In June, global scrap tungsten markets diverged. India followed China's tungsten price rally, with active trading and higher prices in mid-June before cooling as China softened. Europe saw low-level consolidation due to high speculative inventories, but prices began to edge up in late June as stocks cleared. China's tungsten market experienced a sharp rebound followed by a pullback, and is expected to consolidate in the near term, while medium-to-long-term fundamentals remain solid.

[Producers Slightly Hold Prices Firm, Weak Demand Drags Magnesium Prices to Consolidate] Today, the quotation for 99.90% magnesium ingot in the main producing area was 15,700-15,800 yuan/mt, down 50 yuan/mt from the previous working day.

[Resumption recovery, operating rates of galvanising producers rise]: This week's operating rate of galvanising producers was 54.56%, up 3.03 percentage points WoW. Raw material side, zinc prices rebounded this week. Downstream players primarily stayed on the sidelines, mainly picking up previously priced zinc ingots, while zinc ingot inventories at galvanising enterprises edged up. The operating rate rebound was mainly because some galvanising plants were closed for the Dragon Boat Festival last week, causing a sharp decline in operations, while this week they all resumed normal production, pushing the rate back up.

SMM Cobalt Morning Meeting Minutes: This week, the cobalt industry chain overall stopped falling and stabilized. Spot refined cobalt prices rebounded slightly, boosted by policy news from the DRC, and market sentiment recovered somewhat, but actual transactions were still dominated by rigid demand stockpiling. Cobalt intermediate product prices remained stable, with miners’ quotations firm but limited acceptance from downstream smelters, resulting in a significant bid-ask spread. Market transactions for cobalt sulphate, cobalt chloride, and Co3O4 remained sluggish, with strong downstream wait-and-see sentiment and restocking demand not yet significantly released. Cobalt powder prices continued to decline, as off-season pressure on cemented carbide persisted. Ternary cathode precursor prices weakened, while ternary cathode materials rebounded slightly but with limited transactions. LCO demand remained relatively weak.

[SMM Cobalt Lithium Morning Meeting Minutes: This week, overall sentiment in the industry chain recovered, as a rebound in upstream raw material prices drove some material prices higher. Lithium carbonate, LFP, and separator segments performed strongly. Downstream production schedules stayed high, with demand from energy storage, commercial vehicles, and power batteries still providing support. However, acceptance of high prices was limited, and actual transactions were mostly based on essential needs. Cobalt salts, nickel salts, and ternary cathode precursors remained in the doldrums, with a strong wait-and-see sentiment prevailing in the market. Overall, short-term prices may continue to drift higher, but attention still needs to be paid to raw material arrivals, the sustainability of restocking, and the realization of end-use demand going forward.]

This week, the aluminum processing industry was broadly under pressure from three factors: a deepening off-season, continuously weakening aluminum prices that fueled widespread price-drop sentiment, and shrinking exports. Only a few subsectors such as energy storage provided marginal support. The operating rate is expected to continue its downward trend in the short term.

SMM, July 2: Raw Material Side: This week, the domestic petroleum coke market saw average shipment performance, with prices showing mixed performance during the week. Indicators continued to diverge, and the price center declined somewhat. Specifically, this week, transaction prices for petroleum coke at CNOOC’s Binzhou refinery were largely stable, Taizhou Petrochemical resumed operations mid-week, and the Zhoushan Petrochemical unit remained shut down for maintenance. Prices for low-sulphur petroleum coke from PetroChina’s affiliates in north-east China were generally stable with a slight rise, petroleum coke prices at Sinopec’s refineries were broadly stable, and shipments from local refineries performed poorly, with petroleum coke prices falling under pressure. The latest SMM data showed that the Shandong 2# petroleum coke spot price index was recorded at 4,067.69 yuan/mt, down 1.49% from last Thursday; the Shandong 3# petroleum coke spot price index was recorded at 3,675.48 yuan/mt, down 3.28% from last Thursday; and the Shandong 4# petroleum coke spot price index was recorded at 1,908.99 yuan/mt, down 7.57% from last Thursday. Affected by concentrated maintenance at some refineries, the operating rate of China’s coking units stayed low in early July, tightening domestic petroleum coke supply further. Demand showed structural divergence. High aluminum operating rates provided stable support for prebaked anode demand, and carbon enterprises’ monthly restocking led to improved transactions for medium-sulphur petroleum coke; anode material enterprises continued to focus on cost control and purchasing as needed, and upward momentum for low-sulphur petroleum coke prices was relatively insufficient. The petroleum coke market is expected to remain divergent in the short term. The coal tar pitch market held up well this week. As of this Thursday, the average price of coal tar pitch was 4,875 yuan/mt, up 1.46% from last Thursday. Coal tar prices stayed high and stagnant, the operating rate of deep-processing enterprises edged up slightly, and supply increased marginally; downstream anode enterprises mainly restocked as needed at the start of the month, with a stalemate between sellers and buyers continuing. Raw material cost support remained, but demand growth was limited, and the coal tar pitch price is expected to continue consolidating with a generally stable but slightly firm tone in the short term. Overall, cost support for prebaked anodes weakened slightly this week compared to the prior period. Supply side, prebaked anode enterprises continued their production pace of producing based on sales. New anode projects in regions like Xinjiang and Guangxi came on stream in succession, with new capacity being released continuously; meanwhile, some enterprises saw their operating rates pull back slightly due to maintenance, but overall, the industry’s supply capability improved steadily and supply flexibility increased further. Demand side, China’s operating aluminum capacity stayed high, forming steady and rigid support for prebaked anode consumption. On the export front, new aluminum projects in Indonesia continued to come on stream, driving a MoM improvement in domestic anode export orders to Southeast Asia; the geopolitical situation in the Middle East eased somewhat with no signs of further deterioration. If the regional situation remains stable, production at affected aluminum enterprises is expected to recover gradually, leading to a recovery in anode procurement demand. Overall, new domestic prebaked anode supply continued to be delivered, high operating aluminum rates effectively supported domestic demand, and the export market improved marginally. The industry’s supply and demand remained generally stable, but as new capacity continued to be released, market competition will stay high. Summary: This week, China’s prebaked anode raw material market trend diverged. Affected by the retreat of the petroleum coke price center, the overall cost of prebaked anodes continued to shift lower. According to SMM monitoring, as of July 2, China’s prebaked anode cost was approximately 5,460.36 yuan/mt, down 1.64% from last Thursday. On the price side, domestic prebaked anode prices edged up in July. A large aluminum smelter in Shandong raised its July prebaked anode tender price by 30 yuan/mt MoM, and a major domestic prebaked anode sales enterprise raised its quote by 13 yuan/mt MoM. Looking ahead, the petroleum coke market will continue to show structural divergence, coal tar pitch prices will hold up well, and overall support from the raw material side will remain relatively firm; regarding supply and demand, China’s high aluminum operating rates will support demand, and export orders improved marginally. However, as new capacity continues to be released, industry competition will stay high. Future focus should be on changes in the supply-demand pattern and price trends of prebaked anodes and upstream raw materials.

[SMM Magnesium Express]This week, social inventories increased by 1.83% month-on-month, showing a slight accumulation trend overall. Regional inventory disparities were pronounced: in Shaanxi, traders actively settled orders, leading to a minor inventory drawdown; in Shanxi's production area, new supplies flowed into warehouses. Meanwhile, export orders at Tianjin Port were sluggish, hindering external sales and resulting in inventory buildup in both regions, ultimately driving a modest rise in social inventories. Currently, downstream end-user procurement remains limited, and circulation supplies are digesting slowly, with inventory pressure likely to continue suppressing the rebound space for magnesium prices.

This week, ternary cathode precursor prices weakened. Nickel sulphate and cobalt sulphate prices edged lower this week, while manganese sulphate prices rose slightly. On the discount side, for July and Q3 orders, due to relatively tight sulphate raw materials, some producers showed willingness to raise discounts. For long-term contracts, some producers' annual contracts were already settled at the beginning of the year, with coefficients not yet raised; for quarterly contracts, downstream players also showed weak acceptance of coefficient increases. For spot orders, nickel and cobalt coefficients for some consumer-type spot orders in June rose, but with nickel and cobalt salt prices relatively weak recently, coefficients for July orders have not been raised further. Production side, export orders for top-tier producers remained strong this month, with production schedules at relatively high levels. However, some producers experienced a buildup of finished product inventories due to downstream mid-year inventory control, leading to reduced production loads. Looking ahead, sulphate prices have pulled back overall recently, and future new order prices will depend on the pace of downstream stockpiling in Q3.

This week, prices of ternary cathode precursors weakened, while nickel sulphate and cobalt sulphate prices also edged down, and manganese sulphate prices edged up slightly.