SMM Feb. 12: SHFE aluminum 2602 fluctuated upward in the morning session, with the price center rising from the previous trading day. Affected by the approaching Chinese New Year, overall market trading sentiment was weak, with mainstream transaction prices concentrated at the average price to a premium of 10 yuan/mt. Today, the shipment sentiment index in the east China market was 2.21, down 0.08 WoW; the purchasing sentiment index was 2.33, up 0.04 WoW. SMM A00 aluminum closed at 23,350 yuan/mt, up 90 yuan/mt from the previous trading day, at a discount of 160 yuan/mt against the 2602 contract, up 30 yuan/mt from the previous trading day; at a discount of 220 yuan/mt against the 2603 contract. Trading in the central China market remained sluggish today. As the Chinese New Year approaches, pre-holiday stockpiling by downstream processing enterprises has basically ended, with only minimal just-in-time procurement. Major suppliers have also gradually entered the Chinese New Year break, leading to limited spot aluminum availability in the market. However, some traders bought the dip and stockpiled, driving transaction prices higher. Ultimately, actual transaction prices in the central China market ranged from a premium of 20 yuan/mt to a premium of 60 yuan/mt against the central China price. Today, the shipment sentiment index in the central China market was 2.43, down 0.14 WoW; the purchasing sentiment index was 2.09, down 0.05 WoW. SMM central China price closed at 23,260 yuan/mt, up 100 yuan/mt from the previous trading day, at a discount of 250 yuan/mt against the 2602 contract, up 40 yuan/mt from the previous trading day; at a discount of 310 yuan/mt against the 2603 contract. The price spread between Henan and Shanghai was -90 yuan/mt, narrowing 10 yuan/mt from the previous trading day. Inventory side, aluminum ingot inventories in major consumption areas increased by 28,500 mt WoW, with all three regions showing inventory buildup. In the short term, high aluminum prices may continue to suppress end-use demand, coupled with the impact of the Chinese New Year break on downstream sectors. Aluminum ingots still face inventory buildup risks, and spot premiums/discounts are expected to remain under pressure.

Spot premiums/discounts are expected to remain under downward pressure. Approaching the Chinese New Year holiday, market participation continues to decline, with most suppliers and downstream enterprises gradually entering holiday mode, resulting in sluggish overall trading activity during the day. On the supply side, price-ratio-based shipments locked in during the previous period of open import arbitrage windows are continuously arriving at ports, leading to significant inventory buildup in the Shanghai area. On the demand side, downstream enterprises have generally begun holidays due to the approaching festival, with procurement demand continuing to weaken. Overall, the market is expected to maintain sluggish trading, and spot discounts are projected to widen further tomorrow.

[SMM Shanghai Spot Copper] Spot premiums/discounts are still expected to face downward pressure. As the Chinese New Year holiday approaches, market participation continues to decline, with most suppliers and downstream enterprises gradually entering the holiday period, resulting in sluggish overall trading activity during the day. On the supply side, price-ratio cargoes locked in during the previous period of open import arbitrage windows are continuously arriving at ports, leading to significant inventory buildup in the Shanghai area during the day. On the demand side, downstream enterprises have generally begun their holidays due to the approaching festival, causing procurement demand to weaken further. Overall, the market is expected to remain sluggish, and spot discounts are projected to widen further tomorrow.

[SMM Aluminum Morning Meeting Minutes: Overall Warm Macro Front Contends with Inventory Buildup Reality, Aluminum Prices Under Pressure and Fluctuating in the Short Term] In summary, aluminum prices are expected to continue their fluctuating trend under pressure in the short term, constrained above by the reality of inventory buildup and supported below by macro expectations. They are anticipated to remain in the doldrums with limited room for a rebound.

SMM February 12: Overnight, LME lead opened low at $1,974.5/mt, fluctuating upward during the Asian session; it then climbed to a high of $1,996/mt during the European session, ultimately closing at $1,994.5/mt, up 0.86%. Overnight, the most-traded SHFE lead 2603 contract opened at 16,800 yuan/mt, briefly touching a high of 16,805 yuan/mt at the start of the session. It weakened and fell to a low of 16,700 yuan/mt due to a decline in both supply and demand fundamentals, ultimately closing at 16,725 yuan/mt, down 0.09%. As the Chinese New Year holiday approaches, spot quotations continue to decrease. Downstream battery producers have largely entered the holiday period, resulting in weak purchase willingness for lead ingots. Supply and demand in the spot market have both declined. Some producers are offering pre-sale quotations for post-holiday cargo pick-up, but spot order transactions are thin. Downstream battery producers are expected to resume operations around late February to early March. Post-holiday attention will focus on lead ingot inventory buildup and the impact of secondary lead national standard delivery matters on lead price sentiment. Data Source Statement: Except for publicly available information, other data are processed by SMM based on public information, market communication, and SMM's internal database model, and are for reference only, not constituting decision-making advice.

Futures: Overnight, LME lead opened low at $1,974.5/mt, fluctuated upward during the Asian session; climbed to a high of $1,996/mt during the European session, and finally closed at $1,994.5/mt, up 0.86%. Overnight, the most-traded SHFE lead 2603 contract opened at 16,800 yuan/mt, touched a high of 16,805 yuan/mt early in the session, then weakened and probed lower to 16,700 yuan/mt due to the dual decline in fundamental supply and demand, finally closing at 16,725 yuan/mt, down 0.09%. On the macro front: US January seasonally adjusted non-farm payrolls increased by 130,000, significantly exceeding market expectations and marking the largest increase since April 2025; the unemployment rate unexpectedly fell to 4.3%, hitting a new low since August 2025; following the non-farm data release, traders lowered expectations for US Fed interest rate cuts. The Central Bank of Kenya joined African gold accumulation efforts, planning gold purchases to strengthen buffer capacity. Indonesia plans to cut production at the world's largest nickel mine by 70%. The State-owned Assets Supervision and Administration Commission of the State Council is promoting central state-owned enterprises to actively expand effective investment in computing power. Ministry of Commerce: The prize pool for the lottery invoice event during the 9-day Chinese New Year holiday will exceed 1 billion yuan. : The Chinese New Year atmosphere is strong in the Jiangsu, Zhejiang, Shanghai market, most suppliers have suspended quotations, only a few can offer primary lead cargoes self-picked up from production site, but currently vehicles are scarce, except for a very few ultra-short distances that can barely manage delivery, the vast majority of lead ingots require pick-up after the holiday. Secondary lead spot order prices are sporadic, enterprise transaction willingness is weak, most enterprises have entered the holiday and suspended shipments and quotations. Simultaneously, most downstream enterprises have entered the holiday break, the final batch of lead-acid battery enterprises will also start their holiday this Saturday, downstream inquiries are minimal, and trading in the spot market is light on both sides. Inventory: On February 11, LME lead inventory increased by 200 mt to 232,950 mt. As of February 9, the SMM lead ingot five-region social inventory increased to a five-month high. Today's Lead Price Forecast: Approaching the Chinese New Year holiday, spot quotations continue to decrease, downstream battery enterprises have largely entered the holiday, and lead ingot purchase willingness is sluggish. Supply and demand both decline in the spot market, individual producers offer pre-sale post-holiday pick-up prices, spot order transactions are thin. Downstream battery producers are expected to resume production by late February to early March; post-holiday focus will be on lead ingot inventory buildup and the impact of secondary lead national standard delivery matters on lead price sentiment. Data Source Statement: Data other than public information is processed by SMM based on public information, market communication, and relying on SMM's internal database model, for reference only and does not constitute decision-making advice.

> SMM Cold Rolling Production Schedule: Daily average cold rolling production schedule at steel mills increased 3% in February According to the latest SMM tracking, the total planned volume of cold rolled commodity materials from 31 mainstream steel mills this month was 3.8755 million mt, down 278,300 mt MoM from the actual production of cold rolled commodity materials last month, a decrease of 6.7%.

The HRC price edged up intraday, with the most-traded contract closing at 3,228, up 0.06%. In the spot market, national mainstream city HRC offers were mostly stable with some increases, cold-rolled and coated sheets prices held steady, and export prices remained stable. Data-wise, hanghai HRC inventory was 347,100 mt this week, up 14,300 mt WoW (a 4.30% increase); the Gregorian calendar YoY decline was 10.95%, while the lunar calendar YoY increase was 17.94%. Mainstream city inventories began to accumulate gradually. Short-term, market transactions gradually stalled, and HRC prices were expected to stabilize in the latter half of the week; post-holiday inventory buildup will be monitored.

SMM February 11: SHFE aluminum 2602 contract fluctuated with small gains in the morning session, but the price center edged down slightly compared with the previous trading day. Affected by the approaching Chinese New Year, overall market trading sentiment was weak, with mainstream transaction prices concentrated at the average price to a premium of 10 yuan/mt. Today, the east China market shipment sentiment index was 2.3, down 0.4 WoW; the purchasing sentiment index was 2.29, down 0.21 WoW. SMM A00 aluminum closed at 23,260 yuan/mt, down 30 yuan/mt from the previous trading day, at a discount of 190 yuan/mt against the 2602 contract, flat from the previous trading day. Transactions in the central China market remained sluggish today. As the Chinese New Year approaches, pre-holiday stockpiling by downstream processing enterprises has basically ended, with only a small amount of just-in-time procurement. Major suppliers also gradually entered the Chinese New Year break, resulting in limited spot aluminum supply in the market. However, some traders bought the dip and stockpiled, driving transaction prices higher throughout the session, from a premium of 10 yuan/mt against the central China price before the opening to a premium of 50 yuan/mt. The main transaction range was concentrated between a premium of 10 yuan/mt and 30 yuan/mt against the central China price. Today, the central China market shipment sentiment index was 2.56, down 0.16 WoW; the purchasing sentiment index was 2.14, down 0.02 WoW. SMM central China aluminum closed at 23,160 yuan/mt, down 10 yuan/mt from the previous trading day, at a discount of 290 yuan/mt against the 2602 contract, up 20 yuan/mt from the previous trading day. The price spread between Henan and Shanghai was -100 yuan/mt, narrowing 20 yuan/mt from the previous trading day. Inventory side, aluminum ingot inventories in major consumption areas increased by 4,000 mt WoW today, with the main sources of inventory buildup being Guangdong and Wuxi. In the short term, high aluminum prices may continue to suppress end-use demand, and coupled with the impact of the Chinese New Year break on downstream sectors, aluminum ingots still face inventory buildup risks. Spot premiums/discounts are expected to remain under pressure.

[SMM Aluminum Morning Meeting Minutes: Geopolitical Risks and Accelerated Seasonal Inventory Buildup Keep Aluminum Prices in the Doldrums] In summary, amid the combined effects of supply growth, seasonal demand pullback, and accelerated inventory buildup, aluminum prices are generally under pressure. It is expected that prices will remain in the doldrums in the short term, with limited room for a rebound.