SMM News, April 30: According to SMM statistics, China’s primary aluminum output in April 2026 (30 days) rose by 1.7% year-on-year and fell by 2.9% month-on-month. As the traditional peak consumption season continues, demand from downstream sectors including aluminum sheet, strip & foil and aluminum wires & cables has formed effective support. The domestic liquid aluminum ratio edged up moderately, rising by 1.7 percentage points month-on-month to 75.3% in April. The overall performance was slightly below early-month expectations, mainly dragged by weaker-than-anticipated orders for aluminum profiles. Based on SMM’s liquid aluminum ratio calculation data, domestic primary aluminum ingot output in April dropped by 3.4% year-on-year and 9.0% month-on-month. Capacity Changes: As of late April, China’s commissioned primary aluminum capacity surveyed by SMM stood at approximately 46.209 million tons, showing no month-on-month changes. Output Forecast: In May 2026, the liquid aluminum production ratio among domestic primary aluminum producers will operate in a differentiated pattern. Overall, with the recovery of overseas market demand, export orders for domestic aluminum fabricated products are expected to keep improving, supporting a mild rebound in the liquid aluminum ratio. comprehensively, the liquid aluminum ratio is projected to increase by 0.5 percentage points to 75.8%.

According to customs data, China's aluminum foil (tariff codes 76071110, 76071120, 76071190, 76071900, 76072000) total exports in March 2026 reached 103,500 mt, up 10% MoM but down 13% YoY. The share of exports to the UAE plunged from 6.8% in January-February to 2.5% in March, with the Middle East trade chain nearly severed.

According to POSCO’s Q1 2026 earnings call, the ongoing US-Iran conflict has pushed up FX, oil, LNG, and logistics costs, creating clear pressure on steel margins. The company said that although sales volumes, production, and utilization rates recovered sequentially, raw material sourcing costs remain elevated due to disruptions linked to the Middle East situation, and this cost pressure is expected to continue into the second quarter.

According to customs data, China's aluminum plate/sheet and strip (tariff codes 76061121, 76061129, 76061191, 76061199, 76061220, 76061230, 76061251, 76061259, 76061290, 76069100, 76069200) exports in March 2026 reached 278,200 mt, up 21% MoM and up 3% YoY.

Cost Support & Fundamental Improvement: Hot-Rolled Coil Prices Continued to Strengthen in April As of April 30, the most-traded hot-rolled coil futures contract closed at 3,425 points, up 131 points MoM from March 31. In April, SMM's national average spot price for hot-rolled coil was 3,321.78 yuan/mt, up 54.91 yuan/mt MoM (1.68%). HRC prices continued to rise in April, mainly due to relatively stable cost support. Additionally, since the start of April, on one hand, semi-finished products export orders were robust, with some steel mills prioritizing delivery of semi-finished product orders, thereby easing supply pressure in the HRC market; on the other hand, amid the peak season, HRC demand release was strong, driving rapid HRC inventory drawdown and significantly easing supply-demand imbalances. Before mid-May, HRC prices are expected to continue fluctuating at highs; in late May, attention turns to export support and the extent of demand pullback Fundamentals, few new maintenance shutdowns have been announced so far, and May HRC production is expected to rebound MoM. However, considering that some steel mills are still actively delivering earlier semi-finished product and HRC export orders, the supply rebound pressure is expected to be manageable. Demand side, the average apparent demand for HRC tracked by SMM in April was 3.3961 million mt, up 7.52% MoM and down 2.19% YoY. Since the start of April, HRC demand climbed rapidly, mainly driven by a simultaneous rebound in export orders and domestic downstream demand in China. For May, historically apparent demand for the five major steel products tends to peak and pull back around Labour Day holiday. Combined with weakening domestic trade demand in some downstream industries, further upside room for May HRC demand is expected to be limited, with overall demand likely edging down slightly MoM from April, and apparent demand levels falling below the same period last year. In the short term, downstream restocking demand expectations remain after the Labour Day holiday, coupled with expectations of a third round of coke price increases, and HRC prices are expected to fluctuate at highs for 1–2 weeks after the holiday. From mid-to-late May, steel demand faces challenges as the traditional peak season winds down, and the steel supply-demand imbalance may widen MoM, limiting further upside room for steel prices. Other aspects, attention should be paid to export order support and the extent of domestic demand pullback.

This week, ferrous metals moved sideways and upward. During the week, as US-Iran negotiations made no progress and the Strait of Hormuz remained closed, combined with declining US crude oil inventories, Brent crude oil surged sharply, driving coking coal higher. Although BHP port spot cargoes were available for purchase, which was bearish for market sentiment, futures had already priced in related expectations earlier, so iron ore pullback was limited and cost support was relatively neutral. The Politburo meeting held mid-week had low direct correlation with ferrous metals, and ferrous metals fluctuated at highs during the week. Spot market side, end-users restocked at low prices before the holiday, and as futures rose in the latter half of the week, speculative demand was also released...

The most-traded BC copper contract 2606 opened at 89,560 yuan/mt today. It maintained wild swings in early trading, then the copper price center gradually shifted upward to 89,990 yuan/mt after the daytime session opened, before fluctuating downward to a low of 89,150 yuan/mt, and finally closed at 89,460 yuan/mt, down 0.26%. Open interest stood at 9,089 lots, an increase of 166 lots from the previous trading day, with trading volume at 5,934 lots, indicating bears adding positions. The US Fed kept the current interest rate unchanged, with notable internal policy stance divergence. Powell will remain as a governor after stepping down as Fed Chairman, and Warsh's nomination has passed the Senate committee review. Trump stated that conditions were currently suitable for an interest rate cut, while making clear that sanctions on Iran would not be lifted until the Iranian nuclear issue is resolved. The US and Iran are currently maintaining phone communications. Iran released a tough signal, warning that if the US continued to seize vessels, it might take unprecedented military countermeasures, with related retaliation plans still advancing. Combined with rising international crude oil prices, the overall atmosphere exerted some pressure on copper prices. Fundamentals side, on the supply end, arrivals of imported copper pulled back, while domestic source arrivals remained stable. However, approaching the month-end settlement period, suppliers showed weak willingness to sell, and spot circulation remained tight. Demand side, end-user pre-holiday stockpiling was largely completed, overall procurement sentiment was sluggish, and spot trades were mediocre. Inventory side, as of Thursday April 30, SMM copper cathode social inventory in major regions nationwide decreased by 5,600 mt WoW to 243,000 mt; current total inventory was 113,400 mt higher compared to the same period last year at 129,600 mt. SHFE copper 2606 contract closed at 101,030 yuan/mt. Based on BC copper 2606 contract at 89,460 yuan/mt, its after-tax price was 101,089 yuan/mt, and the price spread between SHFE copper 2606 and BC copper was -59, with the spread returning to an inverted state.

Jiangxi Copper Corporation announced that, to further optimize its industrial layout, broaden financing channels, enhance the core competitiveness of its controlled subsidiary JCC Copper Foil, and continuously strengthen the copper foil business, the company is expected to spin off JCC Copper Foil for listing on the Hong Kong Stock Exchange. This spin-off will not result in the company losing control over JCC Copper Foil, which will remain a controlled subsidiary within the company's consolidated financial statements, and will not have a material impact on the business operations and development of the company's other segments.

[Price Review] This week, Middle East geopolitical concerns resurfaced, with the US-Iran standoff continuing to escalate: on April 28, Iran demanded transit fees from vessels passing through the Strait of Hormuz; on April 29, the US explicitly prohibited its individuals and entities from paying such fees to Iran, while warning non-US entities that payment would face significant sanctions risks; on April 30, Trump reiterated that Iran's abandonment of nuclear weapons was the bottom line for negotiations, stating that communication with Iran was underway via phone. Middle East tensions and energy price fluctuations further amplified uncertainties over the global economic outlook, and precious metals remained under pressure. On the US Fed front, the April FOMC meeting maintained interest rates unchanged as expected, with internal policy divergence persisting—one member advocated for an interest rate cut while three members opposed releasing easing signals. Powell broke decades of industry convention by announcing that after stepping down as Fed Chairman, he would remain as a governor until early 2028; he explicitly stated that the Trump administration's legal actions were threatening the independence of the US Fed's monetary policy-making while undermining the institution's own stability. Whether the conflict risks further escalation will continue to dominate global market risk appetite and energy price fluctuations, exerting significant impact on silver price trends. Industrial demand side, sluggish downstream consumption persisted, and as spot silver prices declined, only some downstream enterprises opted to stockpile small quantities on dips. Gold/silver ratio side, as of April 29, the LBMA gold/silver ratio rose to 62. [Key Data] Bearish: Middle East geopolitical conflict continued to escalate, with the US-Iran standoff over Strait of Hormuz transit fees intensifying. Core negotiation demands were completely opposed, and the deadlock over waterway blockade and military confrontation remained unresolved, pushing up sticky inflation expectations and reinforcing the US Fed's stance of maintaining higher interest rates for longer. The US Fed's April FOMC meeting maintained interest rates unchanged as expected, with internal policy divergence hitting a 34-year high. The overall stance was neutral-to-hawkish, with no clear interest rate cut signal released. Market expectations for rate cuts within the year cooled significantly, and the US dollar and US Treasury yields fluctuated at highs, continuously suppressing silver valuations. Inflation stickiness in the US and Europe exceeded expectations. US March CPI rose to the highest YoY and MoM since 2024, and the eurozone March core CPI final reading was unexpectedly revised upward. Persistent inflation further weakened the necessity for central bank easing. US labor market resilience exceeded expectations. Initial jobless claims for the week ending April 11 posted the largest single-week decline since February, significantly below market expectations, completely eliminating market bets on an emergency US Fed interest rate cut. China's silver industrial demand remained weak, with downstream PV and electronics enterprises maintaining only just-in-time procurement. Social inventory of spot silver ingots continued to accumulate, and transaction discounts kept widening. Bullish factors: US March PPI data significantly missed market expectations, with YoY, MoM, and core PPI gains all well below forecasts, releasing signals of marginal inflation easing and preserving room for subsequent Fed interest rate cuts. Dovish divergence within the Fed persisted, with one committee member advocating an immediate rate cut at the April meeting; some officials still believed multiple rate cuts remained possible this year, keeping the rate cut window open and preventing a complete reversal of easing expectations. Concerns over slowing US economic growth emerged, with market expectations for US Q1 GDP growth pulling back sharply from the previous reading; stagflation and recession fears reinforced safe-haven demand for silver. Key data and macro events to watch next week include: May 1: Eurozone April CPI preliminary reading, US April ISM Manufacturing PMI. May 6: US March JOLTs job openings, April ISM Non-Manufacturing PMI. May 7: Bank of England interest rate decision, ECB April monetary policy meeting minutes. May 8: US April non-farm payrolls report. [Price Forecast] Recent precious metals market trading logic continues to revolve around re-escalating Middle East geopolitical concerns, inflation expectations driven by high oil prices, US Fed monetary policy expectations, and Fed Chairman transition and internal divergence. On the China fundamentals side, downstream consumption remained sluggish; as spot silver prices declined, only some downstream enterprises chose to stockpile small quantities on dips. The upward trend in spot silver ingot social inventory has yet to improve, and the market expects mainstream spot transaction discounts to remain within a narrow discount range relative to the SGE TD price. Silver prices are expected to remain under pressure with volatile trading next week.

[SMM News] US crude oil exports rose to a record high of over 6 million barrels per day in the latest week; net crude oil imports fell to negative territory, hitting a historic low.