[Full-Scale US-Iran War Risks Climb, Strengthening Short-Term Upward Drivers for Aluminum Prices] Overall assessment suggests that with the volatile Middle East situation, persistent market concerns over interest rate hikes, and continuously recovering supply, the destocking trend will be hard to reverse in the short term. Amid the tug-of-war between longs and shorts, aluminum prices are expected to consolidate and adjust in the near term. Going forward, close attention should be paid to the progress of production resumptions in the Middle East, the trajectory of geopolitical conflicts, LME aluminum ingot inventory changes, and the status of China’s downstream processing orders.

[SMM Silicon-based PV Morning Meeting Minutes] Polysilicon: N-type recharging polysilicon quotes are 30.6-33 yuan/kg, and order signing remains limited at present. However, as meetings are held, some enterprises have strong expectations for H2 policies, some believe a series of related measures will follow, and market sentiment has improved somewhat. Wafers: Market wafer prices are 18X (0.82-0.86 yuan/piece), 210RN (0.93-0.97 yuan/piece), and 210N (1.13-1.17 yuan/piece). As wafer energy consumption standards are further tightened and expectations of upstream price increases grow, wafer enterprises have turned cautious, waiting for meeting outcomes before deciding on pricing strategies. Currently, wafer prices are already near cash cost, so the likelihood of another sharp decline is relatively small.

[SMM Morning Meeting Summary: Supply Disruptions Persist, LME Zinc Center Edges Up] Overnight, LME zinc recorded a bullish candlestick with a long upper shadow, with the 60-day moving average below providing support, and the KDJ gap narrowed. The Middle East conflict continued overnight, and shipping delays, compounded by...

Entering late July, China's tungsten market has overall moved into a phase of stage-based consolidation and repair. Following a sustained deep pullback in tungsten prices, low-priced goods in the market have become hard to find, as upstream mines and supplier traders have been hoarding, holding back from selling, and showing a strong willingness to hold prices firm, while the center of spot order transactions has steadily moved higher. Coupled with the boost to market sentiment from long-term contract purchase quotations by leading tungsten enterprises, transaction activity at the mine and APT ends has recently warmed up. However, constrained by the traditional consumption off-season in the industry, downstream end-use demand has yet to see a marked recovery, leaving the overall market in a structurally split pattern, with upstream raw material prices rebounding as suppliers hold prices firm, while downstream demand remains relatively weak. A Tungsten Enterprise Lowers Long-Term Contract Quotations for the Second Half of July A tungsten enterprise has lowered its long-term contract quotations for the second half of July, as detailed below: According to the long-term contract purchase quotations of a tungsten enterprise in Chongyi for the second half of July, the details are as follows: 1. 55% wolframite concentrates: 411,000 yuan/standard tonne, down by 37,000 yuan/standard tonne from the previous quotation; 2. 55% scheelite concentrates: 410,000 yuan/standard tonne, down by 37,000 yuan/standard tonne from the previous quotation; 3. APT (national standard grade 0): 605,000 yuan/mt, down by 55,000 yuan/mt from the previous quotation. Tungsten Prices Bid Farewell to Declines, Notch Two Consecutive Gains Looking back at the trend in this cycle, after the average price of wolframite concentrates rebounded to the previous high of 527,500 yuan/standard tonne in mid-to-early June, the trend continued to weaken. The core drag factor was the persistently sluggish downstream end-use demand, compounded by the ongoing digestion cycle of raw material inventories after earlier concentrated stockpiling by enterprises, which significantly weakened market price support. Starting from June 17, tungsten prices embarked on an overall weak downward path. Compared to the average price of 527,500 yuan/standard tonne on June 16, the average price of 402,500 yuan/standard tonne on July 17 marked a decline of 125,000 yuan/standard tonne over a period of just over one month, a drop of 23.7%. After the rapid pullback in tungsten prices, stage-based bottom support gradually emerged in the tungsten market. The tightening of upstream goods and rising sentiment of holding back from selling and holding prices firm pushed tungsten prices to stop falling and stabilize, then ushered in a two-consecutive-day rebound. According to SMM quotations, the price of wolframite concentrates (≥65%) on July 21 was 410,000~415,000 yuan/standard tonne, with an average price of 412,500 yuan/standard tonne, up 1.23% from the previous trading day. Currently, low-priced goods on the market are quite scarce, and suppliers have generally ceased offloading at low prices. Coupled with the fact that long-term contract purchase prices from leading tungsten enterprises are higher than mainstream spot transaction prices, this has effectively boosted market confidence, driving spot transaction prices to gradually converge with long-term contract prices. Market Outlook Short term, supported by tightening raw material supply and strong sentiment among suppliers to hold prices firm, the tungsten market will mainly see a slight rebound and consolidation at lows in late July, and the market does not yet have the conditions for a significant reversal. A substantial recovery in the market still hinges on the traditional downstream consumption peak season from August to September, driven by end-user order recovery and the release of concentrated restocking demand to push prices higher. Currently, the industry chain has relatively consistent expectations for the seasonal recovery, and some enterprises may gradually begin advance stockpiling at low prices, which is expected to bring marginal improvement to the tungsten market. At present, the tungsten market is at a critical period of stopping the decline and consolidating at lows, with market recovery focused on the upstream raw material side. The downstream tungsten powder and cemented carbide sectors remain trapped in the traditional consumption off-season, with stable end-user operating rates and scarce new orders. Enterprises generally adopt a just-in-time essential restocking strategy, with no large-scale stockpiling activity, unable to support a significant rise in raw material prices. However, the industry chain has formed a broad consensus on the market recovery after August, and advance stockpiling at low prices in the market is gradually increasing, which is expected to drive the industry chain’s marginal improvement earlier. Markets outside China are affected by the summer holiday, with sluggish trading and high prices but no actual transactions, as prices continue to consolidate at high levels, with very low risk of a sharp decline. The divergent pattern between domestic and overseas markets is expected to persist. Going forward, close attention will be paid to four key variables: first, the pace of supply release from domestic mines and changes in suppliers’ holding firm sentiment; second, the pace of downstream cemented carbide end-user operating rate recovery and the strength of concentrated restocking; third, the market guidance role of APT long-term contract prices; fourth, the circulation volume of recycled tungsten scrap and the procurement release of downstream recycled raw materials. Recommended reading:

The Sinowei Lithium Mine (Dechelongba Spodumene Mine) has retained resources of 24.924 million mt of ore, with an average Li2O grade of 1.34%. Designed for open-pit mining, it has a capacity of 1.5 million mt/year. The project has now entered the environmental impact assessment (EIA) acceptance stage, and construction is progressing as planned. SMM believes that the capacity release pace of this mine meets market expectations, as the market has already fully priced in the commissioning pace of such large mines. The subsequent real marginal variables remain the actual mining progress and the pace of profit recovery in the lithium chemical processing segment.

The domestic ore market in Liaodong is relatively stable, with mines and beneficiation plants showing a relatively strong willingness to hold prices firm and mostly reluctant to sell below psychological expectations. Both sides are clearly in a stalemate and waiting on the sidelines. Steel mills, taking advantage of the situation, have strengthened their desire to push for lower prices. Moreover, some individual equipment is not running smoothly and is under shutdown and debugging, leading to weakening demand and increasing constraints on ore prices. However, ROM ore is in short supply, and the periodic production of beneficiation plants has not significantly eased supply tightness, which still provides support for the bottom of ore prices. In the short term, sellers and buyers in the market remain in a game-playing state. It is expected that local iron ore concentrate prices will likely operate in the doldrums in the near term. [SMM Steel]

Colombia has recorded 4.58GW of solar capacity under UPME’s 6GW+ tracking program, including 3.39GW in operation and 1.19GW under testing, meaning around one-quarter of registered solar capacity has yet to reach full commercial operation. Since August 2022, the country has registered 4.65GW of new solar, wind and small hydropower capacity, with solar accounting for more than 98% of the total. As of July 17, combined solar and wind capacity stood at 4.63GW, representing 19.23% of installed capacity in Colombia’s National Interconnected System. The 6GW+ program aims to add at least 6GW of solar, wind and small hydropower capacity between August 2022 and August 2026, leaving around 1.35GW still needed.

[Shanghai Zinc: Suppliers Continued to Hold Prices Firm, Shanghai Spot Premiums Kept Rising] #0 zinc mainstream transaction prices were concentrated at 24,355-24,490 yuan/mt today, Shuangyan saw no transactions, and #1 zinc mainstream transactions were at 24,285-24,420 yuan/mt. In early trade, quotes against the SMM average price were at premiums of 50-60 yuan/mt, while there were no quotes against the futures price yet...

Southeast Asian SHG zinc ingot CIF premiums have continued to decline recently. According to SMM data, as of July 21, premiums in both the Malaysian and Indonesia markets stood at USD$100–128/mt, averaging USD$114/mt, down notably from early July. The decline was mainly driven by weak spot demand. Downstream buyers in Southeast Asia continue to rely primarily on annual contracts, resulting in limited spot restocking demand, fewer new inquiries and scarce concluded transactions. Sellers have therefore gradually lowered offers to facilitate spot sales. Meanwhile, some China-brand zinc ingots have entered the market at lower premiums, with recent transactions and workable levels mostly reported at USD$80–100/mt, placing pressure on mainstream offers. Premium differentials between brands remain. International mainstream and more widely accepted brands continue to command relatively firm offers, but higher-priced deals have become more difficult to conclude amid insufficient buying interest. In the near term, Southeast Asian zinc premiums are expected to remain under pressure as long-term contract coverage stays high and spot demand shows no clear improvement. However, actual transaction levels may continue to vary depending on brand, shipment timing and quotation period.

H1 silver concentrate imports surged 35.5% YoY, while refined silver exports stayed flat. Q2 saw heavy stockpiling in Shenzhen, disrupting spot pricing. Since late June, low-price inventories have cleared and投机盘 have retreated, stabilizing quotes. However, risks from remaining low-cost stocks remain.