China's stainless steel futures gave back ground sharply in the first trading week after the May Day holiday, as a sudden easing of Middle East tensions deflated the risk premium that had carried prices to recent highs. With the cost-side narrative unwinding and physical demand showing little follow-through, the market is searching for a new floor

Today, SMM's premiums against the SGE Ag(T+D) were quoted at a range of TD discount of 40-0 yuan/kg, with an average price of -20 yuan/kg. The TD-SHFE contract spot-futures price spread narrowed somewhat today. After downstream enterprises bought on dips yesterday, demand continued to pull back, and market consumption remained sluggish. Shipments of registered brand supplies were relatively limited, downstream enterprises' just-in-time procurement saw limited transactions, and bank floor bids were the mainstream choice. Quotation differences for circulating supplies varied significantly across different brands and regions. In the Shanghai market during the morning session, suppliers of national-standard silver ingots posted mainstream quotations against TD at a discount of 40-0 yuan/kg. The market was dominated by transactions at discounts, with most deals concluded around a TD discount of 20 yuan/kg. Major smelter silver ingots saw a small volume of transactions at parity, while some low-priced supplies in the Shenzhen area were offered at relatively low levels.

The low-priced delivered zinc ingots impacted the Ningbo market, with spot premiums declining throughout the week. This week, spot premiums in Ningbo decreased, down 35 yuan/mt WoW. As of Friday, spot prices against the 2505 contract in Ningbo were at a premium of 180 yuan/mt, with a premium of around 10 yuan/mt against the SHFE contract.

[SMM Lead Morning Meeting Summary: SHFE Lead Front-Month Contract Delivery Reduces Short-Term Market Circulating Supply] Primary lead production remains stable with slight increases, while the delivery of SHFE lead front-month contract reduces short-term market circulating supply. Spot is expected to maintain trading at a premium. For secondary lead, with stronger lead prices and improved smelter profits, the discount for secondary refined lead shipments may widen.

[SMM Analysis] From January 2 to February 11, 2025, the two-week closing price increases for LME and SHFE copper were approximately 6.316% and 5.28%, respectively. Compared to the two-week increases of around 6% and 5% for LME and SHFE copper, it is worth noting that the most-traded COMEX copper contract saw a significant increase of over 11% (15.26%), substantially outperforming the most-traded SHFE contract and the LME 3M copper contract. Since May 2024, the price spread between the most-traded COMEX contract and the LME 3M contract has widened again, reaching nearly $950/mt during intraday trading on February 11, 2025.

At the 2024 (19th) SMM Copper Industry Conference and Copper Industry Expo jointly organized by SMM and Shandong Humon Smelting Co., Ltd., SMM Big Data Director Ye Jianhua gave an outlook and forecast on the copper market price in 2024.

LME copper prices opened at $8035/mt and closed at $8091/mt in last Friday evening trading, a gain of 1.29%, with the low-end of $8028/mt and the high-end of $8122.5/mt.

At last Friday’ night session, the most-traded SHFE 2312 aluminum contract opened at 18925 yuan/mt, with its low and high at 18925 yuan/mt and 19145 yuan/mt before closing at 19140 yuan/mt, up 235 yuan/mt or 1.24%.