[SMM Analysis: From Aurubis to Nexans and Wieland, Why Are European and American Copper Companies Collectively Ramping Up Recycled Raw Materials?] In recent years, the copper industry in Europe and the United States has significantly accelerated its push into recycled raw materials, and participants are no longer limited to traditional secondary copper smelters. From integrated smelters such as Aurubis, Boliden, and Glencore to wire-and-cable and copper-processing enterprises such as Nexans and Wieland, different segments of the industry are simultaneously strengthening their capabilities in copper scrap recycling, pretreatment, smelting, and internal recycling. This means the logic behind the development of the secondary copper industry in Europe and the United States is shifting: recycled raw materials are no longer merely a supplement to primary copper supply, but are gradually becoming an important strategic resource for companies to ensure raw material security, stabilize profit sources, and reduce the carbon footprint of their products.

National Bureau of Statistics (NBS) reported: From January to July, under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, all regions and departments thoroughly implemented the decisions and arrangements of the CPC Central Committee and the State Council, adhered to the general principle of pursuing progress while ensuring stability, effectively responded to various external shocks and internal difficulties, focused on implementing more proactive and effective macro policies, and solidly advanced high-quality development. Production and supply grew steadily, employment and prices remained generally stable, resilience in foreign trade continued to stand out, new growth drivers expanded and strengthened, and overall economic performance remained stable, sustaining a development trend featuring renewed momentum and an improved structure. From January to July, the value added of industrial enterprises above the designated size nationwide increased by 5.3% YoY. By the three major sectors, value added in mining increased by 2.5% YoY, manufacturing by 5.6%, and the production and supply of electricity, heat, gas and water by 5.4%. Value added in equipment manufacturing increased by 9.7% YoY, and value added in high-tech manufacturing increased by 13.8%, respectively 4.4 and 8.5 percentage points faster than the overall value added of industrial enterprises above the designated size. In July 2026, the value added of industrial enterprises above the designated size increased by 4.5% In July, the value added of industrial enterprises above the designated size increased by 4.5% YoY in real terms (all value-added growth rates are real growth rates after deducting price factors). On a MoM basis, in July, the value added of industrial enterprises above the designated size increased by 0.11% from the previous month. From January to July, the value added of industrial enterprises above the designated size increased by 5.3% YoY. By the three major sectors, in July, value added in mining decreased by 4.2% YoY, manufacturing increased by 5.5%, and the production and supply of electricity, heat, gas and water increased by 5.0%. By ownership type, in July, value added of state-controlled enterprises increased by 1.6% YoY; joint-stock enterprises increased by 5.0%, and foreign-funded enterprises as well as enterprises with investment from Hong Kong, Macao and Taiwan increased by 2.8%; private enterprises increased by 3.7%. By industry, in July, among the 41 major industry categories, 25 industries maintained YoY growth in value added. Specifically, coal mining and washing declined by 10.8%, oil and natural gas extraction increased by 6.1%, processing of agricultural and sideline food products increased by 3.8%, manufacturing of liquor, beverages and refined tea increased by 2.6%, textiles increased by 2.3%, manufacturing of chemical raw materials and chemical products declined by 1.2%, manufacturing of non-metallic mineral products declined by 3.3%, smelting and pressing of ferrous metals increased by 0.3%, smelting and pressing of non-ferrous metals declined by 2.5%, manufacturing of general-purpose equipment increased by 9.5%, manufacturing of special-purpose equipment increased by 12.6%, automobile manufacturing increased by 8.7%, manufacturing of railway, ship, aerospace and other transport equipment increased by 13.6%, manufacturing of electrical machinery and equipment increased by 8.8%, manufacturing of computers, communications and other electronic equipment increased by 19.1%, and the production and supply of electricity and heat increased by 5.3%. By product, in July, output increased YoY for 279 of the 626 products produced by industrial enterprises above designated size. Specifically, steel products totaled 116.46 million mt, down 4.1%; cement 126.71 million mt, down 11.6%; ten nonferrous metals 6.97 million mt, up 2.5%; ethylene 3.48 million mt, up 0.1%; automobiles 2.529 million units, down 0.1%, including NEVs at 1.55 million units, up 29.9%; power generation 943.9 billion kWh, down 0.1%; and crude oil processing volume 53.11 million mt, down 15.8%. In July, the sales-to-production ratio of industrial enterprises above designated size was 96.9%, down 0.6 percentage points YoY; the export delivery value realized by industrial enterprises above designated size was 1,413.3 billion yuan, up 10.4% YoY in nominal terms. From January to July, the national economy remained generally stable and maintained a development momentum toward new and better growth. From January to July, under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at its core, all regions and departments earnestly implemented the decisions and arrangements of the CPC Central Committee and the State Council, adhered to the general principle of pursuing progress while maintaining stability, effectively responded to various external shocks and internal difficulties, focused on implementing more proactive and effective macro policies, and solidly advanced high-quality development. Production and supply grew steadily, employment and prices were generally stable, foreign trade resilience continued to stand out, new growth drivers expanded and strengthened, and overall economic performance remained generally stable, sustaining a development momentum toward new drivers and a better structure. I. Industrial production grew rapidly, with strong growth in the equipment manufacturing sector and high-tech manufacturing sector From January to July, the value added of industrial enterprises above designated size nationwide increased by 5.3% YoY. By three major sectors, value added increased by 2.5% YoY in mining, 5.6% in manufacturing, and 5.4% in the production and supply of electricity, heat, gas, and water. Value added increased by 9.7% YoY in the equipment manufacturing sector and by 13.8% in the high-tech manufacturing sector, exceeding the overall growth of industrial enterprises above designated size by 4.4 and 8.5 percentage points, respectively. By ownership type, value added increased by 3.9% YoY for state-controlled enterprises; 5.8% for joint-stock enterprises; 3.1% for enterprises with investment from foreign countries and from Hong Kong, Macao and Taiwan; and 4.5% for private enterprises. By product, the production of 3D printing equipment, lithium-ion batteries, and industrial robots increased YoY by 52.3%, 40.2%, and 28.5%, respectively. In July, the value added of industrial enterprises above designated size nationwide increased by 4.5% YoY and by 0.11% MoM. In July, the manufacturing PMI was 49.2%, and the expectations index for enterprise production and business activities was 54.1%. From January to June, industrial enterprises above the designated size nationwide recorded total profits of 3,948 billion yuan, up 18.7% YoY. II. The Service Sector Maintained Steady Growth, With Modern Services Showing Positive Momentum From January to July, the national service sector production index rose 4.7% YoY. By industry, the production indices for information transmission, software and information technology services; leasing and business services; financial services; and transportation, warehousing and postal services increased 10.6%, 9.5%, 6.3%, and 5.1% YoY, respectively. In July, the national service sector production index rose 4.3% YoY. In July, the business activity index for the service sector was 49.3%, and the business activity expectations index for the service sector was 56.0%. Among them, the business activity indices for industries such as postal services, telecommunications, radio and television and satellite transmission services, and culture, sports and entertainment were in the relatively high prosperity range of 55.0% or above. From January to June, operating revenue of service enterprises above the designated size rose 5.9% YoY. III. Market Sales Expanded, With Faster Growth in Service Retail Sales From January to July, total retail sales of consumer goods and services rose 2.6% YoY, of which service retail sales increased 5.0% and goods retail sales increased 1.1%. Within service retail sales, retail sales in categories such as communications and information services, tourism consulting and leasing services, and cultural, sports and leisure services grew relatively quickly. From January to July, total retail sales of consumer goods reached 28,774.4 billion yuan, up 1.2% YoY. By location of business unit, urban retail sales of consumer goods were 24,928.5 billion yuan, up 1.1% YoY; rural retail sales of consumer goods were 3,845.9 billion yuan, up 2.4%. By type of consumption, goods retail sales were 25,492.2 billion yuan, up 1.1% YoY; catering revenue was 3,282.2 billion yuan, up 2.6%. Sales of basic necessities and some upgraded goods grew relatively quickly, with retail sales of grain, oil and food; communications equipment; and cosmetics by units above the designated size rising 7.2%, 15.1%, and 6.3% YoY, respectively. In July, total retail sales of consumer goods were 3,902.2 billion yuan, up 0.6% YoY and up 0.06% MoM. From January to July, nationwide online retail sales of goods and services were 11,721.4 billion yuan, up 4.8% YoY. Of this total, online goods retail sales were 7,396.5 billion yuan, up 4.6%; online services retail sales were 4,324.9 billion yuan, up 5.2%. IV. Fixed-Asset Investment Declined, While Investment in Intellectual Property Products Grew Rapidly From January to July, nationwide fixed-asset investment (excluding rural households) was 26,032.8 billion yuan, down 6.7% YoY; fixed-asset investment excluding real estate development fell 3.7%. Among them, investment in intellectual property products rose 9.1% YoY. By sector, infrastructure investment fell 3.6% YoY, manufacturing investment fell 1.7%, and real estate development investment fell 19.2%. Nationwide, the floor space of commercial buildings sold (newly built) totaled 450.21 million m², down 11.8% YoY; sales of newly built commercial buildings totaled 4,271.8 billion yuan, down 13.1%. By industry, primary industry investment fell 0.5% YoY, secondary industry investment fell 2.1%, and tertiary industry investment fell 9.5%. Private investment fell 9.4% YoY; excluding real estate development, private investment fell 5.7%. Investment in high-technology industries rose 5.0% YoY, with investment in information services, aircraft and spacecraft and equipment manufacturing, and electronic and communications equipment manufacturing rising 19.2%, 12.3%, and 7.1%, respectively. In July, fixed asset investment (excluding rural households) fell 1.42% MoM. V. Goods Imports and Exports Grew Rapidly, and the Trade Structure Continued to Improve From January to July, total goods imports and exports reached 30,126.4 billion yuan, up 17.3% YoY. Of this total, exports were 17,440 billion yuan, up 14.0%; imports were 12,686.4 billion yuan, up 22.0%. From January to July, imports and exports under Ordinary Trade rose 10.2% YoY. Imports and exports with Belt and Road partner countries rose 15.5%. Imports and exports by private enterprises rose 17.2%, accounting for 56.9% of the total. Exports of mechanical and electrical products rose 21.2%, accounting for 63.8% of total exports. In July, total goods imports and exports reached 4,658 billion yuan, up 19.2% YoY. Of this total, exports were 2,712.5 billion yuan, up 17.8%; imports were 1,945.4 billion yuan, up 21.2%. VI. The Employment Situation Remained Generally Stable, and the Urban Surveyed Unemployment Rate Rose Seasonally From January to July, the national average urban surveyed unemployment rate was 5.2%, unchanged from January to June and the same period last year. In July, the national urban surveyed unemployment rate was 5.2%, up 0.2 percentage points from the previous month. The surveyed unemployment rate for the local registered labor force was 5.2%; that for the migrant registered labor force was 5.2%, including 4.9% for the migrant agricultural registered labor force. The urban surveyed unemployment rate in 31 major cities was 5.2%, up 0.2 percentage points from the previous month. The national average weekly working hours for enterprise employees were 48.2 hours. VII. Market Prices Rose Mildly, and the Increase Moderated Somewhat in July From January to July, the national consumer price index (CPI) rose 0.9% YoY. By category, prices of food, tobacco and alcohol, and dining out fell 0.2% YoY; clothing prices rose 1.6%; housing prices fell 0.2%; prices of household goods and services rose 1.7%; transport and communications prices rose 1.6%; education, culture and entertainment prices rose 1.2%; healthcare prices rose 2.1%; and prices of other goods and services rose 10.8%. Among food, tobacco and alcohol, and dining-out prices, pork prices fell 13.4%, grain prices fell 0.3%, fresh fruit prices rose 1.1%, and fresh vegetable prices rose 3.5%. In July, the national CPI rose 0.5% YoY and fell 0.1% MoM. From January to July, the core CPI excluding food and energy prices rose 1.1% YoY. Of this, the core CPI rose 0.9% YoY in July. From January to July, national industrial producer EXW prices rose 1.8% YoY. Of this, they rose 3.5% YoY and fell 0.7% MoM in July. From January to July, national industrial producer purchase prices rose 2.8% YoY. Of this, they rose 5.5% YoY and fell 1.0% MoM in July. Overall, from January to July, the national economy operated generally steadily, maintaining a development momentum toward new, better, and improved. However, it should also be noted that the external environment is complex and volatile; in China, the contradiction of strong supply and weak demand is prominent; some enterprises face operational difficulties; and the foundation for the economy’s steady improvement still needs to be consolidated. In the next stage, we should adhere to Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era as the guidance, uphold the general principle of pursuing progress while ensuring stability, fully, accurately, and comprehensively implement the new development philosophy, accelerate the building of a new development paradigm, remain committed to deepening reform and opening up, accelerate efforts to replace old growth drivers with new ones, step up counter-cyclical adjustments, intensify efforts to expand domestic demand and optimize supply, effectively safeguard and improve people’s wellbeing, strengthen development momentum and invigorate social vitality, and promote sustained economic development toward new, better, and improved.

SMM News on August 15: Metals market: Overnight last Friday, base metals in the domestic market mostly rose. SHFE copper rose 0.49%; on a weekly basis, SHFE copper fell 0.31% for the week. SHFE aluminum was flat at 23,945 yuan/mt. SHFE lead fell 0.22%, SHFE zinc rose 0.41%, and SHFE tin rose 0.36%. SHFE nickel edged up 0.07%. In addition, the most-traded alumina futures contract fell 0.19%, while the most-traded cast aluminum contract rose 0.24%. Overnight last Friday, ferrous metals showed mixed performance. Stainless steel fell 0.49%, iron ore fell 0.35%, and rebar fell 0.03%. Hot-rolled coil rose 0.34%. Coking coal and coke: the most-traded coking coal contract rose 1.7%, and the most-traded coke contract rose 1.97%. Overnight last Friday, overseas metals: LME base metals all rose. LME copper rose 0.26%; on a weekly basis, LME copper extended gains for seven consecutive weeks, up 1.07% for the week. LME aluminum rose 0.22%. LME lead rose 0.26%. LME zinc rose 0.45%. LME tin rose 0.36%. LME nickel rose 0.3%. Overnight last Friday, precious metals : COMEX gold rose 0.26%; COMEX gold posted a fourth consecutive weekly gain, up 0.73% for the week. COMEX silver fell 0.26%; COMEX silver logged a second consecutive weekly gain, up 2.09% for the week. Overnight last Friday, the most-traded SHFE gold contract rose 0.6%; SHFE gold posted a fourth consecutive weekly gain, up 1.68% for the week. The most-traded SHFE silver contract rose 0.57%; SHFE silver extended gains for four consecutive weeks, up 3.45% for the week. As of 7:17 on August 15, overnight last Friday’s closing prices: Macro front China: [Central bank: Aggregate social financing rose by 2.225 trillion yuan in the first seven months; M2 in July was up 7.7% YoY] According to preliminary statistics from the central bank, in the first seven months of 2026, the cumulative increase in aggregate social financing totaled 2.225 trillion yuan, down 174 billion yuan from the same period last year. Among them, RMB loans to the real economy increased by 1.017 trillion yuan, an increase of 214 billion yuan less YoY; foreign-currency loans to the real economy (converted into RMB) increased by 169.4 billion yuan, an increase of 241.9 billion yuan more YoY; entrusted loans decreased by 81 billion yuan, a decrease of 12.1 billion yuan more YoY; trust loans decreased by 67.2 billion yuan, a decrease of 226.4 billion yuan more YoY; undiscounted bank acceptance bills decreased by 178.6 billion yuan, a decrease of 41 billion yuan less YoY; net financing of enterprise bonds was 252 billion yuan, 110 billion yuan more YoY; net financing of government bonds was 776 billion yuan, 115 billion yuan less YoY; and domestic equity financing by non-financial enterprises was 406.1 billion yuan, 184.7 billion yuan more YoY. In the first seven months, RMB loans increased by 10.38 trillion yuan. By sector, loans to households decreased by 827.1 billion yuan, of which short-term loans decreased by 928.1 billion yuan and medium- and long-term loans increased by 101 billion yuan; loans to enterprises and public institutions increased by 11 trillion yuan, of which short-term loans increased by 4.34 trillion yuan, medium- and long-term loans increased by 5.32 trillion yuan, and bill financing increased by 1.19 trillion yuan; loans to non-bank financial institutions decreased by 394.4 billion yuan. At the end of July, the outstanding balance of broad money (M2) was 355.51 trillion yuan, up 7.7% YoY. The outstanding balance of narrow money (M1) was 115.46 trillion yuan, up 4% YoY. The outstanding balance of currency in circulation (M0) was 14.82 trillion yuan, up 11.6% YoY. In the first seven months, net cash injection totaled 725.5 billion yuan. [Shanghai: Promoting Leading Industries Such as Integrated Circuits, Civil Aviation, Smart Vehicles, and High-End Equipment to Accumulate Strength and Gain Momentum] Today (August 14), Shanghai Municipal Party Secretary Chen Jining spent an entire day conducting a survey and presiding over a symposium in the Lingang Special Area of the China (Shanghai) Pilot Free Trade Zone. Chen Jining pointed out that the Lingang Special Area should always place advanced manufacturing in a prominent position and unswervingly enhance its capacity and core competitiveness. It should seize the opportunities of digitalization, intelligence, and green development, place greater emphasis on cultivating industrial ecosystems while ensuring project implementation, focus on cultivating industry leaders and high-growth enterprises, and focus on developing industrial platforms and improving service capabilities, thereby enhancing the resilience and stickiness of industrial development and promoting leading industries such as integrated circuits, civil aviation, smart vehicles, and high-end equipment to accumulate strength and gain momentum. It should leverage the advantage of abundant manufacturing scenarios, promote the digital and intelligent transformation of industry, increase the application of industrial robots, vertical models, and intelligent agents in key links such as production and manufacturing, and equipment operation and maintenance, and drive the systematic transformation of the entire process covering industrial design, pilot-scale validation, inspection and testing, and marketing and operations. It should optimize the business environment, provide better services for enterprises, and accelerate the cultivation of world-class enterprises. It should deepen the reform of the management system of development zones, and refine and improve reform plans around key links such as functional positioning, spatial integration, professional services, and assessment and evaluation. (Shanghai Release) On the US dollar: Last Friday, the US dollar index fell 0.32% overnight, closing at 99.64. On a weekly basis: the US dollar index rose on the week, up 0.04% for the week. US July retail sales released on Friday decreased 0.6% MoM, marking the largest decline in more than a year. Coupled with mild inflation data this week, market pricing for a US Fed rate hike in September collapsed further. The US dollar index fell. Under the triple blow of mild CPI on Wednesday, zero MoM growth in PPI on Thursday, and unexpectedly weak retail sales on Friday, the probability of a September rate hike plunged from 75% at the end of July to around 25%; CME FedWatch showed that 67% of traders were betting on rates being held steady in September. The focus of market pricing has shifted from "how many more rate hikes are needed" to "whether this round of rate hikes has ended".(Wallstreetcn) The US Department of Commerce announced on Friday that retail sales in July fell 0.6% MoM, the largest decline in more than a year, while market expectations were for slight growth. Core control group sales excluding automobiles, building materials, and gas stations fell 0.4%, the worst performance since January 2025. The University of Michigan's preliminary August Consumer Sentiment Index released on the same day was only 51, well below the expected 54.5.(Wallstreetcn) US consumer confidence fell for the first time in three months as households worried about deteriorating business conditions and rising inflation. According to survey data released by the University of Michigan on Friday, the preliminary August consumer sentiment index fell to 51, below the final July reading of 55.2. The median expectation among economists was 55. Consumers expect prices to rise 4.3% over the next year, edging up MoM and markedly above the level before the Iran conflict broke out in February. They also expect prices to rise at an annual rate of 3.3% over the next 5 to 10 years. After two consecutive months of improvement, consumer confidence in both the short- and long-term economic outlook deteriorated. Since the beginning of the year, changes in consumers' expectations for the labour market have been relatively small. The survey showed that consumers were increasingly worried about inflation, while concerns about unemployment declined. This survey covered responses collected from July 28 to August 10. During this period, the US national average gasoline price hovered above $4 per gallon. Another report released on Friday showed that US retail sales in July recorded their largest decline in over a year, as consumers cut back on automobile and online store purchases.(Jin10 Data App) US Fed's Goolsbee said he supported the decision to keep interest rates unchanged in July. He pointed out that the two most recent productivity data readings were disappointing, and if productivity continues to decline, the US Fed may need to reassess market expectations for artificial intelligence (AI). Goolsbee said the latest CPI data were encouraging, but more data are needed to make a judgment; continued consumption weakness is concerning, though the weakness in retail sales is currently only a single-month performance. At the same time, US GDP and the labour market were basically stable overall.(from Wallstreetcn App) According to CME "US Fed Watch": the probabilities for the US Fed in September are no change in interest rates (67.5%) and a cumulative 25-basis-point rate hike (32.5%). The probabilities for the US Fed in October are no change in interest rates (53.3%), a cumulative 25-basis-point rate hike (39.8%), and a cumulative 50-basis-point rate hike (6.8%).(Jin10 Data App) On the macro front: This week will see the release of China July total retail sales of consumer goods YoY, China July value added of industrial enterprises above designated size YoY, Canada July CPI MoM, US August New York Fed Manufacturing Index, US August NAHB Housing Market Index, UK ILO unemployment rate for the three months to June, UK July unemployment rate, UK July unemployment benefit claimant count, Germany August ZEW Economic Sentiment Index, Eurozone August ZEW Economic Sentiment Index, US weekly ADP employment change for the week ending August 1, US July total annualized housing starts, US July total building permits, US July import price index MoM, US July industrial output MoM, US July pending home sales index MoM, UK July CPI MoM, UK July retail price index MoM, Eurozone June seasonally adjusted current account, Eurozone July final CPI YoY, Eurozone July final CPI MoM, China July SWIFT RMB share in global payments, China 1-year loan prime rate for August 20, Australia July seasonally adjusted unemployment rate, Germany July PPI MoM, Switzerland July trade balance, UK August CBI industrial orders balance, US initial jobless claims for the week ending August 15, US August Philadelphia Fed Manufacturing Index, US July Conference Board Leading Indicators MoM, UK August GfK Consumer Confidence Index, Japan July core CPI YoY, UK July public sector net borrowing, UK July seasonally adjusted retail sales MoM, France August flash manufacturing PMI, Germany August flash manufacturing PMI, Eurozone August flash manufacturing PMI, UK August flash manufacturing PMI, UK August flash services PMI, Canada June retail sales MoM, US August flash S&P Global Manufacturing PMI, global flash services PMI, Eurozone August flash consumer confidence index, and other data. In addition, this week also requires attention: the National Bureau of Statistics (NBS) will release the monthly report on residential selling prices in 70 large and medium-sized cities; the State Council Information Office will hold a press conference on the performance of the national economy; European Central Bank President Lagarde will attend the "Global Economic Outlook" discussion at the World Economic Forum International Business Council (IBC) meeting; the US Fed will release the minutes of its monetary policy meeting; and Hang Seng Indexes will announce the Hang Seng Index Series Review results for Q2 2026. On the crude oil front: Last Friday, futures for both crude oils rose in overnight trading, with WTI crude oil futures up 1.42% and Brent crude oil futures up 2.01%. On a weekly basis: WTI crude oil futures rose for the week, up 5.4%; Brent crude oil futures closed higher for the week, up 6.31%. International crude oil prices rose, driven by a near standstill in traffic through the Strait of Hormuz. Two vessels were attacked in the Strait of Hormuz that day, and traffic came to a near standstill. The US said it could maintain a maritime blockade against Iran indefinitely, and Trump also said that the US would impose severe economic measures on Iran. Capital Economics estimates that current crude oil flows through the Strait of Hormuz are only about 4 million to 5 million barrels per day, far below pre-conflict levels. Dated Brent maintained a spot premium structure, indicating continued tightness in physical supply. Capacity at three of the world’s four major refining centers has been impaired, and surging refined product prices are being passed directly to end consumers. (Wall Street CN) Traders said that, with the Strait of Hormuz still largely closed, Asian refiners were seeking alternative supplies for deliveries later this year, and at least four Asian refiners purchased US crude this week. Both the US and Iran claim control of the Strait of Hormuz, and vessel traffic through the strait fell below the monthly average in the latter half of this week. With no sign that shipping through the strait will resume normal flows in the short term, tightening fuel supply will push up refining margins, prompting refiners to lock in crude inventories needed for the coming months from markets outside the Gulf region. South Korea’s GS Caltex purchased 2 million barrels of Mars crude from Shell and plans to take delivery in November. Traders said the cargo was priced at a premium of about $13 to $14 per barrel over the October Dubai benchmark price. Japan’s third-largest refiner Cosmo Energy Holdings bought Mars crude from Trafigura; Japan’s largest refiner ENEOS purchased 2 million barrels of WTI crude from Trafigura at a premium of more than $10 per barrel over the October WTI price and plans to take delivery in November. (Jin10 Data App) US Energy Information Administration (EIA): US petroleum production is expected to average 13.83 million barrels per day in August, compared with 13.82 million barrels per day in July; production is expected to average 13.77 million barrels per day in September. (Jin10 Data App) It is worth noting that, due to contract rollover, the September NYMEX New York crude oil futures will complete final floor trading at 2:30 on August 21 and final electronic trading at 5:00 a.m. Please pay attention to exchange announcements regarding expiration and contract rollover to manage risk. In addition, some trading platforms usually set the expiration time of US crude oil contracts one day earlier than the official NYMEX schedule, so please pay extra attention. Recommended Reading:

CAAM data showed that in July, China’s auto sales totaled 2.584 million units, edging down YoY. Among them, NEVs performed strongly, with sales reaching 1.561 million units, up 23.7% YoY, and their sales share surpassing 60% for the first time. On the export side, China exported 1.043 million units of automobiles during the month, including 553,000 units of NEVs, up 1.5 times YoY.

Dongfeng Co., Ltd. announced on August 12 that its automobile sales stood at 7,509 units in July 2026, compared with 8,708 units in the same period of last year. From January to July 2026, the company's cumulative automobile sales reached 76,694 units, down 1.15% year‑on‑year. Among them, cumulative new‑energy vehicle sales hit 21,999 units, surging 97.69% year‑on‑year.

According to data released by CAAM on August 12, China's automobile output and sales reached 2.573 million units and 2.584 million units respectively in July, down 6.8% and 8% month‑on‑month, and down 0.7% and 0.3% year‑on‑year. From January to July, automobile output and sales stood at 17.567 million units and 17.602 million units respectively, both down 3.7% year‑on‑year, with declines further narrowed compared with the first half of the year. Among them, domestic automobile sales hit 1.541 million units in July, down 13.1% month‑on‑month and 23.6% year‑on‑year. Domestic automobile sales totalled 11.462 million units from January to July, down 21.4% year‑on‑year.

This week, industry chain prices diverged. Lithium ore edged down alongside lithium carbonate, but mines continued to hold prices firm, making profit distribution across the industry chain a market focus. Supported by maintenance and tight spot order supply, lithium carbonate prices consolidated on a subdued note, while lithium hydroxide prices initially fell before rebounding. The cobalt industry chain remained generally under pressure—with weakening overseas quotations and sluggish off-season demand, refined cobalt, intermediate products, and cobalt salt prices continued to weaken, and the price spread between buyers and sellers widened. Nickel sulphate edged down, with the market still primarily focused on destocking; ternary cathode precursor prices declined due to weaker nickel and cobalt salt prices, while ternary cathode material prices remained basically stable. LFP prices proved resilient, supported by rising processing fees, with August production schedules continuing to grow and high-quality capacity remaining tight. Artificial graphite prices rose, the supply-demand balance for separators stayed in tight balance, and electrolyte prices were pushed up by raw material cost transmission. Supply of key materials for sodium-ion batteries remained tight, while recycling-side transactions were subdued. On the terminal side, EV and ESS demand maintained resilience, though the consumer market recovery remained limited. Looking ahead, the focus will be on peak season stockpiling and demand realization.

After hitting the daily limit on August 5, Baowu Magnesium’s share price pulled back over the past two trading days. As of around 10:55 a.m. on August 7, the stock was up 2.74%, trading at 11.26 yuan per share. On the news front, Baowu Magnesium’s investor relations activity record dated August 4, 2026 shows: Question: What are Baowu Magnesium’s main businesses? Baowu Magnesium responded: The company’s businesses include magnesium materials, magnesium products, aluminum products, mineral products, and building formwork. Its main products include magnesium alloys, magnesium alloy deep-processed products, aluminum alloys, aluminum alloy deep-processed products, master alloys, and strontium metal. Question: Could you introduce the company’s ore resources? Baowu Magnesium responded: The company’s subsidiary Chaohu Baomei holds 90 million mt of dolomite ore reserves and is in active mining operation; subsidiary Wutai Baomei holds 580 million mt of dolomite ore reserves; and associate company Anhui Baomei holds 1.3 billion mt of dolomite ore reserves. The subsidiary Gansu Mining under Gansu Baomei holds 14.91 million mt of available quartzite ore reserves. Question: How was China’s magnesium product production in H1 2026? Baowu Magnesium responded: In H1 2026, China’s primary magnesium production was approximately 603,100 mt, up 26.49% YoY. China exported approximately 239,100 mt of various magnesium products, up 7.95% YoY. Question: How does the company promote magnesium metal? Baowu Magnesium responded: Relying on its full magnesium industry chain, the company focuses on lightweighting and high-end manufacturing, seizes the rapid growth opportunity of magnesium applications in lightweighting, and will focus on the following points: 1. Full-chain guarantee: With an integrated industry chain covering ore mining, magnesium smelting, alloys, and deep processing, we ensure a stable magnesium supply to support large-scale applications across sectors. 2. Technology leadership: Leveraging our technological strengths, we collaborate with universities, research institutes, and clients on R&D for new magnesium alloys, and break through key technologies such as large-scale integrated die casting and magnesium alloy corrosion resistance and flame retardancy. 3. Application expansion: Guided by high-end, green and intelligent development, we focus on automotive, robotics, aerospace and other fields, and provide integrated services covering materials, components, and solutions. Question: What is the pace of design wins and mass production of magnesium alloy die castings in the NEV sector? Baowu Magnesium responded: The company has concentrated superior technical resources to continue deepening its presence in mid-to-large magnesium casting businesses such as drive motors, instrument panel cross car beams, seat frames, and integrated auto body structural components. In the cross car beam area, we focused on breaking through with leading automakers, securing design wins for multiple hot-model cross car beams, and during this period launched the world’s first “semi-solid process CCB.” In drive motors, we are orderly advancing customer mass production deliveries, actively conducting aluminum-to-magnesium feasibility studies with industry-leading suppliers, and have achieved major breakthroughs in both rare earth alloy R&D and process optimization. Meanwhile, "magnesium alloy auto body integrated castings" became a hot topic in magnesium applications most concerned by NEV manufacturers in 2025. After successfully passing the whole-vehicle road test for a certain automaker's tailgate inner panel, one-stage sample trial production of magnesium components was subsequently completed, contributing substantial verification and testing data for industry technology iteration and further boosting NEV manufacturers' confidence in large magnesium part applications. Under this favorable situation, the company gradually established in-depth R&D cooperation with some leading automakers. In terms of performance: Baowu Magnesium's semi-annual performance forecast showed it expected a net loss of RMB14-20 million in H1. Regarding the reasons for the performance change, Baowu Magnesium stated: Due to a slight YoY increase in magnesium prices, the profitability of the company's magnesium materials segment was basically stable YoY. The main reasons for the YoY decline in the company's H1 performance include: due to aluminum price fluctuations and lower sales volume of aluminum products compared to the same period last year, the aluminum products business saw a decline in profitability; the newly built ferrosilicon project of subsidiary Gansu Baowu Magnesium was just commissioned in May, with consumption indicators not yet stable, leading to relatively high product costs; the company's associate company Anhui Baowu Magnesium was still in the capacity ramp-up stage, with crude magnesium and alloy production significantly higher YoY, and various production technical indicators gradually optimized, but the products remained loss-making, impacting the company's investment income YoY; and due to the appreciation of the renminbi against the US dollar and euro, the company's foreign exchange losses on export business increased YoY, etc. On July 14, Baowu Magnesium issued an announcement on daily related-party transactions. Due to daily production and operation needs, the company and its controlled subsidiaries plan to conduct daily related-party transactions in 2026 with related parties including the controlling shareholder Baosteel Metal and its affiliates, other Baowu second-level subsidiaries and their affiliates, and the associate company Yi'an Yunhai. The types of related-party transactions include purchasing products and goods from related parties, accepting operational services from related parties, selling products and goods to related parties, providing operational services to related parties, providing and financial services (including deposits and loans, factoring, discounting, foreign exchange settlement and sales, etc.). The total estimated amount of daily related-party transactions (excluding financial services) in 2026 is RMB1.28 billion; in addition, the estimated amount of financial related-party transactions with Baowu Group Finance Co., Ltd. has not been adjusted, and the relevant quotas are already included in the overall arrangement. These related-party transactions strictly follow market-based fair pricing principles, with fair and reasonable transaction terms, which are conducive to ensuring the company's sustained and stable operations, will not harm the lawful rights and interests of the publicly listed company and minority shareholders, nor affect the company's operational independence. When asked "Hello, board secretary, could you tell me whether your company can stably mass-produce semiconductor-grade ultra-high-purity magnesium metal ingots as found online, and is the only publicly listed company? Also, what is the proportion of your sales in this area to the company's total sales over the past few years?" Baowu Magnesium responded on the investor interaction platform on June 23: The company's business includes magnesium materials, magnesium products, aluminum products, mineral products, and building formwork. The company's main products include magnesium alloys, magnesium alloy deep-processed products, aluminum alloys, aluminum alloy deep-processed products, master alloys, and strontium metal. Please refer to the 2025 annual report for the proportion of revenue by product segment. Regarding the specific products and sales proportion you mentioned, the company has not publicly disclosed such information; please refer to the company's official periodic reports or announcements. In response to the questions: "1. Regarding the Anhui Qingyang project, what is the mine commissioning progress, and what is the current approximate ore output of the mine? 2. What are the advantages of the company's vertical retort magnesium smelting technology? How does it compare with peers in Fugu?" Baowu Magnesium replied on the investor interaction platform on June 17: The company adopts the vertical retort magnesium smelting process, which has outstanding technical advantages: increased per-retort capacity, shortened production cycle, improved production efficiency, extended service life of reduction retorts, and a higher level of mechanized and automated operations. The Anhui Qingyang mine project has achieved a capacity of 20 million mt per year. Regarding the main business engaged in during the reporting period, Baowu Magnesium introduced in its 2025 annual report: The company is the leader in magnesium-based new materials under China Baowu, possessing the advantages of the entire industry chain and mine resources, leading vertical retort magnesium smelting technology, and its magnesium alloy capacity and market share rank among the top globally. The company focuses on lightweight materials, with products covering automobiles, household consumer electronics, e-bikes, building formwork, and other fields. After more than 30 years of development, the company has become a high-tech enterprise integrating mining, non-ferrous metal smelting and processing, committed to becoming a global leader in the magnesium industry. The company's business includes magnesium materials, magnesium products, aluminum products, mineral products, and building formwork. Its main products include magnesium alloys, magnesium alloy deep-processed products, aluminum alloys, aluminum alloy deep-processed products, master alloys, and strontium metal. For the company's future development outlook, Baowu Magnesium stated in its 2025 annual report: 2026 marks the starting year of the company's 15th Five-Year Plan, and the industry will usher in an important period of opportunity for high-end and large-scale development. The company's board of directors will lead the management to, with "building a lightweight solution provider and becoming a mainstay of China Baowu's new materials" as the core positioning, focus on the main business, deepen and refine operations, promote the upgrading of the entire industry chain, technological innovation, market expansion, and green development, achieving sustained improvement in operating performance and significant enhancement of core competitiveness. 1. Strengthen strategic guidance, consolidate the foundation for magnesium industry new quality productive forces. Accelerate the construction of a development pattern for the entire industry chain covering primary magnesium—alloys—deep processing—end-use applications, focus on tackling key technologies in green smelting and stable production with cost reduction, and accelerate large-scale promotion of key products. 2. Coordinate key project construction, synergistically enhance overall operational efficiency. Accelerate the construction and comprehensive acceptance of the Huayuan Wu's Mine in the Qingyang project, orderly promote the construction of the main plant area and optimization of production indicators, and orderly advance key projects of Gansu Baowu Magnesium, Wutai Baowu Magnesium, and Chaohu Baowu Magnesium. 3. Deepen magnesium industry reform and innovation, promote the modernization of corporate governance systems. Steadily promote business development transformation and innovation, advance asset integration, and further optimize governance and control as well as business management models. 4. Accelerate the layout of smart development, comprehensively advance the construction of information systems. Complete full coverage of the Baowu standard financial system and the update and launch of the cost systems of subsidiaries, build a full-process informatization model project for magnesium business, and further enhance Baowu Magnesium's capabilities in operation management, cost-based management, compliance operation, and risk prevention and control. 5. Focus on reducing primary magnesium costs, continuously enhance market competitiveness. Reduce manufacturing costs of the three core components—reduction retorts, center tubes, and cones—optimize steel grades to extend the service life of reduction retorts, lower auxiliary energy consumption and the material-to-magnesium ratio. 6. Implement cost-based management, systematically build a high-quality development operating model. Deepen comprehensive benchmarking to identify gaps, systematically tackle the "four major costs" of primary magnesium, energy, logistics, and quality, and improve the operation management and control system. 7. Strengthen safety and environmental protection fortifications, systematically enhance green development levels. Continuously strengthen safety and environmental compliance rectification, highlight risk control and inherent safety improvement in key areas, and accelerate the construction of green factories and low-carbon capacity building. 8. Major risk factors and countermeasures the company faces (1) Risk of fluctuations in main raw material prices The company's main business involves magnesium, aluminum alloys and deep processing, with main raw materials being magnesium and aluminum metals. Magnesium and aluminum prices are affected by supply-demand dynamics, global and Chinese economic conditions, and are closely related to factors such as the progress of automotive lightweighting and demand from the 3C industry. If future magnesium and aluminum prices experience wild swings, it will have a certain impact on the company's cost control and profitability. The company is increasing the self-supply ratio of raw materials, adjusting product mix, and increasing the proportion of deep-processed products to mitigate the impact of raw material price fluctuations. (2) Risk of market demand fluctuations The company's magnesium and aluminum lightweight alloy products are mainly used in automobiles, consumer electronics, and other fields. At present, seizing the opportunity of automotive lightweighting development, while stabilizing the supply of magnesium and aluminum alloy base materials, the company is focusing on expanding downstream deep-processing businesses such as magnesium alloy automotive die-casting parts, magnesium alloy building formwork, and aluminum alloy extrusion products. Market demand in areas such as automotive lightweighting progress and 3C electronics consumption is influenced by multiple factors including macroeconomics, industrial policies, and process technology innovation. If downstream market demand falls short of expectations, it will affect the company's operating performance level. The company is expanding the application of its products in various fields, increasing the penetration rate of products in various application fields, to reduce the risk of market demand fluctuations. Looking back at the Chinese magnesium market in H1 2026, affected by the concentrated production stoppages at magnesium plants earlier, the pattern of strong supply and weak demand was quietly reversed. Tight spot supply and low inventory provided a good foundation for a phased rise in the magnesium ingot market fundamentals. Coupled with market disturbances such as the explosive demand for magnesium alloys, speculative demand surged, and market purchasing enthusiasm ran high. Magnesium prices showed a staircase-like increase in Q1. Overly high expectations boosted magnesium plants' production enthusiasm, and magnesium production climbed all the way. By June 2026, China's primary magnesium production exceeded 110,000 mt. The persistently rising production increased sales pressure on magnesium plants. As both inventory and production grew, magnesium prices trended downward in a staircase-like manner in Q2, and overall magnesium prices in H1 showed an inverted V-shaped trajectory. From the price performance of 99.90% magnesium ingot (Fugu, Shenmu) in H1 this year, it can be seen: the average price of 99.90% magnesium ingot (Fugu, Shenmu) on June 30, 2026 was 15,850 yuan/mt, compared to its average price of 17,950 yuan/mt on December 31, 2025, its average price fell by 2,100 yuan/mt in H1, a decline of 11.7%. Its daily average price in H1 was 16,607.33 yuan/mt, compared to its daily average price of 16,241.45 yuan/mt in H1 2025, its daily average price increased by 365.88 yuan/mt YoY, an increase of 2.25%. According to SMM quotes, the price of 99.90% magnesium ingot (Fugu, Shenmu) on August 7 was 15,850-15,950 yuan/mt, with an average price of 15,900 yuan/mt, up 0.32% from the previous trading day. Low-priced supply in the market tightened, and magnesium prices edged up slightly. On the supply side, affected by rising coal costs and sustained losses, producers had a strong willingness to hold prices firm, but some sources still offered small discounts, leading to a divergence in selling attitudes. On the demand side, downstream users and traders maintained a strong wait-and-see sentiment, with weak restocking willingness, making only small-scale just-in-time procurement, and market trading was sluggish. Cost support limited the downside room, but production cuts have not yet effectively promoted inventory destocking, and social inventory pressure remained. In the short term, magnesium prices lack upward momentum and face downside limitations, likely to continue moving sideways. Subsequent attention should be paid to the downstream recovery pace and restocking signals.

[SMM Analysis: Cost Support and Demand Constraints Coexist, ADC12 Consolidates at Highs Awaiting Peak Season Breakthrough] Entering August, ADC12 prices are expected to continue to consolidate at highs. Cost side, currently tight supply of aluminum scrap and high tax invoice compliance costs...

Futures: Overnight, LME lead opened at $1,893/mt, drifted higher in Asian trading to touch a high of $1,907.5/mt before weakening, and entering European trading, LME lead gave back most of its gains, dipping to a low of $1,883.5/mt, and finally closing at $1,890/mt, unchanged with a 0% change. Overnight, the most-traded SHFE lead 2609 contract opened at 15,735 yuan/mt, early in the session touched a session high of 15,745 yuan/mt before drifting lower, bulls reduced positions on SHFE lead, dipping to a low of 15,600 yuan/mt in late trading, and finally closing at 15,640 yuan/mt, down 0.73%. Macro Front: US July ADP employment came in at 44,000, below market expectations of a 70,000 increase and the downwardly revised 95,000 in June, marking the smallest gain since January this year. The US Treasury Department will maintain its buyback program at the same pace as the previous quarter and keep auction sizes unchanged at least for the coming few quarters. China's Ministry of Commerce: Countermeasures taken against US compliance testing companies. China's designated certification body for CCC certification suspended entrusting US certification organizations to conduct factory follow-up inspections. The "15th Five-Year Plan for Promoting the Development of Small and Medium-Sized Enterprises," jointly formulated by MIIT and multiple departments, is about to be released. The Ministry of Foreign Affairs responded to the US plan to ban Chinese optical modules: China firmly opposes the US generalization of the national security concept and will continue to firmly safeguard the legitimate rights and interests of Chinese enterprises. Spot Fundamentals: In Shanghai, Chihong lead was quoted at 15,730-15,830 yuan/mt, representing premiums of 50-100 yuan/mt against the most-traded SHFE lead 2609 contract. SHFE lead rose sharply, suppliers sold cargoes as the market moved, and premium quotes in Jiangsu, Zhejiang, Shanghai remained unchanged. However, quotes for EXW cargoes from primary lead smelters diverged; smelters held prices firm while selling, while traders widened discounts on sales, with mainstream producing regions quoting premiums of 0-50 yuan/mt against SMM #1 lead average price. In secondary lead, as lead prices rebounded, secondary lead smelters showed slightly improved willingness to sell, secondary refined lead quotes were at discounts of 25-0 yuan/mt against SMM #1 lead average price, with a few at a premium of 75 yuan/mt. Downstream enterprises exhibited strong wait-and-see sentiment, inquiries significantly decreased from yesterday, some suppliers indicated almost no inquiries, and spot market trading volume plummeted. Inventory: On August 5, LME lead inventory decreased by 3,325 mt to 431,550 mt; as of August 3, SMM lead ingot social inventory across five locations totaled 72,100 mt, up 3,700 mt from July 27 and 3,600 mt from July 30. Lead Price Forecast Today: Supply side, primary lead saw additional maintenance in August, with production expected to decline; while secondary lead production also has expectations of decline, attention should be paid to the boost from the rebound in lead prices on smelter production enthusiasm, with some enterprises having the probability of early production resumptions. In addition, currently lead ingot social inventory stays high, be cautious of the pullback risk for lead prices due to suppliers' lead ingot warehouse transfers before delivery. Domestic consumption is neutral overall, with conservative demand in the e-bike sector and relatively stable demand in July-August; in the automobile sector, demand is experiencing a tug-of-war: enterprises handling export orders are doing well, while those serving the Chinese market are underperforming. Overall, the exit of bears has led to a short-term lead price rebound and catch-up rally, but the performance of the consumption side determines the room for the lead price rebound.