SMM News, May 15: Metals market: As of the midday close, domestic market base metals fell across the board. SHFE copper dropped 1.61%, SHFE aluminum fell 1.09%, SHFE lead declined 0.6%, SHFE zinc slipped 0.24%, SHFE tin lost 2.14%, and SHFE nickel fell 1.82%. In addition, the most-traded casting aluminum alloy futures fell 1.04%, the most-traded alumina contract dropped 0.64%, the most-traded lithium carbonate contract declined 0.54%, the most-traded silicon metal contract fell 1.84%, and the most-traded polysilicon futures slipped 0.08%. Ferrous metals all fell. Iron ore dropped 0.8%, rebar declined 0.18%, hot-rolled coil fell 0.43%, and stainless steel lost 1.27%. Coking coal and coke: the most-traded coking coal contract fell 1.29%, and the most-traded coke contract dropped 0.85%. Overseas market base metals: as of 11:46, LME metals declined across the board. LME copper fell 1.46%, LME aluminum dropped 0.82%, LME lead slipped 0.47%, LME zinc declined 0.91%, LME tin lost 0.19%, and LME nickel fell 1.16%. Precious metals: as of 11:46, COMEX gold fell 1.5% and COMEX silver dropped 4.6%. Domestic market precious metals: the most-traded SHFE gold contract fell 1.53%, and the most-traded SHFE silver contract dropped 7.64%. In addition, as of the midday close, the most-traded platinum futures fell 5.47%, and the most-traded palladium futures dropped 4.87%. As of the midday close, the most-traded Europe containerized freight index contract rose 1.88% to 2,519 points. As of 11:46 on May 15, midday futures quotes for selected contracts: Spot prices and fundamentals Copper: Today in Guangdong, #1 copper cathode spot prices against the front-month contract: high-quality copper was quoted at 270 yuan/mt, unchanged from the previous trading day; standard-quality copper was quoted at a premium of 200 yuan/mt, unchanged from the previous trading day; SX-EW copper was quoted at a premium of 130 yuan/mt, unchanged from the previous trading day. The average price of Guangdong #1 copper cathode was 105,750 yuan/mt, down 2,020 yuan/mt from the previous trading day. The average price of SX-EW copper was 105,645 yuan/mt, down 2,020 yuan/mt from the previous trading day... Macro front China: [Preview: The State Council Information Office will hold a press conference on May 18 to introduce measures to strengthen and optimize departure tax refund policies and expand inbound consumption] The State Council Information Office will hold a press conference at 3:00 PM on Monday, May 18, 2026. Vice Minister of Commerce Sheng Qiuping, along with officials from the State Taxation Administration, Beijing, Shanghai, and Shenzhen, will introduce measures to strengthen and optimize departure tax refund policies and expand inbound consumption, and answer questions from reporters. (Guoxin.com) [CAICT Launches AI Terminal Intelligence Grading Tests to Accelerate Implementation of New National Standards] Recently, the Ministry of Industry and Information Technology, the State Administration for Market Regulation, the Ministry of Commerce, and other departments jointly released the national standard series "Artificial Intelligence Terminal Intelligence Grading" (GB/Z 177—2026), which clearly defines the intelligence levels of AI terminals and lays a solid foundation for building a safe, orderly, and efficient AI terminal ecosystem. CAICT is one of the primary drafting organizations of the standard series and possesses comprehensive detection qualifications and technical capabilities in product areas including smartphones, tablets, microcomputers, smart glasses, earphones, speakers, televisions, and automotive cockpits. The first round of AI terminal intelligence grading standard conformity detection has now been launched, and relevant enterprises are welcome to actively participate in testing to jointly promote the implementation of the standards and help enhance product intelligence levels. (CAICT) [PBOC Achieves Zero Injection and Zero Withdrawal for the Day, with a Net Withdrawal of 51 Billion Yuan for the Week] PBOC conducted 500 million yuan of 7-day reverse repo operations today. As 500 million yuan of 7-day reverse repos matured today, zero injection and zero withdrawal were achieved for the day. This week, PBOC conducted 2.5 billion yuan of reverse repo operations. As 53.5 billion yuan of reverse repos matured this week, a net withdrawal of 51 billion yuan was achieved for the week overall. (Jin10 Data) US dollar: As of 11:46, the US dollar index rose 0.17% to 99.04. Data released by the US Department of Commerce on Thursday showed that US retail sales continued to grow in April, but against the backdrop of rapidly rising energy prices, the market believed that consumer data was partly influenced by inflation-driven price increases, and actual consumption momentum may not have been as strong as the headline data suggested. Data showed that US retail sales rose 0.5% MoM in April, the lowest since January, in line with market expectations. The previously reported March figure was revised down to a gain of 1.6%. US consumer confidence had already fallen to a historic low in early May, and the pace of inflation exceeded wage growth for the first time in three years, raising market concerns that consumer spending could slow down significantly going forward. US Fed's Williams: Monetary policy is slightly restrictive. I see no reason to raise or cut interest rates at this point. US Fed Governor Barr: We are not in a recession, but job growth is weak. I have not yet decided what action to take at the June FOMC meeting. According to the CME "FedWatch": The probability of the US Fed keeping rates unchanged through June was 96.8%, while the cumulative probability of a 25-basis-point interest rate cut was 3.2%. The probability of the US Fed keeping interest rates unchanged through July was 93.8%, with a 3.1% probability of a cumulative 25-basis-point interest rate cut and a 3.1% probability of a cumulative 25-basis-point rate hike. (Jin10 Data) Data: The US May New York Fed Manufacturing Index, US April industrial production MoM, and China's April total electricity consumption YoY will be released today. Also noteworthy: 2026 FOMC voter and Cleveland Fed President Hammack will deliver opening remarks at an online discussion on central bank independence; permanent FOMC voter and New York Fed President Williams will participate in a discussion; Fed Governor Barr will speak on the balance sheet; the National Energy Administration will release total electricity consumption data around the 15th of each month; Fed Chairman Powell's term will end; US President Trump will pay a state visit to China. Crude oil: As of 11:46, oil prices in both markets rose, with WTI up 1.36% and Brent up 1.29%. Middle East conflicts and uncertainty over navigation through the Strait of Hormuz supported oil prices. US President Trump stated: "We don't need to open the Strait of Hormuz," adding that efforts were being made to reopen the Strait of Hormuz for regional countries. India's Ministry of External Affairs confirmed on the 14th that an Indian-flagged merchant vessel was attacked near the Omani coast close to the Strait of Hormuz, but all crew members were safe. The Ministry expressed regret in a statement that day over the continued targeting of merchant ships and seafarers. However, the statement did not mention the specific name of the attacked vessel or the identity of the attackers, only stating that all Indian crew members on board were safe. UK-based Windward maritime analytics company said on social media on the 14th that an Indian-flagged cargo ship sank after a suspected drone attack in Omani waters near the Strait of Hormuz, and all crew members had been successfully rescued. (Xinhua) According to retailers in Delhi on Friday, India raised gasoline and diesel prices by approximately 3 rupees per liter (about $0.03); this was the country's first fuel price increase in four years, aimed at offsetting part of the losses incurred from surging global oil prices. Affected by the near-closure of the Strait of Hormuz and severe shipping disruptions triggered by the Iran war, global oil prices once surged to highs of over $120 per barrel before pulling back to around $100–105 per barrel. Currently, the retail price of diesel in Delhi was 90.67 rupees per liter, and the retail price of gasoline was 97.77 rupees per liter. Three state-owned enterprises — Indian Oil Corporation, Hindustan Petroleum Corporation, and Bharat Petroleum Corporation — collectively controlled over 90% of more than 103,000 fuel stations across India, and these three companies typically adjusted diesel and gasoline retail prices in tandem. (Jin10 Data) In addition, Bank of Japan officials stated that prices of a wide range of commodities, including oil and chemical products, rose due to uncertainties surrounding the Middle East conflict and the de facto closure of the Strait of Hormuz. The YoY increase in wholesale prices in April was the largest since May 2023. (Jin10 Data) Spot Market Overview: ► ► ► ► ► ► ► ► ► ► ► ►

Futures: Overnight, LME lead opened at $2,004/mt, moved sideways during the Asian session with a low of $2,001.5/mt; LME lead fluctuated upward after entering the European session, reaching a high of $2,017/mt, and finally closed at $2,012/mt, up 0.4%. Overnight, the most-traded SHFE lead 2606 contract opened at 16,590 yuan/mt, briefly touched a high of 16,620 yuan/mt at the beginning of the session before fluctuating downward, hitting a low of 16,530 yuan/mt near the close, and finally settled at 16,535 yuan/mt, down 0.33%. On the macro front: India restricted duty-free gold imports; Ukraine reported the largest Russian airstrike since the conflict began; Israel and Lebanon held a new round of negotiations in the US. OPEC+ reportedly plans to continue increasing production, targeting the restoration of all production cuts by the end of September. US Treasury Secretary Bessent: the oil price curve is expected to decline within six months; Iran has exhausted its oil storage capacity and will be forced to halt production. China's Ministry of Commerce: China is willing to work with the US to continuously expand the cooperation list. Ministry of Foreign Affairs: China is willing to work with the US to translate the new positioning of China-US relations into actions moving in the same direction. The PBOC: a 300 billion yuan outright reverse repo operation with a 6-month tenor will be conducted on May 15. : Driven by the LME lead rally, SHFE lead rebounded relatively, and suppliers actively made shipments while lowering quoted premiums. Additionally, primary lead smelter supplies were ample, with mainstream production areas quoted at parity with the SMM #1 lead average price on an ex-factory basis. Secondary lead side, losses remained prominent, and smelters held prices firm while shipping, with secondary refined lead quoted at parity with the SMM #1 lead average price on an ex-factory basis. Meanwhile, the lead-acid battery market remained in an off-season state, with limited just-in-time procurement from downstream enterprises. After lead prices rebounded, inquiry enthusiasm weakened, with buyers only maintaining just-in-time procurement, and spot market transactions turned sluggish. Inventory: On May 14, LME lead inventory decreased by 50 mt to 265,250 mt; SMM five-region lead ingot social inventory increased by approximately 6,100 mt WoW. Lead price forecast for today: Today is the delivery day. Suppliers continued to transfer lead ingots to delivery warehouses, and lead ingot social inventory continued to accumulate. Notably, the domestic market has recently underperformed the overseas market for lead prices. The lead ingot import window has entered a closed state this week. Meanwhile, the supply gap for high-grade lead ingots in Southeast Asia remained significant, with spot cargoes maintaining high premiums. In H2, the potential opening of the lead ingot export window and its impact on domestic lead price trends may be worth watching. 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.

【SMM Steel】Italy's Danieli has been awarded a contract by PT Garuda Yamato Steel to upgrade the water-treatment plant at its Indonesian steel facility. The new system will serve as the primary cooling infrastructure, supporting production processes and ensuring reliable water handling. Designed for a brownfield site, the system fits within the existing layout, reducing demolition and major civil work. Existing structures, piping supports, electrical/cable-routing systems, and overhead cranes will be reused to cut costs and speed implementation. Danieli's scope covers engineering, equipment supply, automation, and project management, meeting international standards. Danieli will also provide support through to commissioning and final acceptance.

SMM May 14: Metals market: As of the midday close, base metals in the domestic market mostly fell. SHFE copper fell 1.07%. SHFE aluminum fell 0.3%. SHFE lead rose 0.27%, SHFE zinc rose 0.44%. SHFE tin fell 0.87%. SHFE nickel fell 1.06%. In addition, the most-traded foundry aluminum futures fell 0.3%, the most-traded alumina contract rose 0.29%. The most-traded lithium carbonate contract fell 2.01%. The most-traded silicon metal contract fell 0.29%. The most-traded polysilicon futures rose 0.49%. Ferrous metals mostly fell. Iron ore fell 0.43%, rebar fell 0.25%, hot-rolled coil edged down, and stainless steel fell 1.52%. Coking coal and coke: the most-traded coking coal contract rose 0.57%, and the most-traded coke contract rose 0.8%. Overseas market base metals, as of 11:41, LME metals nearly all declined. LME copper fell 1.08%. LME aluminum fell 0.9%, LME lead edged up 0.02%. LME zinc edged down. LME tin fell 2.76%. LME nickel fell 1.57%. Precious metals, as of 11:41, COMEX gold fell 0.33%, COMEX silver fell 2.2%. Domestic precious metals: the most-traded SHFE gold contract fell 0.04%, the most-traded SHFE silver contract rose 1.6%. In addition, as of the midday close, the most-traded platinum futures rose 0.28%, and the most-traded palladium futures fell 0.27%. As of the midday close, the most-traded Europe containerized freight index contract fell 4.32%, closing at 2,434 points. As of 11:41 on May 14, midday futures quotes for selected contracts: Spot and fundamentals Nickel: On May 14, SMM #1 refined nickel prices fell 1,200 yuan/mt from the previous trading day. Spot premiums: Jinchuan #1 refined nickel averaged 1,350 yuan/mt, up 100 yuan/mt from the previous trading day... Macro front [Xi Jinping: The Essence of China-US Economic and Trade Relations Is Mutual Benefit and Win-Win] On the morning of May 14, President Xi Jinping held talks with US President Trump, who was on a state visit to China, at the Great Hall of the People in Beijing. Xi Jinping pointed out that facts have repeatedly proven that there are no winners in a trade war, the essence of China-US economic and trade relations is mutual benefit and win-win, and equal consultation is the only correct choice when facing differences and frictions. Yesterday, the economic and trade teams of both sides reached overall balanced and positive outcomes, which is good news for the people of both countries and for the world. Both sides should work together to maintain the current hard-won positive momentum. (CCTV News) [Xi Jinping: Making 2026 a Historic and Landmark Year for China-US Relations to Build on the Past and Open Up the Future] On the morning of May 14, President Xi Jinping held talks with US President Trump, who was on a state visit to China, at the Great Hall of the People in Beijing. Xi Jinping emphasized that the common interests between China and the US outweigh their differences, that the success of each country represents an opportunity for the other, and that stability in China-US relations benefits the world. Both sides should be partners rather than rivals, achieving mutual success and shared prosperity, and forging a path of proper engagement between major countries in the new era. He looked forward to exchanging views with President Trump on major issues concerning both countries and the world, jointly steering the great ship of China-US relations on the right course, and making 2026 a historic and landmark year for China-US relations to build on the past and open up the future. (Xinhua News Agency) China: [PBOC Reverse Repo Operations Resulted in a Net Withdrawal of 26.5 Billion Yuan for the Day] The PBOC conducted 500 million yuan of 7-day reverse repo operations today. As 27 billion yuan of 7-day reverse repos matured today, a net withdrawal of 26.5 billion yuan was achieved for the day. US Dollar: As of 11:41, the US dollar index fell 0.01% to 98.48. Driven by a sharp climb in energy prices amid Middle East conflicts, the US April Producer Price Index (PPI) significantly exceeded expectations, posting the largest increase in over three years, and market bets on a Fed rate hike warmed notably. Data released by the US Bureau of Labor Statistics showed: US April PPI came in at 6% YoY, the highest level since December 2022. Expectations were 4.8%, with the prior reading at 4%. US April PPI rose 1.4% MoM, the largest single-month increase since March 2022. Expectations were 0.5%, with the prior reading at 0.5%. US April core PPI came in at 5.2% YoY (expectations: 4.3%, prior: 3.8%). US April core PPI rose 1% MoM (expectations: 0.3%, prior: 0.1%). The money market has now priced in approximately 24 basis points of rate hikes ahead of the Fed's June 2027 policy meeting, up from 21 basis points at Tuesday's close. The market priced in roughly a 50% probability of one rate hike within 2026. (Wallstreetcn) According to the CME "FedWatch" tool, the market has now priced in a probability of over 30% for a rate hike by December. Following the unexpectedly strong US April PPI data, the market believes it is now even harder for the US Fed to justify any interest rate cuts this year. In April, the PPI rose 1.4%, well above economists’ consensus expectations of 0.5%, indicating inflationary pressures were stronger than expected and reinforcing the market’s trend toward repricing the interest-rate path. (Jin10 Data) On the data front: Today will see the release of the UK Q1 preliminary annual GDP growth rate, the UK March three-month GDP monthly rate, the UK March manufacturing production monthly rate, Canada March wholesale sales monthly rate, the US weekly initial jobless claims for the week ending May 9, the US April retail sales monthly rate, the US April import price index monthly rate, and other data. In addition, attention should be paid to: 2026 FOMC voting member and Minneapolis Fed President Kashkari participating in a discussion hosted by the local chamber of commerce; the Bank of Canada releasing the minutes of its monetary policy meeting; 2026 FOMC voting member and Dallas Fed President Logan taking part in a dialogue on the energy industry; 2028 FOMC voting member and Kansas City Fed President Schmid delivering remarks on “payments innovation and community banks”; and US President Trump paying a state visit to China. On crude oil: As of 11:41, oil prices in both markets edged up, with WTI up 0.42% and Brent up 0.4%. The market continued to focus on developments in the US-Iran situation. US Vice President Vance said on Wednesday local time: “On the negotiations with Iran, I think progress is being made. Right now we’re focused on the diplomatic track, and I spoke this morning with Special Envoy Witkoff and Kushner. The fundamental issue in the talks is whether we can make enough progress to meet the red lines set by Trump. That red line is very simple. He needs to be confident that we have put in place sufficient safeguards to ensure Iran never obtains a nuclear weapon.” Commenting on the previously released CPI data, Vance said: “Last month’s inflation data wasn’t ideal. The President, I, and the entire team care about the financial situation of the American people.” (Jin10 Data) OPEC’s monthly report showed that Saudi Arabia’s daily crude oil production in April fell to 6.316 million barrels, the lowest since 1990. Saudi Arabia also reported to OPEC that “actual market supply,” excluding the portion injected into storage, was slightly higher than production, reaching a daily average of 6.879 million barrels. (Wallstreetcn) Hunter Hunt, grandson of Texas oil tycoon H.L. Hunt, worried that damage to energy infrastructure in the Middle East could lead to a decline in oil production over the next few years. Hunt discussed many Iran-war-related issues, including production shutdowns, refinery damage, and the effective closure of the Strait of Hormuz, through which about one-fifth of the world’s crude oil had once been transported. “This is literally the nightmare that no one wants to see in their plans," Hunt said on Wednesday. Hunt rarely speaks publicly. He runs the 91-year-old Hunt Oil Company, which operates globally, including in Yemen and the Kurdistan region of Iraq. (Jin Shi Data) Spot Market Overview: ► ► ► ► ► ► ► ► ► ► ►

[SMM Morning Meeting Minutes: Growing Market Concerns over Supply Push LME Zinc to Multi-Year Highs] LME zinc opened at $3,536/mt during the overnight session. Early in the session, a tug-of-war between longs and shorts ensued, and LME zinc swung wildly along the daily average line. Entering the night session, it briefly dipped to a low of $3,524.5/mt. Bulls then increased open interest, driving LME zinc up to a multi-year high of $3,582.5/mt. The center subsequently pulled back slightly, and it ultimately closed higher at $3,552/mt, up $19.5/mt or 0.55%. Trading volume rose to 15,506 lots, and open interest increased by 488 lots to 242,000 lots.

Futures: Overnight, LME lead opened at $1,996.5/mt, briefly touching a low of $1,995.5/mt during the Asian session. LME lead continued to rise firmly after entering the European session, reaching a high of $2,016/mt near the close, and ultimately settled at $2,004/mt, up 0.33%, refreshing a nearly 4-month high. Overnight, the most-traded SHFE lead 2606 contract opened at 16,655 yuan/mt, then moved sideways, with a low of 16,625 yuan/mt and a high of 16,675 yuan/mt during the session, ultimately settling at 16,640 yuan/mt, up 0.15%. On the macro front: US Fed's Collins: If inflation does not ease, rate hikes may be needed. US April PPI surged 1.4% MoM and 6% YoY, both the largest increases since 2022. OPEC lowered its 2026 global oil demand growth expectations from 1.38 million bpd to 1.17 million bpd. US President Trump arrived in Beijing to begin his visit to China. He Lifeng held economic and trade consultations with US Treasury Secretary Bessent in South Korea. China's State Administration for Market Regulation: launched a special campaign to remove obstacles hindering the unified market and fair competition. : SHFE lead remained in the doldrums. Suppliers offered limited quotations, with some waiting for delivery and others seeing rising wait-and-see sentiment. Additionally, cargoes self-picked up from primary lead smelters also saw relatively fewer quotations. Secondary lead side, regional supply disparities persisted, with smelters showing strong reluctance to sell at low prices. Some smelters held prices firm for shipments, with secondary refined lead quoted at premiums of 0~+50 yuan/mt against SMM #1 lead average price on an ex-works basis. Downstream enterprises made just-in-time procurement, with inquiry enthusiasm still present and some purchasing on dips as needed, but market trading activity weakened compared to yesterday. Inventory: On May 13, LME lead inventory decreased by 250 mt to 265,300 mt. As of May 11, SMM five-region lead ingot social inventory increased by approximately 2,200 mt WoW. Lead price forecast for today: Ex-China lead ingot inventory continued to decline, while the LME Cash-3M spread maintained a slight contango. Combined with the persistently tight spot market supply in Southeast Asia, LME lead is expected to hold up well. In addition, uncertainty surrounding overseas geopolitical factors remains significant, and their impact on the market warrants continued attention. Although domestic spot lead prices received a slight boost from LME lead's movement, upward momentum remained insufficient due to weak end-use consumption. Data source statement: 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.

SMM May 13 News: Metals market: As of the midday close, base metals in the domestic market generally rose. SHFE copper gained 1.63%. SHFE aluminum rose 0.3%. SHFE lead fell 0.15%. SHFE zinc gained 1.46%. SHFE tin rose 0.08%. SHFE nickel edged down. In addition, the most-traded casting aluminum futures rose 0.15%, the most-traded alumina futures fell 0.71%. The most-traded lithium carbonate futures fell 3.55%. The most-traded silicon metal futures fell 2.74%. The most-traded polysilicon futures fell 0.62%. Ferrous metals mostly fell. Iron ore was flat at 817.5 yuan/mt. Rebar fell 0.7%. Hot-rolled coil fell 0.57%. Stainless steel rose 0.16%. Coking coal and coke: the most-traded coking coal contract fell 2.51%, and the most-traded coke contract fell 1.28%. Overseas base metals, as of 11:41, LME metals rose across the board. LME copper gained 0.6%. LME aluminum rose 0.24%. LME zinc gained 0.4%. LME lead rose 0.3%. LME tin gained 1.29%. LME nickel rose 0.87%. Precious metals, as of 11:41, COMEX gold rose 0.48%, and COMEX silver gained 1.99%. Domestic precious metals: the most-traded SHFE gold contract fell 0.55%, and the most-traded SHFE silver contract rose 1.1%. In addition, as of the midday close, the most-traded platinum futures edged down, and the most-traded palladium futures fell 1.03%. As of the midday close, the most-traded Europe containerized freight index contract rose 3.17%, closing at 2,539.5 points. As of 11:41 on May 13, midday futures quotes for selected contracts: Spot and Fundamentals Copper: Looking ahead to tomorrow, copper prices continue to fluctuate at highs, downstream purchasing sentiment remains subdued, intraday buying and selling sentiment both pulled back, and spot discounts continued to widen. According to SMM, downstream orders continued to decline from the previous day... Macro Front [China-US Economic and Trade Consultations Begin in South Korea] At noon local time on May 13, the economic and trade teams of China and the US began China-US economic and trade consultations at Incheon International Airport in Seoul, South Korea. (Xinhua) Domestic: [PBOC Reverse Repo Operations Achieved Net Withdrawal of 25.5 Billion Yuan on the Day] The PBOC conducted 500 million yuan of 7-day reverse repo operations today. As 26 billion yuan of 7-day reverse repos matured today, a net withdrawal of 25.5 billion yuan was achieved on the day. US dollar: As of 11:41, the US dollar index rose 0.01%, at 98.31. The US CPI rose faster than expected in April, further intensifying concerns about the impact of inflation on the US economy. The Bureau of Labor Statistics reported on Tuesday that, after seasonal adjustment, the overall CPI rose 0.6% MoM and 3.8% YoY. The monthly increase was in line with expectations, but the YoY increase was 0.1 percentage point higher than market expectations. Core CPI, excluding food and energy, rose 0.4% and 2.8% respectively, indicating that although inflation remained well above the US Fed's 2% target, pressure mainly came from non-core areas, especially energy. Energy prices rose 3.8%, once again becoming one of the main drivers of rising inflation; food prices also rose 0.5%. For the full year, energy prices rose 17.9% and food prices rose 3.2%. Gasoline price index was up 28.4% YoY. Although energy, especially gasoline, was the main news focus, inflationary pressures also came from multiple other areas. Housing costs rose 0.6%, tariff-sensitive apparel prices rose 0.6%, airfares rose 2.8% with a YoY increase of 20.7%. Tariffs also appeared to have affected other areas, with household furnishings and related expenditures rising 0.7%. (Jin10 Data) According to the CME "Fed Watch": the probability of the US Fed maintaining rates unchanged through June was 97.1%, with a 2.9% probability of a cumulative 25 basis point interest rate cut. The probability of the US Fed maintaining rates unchanged through July was 96%, with a 3.9% probability of a cumulative 25 basis point interest rate cut. (Jin10 Data) A CITIC Securities research report stated that US April inflation continued to run hot, the spillover effects of the Middle East conflict persisted, and compensatory increases in rent inflation pushed up core readings. High inflation continued to erode the real purchasing power of US households, with low-income households facing stronger cost shocks, and real hourly wages YoY turned negative for the first time in three years. We believe the risk of a second wave of US inflation is relatively small, but high oil prices will constrain the room for inflation to pull back within the year. Under the base case scenario, the US Fed is still expected to cut interest rate by 25bps within the year. US Treasuries are currently more suited for trading opportunities. After the strong earnings season nears its conclusion, US equities should be watched for short-term risks of profit-taking. The US dollar index may remain in the doldrums below 100 rather than on a sustained downtrend. Other currencies: According to a latest estimate by the OECD, the Bank of Japan's benchmark interest rate is expected to reach 2% by the end of 2027. The report noted that, assuming inflation remains around 2%, the current interest rate is still close to the lower bound of the neutral rate range for the economy. The report also recommended that the Bank of Japan should continue to gradually raise interest rates to prevent the economy from overheating. The Bank of Japan previously estimated that Japan's nominal neutral interest rate was between 1.1% and 2.5%, but noted that there was significant uncertainty regarding the specific level. (Jin10 Data) On the macro front: Data to be released today include France's Q1 ILO unemployment rate, France's April CPI MoM final reading, eurozone Q1 GDP YoY revised reading, eurozone Q1 seasonally adjusted employment QoQ final reading, eurozone March industrial output MoM, US April PPI YoY, and US April PPI MoM. In addition, attention should be paid to: Chicago Fed President Goolsbee participating in a Q&A session hosted by a local chamber of commerce; 2028 FOMC voter and Boston Fed President Collins delivering a speech at the Boston Economic Club; Vice Premier He Lifeng leading a delegation to South Korea from May 12–13 for trade consultations with the US side; and US President Trump's state visit to China. Crude oil: As of 11:41, oil prices in both markets fell, with WTI down 1.03% and Brent down 1.06%. Iran presented its "entry ticket" for nuclear talks with the US, including unfreezing assets and recognizing sovereignty over the Strait of Hormuz. Trump stated: "When negotiating with Iran, I don't consider the financial situation of the American people. I don't consider anyone." Meanwhile, the US Secretary of Defense said the Iran ceasefire agreement remained in effect. (Jin10 Data) American Petroleum Institute (API) data showed that US crude oil inventory fell for the fourth consecutive week last week, while gasoline inventory increased. US API crude oil inventory for the week ending May 8 was -2.188 million barrels, versus expectations of -1.654 million barrels and a prior reading of -8.141 million barrels. US API gasoline inventory for the week ending May 8 was 502,000 barrels, versus expectations of -2.549 million barrels and a prior reading of -6.107 million barrels. The EIA Short-Term Energy Outlook report indicated that if the Strait of Hormuz were closed through the end of June, crude oil prices would be $20/barrel higher than the current forecast, which assumes reopening by the end of May. (Jin10 Data) Spot Market Overview: ► ► ► ► ► ► ► ► ►

[SMM Analysis] After Sulfur Breaks Through $1,200: How Far Is the Ceiling? — The Ultimate Game Under International Supply Disruptions, Discussing China's Sulfur Policies and International Supplementary Supply Pathways

SMM News, May 12: Metals market: As of the midday close, domestic base metals mostly rose. SHFE copper was up 2.51%. SHFE aluminum was up 0.18%. SHFE lead was down 0.99%. SHFE zinc was up 1.8%. SHFE tin was up 1.47%. SHFE nickel was down 0.71%. In addition, the most-traded casting aluminum futures were up 0.19%, and the most-traded alumina futures were down 1.24%. The most-traded lithium carbonate futures were up 1.63%. The most-traded silicon metal futures were down 2.84%. The most-traded polysilicon futures continued the downtrend from the previous two trading days, falling 4.37%. Ferrous metals mostly fell. Iron ore was flat at 820.5 yuan/mt. Rebar was down 0.18%. Hot-rolled coil edged up slightly. Stainless steel was down 0.13%. Coking coal and coke: the most-traded coking coal contract was down 2.54%, and the most-traded coke contract was down 1.21%. Overseas base metals: as of 11:43, LME metals were nearly all lower. LME copper edged up slightly. LME aluminum was down 0.74%. LME zinc edged down slightly. LME lead was down 0.53%. LME tin was down 0.16%. LME nickel was down 1.22%. Precious metals: as of 11:43, COMEX gold was up 0.13%, and COMEX silver was up 1.06%. Domestic precious metals: the most-traded SHFE gold contract was up 0.36%, and the most-traded SHFE silver contract was up 6.43%. In addition, as of the midday close, the most-traded platinum futures were up 2.9%, and the most-traded palladium futures were up 0.44%. As of the midday close, the most-traded Europe containerized freight index contract was up 1.23%, at 2,474.5 points. As of 11:43 on May 12, midday futures quotes for selected contracts: Spot Prices and Fundamentals Copper: Today in Guangdong, spot prices of #1 copper cathode against the front-month contract: high-quality copper was quoted at a premium of 260 yuan/mt, down 30 yuan/mt from the previous trading day; standard-quality copper was quoted at a premium of 190 yuan/mt, down 30 yuan/mt from the previous trading day; SX-EW copper was quoted at a premium of 120 yuan/mt, down 30 yuan/mt from the previous trading day. The average price of Guangdong #1 copper cathode was 104,355 yuan/mt, up 1,385 yuan/mt from the previous trading day. The average price of SX-EW copper was 104,325 yuan/mt, up 1,395 yuan/mt from the previous trading day. Spot market: Guangdong inventory increased again today, mainly due to increased arrivals and weak consumption... Macro Front China: The PBOC conducted 500 million yuan of 7-day reverse repo operations in the open market at an interest rate of 1.40%, unchanged from the previous day. No reverse repos matured today. [CICC: China's PPI and CPI are expected to have further upside room on a YoY basis over the next two months] CICC commented on April 2026 price data, noting that PPI rose 1.7% MoM in April, with the YoY increase expanding from 0.5% in the previous month to 2.8%. The PPI increase exceeded expectations, mainly because price gains were highly concentrated in the energy and chemical industry chain. April CPI rose 0.3% MoM, stronger than seasonal patterns, with CPI YoY growth also rebounding from 1.0% in the previous month to 1.2%, primarily driven by energy prices and holiday travel demand. Looking ahead, CICC believes that against the backdrop of ongoing tug-of-war in US-Iran negotiations, international oil prices will most likely fluctuate at highs. Given the time lag in price transmission from oil price shocks, PPI and CPI YoY are expected to still have upside room in the next two months. However, this round of production-side price recovery shows clear structural divergence, with upstream price increases significantly stronger than downstream. In an environment of weak end-use consumption demand, imported cost-push inflation is likely to continue suppressing profitability in mid- to downstream industries. US dollar: As of 11:43, the US dollar index rose 0.21% to 98.14. On May 11 local time, the US Customs and Border Protection announced that the first batch of refunds for illegal tariffs will begin on May 12, with some US enterprises set to receive tax refund funds. The US government launched an online application platform last month, allowing enterprises to apply for refunds of tariffs previously paid but later ruled illegal by the US Supreme Court. US Customs data shows that over 330,000 importers paid a total of approximately $166 billion in related tariffs. As of April 26, at least 75,000 enterprises had submitted refund applications. (CCTV News) The market is focused on copper data to be released tonight, which will help assess the US Fed's interest rate path. According to CME "FedWatch": The probability of the US Fed maintaining rates unchanged through June is 97.7%, with a 2.3% probability of a cumulative 25 basis point cut. The probability of maintaining rates unchanged through July is 94.6%, with a 5.4% probability of a cumulative 25 basis point cut and a 0.1% probability of a cumulative 50 basis point cut. Other currencies: Japanese Finance Minister Katayama Satsuki stated that following her meeting with US Treasury Secretary Bessent in Tokyo, her team is conducting smooth cooperation with the US side in the foreign exchange policy area. Katayama said she would not comment on Bessent's specific remarks. This is Bessent's third visit to Japan since assuming his cabinet position. Markets are closely watching this meeting, as it comes less than two weeks after Tokyo authorities' suspected large-scale yen intervention lasting several days to boost the yen exchange rate. Bessent has previously hinted that he is critical of direct market intervention, instead favoring support for the yen through the Bank of Japan tightening monetary policy. The Japanese authorities likely first intervened in the market on April 30, when the Bank of Japan's decision to keep policy unchanged, combined with hawkish signals released by the US Fed, jointly pushed the yen-to-dollar exchange rate past the 160 level. Data analysis showed that the Japanese authorities may have deployed approximately $24.7 billion in this operation, followed by an additional approximately $30 billion in a subsequent round of intervention. Katayama said she also discussed topics such as artificial intelligence and critical minerals with Bessent. (Jin10 Data) On the macro front: Today saw the release of Germany's April CPI MoM final reading, Germany's May ZEW Economic Sentiment Index, Eurozone May ZEW Economic Sentiment Index, US April NFIB Small Business Optimism Index, US ADP Employment Change for the week ending April 25, US April non-seasonally adjusted CPI YoY, US April seasonally adjusted CPI MoM, US April seasonally adjusted core CPI MoM, and US April non-seasonally adjusted core CPI YoY. In addition, attention should also be paid to: the Bank of Japan releasing the Summary of Opinions from its April monetary policy meeting; permanent FOMC voter and New York Fed President Williams participating in a panel discussion on monetary policy; Vice Premier He Lifeng leading a delegation to South Korea from May 12 to 13 for trade consultations with the US side. Crude oil: As of 11:43, both benchmarks rose, with WTI up 0.95% and Brent up 0.87%. Uncertainty over the prospects of US-Iran negotiations kept market concerns about supply alive, supporting oil prices. The US Strategic Petroleum Reserve (SPR) allocated 53.5 million barrels of crude oil to companies including commodity trader Trafigura Group and US refiner Marathon Petroleum, to help ease the oil price surge triggered by the Iran war. Ahead of the US summer driving peak, the US government is releasing near-record levels of crude oil to the market to push down oil prices. The crude oil will be released from June to August, when refineries will ramp up capacity to meet peak gasoline demand. This second-largest SPR sale in history is also part of a global effort led by the International Energy Agency to bring down oil prices. Last week, the US already released a daily average of 1.22 million barrels of crude oil under the aforementioned framework, setting a historical record. The Trump administration has pledged to release 172 million barrels of crude oil through a so-called "exchange program." Under this mechanism, crude oil is lent to enterprises and must later be returned in physical form. As of now, the US has agreed to release 133.1 million barrels of crude oil. (Jin10 Data) Spot market overview: ► ► ► ► ► ► ► ► ► ► ►

SMM May 11 News: Metals market: As of the midday close, domestic market base metals mostly rose. SHFE copper was up 1.01%, SHFE aluminum up 0.86%, SHFE lead edged down slightly, SHFE zinc fell 0.6%, SHFE tin was up 0.38%, and SHFE nickel up 0.86%. In addition, the most-traded casting aluminum futures rose 1.09%, the most-traded alumina contract fell 0.81%, the most-traded lithium carbonate contract rose 3.1%, the most-traded silicon metal contract rose 1.66%, and the most-traded polysilicon futures fell 2.8%. Ferrous metals mostly rose. Iron ore was up 0.86%, rebar up 0.52%, hot-rolled coil up 0.46%, and stainless steel down 0.07%. Coking coal and coke: the most-traded coking coal contract rose 0.85%, and the most-traded coke contract rose 1.65%. Overseas market base metals, as of 11:46, LME metals were nearly all up. LME copper rose 0.59%, LME aluminum up 0.67%, LME zinc down 0.31%, LME lead edged up slightly, LME tin up 1.16%, and LME nickel up 1.29%. Precious metals, as of 11:46, COMEX gold fell 0.77% and COMEX silver rose 0.66%. Domestic market precious metals: the most-traded SHFE gold contract fell 0.96%, and the most-traded SHFE silver contract rose 0.68%. In addition, as of the midday close, the most-traded platinum futures rose 0.14%, and the most-traded palladium futures fell 0.62%. As of the midday close, the most-traded Europe containerized freight index contract rose 5.07% to 2,474.5 points. As of 11:46 on May 11, midday futures quotes for selected contracts: Spot and Fundamentals Lead: An SMM survey showed that in April, refined lead supply from secondary lead enterprises edged up MoM, mainly driven by production resumptions at previously idled enterprises and restocking of raw materials to boost output... Macro Front China: [NBS: April CPI Up 1.2% YoY, PPI Up 2.8% YoY, PPI Growth Expanded] NBS data showed that in April 2026, the national consumer price index rose 1.2% YoY. Among them, urban areas were up 1.2% and rural areas up 1.0%; food prices fell 1.6%, while non-food prices rose 1.8%; consumer goods prices rose 1.4%, and services prices rose 0.9%. On average from January to April, the national CPI was up 0.9% YoY. In April, the national CPI rose 0.3% MoM. Among them, urban areas were up 0.3% and rural areas up 0.1%; food prices fell 1.6%, while non-food prices rose 0.7%; consumer goods prices rose 0.1%, and services prices rose 0.5%. In April 2026, national industrial producer ex-factory prices rose 2.8% YoY and 1.7% MoM. Industrial producer purchase prices rose 3.5% YoY and 2.1% MoM. For the January–April average, industrial producer ex-factory prices were up 0.2% from the same period last year, and industrial producer purchase prices were up 0.5%. Dong Lijuan, Chief Statistician of the Urban Division of the National Bureau of Statistics (NBS), interpreted the April 2026 CPI and PPI data. The main characteristics of PPI MoM movements this month were as follows: First, international input factors drove up prices in China's petroleum-related industries. Rising international crude oil prices drove up prices in domestic petroleum-related industries. Specifically, prices in the petroleum and natural gas extraction industry rose 18.5% MoM, petroleum, coal, and other fuel processing industry prices rose 16.4%, chemical raw materials and chemical products manufacturing prices rose 8.3%, chemical fiber manufacturing prices rose 5.6%, and rubber and plastics products industry prices rose 1.7%. Second, increased demand in some domestic industries drove prices higher. Rapid growth in computing power demand and accelerated electrification pushed optical fiber manufacturing prices up 22.5% MoM, external storage devices and components prices up 3.2%, and non-ferrous metal smelting and rolling processing industry prices up 0.2%. Restocking demand for thermal coal was released, combined with increased non-power coal demand from chemical and metallurgical industries, driving coal mining and washing industry prices up 1.9%. Continued advancement of manufacturing equipment upgrades drove increased steel demand, pushing ferrous metals smelting and rolling processing industry prices up 0.6%. Third, competition order in the Chinese market continued to improve, with prices in related industries rising or declines narrowing. Efforts to address "involution-style" competition continued to show results, with lithium-ion battery manufacturing prices up 1.6% MoM, new energy vehicle manufacturing prices down 0.1%, with the decline narrowing by 0.7 percentage points from the previous month. The PBOC conducted 500 million yuan in 7-day reverse repo operations today. As no reverse repos matured today, a net injection of 500 million yuan was achieved. US dollar: As of 11:46, the US dollar index was up 0.24% at 98.08. Data from the US Department of Labor showed that US April non-farm payrolls added 115,000 jobs, far exceeding expectations, thanks to strong corporate earnings and enterprises' effective response to supply chain disruptions triggered by the Iran war. The unemployment rate held steady at 4.3%, in line with economists' expectations. From trade to immigration to tax policy, changes across various fronts posed challenges for enterprises, but most did not resort to large-scale layoffs. At the same time, enterprises appeared to take various intertwined headwinds in stride. Robust consumer demand meant that despite news of high-profile layoffs at well-known companies, low hiring was often accompanied by relatively low levels of layoffs. Data from the Department of Labor and human resources firm ADP earlier this week showed that the job market was stabilizing. Strong hiring in healthcare and social assistance also underpinned overall employment figures. US equities at or near record highs boosted confidence among corporate CEOs. The full impact of the conflict with Iran and the resulting rise in energy prices had yet to manifest in the labour market. Rising US oil prices had put greater pressure on lower-income households, which could dampen travel and services spending, in turn dragging on hiring in sectors such as retail and leisure. The impact of higher oil prices was particularly severe for airlines. However, these effects had yet to show up clearly in monthly employment data. According to the CME "Fed Watch": the probability of the US Fed holding rates unchanged through June was 93.8%, with a 6.2% probability of a cumulative 25 basis point interest rate cut. The probability of the US Fed holding rates unchanged through July was 88.8%, with a 10.8% probability of a cumulative 25 basis point cut and a 0.3% probability of a cumulative 50 basis point cut. (Jin10 Data) Goldman Sachs expects the US Fed to cut interest rates by 25 basis points each in December 2026 and March 2027, compared with its previous forecast of cuts in September and December this year. A CITIC Securities research report noted that US nonfarm payrolls in April 2026 came in above expectations, while the unemployment rate of 4.3% was in line with expectations. We believe April data better reflected the current state of the US job market than the previous two months: first, one-off factors diminished in April; second, the enterprise response rate was higher in April; and third, the Birth-death model impact was the smallest among the last four data releases. Demand side, the US labour market in April exhibited overall resilience with marginally increasing layoff pressure. Supply side, the labour force participation rate and employment-population ratio declined, but the prime-age (25–54) participation rate remained stable, suggesting it was not a large-scale exit of core labour force but rather aging and retirement factors dragging down the overall participation rate. Regarding US Fed monetary policy, we maintain our previous view: after Waller takes over, if the Iran situation eases and oil prices pull back, driving inflation expectations lower, the base case for H2 is one interest rate cut of 25 bps. Other currencies: Bearish yen positions decreased significantly after Japanese authorities intervened to support the yen, highlighting how official action curbed this crowded trade. According to data from the US Commodity Futures Trading Commission (CFTC), leveraged funds reduced their net short positions on the yen in the week ending May 5. Currently, their net short position in the Japanese yen stood at 61,340 contracts, valued at approximately $4.9 billion, hitting the lowest level in nearly a month. Meanwhile, asset management firms also cut 13,839 short contracts, bringing their open interest down to 10,653 contracts. "Given the intervention risk and strong official warnings, chasing yen shorts near the 160 level has become unattractive," said Stefan Rittner, Senior Portfolio Manager at Allianz Global Investors. He held a neutral stance on the USD/JPY exchange rate. However, he noted that "despite the yen's already cheap valuation, persistent structural headwinds limit the scope for a sustained rebound"; moreover, further intervention risks are expected to rise once the USD/JPY rate approaches its previous highs again. (Jin10 Data) On the macro front: Data to be released today include US April existing home sales annualized total and China's April M2 money supply year-on-year. In addition, attention should be paid to: US Treasury Secretary Bessent's visit to Japan, where he will meet with the Japanese Prime Minister, the central bank governor, and the Finance Minister. Crude oil: As of 11:46, oil prices in both markets surged significantly, with WTI up 4.65% and Brent up 4.17%. Renewed tensions between the US and Iran supported oil prices. According to Xinhua News Agency, US President Trump posted on social media on May 10, expressing dissatisfaction with Iran's response, calling it "completely unacceptable." This statement cast a shadow over the already fragile Middle East ceasefire situation. Oil prices jumped sharply after the news broke. (Wallstreetcn) Data from shipping intelligence firm Kpler showed that two more fully loaded crude oil tankers switched off their trackers while passing through the Strait of Hormuz last week to evade Iranian attacks. Data indicated that the very large crude carrier "Basrah Energy" loaded 2 million barrels of Upper Zakum crude oil from ADNOC's Zirku terminal on May 1 and passed through the Strait of Hormuz on May 6. The vessel discharged its cargo at the Fujairah tanker terminal on May 11. It remained unclear which company chartered the tanker owned and managed by shipping company Sinokor. ADNOC and its buyers had recently dispatched tankers through the Strait of Hormuz on multiple occasions to transport crude oil, in response to the issue of stranded oil in the Persian Gulf caused by Middle East conflicts. Another very large crude carrier, Kiara M, switched off its transponder and departed the Persian Gulf on Sunday, carrying 2 million barrels of Iraqi crude oil. The discharge destination of this San Marino-flagged tanker remained unclear. (Jin Shi Data) Spot Market Overview: ► ► ► ► ► ► ► ► ► ►