Zhaoyuan in Shandong Province, China's county with the highest "gold content," saw its total output value of the gold industry exceed 100 billion yuan last year, ranking first among all county-level cities nationwide. The region has established an entire gold industry chain, spanning from upstream exploration and mining, midstream smelting and processing, to downstream design and retailing. Amidst the current scenario where gold prices have repeatedly hit new historical highs, the city exudes an air of opulence. Recently, a reporter from Cailian Press visited this small city and engaged in discussions with numerous individuals involved in the local gold industry chain to understand their perspectives on gold price trends, the situation of upstream reserve and production increases, the recent developments in midstream smelting and processing, as well as the new trends emerging in the "time-honored" downstream gold jewelry sector. Upstream: Reserve and Production Increases in Progress The Jiaodong region, where Zhaoyuan is located, is China's largest gold ore concentration area, with proven gold resources exceeding 5,800 mt, accounting for 35% of the country's total reserves. Notable ore-controlling faults in the region include the Sanshandao Fault, Jiaojia Fault, Zhaoping Fault, and Jinniushan Fault. Among them, Zhaoyuan's gold resources are mainly distributed within the fault structures of the Zhaoping Fault Zone, with the Linglong ore field in the north being a world-class ore field with reserves exceeding 1,000 mt. Currently, Zhaoyuan boasts two gold mines under active exploitation that rank among China's top ten gold mines. One of them, the Linglong Gold Mine, belongs to Shandong Gold Group, while the other, the Xiadian Gold Mine, belongs to Zhaojin Group. In addition, enterprises such as China National Gold Group Corporation and Jindu State Investment also possess abundant resources in the local area. With the soaring international gold prices—which surged by 26.8% throughout last year and even exceeded $3,500 per ounce at one point this year—the topic of gold prices has begun to attract increasing discussions. Industry insiders in Zhaoyuan told Cailian Press, "The pricing mechanism of gold is based on credit, influenced by supply and demand dynamics, and underpinned by mining costs. From a medium and long-term perspective, the upward trend is evident." The sustained increase in gold prices has profound implications for gold mining enterprises. On one hand, the production cost per gram of gold for major domestic publicly listed gold firms mostly fell within the 200-300 yuan range last year, and the rise in gold prices directly boosted their profits. On the other hand, the increase in gold prices has made it economically viable to mine ore deposits with lower grades or higher costs, leading to significant reserve and production increases for gold mining enterprises. According to the 2025 Zhaoyuan Government Work Report, key local enterprises in Zhaoyuan "achieved remarkable results in reserve and production increases last year," implementing a total of 17 in-region exploration projects and 2 out-of-region M&A projects. The annual new gold reserves reached 178.2 mt, and self-produced gold output amounted to 28.1 mt, representing increases of 10.5% and 16.1%, respectively. The local target for 2025 is to strive for gold production to exceed 31.25 mt and to increase proven reserves by 33.3 mt. Midstream: Gold Bars in Undersupply Zhaoyuan is not only rich in gold ore resources but also serves as the country's largest base for gold intensive and deep processing. Zhaojin Refining, a subsidiary of Zhaojin Group, is the leading enterprise in the local deep-processing industry chain. It holds certifications from the Shanghai Gold Exchange, Shanghai Futures Exchange, and London Bullion Market Association as a "qualified refiner capable of producing standard gold and silver ingots." With an annual refining capacity of 200 mt of gold and 1,000 mt of silver, it ranks first in the industry in terms of gold refining production. Local industry insiders told Cailian Press that gold refining has become fully marketized, with thin profit margins. Core competitiveness depends on production and management efficiency. However, as gold prices doubled over the past two years, processing fees also rose significantly, leading to a substantial improvement in profitability and keeping the entire industry at a high prosperity level this year. Additionally, Zhaojin Refining collaborates extensively with major domestic banks in the field of gold deep-processing, offering comprehensive services including design, processing, distribution, repurchase, customization, and warehousing logistics for precious metal products. Since last year, there has been an "explosive" surge in public demand for investment gold bars, with orders pouring in continuously. Zhaojin Refining's gold bar production workshop once had its production schedule booked a month in advance, forcing workers to work overtime. Due to its heavy involvement in physical gold trading, upstream and midstream gold mining companies need to use "futures + options" combinations for risk hedging and price protection to mitigate market risks caused by gold price fluctuations. Seizing this opportunity, Zhaojin Group entered the futures market, and its subsidiary Shandong Zhaojin Investment Co., Ltd. became one of the largest gold traders on the Shanghai Gold Exchange, consistently ranking among the top three comprehensive members. This serves as a model for the integration of industry and finance in the gold sector. Downstream: Repositioning of Gold Jewelry The rapid rise in gold prices has not been universally welcomed in the gold industry chain, with some benefiting while others suffer—particularly downstream gold jewelry retailers. This is because when gold prices rise from low levels, the increase stimulates jewelry consumption. However, once prices reach a psychological high, further increases tend to suppress jewelry demand. Consequently, since H2 last year, typical gold jewelry stocks such as Lao Feng Xiang, Caibai Co., Ltd., and China Gold have generally faced declining performance and stock prices, starkly contrasting with the continuous climb in gold prices. However, against the backdrop of persistently high gold prices, will gold jewelry consumption inevitably continue to shrink? In Zhaoyuan, industry insiders hold differing views. "If you look at the three newly emerging jewelry brands—Laopu, Linchao, and Junpei—they remain completely unaffected by the surge in gold prices." The professional attributes this to the core strategy of brands like Laopu, which emphasize ancient-style gold jewelry with a focus on design, craftsmanship, and artistic value. These brands align with the current trend of Chinese aesthetic revival and psychologically "capture" consumers, making them view their purchases as luxury or collectible items, thereby desensitizing them to the relationship between product pricing and real-time gold prices. "This brings us a profound insight: the competition in the gold jewelry industry is increasingly focused on product strength and design. The new generation of consumers, including young people, place greater emphasis on the self-pleasing and collectible attributes of gold jewelry. Only by continuously exerting efforts in this dimension can we break through in an environment of high gold prices." Currently, Zhaojin Group is focusing on building its brand "Zhaojin Silver House" (formerly known as Zhaoyuan Silver Workshop, established in 1908). It has launched product series such as "Contemporary Treasure" and "Dunhuang Splendid Ornaments," attempting to secure a place in the fiercely competitive gold retail market through innovative designs that integrate traditional culture. In Zhaoyuan, beyond the traditional business models of gold mining, smelting, and retail, efforts are being made to explore more economic growth points centered around gold themes. Today, Zhaoyuan is promoting the deep integration of "gold + culture + tourism" offline, attempting to leverage the Gold Town to delve into the millennium-old gold culture and experience the intangible cultural heritage of the Song Dynasty. It is constructing a new pattern of integrated development of industry, culture, and tourism that encompasses "mining gold, making gold, playing with gold, buying gold, and exchanging gold," further cultivating a characteristic cultural tourism IP of "China's Gold Capital." Locals in Zhaoyuan say that the charm of gold lies in its heritage from antiquity, yet it always manages to remain fresh and relevant.

Macro News 1. On the 28th, He Lifeng, Member of the Political Bureau of the CPC Central Committee and Vice Premier of the State Council, met with Dan Simkowitz, Co-President of Morgan Stanley in the US, at the Great Hall of the People. He Lifeng stated that China is committed to promoting high-quality development through high-level opening up, and welcomes more US financial institutions, including Morgan Stanley, and long-term capital to continuously deepen mutually beneficial cooperation with China and actively participate in the construction and development of China's capital market. Simkowitz expressed that Morgan Stanley will continue to expand its presence in the Chinese market and provide high-quality services to facilitate investment cooperation between US and Chinese enterprises. 2. From the 27th to the 28th, Zhang Guoqing, Member of the Political Bureau of the CPC Central Committee and Vice Premier of the State Council, conducted a survey in Shanghai on promoting the healthy development of the platform economy and market supervision. He emphasized the need to thoroughly implement the important instructions and directives of General Secretary Xi Jinping, implement the decisions and arrangements of the CPC Central Committee and the State Council, focus on promoting high-quality development, comprehensively strengthen governance capabilities in the field of market supervision, promote the construction of a sound ecosystem for the platform economy, and maintain a fair and orderly market environment. 3. On May 28th, Foreign Ministry spokesperson Mao Ning presided over a regular press conference. Mao Ning stated that China has decided to expand the scope of visa-free countries. From June 9, 2025, to June 8, 2026, a visa-free policy will be implemented on a trial basis for holders of ordinary passports from Saudi Arabia, Oman, Kuwait, and Bahrain. Individuals from these four countries holding ordinary passports who come to China for business, tourism, visiting relatives and friends, exchanges, visits, or transit for no more than 30 days may enter the country without a visa. 4. According to the National Disease Control and Prevention Administration, the upward trend of the COVID-19 epidemic nationwide has slowed down, and the epidemic has reached its peak or is showing a downward trend in most provinces. The dominant circulating strain is the sixth-generation sub-lineage NB.1.8.1 of the XDV variant, with no significant changes observed in its pathogenicity or clinical severity of the disease. Industry News 1. It has been learned from multiple informed sources that at a recent symposium on upstream and downstream enterprises in the China-EU semiconductor industry held by the Ministry of Commerce, the policy on rare earth export controls was explained, and communication with China-EU chip enterprises on rare earth export controls was strengthened to maintain the stability of the global industry chain. Another informed source indicated that this move implies that China may relax rare earth export controls targeting the industry chain of China-EU semiconductor enterprises. 2. The Office of the National Healthcare Security Administration conducted an investigation into cases of "ghost pharmacists" (pharmacists whose names are listed but who are not actually present) at designated retail pharmacies. Through screening and analysis, it was found that the names of some pharmacists (corresponding to the same ID numbers) appeared in the drug expense details of multiple designated retail pharmacies, suggesting possible violations such as pharmacist information being falsified or pharmacists engaging in "ghost pharmacist" practices. Designated retail pharmacies found to have engaged in violations such as falsified pharmacist information, "ghost pharmacists," or failure to provide pharmaceutical services as required will be subject to measures such as interviews, rectification within a specified time limit, suspension of the medical insurance service agreement, or termination of the medical insurance service agreement, depending on the severity of the violations. 3. The website of the Shenzhen Municipal Housing and Construction Bureau released the "Administrative Measures for the Allocation and Sale of Affordable Housing in Shenzhen (Draft for Soliciting Opinions)" and the "Administrative Measures for the Planning and Construction of Affordable Housing in Shenzhen (Revised Draft for Soliciting Opinions)". The drafts mention that allocation-and-sale-type affordable housing will be subject to strict closed-loop management, and it is prohibited to convert such housing into commercial housing in any way. 4. It has been learned from informed sources that DJI's robotic vacuum cleaner products have entered mass production and are expected to be launched in June. It is understood that DJI has been engaged in the R&D of robotic vacuum cleaners for more than four years, and the upcoming product is a robotic vacuum and mop combo. 5. The General Office of the People's Government of Fujian Province issued the "Implementation Plan for Special Actions to Boost Consumption in Fujian Province", which proposes supporting automobile consumption. It supports various regions in carrying out automobile consumption promotion activities and providing additional support through preferential car purchase policies. 6. The State Administration for Market Regulation recently issued the "Action Plan for Key Technological Innovations in Metrology and Testing". The Plan proposes that by 2030, more than 50 key metrological core technologies will be achieved, more than 20 new-generation international first-class metrological standards will be established, the self-controllable rate of core devices for newly established metrological standards will reach over 60%, and the leading rate in international metrological comparisons will reach 20%. 7. It was learned from the media briefing on promoting the trade-in of e-bikes in Guangdong that as of May 26, the sales volume of e-bikes traded in in Guangdong Province reached 174,000 units, ranking among the top in the country, with the trade-in volume being approximately three times that of the previous year. The cumulative subsidy funds used amounted to 87.08 million yuan, boosting new e-bike consumption by over 400 million yuan. Corporate News 1. Jiaying Pharmaceutical announced that it is under investigation by the China Securities Regulatory Commission for suspected violations of laws and regulations in information disclosure. 2. China Energy Engineering Group announced that it has won the bid for the 6×660 MW coal-fired power project in the Bingzhun Industrial Park of the China-Kyrgyzstan-Uzbekistan Railway, with a bid amount of approximately 14.586 billion yuan. 3. *ST Jilin Pharmaceutical announced that its shares will be delisted on May 29. 4. *ST Longjin announced that its shares will enter the delisting consolidation period starting from June 6. 5. ST Huaxi announced that it has signed a major contract for daily operations worth approximately 2.084 billion yuan. 6. Fuda Co., Ltd. announced that it plans to invest in the construction of a project for ultra-precision gears for electric drive systems in NEVs and a project for robotic transmission joint components. 7. Longgao Co., Ltd. announced that the restructuring of its controlling shareholder is undergoing the approval process for the assessment report. 8. Jiangsu New Energy announced that its future performance is related to multiple factors such as the natural resources at the project sites, and significant changes may bring about performance fluctuation risks. 9. China Flag Chemical announced that the company currently has the project approval procedures for chlorantraniliprole, but it has not yet officially commenced production. 10. ST United announced its intention to acquire 100% equity in Jiangxi Runtian Industry, a packaged drinking water company, and its stock will resume trading. 11. Shangwei Cable announced that the company's actual controller has been changed to Zhang Hua. 12. At the earnings briefing, executives of Huguang stated that the first prototype line for the humanoid robot project has been successfully implemented. 13. IntSig Information announced its intention to plan for the issuance of H shares and list them on the Hong Kong Stock Exchange. 14. China National Gold Group announced that its controlling shareholder intends to increase its stake in the company by 168 million to 335 million yuan. 15. Lier Chemical stated on its interactive platform that the 5,000 mt/year chlorantraniliprole production facility is under accelerated construction. Global Markets 1. The three major U.S. stock indices closed lower collectively, with the Dow Jones falling 0.58%, the Nasdaq declining 0.51%, and the S&P 500 index dropping 0.56%. Most popular Chinese ADRs closed lower, with the Nasdaq Golden Dragon China Index falling 0.71%. 2. WTI crude oil futures prices closed up 1.56% at $61.84 per barrel. Brent crude oil futures closed up 1.26% at $64.9 per barrel. 3. COMEX gold futures closed down 0.48% at $3,312.4 per ounce, and COMEX silver futures closed down 0.65% at $33.095 per ounce. 4. Nvidia reported revenues of $44.1 billion in the first fiscal quarter, up 69% YoY, and a net profit of $18.78 billion in the first fiscal quarter, up 26% YoY. Investment Opportunities Reference 1. Xiaomi YU7's pre-booking inquiries exceed those of SU7 during the same period, with the number of users leaving their information being about three times higher. According to media reports, Lu Weibing, Partner and President of Xiaomi Group, stated at the earnings call that Xiaomi YU7 has been well-received by users since its pre-release, becoming more popular and well-known than when Xiaomi SU7 was first unveiled. Lu Weibing revealed that after the technical release of YU7, the number of pre-booking inquiries exceeded those of SU7 during the same period. As of May 25, the number of users leaving their information for the "YU7 Technical Launch Event" was about three times that of the "SU7 Technical Launch Event" during the same period. YU7 has a broader audience than SU7, and we are very confident in YU7. YU7 is expected to be officially launched in July this year. Previously, Xiaomi Auto announced that it had raised its delivery target for 2025 to 350,000 units (up from 300,000 units). Driven by factors such as strong product competitiveness and the launch of new models, Xiaomi Auto's sales are expected to continue to accelerate. Guotai Haitong Securities stated that Xiaomi Group's YU7 was launched on May 22, and its sales after the new model's launch are worth looking forward to, with the industry chain expected to continue benefiting. 2. WeRide Enters Saudi Arabian Market, with Three Major Products Deployed Recently, WeRide, a global leader in autonomous driving technology, announced its market expansion strategy in Saudi Arabia, marking a further expansion of the company's global commercial footprint. As the first step in entering the Saudi market, WeRide has tested and deployed autonomous driving products such as Robotaxi, Robobus, and Robosweeper in key Saudi cities including Riyadh and AlUla, laying the foundation for subsequent large-scale commercial operations across Saudi Arabia. With the rapid development of artificial intelligence (AI) technology, autonomous driving is undergoing unprecedented changes. From intelligent perception to precise decision-making, and from efficient control to data-driven operations, AI has injected strong momentum into autonomous driving. Haitong Securities pointed out that previously, the main barriers to the development of large-scale autonomous driving models included computing power, data loops, etc., with leading autonomous driving enterprises mostly being top-tier technology companies. Following the release of Deepseek's faster inference model, latecomers (including vehicle manufacturers and solution providers) are expected to gain new opportunities, and the autonomous driving algorithm sector is expected to witness a flourishing landscape. Therefore, 2025 is expected to be a year of rapid penetration of high-level intelligent driving, with numerous opportunities emerging across the industry chain. 3. Three Departments, Including MIIT, Coordinate to Promote the Development of Advanced Computing Industry According to media reports, the Ministry of Industry and Information Technology (MIIT), the National Development and Reform Commission (NDRC), and the National Data Administration jointly issued the "Implementation Plan for the Digital Transformation of the Electronic Information Manufacturing Industry" to strengthen the construction of new-type information infrastructure. The plan coordinates the promotion of the development of the advanced computing industry, accelerates the integration of networks, data, computing power, and algorithms, drives innovative development in high-performance computing, intelligent computing, and cloud-edge-end collaborative computing, improves the network layout of edge computing centers, and builds a new-type information infrastructure that is highly reliable, high-performance, and widely connected. It promotes the deep empowerment of new-type information infrastructure in electronic information manufacturing applications, accelerating the large-scale application of advanced computing, 5G-A, gigabit optical networks, industrial internet, and AI in the electronic information manufacturing industry. Advanced computing encompasses three major areas: computing power, algorithms, and data, covering various computing methods such as cloud, edge, and end computing. As the core productivity in the digital economy era, computing power plays a crucial role in driving technological and industrial progress, accelerating the deep integration of digital technologies with the real economy, and its strategic and supportive roles are becoming increasingly prominent. Shanxi Securities believes that the demand for AI computing power from two major downstream sectors, the internet and intelligent computing centers, will continue to experience high growth, with rapid progress in localization procurement. 4. Musk's Brain-Computer Interface Company Completes New Round of Financing It is reported that Musk's brain-computer interface company, Neuralink, has raised $600 million in a round of financing, bringing the company's valuation to $9 billion. In recent years, the global brain-computer interface (BCI) technology has witnessed rapid development, with its application areas gradually expanding from the medical field to non-medical fields such as education and gaming. Meanwhile, the rapid evolution of emerging technologies like artificial intelligence (AI) is driving more breakthroughs in the application of BCI technology. According to PrecedenceResearch, the global BCI market size was approximately $2.62 billion in 2024 and is expected to reach $12.4 billion by 2034, with a compound annual growth rate (CAGR) of 17.4% from 2025 to 2034.

In 2024, the performance of publicly listed firms in China's gold industry chain was characterized by robust growth in the upstream sector and a decline in the downstream sector. Benefiting from the sustained and significant increase in gold prices, the performance of gold mine-related publicly listed firms in the upstream sector of the gold industry chain surged in 2024. However, as gold prices continued to rise, consumer demand for gold jewelry was impacted, leading to a general decline in the performance of publicly listed firms in the downstream gold jewelry sector. Futures Daily reporters reviewed the annual reports of nine gold mine-related publicly listed firms and found that the performance of these firms surged across the board in 2024. Among them, Shandong Gold, the industry leader, achieved operating revenue of 82.518 billion yuan in 2024, up 39.21% YoY, and net profit attributable to shareholders of the publicly listed firm of 2.952 billion yuan, up 26.80% YoY. Chifeng Gold recorded the largest increase in net profit in 2024, up 119.46% YoY, and achieved operating revenue of 9.026 billion yuan, up 24.99% YoY. Both Western Gold and Xiaocheng Technology turned losses into profits in 2024. The significant growth in the performance of gold mine-related publicly listed firms in 2024 was attributed to the sharp increase in gold prices on the one hand, and the increase in the firms' gold production and sales on the other hand. Shandong Humon Smelting stated in its annual report that in 2024, the company achieved operating revenue of 75.801 billion yuan, up 15.59% from the same period last year, due to the increase in sales revenue from its main product, gold. Shandong Gold stated in its annual report that the main reason for the increase in the company's operating revenue in 2024 was the increase in the sales volume and selling price of both self-produced and externally purchased gold in the current period. Reporters found through reviewing annual reports that the gold production of many gold mine-related publicly listed firms increased in 2024. For example, Shandong Gold produced 46.17 mt of gold from its mines in 2024, up 4.39 mt or 10.51% YoY. Shandong Gold International achieved gold production of 8.04 mt in 2024, up 14.69% YoY. Chifeng Gold achieved gold production of 15.16 mt in 2024, up 5.60% YoY. While upstream enterprises in the gold industry chain were quietly reaping profits, publicly listed firms in the downstream gold jewelry sector, whose main business involves gold jewelry sales, were struggling, with a significant decline in performance. Lao Feng Xiang, a leading enterprise in the gold jewelry sector, disclosed its 2024 annual report recently, showing that the company achieved operating revenue of 56.793 billion yuan in 2024, down 20.50% YoY, and net profit attributable to shareholders of the publicly listed firm of 1.95 billion yuan, down 11.95% YoY. Lao Feng Xiang stated in its annual report that in 2024, the world economy lacked growth momentum, domestic effective demand was insufficient, and consumer spending was sluggish. Coupled with the sustained increase in gold prices, this led to weak consumption in the gold jewelry sector. Another leading publicly listed firm in the gold jewelry sector, China National Gold Group Corporation, also experienced a decline in net profit in 2024.Data shows that China National Gold Group Corporation achieved operating revenue of 60.464 billion yuan in 2024, up 7.27% YoY. Net profit attributable to shareholders of publicly listed firms was 818 million yuan, down 15.93% YoY. In its 2024 annual report, Chow Tai Seng, a publicly listed firm in the gold and jewelry sector, stated that during the reporting period, the uncertainty of the external economic environment increased significantly, and gold prices rose rapidly, further dampening consumers' enthusiasm for purchases and putting considerable pressure on the jewelry consumption market. In 2024, the company achieved cumulative operating revenue of 13.891 billion yuan, down 14.73% YoY. Among this, revenue from gold product sales was 7.717 billion yuan, down 24.34% YoY. In addition to the aforementioned companies, Mingr Jewelry, Darry Ring, and other companies in the gold and jewelry industry also reported a decline in net profit YoY in 2024. As gold prices continue to climb, significant changes have occurred in the gold industry. On the upstream smelting side, major gold mine publicly listed firms have all reported plans to increase production or expand capacity. However, in the downstream consumption sector, demand for gold jewelry has been suppressed. In Q1 2025, gold jewelry consumption decreased by 26.85% YoY, with some consumer demand shifting towards investment demand. This year, the total open interest in gold ETFs has increased significantly. "Currently, amidst the backdrop of increasing uncertainty in the global political and economic landscape, gold demand is expected to continue to maintain a robust trend," Shandong Gold Group pointed out in its 2024 annual report. Firstly, from an economic performance perspective, the new US administration's tariff hikes on foreign countries will trigger a new round of trade frictions, causing harm to the global economy. Meanwhile, the rising debt levels in the US may undermine the credit of the US dollar. Secondly, from a monetary policy perspective, tariff hikes on foreign countries may have a certain impact on the US economy while driving inflation to rebound. Therefore, it is expected that the US Fed will still cut interest rates, but the pace may slow down. Finally, from a geopolitical risk perspective, the "America First" policies planned by the US government will exacerbate tensions between major powers, and the global geopolitical situation may become more complex. It is expected that gold's role as a store of value and its hedging value in global asset allocation will further increase, and the gold industry will face better development opportunities. In its 2024 annual report, Western Gold pointed out that the structure of the future gold market will change. On the one hand, consumers' increasing preferences and requirements for the style, quality, and price of gold jewelry may subject the gold jewelry market to greater competitive pressure. This will prompt gold jewelry enterprises to increase product innovation and market expansion efforts to adapt to changes in market demand. On the other hand, the gold investment market will become more diversified and specialized. Sichuan Gold stated in its annual report that due to the interplay between international geopolitical turmoil and expectations for US Fed interest rate cuts, gold's status as a safe-haven asset has gradually become prominent, and it is expected that gold prices will fluctuate upward. The company will continue to monitor domestic and overseas macroeconomic conditions and political environments, enhance its comprehensive research and judgment capabilities on gold price trends, and improve the efficiency of spot price settlement. Through measures such as in-depth promotion of refined management and comprehensive budget management, the company aims to reduce unit production costs. Wu Zijie, a precious metals researcher at Jinrui Futures, holds a bullish view on medium and long-term gold prices. He believes that the core driving force behind the rise in gold prices is the growth in demand for physical gold, represented by continuous central bank gold purchases and ETF inflows. The underlying factors are the trend of de-dollarization, expectations for US Fed interest rate cuts, US debt issues, and geopolitical conflict risks. Although gold prices are currently at historical highs, investors can still consider gradually building positions in batches during pullbacks, adhering to the principle of "buying small amounts during minor declines and larger amounts during major declines," to avoid rushing to buy amid continuous price rise at high levels. For enterprises in related industries, they should conduct systematic hedging through financial instruments such as futures and options, establish a tiered risk management mechanism, control risk exposures in the process of raw material procurement and product sales, stabilize corporate operating profits, and avoid being impacted by sharp price fluctuations. Gu Jianan, Assistant General Manager of Haitong Futures Research Institute, believes that gold is still in a long-term upward trend, and its current price has not yet peaked. In the short term, considering Trump's signals for trade negotiations, global market risk appetite is expected to continue to rebound, and the upward trend in gold prices will temporarily come to an end. From a long-term perspective, Trump's tariff policies will further promote "de-globalization," and the strengthening of trade barriers will drive down the demand for US dollar settlements. As a non-sovereign credit anchor, gold's monetary attributes will drive its price to continue rising. "For investors, it is recommended to firmly adhere to the strategy of long-term gold holding and reduce speculative and leveraged operations. If there is a need to increase positions, it is advisable to wait for entry opportunities after pullbacks and avoid chasing highs. Related enterprises can utilize financial derivatives such as futures and options for hedging to lock in costs or profits. At the same time, optimize inventory management and adjust inventory levels based on market forecasts," said Gu Jianan. It is worth mentioning that many listed gold companies disclosed their use of financial derivatives for hedging in their 2024 annual reports. Shandong Gold stated in its 2024 annual report that during the reporting period, the company and its subsidiaries primarily conducted hedging businesses related to their main operations to ensure stable operating performance.The financial derivative contracts used by the company and its subsidiaries for hedging purposes are linked to products and foreign exchange related to the company's production and operation, thereby reducing the risk of price fluctuations, achieving the expected risk management objectives, and further enhancing the company's production and operation capabilities as well as its risk resistance. In its 2024 annual report, Western Gold stated that to ensure stable operating performance, the company primarily engages in hedging activities related to its main business. The gains and losses on the derivatives side and the spot side can be hedged against each other, reducing the risk of price fluctuations and further enhancing the company's production and operation capabilities as well as its risk resistance. During the reporting period, the combined profits from derivative transactions and changes in spot value amounted to 34.1965 million yuan.

China National Gold Group Corporation (600489.SH) reported a YoY increase of over 10% in net profit for 2024, yet still underperformed the growth in gold prices. The company has revised down its production targets for major non-ferrous metal products in 2025. The company announced this evening that in 2024, it achieved operating revenue of RMB 65.556 billion, up 7.01% YoY; net profit attributable to shareholders of the publicly listed firm was RMB 3.386 billion, up 13.71% YoY; and net profit excluding non-recurring gains and losses was approximately RMB 3.532 billion, up 18.25% YoY. In Q1 of this year, the company generated operating revenue of RMB 14.859 billion, up 12.88% YoY; and net profit attributable to shareholders was RMB 1.038 billion, up 32.65% YoY. The rise in gold prices was the primary factor driving the company's performance growth in 2024. The company stated that the average international gold price in 2024 was US$2,386 per ounce, up 23% YoY. It should be noted that, compared to major listed gold mining enterprises such as Shandong Gold Mining Co., Ltd. (600547.SH), Shandong Gold International Mining Co., Ltd. (000975.SZ), Hunan Chenzhou Mining Group Co., Ltd. (002155.SZ), and Chifeng Gold Corporation (600988.SH), which all reported YoY increases in net profit of over 50% for 2024, China National Gold Group Corporation significantly underperformed its peers in the industry. Further analysis reveals that China National Gold Group Corporation's gold business primarily consists of two major segments: smelting and mining. Among these, the smelting business typically accounts for approximately 90% of operating revenue (before inter-segment eliminations), with a gross profit margin that has remained around 2%-4% in recent years, significantly lower than the 40%-50% gross profit margin of the mining business in recent years. In terms of production, in 2024, the company's production of mine-produced gold, smelted gold, mine copper, and copper cathode was 18.35 mt, 37.95 mt, 82,000 mt, and 396,900 mt, respectively, with YoY changes of -2.86%, -7.14%, 2.60%, and -3.42%, respectively. The company also disclosed its 2025 business plan this evening. In terms of production of major products, it plans to produce 18.17 mt of mine-produced gold, 35.30 mt of smelted gold, 79,400 mt of mine copper, and 396,200 mt of copper cathode, with YoY changes of approximately -0.98%, -6.98%, -3.17%, and -0.18%, respectively. In terms of resource exploration, it plans to add 33.5 mt of gold metal resources and 120,000 mt of copper metal resources. Regarding gold prices in 2025, the company stated that, on one hand, although inflation has slowed somewhat, it remains above target levels; on the other hand, the US dollar is expected to stabilize or weaken slightly. Additionally, although global economic growth remains on an upward trajectory, it is still below trend levels, and safe-haven demand may support gold to some extent. However, the weakness in gold jewelry demand may narrow somewhat, while the growth momentum of investment demand may slow compared to 2024, and gold prices may continue to fluctuate at highs.

Against the backdrop of an evolving global economic landscape and ongoing industrial development, the lead-zinc industry, as a vital foundational sector, is facing unprecedented opportunities and challenges. On one hand, the rise of the new energy industry has brought about new market demands for the lead-zinc sector, such as the continuous application of lead-acid batteries in the ESS sector and the innovative use of zinc in new-type materials. On the other hand, environmental protection pressure is increasing, prompting the industry to accelerate its transformation and upgrading, exploring more green and sustainable production methods. Meanwhile, with the end of the pandemic, the resumption of overseas smelters and the impact of various countries' policies on mineral resource protection, tariff adjustments, and trade barriers are affecting the import and export landscape of lead and zinc, forcing companies to reassess their market strategies and expand diversified supply and sales channels. At this critical juncture, the 2025SMM (20th) International Lead-Zinc Conference and Industry Expo comes into being. This summit will bring together leading enterprises, experts, scholars, government officials, and professionals from the domestic and overseas lead-zinc industries to discuss hot topics in industry development, share the latest technological achievements and management experiences, and build a high-end, professional, and practical exchange platform for promoting the sustainable development of the lead-zinc industry. At this conference, Yantai Jinpeng Mining Machinery Co., Ltd. will make a grand appearance, joining peers in the upstream and downstream of the lead-zinc industry to engage in in-depth discussions on the pain points and difficulties in industry development, jointly explore business opportunities for win-win cooperation, and discuss ways to promote high-quality industry development. Click registration form to register now, grasp the trends in the lead-zinc industry, and lead the future of the industry. See you in Nanjing. Yantai Jinpeng Mining Machinery Co., Ltd. is located in the Jinpeng Industrial Park, Yantai Development Zone, covering an area of 250,000 m², with a planned construction area of 150,000 m². It is a national high-tech enterprise and a national specialized, refined, unique, and new "little giant" company. The company currently has over 500 employees, including more than 200 technical personnel. The group company includes a Mineral Processing and Metallurgy Research Institute, a Metallurgical and Mining Design Institute, a Machinery Equipment Factory, an Automation Research Institute, and an Installation and Commissioning Company. With strong technical capabilities and advanced processing equipment, Jinpeng can provide EPC services, including mineral processing test research, mine design, equipment manufacturing, installation and commissioning, and personnel training, for gold, silver, copper, lead-zinc, iron, manganese, chrome, fluorite, lithium, graphite, silica sand, and potassium-sodium feldspar mines of all sizes. The Mineral Processing and Metallurgy Research Institute has proprietary technologies in several areas, including difficult-to-process gold, copper-lead-zinc ore processing, molybdenum ore processing, white tungsten and fluorite ore processing, graphite ore processing, lithium ore processing, and bacterial oxidation of gold ores, and has achieved multiple national-level scientific research results and nearly a hundred patents. The Metallurgical and Mining Design Institute holds Grade A consulting and design qualifications and Grade B metallurgical and mining design qualifications. Since its establishment, the design institute has completed the design work for hundreds of mining and beneficiation projects both domestically and overseas, earning high praise from customers. The Machinery Equipment Factory adheres to the production policy of "safety first, quality paramount," implementing strict full-process quality control for every piece of equipment produced. It was the first in the industry to pass the ISO 9001:2015 Quality Management System certification and CE certification, and has been rated as an outstanding supplier in the Chinese gold industry for five consecutive years. Large publicly listed firms such as China National Gold Group, Shandong Zhaojin Group, Zijin Mining, Zhaojin Group, and Shandong Humon Smelting, are all partners of Jinpeng Mining Machinery. While focusing on the Chinese market, the company is also actively committed to expanding its international business, with EPC projects spanning over 80 countries and regions, making positive contributions to the economic development of the mining industry in China and around the world. Contact Information Address: No. 11 Fuzhou Road, Yantai Development Zone, Shandong Province Tel: +86-400-6969-268 13806388750 http://www.ytipkj.com E-mail: jpkj2006@ytjpkj.com Scan the QR code to register now 2025SMM (20th) Lead-Zinc Conference and Industry Expo