[SMM Tin Morning News: US Dollar Breaks 101 to Hit 13-Month High, SHFE Tin Falls to 380,000 Yuan Mark]

[SMM Morning Meeting Summary: LME Zinc Held Up Well on Expectations of De-escalation in Geopolitical Conflict] Overnight, LME zinc formed a bullish candlestick, with the 10/20-day moving averages providing support below and the upper Bollinger Band exerting resistance above. Preliminary talks between the U.S. and Iran may pave the way for a war agreement, reigniting optimism and keeping LME zinc firm.

[SMM Zinc Morning Meeting Summary: Bears Cut Positions, LME Zinc Rebounds from Lows]: Overnight, LME zinc opened at $3,560/mt, then fluctuated upward throughout the session, dipping to $3,555.5/mt in early trading and touching a high of $3,618/mt. It then maintained a fluctuating trend at high levels, finally closing up at $3,611.5/mt, up $50/mt, or 1.4%. Trading volume increased to 11,957 lots...

[SMM Zinc Morning Comment: LME Trend Lifts SHFE, SHFE Zinc Opens Higher in Night Session] Overnight, the most-traded SHFE zinc 2608 contract opened at 24,865 yuan/mt, and in the night session, SHFE zinc opened higher with a gap. After opening, it maintained a fluctuating trend, reaching a high of 24,970 yuan/mt early in the session and dipping to a low of 24,850 yuan/mt near the close, finally settling up at 24,890 yuan/mt.

[SMM Zinc Morning Comment] Overnight, the most-traded SHFE zinc 2607 contract opened at 24,190 yuan/mt. Early in the session, it briefly dipped to a low of 24,020 yuan/mt, then bears reduced their positions, and the price fluctuated upward, touching a high of 24,305 yuan/mt near the close. It finally closed up at 24,265 yuan/mt, up 100 yuan/mt, a gain of 0.41%. Trading volume decreased to 60,028 lots, and open interest decreased by 1,210 lots to 79,545 lots.

I. MJP Quarterly Premium Surges, Asian Aluminum Market Pricing Center Shifts Significantly Upward This week, two major international aluminum producers, South32 and Rio Tinto, successively announced their Q3 2026 Japan Main Port (MJP) aluminum ingot CIF long-term contract quotes. South32 quoted $480/mt, while Rio Tinto quoted $460/mt. Compared to the Q2 finalised level of $350–353/mt, this represented a significant QoQ increase of $110–130/mt, a rise of over 30%, hitting a phased high in recent years. Affected by the sharp rise in premiums, the Japanese local spot market showed notable differentiation. Some downstream enterprises had relatively high price acceptance, releasing just-in-time procurement willingness; while more cost-sensitive buyers gradually shifted to alternative sources such as other mainstream ex-China brand aluminum ingots to reduce procurement costs. Regional cargo diversion intensified, and Japan's aluminum ingot procurement structure became increasingly diversified. II. Thailand CIF Market: Dual Tailwinds Support Price Rise, Market Shows Strong Prices but Weak Volume As Southeast Asia's core aluminum ingot transit and distribution hub, the Thai market was simultaneously supported by dual tailwinds of MJP high premium transmission and domestic aluminum scrap supply shortages, with traders showing strong willingness to hold prices firm. Currently, mainstream local aluminum ingot CIF offers remained stable at $300–320/mt, with quotes rising WoW. The logic supporting this round of price rise was clear: on the fundamentals side, China's aluminum scrap supply was tight, highlighting the overall aluminum element supply gap and providing solid bottom support for primary aluminum prices; externally, the Q3 MJP premium surge drove Southeast Asian traders to collectively raise spot quotes. Downstream participants mostly adopted a wait-and-see stance, with end-users only maintaining small-batch just-in-time procurement to restock, while overall proactive stockpiling sentiment remained subdued. Acceptance of high-priced resources was low, and the market exhibited a typical pattern of strong prices but weak volume. III. Vietnam Market: Fundamentals Operating Independently, Desensitized to MJP Premium Rise This round of MJP premium increase did not provide notable support to the Vietnamese aluminum market, with market trends remaining relatively independent. The core reason was that local processing enterprises chose to import aluminum semis as a substitute for purchasing aluminum ingots, significantly weakening domestic primary aluminum procurement demand. Domestic demand was diverted by finished aluminum semis, and market trading was sluggish. IV. South Korea Market: Transactions Recover and Prices Rise, Stockpiling Risks Gradually Emerge Driven by the rising QMJP premium, sellers in the South Korean market showed strong sentiment to hold prices firm, with the overall trading atmosphere outperforming other markets in the region. This week, spot transaction activity increased, and market transaction prices rose in tandem. V. Market Summary and Risk Alert: LME Structure Extremely Bullish, Squeeze Risk Elevated to High Levels At the current stage, the core contradiction in the Asian aluminum market stemmed from the global spot supply shortage. This shortage directly drove the Q3 MJP premium significantly higher and radiated outward to Southeast Asia, Japan and South Korea, and other regional markets, causing notable divergence in market conditions across regions. Meanwhile, the extreme backwardation structure in the LME market further amplifies potential risks at the commodity level: First, futures exhibit a deep backwardation structure. As of May 28, the LME Cash-3M backwardation was recorded at $92.53/mt. This extreme spot premium directly reflects the extreme scarcity of global spot resources. Second, social inventory is at historical lows. Total aluminum ingot inventory in LME registered warehouses stands at only around 340,000 mt, with stock levels hitting new lows. Available spot cargo remains insufficient, posing squeeze risks. Third, speculative stockpiling risks are intensifying. In a market environment of low inventory and high premiums, if regional traders collectively stockpile, hold back from selling, and hold prices firm, this could further tighten available market supply, exacerbate the current tight spot supply situation, and significantly increase the probability of a squeeze occurring. Overall, Asian aluminum prices are more likely to rise than fall in the short term, and the firm pricing pattern in core markets such as Thailand and South Korea will continue. However, market participants should be highly vigilant against squeeze crises triggered by the extreme LME backwardation structure. [Data Source Disclaimer: Data other than publicly available information is derived from public information, market communication, and SMM's internal database models, processed by SMM. It is for reference only and does not constitute decision-making advice.] Data source: SMM

[Macro Policy and Tug-of-War Between Sellers and Buyers: Aluminum Prices Move Sideways] The risk of supply disruptions to aluminum outside China has not yet subsided, and there remains a supply gap in ex-China aluminum, with the strong LME market transmitting to China and providing support for aluminum prices. However, the continuation of inventory buildup exceeding expectations in China will weigh on domestic aluminum prices. Meanwhile, tightened invoicing regulations may lead to structural tightness in spot cargo, and the weakening spot market further limits the upside room for domestic aluminum prices. Close attention should be paid to the potential turning point in China's social inventory, which could drive a rebound and rise in aluminum prices.

[Tug-of-War Between Longs and Shorts Continued, SHFE and LME Prices Fluctuated Upward] At the beginning of the week, boosted by optimistic sentiment over the easing of earlier geopolitical tensions, LME zinc edged up. Subsequently, as expectations for U.S.-Iran peace talks wavered and the Strait of Hormuz faced renewed restrictions, market concerns intensified, and LME zinc struggled to rise and continued to pull back.

SMM, April 7: The LME market was closed from April 3 to April 6 for Good Friday and the Easter holiday; due to the Qingming Festival holiday, SHFE lead did not conduct night session trading on the evening of Friday, April 3; normal trading resumed from Tuesday, April 7. Supply side, although social inventory of lead ingots in five regions across China continued to decline, maintenance and production resumptions at primary lead smelters proceeded in parallel in April. In addition, secondary lead capacity in northern China increased, finished product inventories at plants increased slightly, and imported lead continued to flow in, leaving spot supply generally ample. Demand side, the lead-acid battery sector entered the traditional off-season, downstream purchase willingness remained cautious, spot transactions were weak, and consumption was absent at stages. Moreover, the risk of post-holiday inventory buildup in social inventory remained high, making resistance in SHFE lead increasingly evident. Lead prices were expected to maintain a fluctuating trend, with limited upside room.

Futures: The LME market was closed from April 3 to April 6 for the Good Friday and Easter holidays; due to the Qingming Festival holiday, SHFE lead did not conduct night session trading on the evening of Friday, April 3; normal trading resumed from Tuesday, April 7. On the Macro Front: 1. Trump said Iran's bridge power plants could be destroyed within four hours. 2. Trump on strait transit fees: the US might as well collect them. 3. Iranian Foreign Ministry spokesperson: the US rescue operation for pilots may have been aimed at stealing enriched uranium. 4. Vessel traffic through the Strait of Hormuz rose to the highest level since early March. 5. China made a major breakthrough in sodium-ion battery technology. 6. Media: Foxconn was trial-producing Apple's foldable-screen phones. Spot Fundamentals: Last Friday, SHFE lead held up well. Suppliers shipped in line with the market, and with the holiday approaching, some suppliers actively made shipments. Premiums for primary lead cargoes self-picked up from production site were lowered, with quotations in major producing areas mostly around parity against the SMM #1 lead average price ex-works, while a small number of regions quoted premiums of 50 yuan/mt. For secondary lead, smelters quoted in line with the market, with secondary refined lead quoted at discounts of 50-0 yuan/mt to premiums of 25 yuan/mt against the SMM #1 lead average price ex-works. However, imported lead continued to flow into China, giving downstream enterprises more choices. Apart from slight stockpiling due to the holiday, other enterprises only purchased as needed. Inventory: As of April 2, LME lead inventory fell by 50 mt to 281,650 mt; SMM social inventory of lead ingot across five regions continued to pull back. Lead Price Forecast for Today: Supply side, although social inventory of lead ingot in five regions in China continued to decline, maintenance and production resumptions at primary lead smelters proceeded in parallel in April. In addition, secondary lead capacity in northern China increased, finished product inventories at plants increased slightly, and imported lead continued to pour in, leaving overall spot supply ample. Demand side, lead-acid batteries entered the traditional off-season, downstream purchase willingness remained cautious, and spot transactions were weak. With phased consumption absent and the risk of post-holiday social inventory buildup elevated, resistance in SHFE lead became more evident. Lead prices are expected to maintain a fluctuating trend, with limited upside room.