the imposition of export restrictions or trade barriers is fundamentally unnecessary and risks producing significant unintended consequences for the entire value chain." BIR also explained how its own monitoring fails to identify scrap leakage issues, noting that the EU currently has insufficient domestic smelting capacity to absorb the extra scrap that is being exported out of Europe. In the same statement, BIR warned of a probable reduction in domestic aluminum scrap prices and a decline in the overall quality of waste management systems. Similarly, in 2025, the European Recycling Industries' Confederation (EuRIC) published stark warnings against the possible restriction of aluminum scrap exports. In a scenario where all grades of aluminum scrap are restricted from being exported, or if exports are hit with a significant surcharge, the Asian market, especially China, India, and Southeast Asia, all of which are large importers of EU scrap would be heavily impacted. Supply would see significant decreases, and prices outside Europe might climb to new highs as markets adjust to fill the gap, while secondary prices within the EU could drop to new lows due to localized oversupply. Malaysia: The E-Waste Crackdown and Stringent SIRIM Enforcement Following the success of "Ops Metal" in 2025, Malaysia has seen a massive volume of illegal scrap imports seized, amounting to a total value of RM 7 billion. In response to the influx of illegal scrap imports frequently mixed with electronic waste, the Malaysian government implemented an absolute e-waste import ban effective February 4, 2026, in order to curb these environmental violations. While aluminum scrap is still legally allowed to be imported into Malaysia, albeit under strict SIRIM purity requirements, the absolute e-waste ban will inevitably affect certain secondary grades. Notably, Zorba imports will likely see significant increases in transit and processing times, as customs officials are now far more likely to detain such cargoes for exhaustive inspections due to the high probability of e-waste contamination. In the broader picture, the volume of aluminum scrap legally entering Malaysia will likely decrease. Coupled with escalating processing delays at customs, this friction increases the probability that businesses will actively divert their aluminum scrap trade elsewhere in Southeast Asia, such as to Thailand. Conclusion Looking ahead to the second quarter of 2026, the secondary aluminum market will likely remain in a state of flux as these regional policies take full effect. The era of frictionless global scrap trade is rapidly giving way to a localized, highly regulated environment. For remelters and traders, navigating this landscape will require extreme supply chain agility and a hyper-focus on material compliance. As European supply risks being politically landlocked, U.S. raw material imports become suddenly more expensive, and Southeast Asian quality barriers rise, we expect to see continued volatility in regional premiums and a widening decoupling of traditional scrap-to-LME pricing mechanisms in certain regions. Adapting to this fragmented reality will be the defining challenge for the industry in the months to come.

Futures: Overnight, LME lead opened at $1,957/mt, moving sideways around the daily average during the Asian session. Entering the European session, the US dollar index strengthened before pulling back, and the broad-based gains in nonferrous metals boosted LME lead to rise all the way to a high of $1,996/mt. After small fluctuations at high levels, it finally closed at $1,995.5/mt, up $36/mt or 1.84%. Overnight, the most-traded SHFE lead contract opened at 16,715 yuan/mt, initially dipped to a low of 16,700 yuan/mt, then fluctuated upward, lightly touching 16,800 yuan/mt at highs, and finally closed at 16,790 yuan/mt, up 45 yuan/mt or 0.27%. On the macro front: US Trade Representative Greer recently stated that the US will continue to advance the 301 investigation into China's implementation of the Phase One trade deal and may take tariff measures. Against the backdrop of a rebound in risk appetite, market expectations for the US Fed to start interest rate cuts before mid-year have significantly cooled, with expectations for a June rate cut diminishing. German Chancellor Friedrich Merz paid his first official visit to China from February 25 to 26, accompanied by a high-level delegation including 30 representatives from the German business community. Spot fundamentals: In the Shanghai market, Chihong lead was quoted at discounts of 80-50 yuan/mt against the SHFE lead 2603 contract. SHFE lead maintained a consolidation trend, and as it was late February with the transition between old and new long-term contracts, some suppliers actively cleared inventory by shipping goods at discounts, while a few traders purchased on dips. Downstream enterprises were still in the early stages of resuming work, with limited rigid demand and few inquiries. In terms of secondary lead, some smelters had not yet resumed production, market quotations were scattered, operating enterprises held prices firm for shipments, and secondary refined lead was quoted at premiums of 0-25 yuan/mt against the SMM #1 lead average price ex-works. Downstream enterprises adopted a wait-and-see approach with minimal purchases, and spot order market transactions had not improved significantly. Inventory: On February 25, LME lead inventory decreased by 25 mt to 286,300 mt. As of February 24, the total social inventory of lead ingots across five regions tracked by SMM accumulated further, with the total jumping to a five-month high. Today's lead price forecast: This week, downstream enterprises gradually resumed work and production, with spot purchases mainly focused on long-term contract cargo pick-up, while spot order purchasing demand remained weak. On the supply side for refined lead, primary lead smelters in Hunan that underwent maintenance and production cuts during the holiday gradually resumed crude lead production; primary lead output is expected to recover sequentially from early March to mid-March, with quotations relatively firm. For secondary refined lead, supply recovery was limited by the end of February, but a concentrated recovery is anticipated in early March. Subsequently, the lead market is expected to see both supply and demand increase after the recovery in lead consumption. This week, as the supply of refined lead has not yet recovered concentratedly, support for lead prices remains moderate, and lead prices may continue to move sideways in the short term.

As of February 24, the operating rate of 50 EAF steel mills producing construction steel nationwide was 0%, down 1% MoM; the capacity utilization rate was 0%, down 19.41% MoM; and the daily average production of construction steel was 0 mt, down 43,200 mt MoM.

Futures: Overnight, LME lead opened at $1,957/mt and weakened slightly during the Asian session. Entering the European session, it continued to decline, probing a low of $1,950.5/mt, then rose to fluctuate near the daily moving average, ultimately closing at $1,959.5/mt, up $7.5/mt, a gain of 0.38%. Overnight, the most-traded SHFE lead contract opened at 16,655 yuan/mt. After the session began, it dipped to a low of 16,650 yuan/mt, then fluctuated upward, lightly touching a high of 16,840 yuan/mt, and finally closed at 16,745 yuan/mt, up 20 yuan/mt, a gain of 0.12%. On the macro front: The Trump administration is considering imposing new "national security tariffs" on six industries. According to informed sources, the tariffs under consideration may cover industries such as large-scale batteries, pig iron and iron fittings, plastic pipes, industrial chemicals, as well as power grid and telecommunications equipment. These tariffs would be levied under Section 232 of the Trade Expansion Act of 1962. The new US tariffs on the six major industries will be implemented separately from the new global 15% tariff. Regarding recent US tariff adjustment measures, a spokesperson for the Ministry of Commerce stated that China is closely monitoring and will comprehensively assess the relevant US measures. Subsequently, depending on the situation, China will decide at an appropriate time to adjust its countermeasures against US-origin fentanyl tariffs and reciprocal tariffs. Spot fundamentals: In the Shanghai market, Chihong lead was offered at a discount of 50-0 yuan/mt against the SHFE lead 2603 contract. Today was the first trading day after the Chinese New Year holiday. Suppliers gradually resumed work and attempted to offer prices for shipments. Some with higher prices offered at a premium of 150 yuan/mt against the SHFE lead 2603 contract, while those eager to clear inventory directly sold at a discount, with transactions reaching a minimum discount of 100 yuan/mt against the SHFE lead 2603 contract. SHFE lead got off to a good start on its first trading day. Additionally, as it is late February, suppliers were mostly actively shipping goods, while downstream enterprises were in the initial stages of resuming work, resulting in limited inquiries. Only a few enterprises restocked based on rigid demand, and initial transactions began to emerge in the market. Inventory: On February 24, LME lead inventory was recorded at 286,325 mt, unchanged from the previous day. As of February 24, the total social inventory of lead ingots in five regions tracked by SMM accumulated, with the total amount jumping to a five-month high. Today's lead price forecast: As enterprises across the lead industry chain gradually resumed work after the Chinese New Year holiday, lead consumption was temporarily absent because lead-acid battery enterprises had longer holidays than smelters. This led to accumulated lead ingot inventory at smelters after the holiday, which was transferred to social inventory. The first day after the holiday was the delivery date for the SHFE lead 2602 contract. Suppliers had gradually completed inventory transfers and shipments to delivery warehouses during the holiday, leading to an expected accumulation in social warehouse inventory, which surpassed the 60,000-mt mark. Downstream enterprises had not fully resumed work this week, and the lead ingot inventory reserved by most enterprises before the holiday could be maintained until around the Lantern Festival. In the short term, social lead ingot inventory will remain high. Follow-up attention is still needed on the recovery of lead consumption and the pace of secondary refined lead supply restoration. In the short term, lead prices may still be under pressure amid accumulating inventory.

SMM Morning Meeting Minutes: LME copper opened at $13,055/mt overnight, initially hitting a low of $13,052.5/mt, after which copper prices fluctuated upward, approaching the session high of $13,228/mt before finally settling at $13,195/mt, up 2.28%. Trading volume reached 26,000 lots, an increase of 13,977 lots from the previous trading day; open interest stood at 317,000 lots, a decrease of 1,210 lots from the previous trading day, with the overall performance mainly characterized by short covering. The most-traded SHFE copper 2603 contract opened at 101,650 yuan/mt overnight, initially hitting a high of 102,230 yuan/mt, after which the price center declined to hit bottom at 101,200 yuan/mt, before finally fluctuating rangebound and settling at 101,860 yuan/mt, up 0.25%. Trading volume reached 29,000 lots, a decrease of 42,000 lots from the previous trading day; open interest stood at 123,000 lots, a decrease of 7,789 lots from the previous trading day, with the overall performance mainly characterized by short covering.

SMM Morning Meeting Minutes: LME copper opened at $12,967/mt overnight, hitting an early high of $12,984/mt before copper prices fluctuated downward, touching a low of $12,804/mt near the close and finally settling at $12,901/mt, down 0.76%. Trading volume reached 12,000 lots, down 4,963 lots from the previous session, while open interest stood at 318,000 lots, up 327 lots from the previous session, primarily driven by increased bear positions. The most-traded SHFE copper contract was closed overnight due to the Chinese New Year holiday.