Samsung SDI announced on July 14 that it has met all evaluation criteria in the Indoor Large Scale Fire Test (Indoor LSFT) conducted by global safety certification body UL Solutions. Indoor LSFT is a safety test that forcibly burns a module inside a UPS battery rack and verifies whether the fire spreads to adjacent racks or systems.

The first half of 2026 has come to an end, with China's galvanized steel sheet market facing persistent demand pressure. Most market participants reported weaker order books compared with previous years, as both domestic and export orders declined to varying degrees on a year-on-year basis. Demand performance varied significantly across downstream sectors. How did each end-use segment perform in the first half of the year? And what can be expected for the market in the second half?

According to local media in the DRC on July 10, the country’s General Directorate of Taxes (DGI) sealed off some offices and facilities of Kamoto Copper Company (KCC) in Kolwezi, Lualaba Province, on July 9. The DGI stated that KCC is involved in a tax arrears situation of nearly $3 billion. The sealing action led to the evacuation of some personnel, and copper and cobalt production at the affected sites was temporarily suspended. The exact scope of the sealing, its duration, and the actual impact on the mine and smelting systems remain to be further confirmed. As SMM has learned, KCC’s copper cathode production over the past two years has been around 190,000 mt each year. If the sealing measures persist and materially affect production or product deliveries, it is expected to cause periodic disruptions to copper and cobalt supply from the DRC. Going forward, close attention should be paid to the resumption of KCC’s operations and the progress of the tax dispute resolution.

According to local media in the DRC on July 10, the country’s General Directorate of Taxes (DGI) sealed the offices and some facilities of Kamoto Copper Company (KCC) in Kolwezi, Lualaba Province, on July 9. The DGI stated that KCC is involved in a tax arrears case amounting to nearly $3 billion. The sealing action led to the evacuation of some personnel and a temporary halt to copper and cobalt production activities at the relevant sites. The extent and duration of the sealing, as well as its actual impact on the mine and smelting systems, remain to be further confirmed. Local media, citing sources close to the matter, reported that the tax authority and relevant companies under Glencore had been in negotiations over the dispute for nearly 12 months. The DGI allegedly questioned the relevant enterprises for understating transfer prices in mineral export transactions and transferring some value to overseas affiliates. Glencore denied the tax authority’s assessment, calling the claims “utterly baseless.” Therefore, the approximately $3 billion is still the amount sought by the DRC tax authority and has not yet been finalized as a judicial ruling. Public information shows that KCC is a large copper-cobalt project controlled by Glencore, with its main products including copper cathode and cobalt hydroxide. According to SMM, KCC’s copper cathode production has been around 190,000 mt in each of the past two years. If the sealing measures continue and materially affect production or product shipments, it is expected to cause periodic disruptions to copper and cobalt supply from the DRC. Going forward, close attention should be paid to the progress of KCC’s operational recovery and the resolution of the tax dispute.

H1 2026 silver saw a sharp spike to 30,900 yuan/kg in January, then plunged 55% to 13,816 yuan/kg by June, driven by squeezed spot liquidity and Fed policy reversal from easing to hawkish. Supply grew steadily; PV silver demand fell 21% YoY. H2 outlook: wait for inflation signals and Fed pivot, silver likely remains under pressure.

From a supply-demand balance perspective, China's lithium carbonate market exhibited a tight balance in H1 2026, with sellers and buyers continuously seeking new equilibrium points amid bargaining.

Canadian steelmaker Algoma Steel Group issued preliminary second-quarter 2026 guidance confirming that its electric arc furnace (EAF) transition remains on track, with the first EAF unit continuing to ramp up and a second EAF expected online in the second half of 2026, which would complete the company's shift away from blast furnace steelmaking. Algoma projected Q2 total steel shipments of 175,000–180,000 tons and adjusted EBITDA of CAD$5 million to CAD$15 million, a figure that includes a CAD$45 million final insurance settlement related to a January 2024 coke-making utility corridor incident and an estimated CAD$50–55 million capacity-utilization adjustment benefit. The company reported record plate sales during the quarter and has introduced "Volta" as a new brand name for steel produced via its EAF route. Algoma has described the EAF conversion, which began in January 2026 with the decommissioning of Blast Furnace No. 7, as one of the largest industrial decarbonization projects in North America, targeting a roughly 70% cut in carbon emissions once complete. Date: June 30, 2026 (guidance release, with continued trade-press coverage through the reporting week)

On June 17, 2026, the 2026 SMM (3rd) ASEAN Automotive Supply Chain Conference , organized by Shanghai Metals Market (SMM), successfully wrapped up at the Hyatt Regency Bangkok Suvarnabhumi Airport in Bangkok, Thailand! This conference serves as an annual gathering of Southeast Asia's auto industry, bringing together 400+ delegates, 40+ speakers, 15+ partners and 15+ exhibitors from 15+ countries. Conference Background The Southeast Asian EV industry is at a strategic crossroads. Thailand's "30/30" policy is driving adoption, with EV penetration projected to near 15% by 2025. Indonesia is building a full battery chain using its nickel resources, while Vietnam's market potential grows. Amidst supply chain restructuring and technological competition, strategic action is key. The 3rd SMM Asean Automotive Supply Chain Summit 2026 is designed to empower businesses by focusing on: Unlocking NEV Potential: Analyzing ASEAN's role as a production/export hub and examining OEM technology roadmaps. Bridging the Supply Chain: Leveraging SMM's platform to integrate resources and facilitate deals. Establishing a Price Benchmark: Promoting the use of SMM Southeast Asia metals price assessments in procurement. We believe in turning consensus into action. Join us in Bangkok in 2026 to transform strategic blueprints into tangible advantages. 》Click to Watch the Conference Live Video 》Click to View the Conference Photo Live Stream June 16 Main Forum Opening Address Speaker: Adam Fan, Chairman of SMM Opening Keynote: Thailand EV Outlook 2026 Guest Speaker: Dr. Yossapong Laoonual, Head of Mobility & Vehicle Technology Research Center (MOVE), King Mongkut’s University of Technology Thonburi (KMUTT) Dr. Yossapong Laoonual noted that the ownership of battery electric vehicle (BEV) models is expected to surpass that of hybrid models in the medium and long term. Thailand’s BEV penetration rate will also rise steadily, supported by well-developed charging infrastructure. Data shows that the number of DC charging piles in Thailand has continued to grow, with installations already exceeding the government’s planned phased targets. The country’s 2030 charging pile target is 12,000 units, and multiple supporting regulations for motor vehicles have already been implemented locally. Local planning stipulates that each pile should serve 10-15 BEVs. Compared with markets outside China, where each pile in Europe serves fewer than 15 BEVs on average and in China fewer than 10, Thailand currently faces an imbalanced vehicle-to-pile ratio and still requires the large-scale addition of new charging piles. Thailand’s charging piles are primarily located at gas stations, with shopping malls and office buildings as secondary deployment sites. Local gas stations feature diverse commercial formats, offering excellent conditions for setting up charging stations. However, range anxiety remains widespread among consumers, and charging facilities along highways need to be further improved to alleviate concerns about recharging on the road. Opening Keynote: Southeast Asia’s New Automotive Ambition:Can Industry Players Successfully Navigate Transformation Amid Challenges? Guest Speaker: Krzysztof Tokarz, Chairman of the Automotive Working Group at TEBA, Founder of Auteneo He stated that there were four core strategic challenges in the electrification transformation of Southeast Asian automakers: First, a shortage of professional talent, with undersupply of high-quality talent in the EV and software fields, fierce competition for industry talent, and enterprises needing to plan for talent cultivation and retention; Second, cross-cultural coordination difficulties: significant differences in working models among Chinese, Japanese, Korean, European, American, and local enterprises, which easily led to issues such as lack of trust and poor cooperation; Third, complex and changing regional regulations: fragmented regulatory systems across Southeast Asian countries, with a fast pace of policy updates over the past year or more, placing high demands on enterprises' policy adaptation capabilities; Fourth, profitability pressure, as electrification reshaped the pricing system, with many automakers experiencing simultaneous contraction in revenue and profit margins, necessitating the exploration of long-term profitable models. Overall, he believed that while he currently maintained a cautiously optimistic attitude towards the development of industry technology and products, the aforementioned challenges still urgently needed to be addressed. Panel Discussion: Leadership Dialogue: East Asian Titans' "Southeast Asian Chessboard" Moderator: David Huang, The Head of Strategy, Marketing and Business Development, Forvia China Panelists: Dr. Yossapong Laoonual, Honorary Chairman and Advisors, Electric Vehicle Association of Thailand (EVAT) Suphot Sukphisarn, Honorary Chairman, Auto Parts Industry Club (APIC), The Federation of Thai Industries (FTI), Deputy Secretary General, Thai Auto-Parts Manufacturers Association (TAPMA） Krzysztof Tokarz, Chairman of the Automotive Working Group at TEBA, Founder of Auteneo Dr. Viroj Patcharawatanakul, Chief Marketing Officer (CMO), AAPICO Hitech PCL. The panelists noted that ASEAN countries have distinct industrial advantages: Malaysia has ample electronic factory resources, Indonesia possesses mineral resources needed for battery production, and Vietnam offers comprehensive labor incentive policies. To fully leverage each country's locational appeal, overall integrated planning is required. The ASEAN NEV market is expanding rapidly overall, with the regional EV penetration rate more than doubling. Thailand and Vietnam have seen impressive growth in XEV production and sales. Local vehicle production capacity remains stable, and Chinese new energy brands such as BYD, MG, and Great Wall have established a presence in Thailand, driving up demand for new energy parts supply. Thailand has a well-established multi-tier parts supply system: 27 vehicle manufacturers, 500 Tier 1 suppliers, and 1,800 Tier 2 and Tier 3 parts producers. Traditional mechanical processing industries like stamping, injection molding, rubber processing, machining, casting and forging, and assembly have a solid foundation, with huge annual parts capacity, providing the manufacturing capability to support new energy parts production. Keynote Speech: Navigating Automotive Disruption in Southeast Asia Guest Speaker: Timothy Wong, Principal, Roland Berger Roland Berger noted that AI-driven automation continues to advance and autonomous driving is developing steadily. It is expected that by 2040, autonomous driving will still struggle to become mainstream. However, AI technology has already disrupted the automotive industry, becoming a core driving force for enterprises to build differentiated advantages, enhance competitiveness, and innovate business models. The automotive industry is currently undergoing comprehensive disruptive changes, mainly in five dimensions: First, the automotive supply chain value chain is undergoing fundamental transformation, with vehicles and core parts upgrading toward electrification and electronics. Industry enterprises urgently need to adjust their product structures and proactively position themselves in emerging tracks; passively responding to market changes will entail significant risks. Second, the nature of automotive products is being reshaped by technology, shifting from traditional mechanical vehicles to software-defined vehicles. Sole mechanical manufacturing capabilities can no longer meet development needs; enterprises must build diversified cooperation ecosystems involving semiconductors, software, and sensors to cultivate new industrial capabilities. Third, the consumer market is undergoing significant iteration, with consumer car purchase preferences gradually tilting toward emerging brands, and industry competition continuing to intensify. Fourth, the pace of market iteration has greatly accelerated. Compared with the model update pace of once every few years by traditional automakers, Chinese brands iterate at a much faster pace, forcing the supply chain toward agile transformation and adaptation to rapidly changing vehicle specifications. Fifth, the aftersales distribution model is being disrupted, with traditional parts revenue being impacted by the growth of EVs. New direct-to-consumer models are emerging, requiring enterprises to restructure their distribution networks and expand aftersales services related to power batteries and electrification. Overall, all industry participants must proactively face transformation risks, actively transform and strategically restructure supply chains, vigorously explore new clients and deploy new businesses, abandon passive thinking that clings to existing models, and proactively plan future business development directions, so as to continuously maintain market competitiveness. Keynote Speech: Moving Beyond Negotiation: Fostering a New Framework for Southeast Asian Supply Chain Collaboration Based on the SMM Price Index Guest Speaker: Sing Yao, Director of Steel Business Unit, SMM Information & Technology Co., Ltd. She noted that Southeast Asia as a whole exhibits low per capita automobile ownership, limited NEV penetration, and a large young population, which holds enormous incremental market potential. This vast blue ocean is attracting leading Chinese NEV manufacturers to accelerate their footprint in the region. At the same time, however, Southeast Asian auto parts are highly dependent on imports, and the industry chain has long faced two major pain points: procurement difficulties and disorderly pricing. The launch of the SMM Southeast Asia Price Index may open up a new path for collaborative development of the local automotive supply chain. Low Per Capita Automobile Ownership, Limited NEV Penetration, and Large Young Population Create Vast Market Opportunities for Automakers According to SMM, in recent years, Southeast Asia’s automotive industry chain has shown remarkable resilience, with regional automobile production growing by 24.1% from 2020 to 2022. Although 2024 saw a cyclical decline for the first time due to global economic sluggishness, the decline in production and sales in Thailand and the broader Southeast Asian market has narrowed in 2025, underscoring the self-repair capability of the regional supply chain. As the region’s core hub, Thailand continues to dominate Southeast Asia’s automotive industry landscape with a capacity share of over 40%. In the short term, Thailand will maintain its position as a regional production center and export base, but its long-term competitive advantages are facing structural challenges: the sustained contraction of local capacity and the upgrading of neighboring countries’ industry chains are compelling it to accelerate technological transformation and supply chain restructuring. Driven by the immense allure of this industry “blue ocean,” leading Chinese NEV manufacturers are accelerating their expansion into the Southeast Asian automotive market. Keynote Speech:Baowu JFE Southeast Asia Strategy Sharing Guest Speaker: Liang Chen, Vice General Manager, Baowu Jiefuyi Special Steel Co., Ltd. He that overall steel production in Southeast Asia is declining, but the penetration rate of new energy electric vehicles (EVs) is surging: Thailand’s EV-related demand is up 80% YoY, while Indonesia’s demand has experienced a multiple-fold rise, with subsequent growth potential continuing to be released. Local NEV manufacturers previously purchased Japanese steel, but are gradually switching suppliers now, driven by industry competition and cost pressure. This also represents a core opportunity for the company to promote its supporting supply services. Leadership Panel: The Steel vs. Aluminum Debate and Cost Challenges Moderator: Michelle Leung, Head of Asia Metals and Mining, sustainability, Bloomberg LP Panelists: Thanakorn Thangwanichkapong, Director of Asia Operations, Maxion Wheels Martin Dilly, Southeast Asia Area Sales Director, Bureau Veritas The panelists noted that multiple disruptions, including the situation in the Strait of Hormuz and national tariff adjustments, have moved beyond short-term impact and are driving the restructuring of the entire steel and aluminum industry chain, with the structural transformation of the aluminum industry being particularly pronounced. Global supply chain vulnerability continues to intensify, and upward cost pressure on the industry has increased. Tariff barriers are reshaping the global trade landscape, and market competition is becoming increasingly fierce. The implementation of industrial localization has accelerated, but the pace of progress in Southeast Asia has seen a slowdown. Overall, only enterprises that possess both flexible logistics and procurement capabilities and a robust compliance management system can gain an advantage amid the industry transformation. Keynote Speech: Analysis of Southeast Asia's Secondary Aluminum Market and Price Trends Guest Speaker: Wong Yan Ling, Senior Aluminum Analyst, SMM Information & Technology Co., Ltd. She noted that Southeast Asia has become one of the fastest-growing secondary aluminum markets globally, and the worldwide competition for scrap resources is continuously reshaping the regional supply landscape. As resource protection policies are progressively implemented across various countries and regional manufacturing demand steadily expands, ASEAN countries are expected to further consolidate their core position in the global secondary aluminum industry chain. Regarding secondary aluminum price trends in H2 2026, SMM analysis suggests that weak seasonal demand in Southeast Asia may suppress the upside room for secondary aluminum prices, while the geopolitical situation in the Middle East remains a key variable affecting market trends. If shipping through the Strait of Hormuz returns to normal, cost pressures from logistics could ease. However, persistently tight scrap supply coupled with potential logistics disruptions may still drive up regional secondary aluminum prices. Specialized Seminar: Co-building a Resilient Automotive Materials Supply Chain for Southeast Asia Moderator: Sing Yao, Director of Steel Business Unit, SMM Information & Technology Co., Ltd. Panelists: Zongyan Fu, Purchasing Manager, Changan Auto Southeast Asia Co., Ltd. Weijiang Xue, Chief Engineer of Product R&D, Jiangsu Yonggang Group Co.,Ltd. Hui Yuan, General Manager, Tianjin Dewy Metal Surface Treatment Co., Ltd. Yi Huang, Deputy General Manager, Guangdong Superband Precision Industry Co.，Ltd. Thanakorn Thangwanichkapong, Director of Asia Operations, Maxion Wheels Hongwei Liu, General Manager, BYH NEW TECHNOLOGY CO., LTD. Saurabh Sharma, Sr General Manager & Executive Director, Hero Motors Thai Ltd. Jun Zou, Overseas Region Head, Marketing, Management Office, Baowu Jiefuyi Special Steel Co., Ltd. HaiBin Jia, Deputy Marketing Director, Beijing Jianlong Heavy Industry Group Co., Ltd. The panelists engaged in in-depth exchanges, drawing from their own business practices, focusing on the core topic of deep development in the Southeast Asian automotive industry. They focused on enterprises' current business layouts, operating status, and development trends in the Southeast Asian automotive market, and deeply analyzed core pain points and challenges such as supply chain adaptation, stable supply, and logistics support in the process of going global. At the same time, they shared detailed experiences regarding common challenges faced by enterprises going global, including localization certification, compliance system adaptation in and outside China, and alignment of policy standards. They also discussed core paths for enterprises to anticipate market changes, precisely allocate industrial resources, and quickly adapt to regional market rules and industry demands, focusing on industry trends. Furthermore, focusing on supply-demand coordinated development, they elaborated on their expectations for future cooperation models, collaboration mechanisms, and partnership needs with Chinese material suppliers. As buyers, they also clarified the types and directions of high-quality Southeast Asian clients they plan to prioritize for connection and cooperation, providing practical ideas and references for precise supply-demand matching and deep cultivation of the Southeast Asian automotive market for Chinese enterprises going global. Day 2: June 17 Keynote Speech: Analysis and Outlook of the Supply Chain in the Southeast Asian New Energy Market Speaker: Jena Wang, New Energy Consulting Project Manager, SMM Information & Technology Co., Ltd. She stated that driven by the rapid growth of the Southeast Asian NEV market, several automakers are accelerating their localization strategies. Battery demand in each country will also increase rapidly, with the region's total battery demand expected to grow by about ten times from 2025 to 2030, reaching approximately 201 GWh. However, it is worth noting that currently, Southeast Asia faces issues with low localization rates, significant structural gaps, and heavy import dependence for cathode materials and motor components. In Southeast Asia, the supply of local cathode materials and key motor components cannot meet demand, and the low localization rate and large capacity gaps have become key bottlenecks restricting the development of the NEV industry chain in the region. Data indicates that China's global production share of key new energy raw materials—such as batteries, cathode materials, lithium chemicals, and rare earth permanent magnets—generally exceeds 70%, with its capacity ranking first worldwide, demonstrating a significant advantage. In addition, she introduced the capacity distribution and industrialisation progress of key materials in the new energy markets of core Southeast Asian countries. Vietnam: Local automaker VinFast is boosting rapid development of the entire vehicle and upstream/downstream supporting industry chain. Thailand: As a core hub for automotive manufacturing and export in Southeast Asia, it boasts a relatively complete supporting system for motor and electric drive-related industries. Malaysia: It possesses a mature automotive industry foundation, but its local supporting capability for the three electric systems is insufficient; local policies focus on supporting vehicle assembly and regional distribution operations. Indonesia: With abundant nickel resources, it holds a pronounced competitive edge in the battery raw material industry. Overall, SMM believes that the capacity for core new energy components in Southeast Asia is relatively small. National policies are promoting localisation and industrial upgrading, leaving significant room for supply chain development. Leadership Panel: Supply Chain Security and Opportunities in Southeast Asia Moderator: Peter Klöpfer, Senior Manager Automotive Business Unit, RUTRONIK Electronics Worldwide Panelists: Akshay Prasad, Principal, Arthur D. Little SEA Alex Zhan, Head, ZF LIFETEC Thailand Asst.Prof.Uthane Supatti Ph.D., Head of the Power Electronics Applications and Energy Management (PEEM) Research Unit, Faculty of Engineering at Sriracha, Kasetsart University, Thailand, Vice President, Electric Vehicle Association of Thailand (EVAT) The panelists discussed about core themes of the Southeast Asian automotive supply chain. First, they addressed the delivery timeline crisis caused by sudden supply shortages, the crisis of lacking transparency in the industry chain, the crisis of industry-wide collaboration barriers, and the crisis of trust failure between upstream and downstream players. They jointly explored systematic resolution strategies and elaborated on their respective countermeasures. Building on this, the on-site guests further discussed the Japanese industry chain and China’s domestic supply chain, analyzing the development opportunities, long-term prospects, and practical implementation logic of two-way opening, healthy competition and cooperation, and deep integration between the two. Leadership Panel: Capacity Coopetition and Customer Breakthrough: Winning the Southeast Asian Supply Chain Battle Moderator: Wacharapisuth Thannapong, Researcher, BCG (Bio-Circular-Green Economy Policy) Research Team, Thailand Development Research Institute (TDRI) Panelists: MARK BRIAN PIRIE, Senior Vice President Purchasing & Supplier Management Asia Pacific, Executive Board Member, Schaeffler Frank Yu, General Manager of the Automotive Rubber & Metal Components Business Unit and Thailand Branch, Shanghai Baolong Automotive Corporation The panelists assessed the overheating of three-electric system (battery, motor, electronic control) capacity in Southeast Asia. They noted that overcapacity in three-electric systems is a global trend. The capacity now deployed in Southeast Asia and Thailand already exceeds confirmed demand, intensifying market uncertainty and heightening investment concerns. Risks are structurally differentiated: Tier-1 suppliers are more conservative and risk-averse compared to China’s domestic vehicle makers that are rapidly going global. There is localized overcapacity in basic e-drive parts and low-difficulty electronic components, while supply bottlenecks persist for key items such as high-performance automotive-grade semiconductors, advanced materials, and electrical steel. This is also a core motivation for Chinese suppliers setting up in Southeast Asia. Moreover, Southeast Asia’s geographical advantages are prominent, and mine development in Australia is progressing rapidly. Many mines are set to commence production by Q3 next year. The core contradiction in the industry is not simply overall surplus, but a mismatch between the regional allocation of capacity, the technologies adopted, and actual market demand. Additionally, the guests noted that the core challenges in Southeast Asia and Thailand revolve around three major issues: regional adaptation, supply chain gaps, and industrial competition and collaboration. Enterprises must independently weigh risks and expansion scales based on their own supply chain conditions to find a development balance suited to their needs. Meanwhile, to adapt to the unique environment of Southeast Asia—characterized by high temperatures, high humidity, floods, complex road conditions, and underdeveloped charging infrastructure—the EV technologies originally designed for the Chinese and European markets must undergo localized R&D and verification. This process ensures the reliability of batteries, electronic controls, and lubrication systems, as well as overall vehicle durability. It is recommended that Tier 1 suppliers and upstream partners proactively collaborate in depth with OEM design teams. Even for domestically mature production car models going global in Southeast Asia, it is essential to iterate and optimize products by leveraging local expansion opportunities while drawing on the cost, process, and quality control expertise gained from large-scale domestic production. Leadership Panel: Techno-Economic Analysis and Strategic Pathways for Battery Material Localization in Southeast Asias Moderator: Jay Yu, Senior director, SMM Information & Technology Co., Ltd. Panelists: Brian, Sales Director for the Electrolyte Division in Japan, South Korea, and Southeast Asia, TINCI Materials Max Miao, Director, SEVB Thailand Feng Hao, Southeast Asia Marketing Director, Hefei Guoxuan High-Tech Power Energy Co., Ltd. The panelists noted that amid the restructuring of global manufacturing, Southeast Asia’s lithium battery industry faces both challenges and opportunities. Enterprises are following downstream OEM clients in going global, establishing nearby supply systems centered on customer needs. Three key operational aspects require consideration. First, at the policy level, Southeast Asia’s lithium battery industry must supply both the local market and target exports to Europe and the U.S. Regional policy changes have far-reaching impacts, requiring enterprises to conduct ongoing in-depth analysis and implement corresponding response strategies. Second, in terms of human and cultural factors, local traditions and family values are distinct, necessitating flexible management that fully respects local customs, cares for local employees, and stabilizes production teams. Third, regarding the industry chain, the region’s upstream lithium battery materials are notably underdeveloped. Key raw materials such as high-purity solvents, lithium chemicals, and functional additives currently rely heavily on imports from China, Japan, and South Korea. The establishment and improvement of local upstream and downstream supply capabilities urgently need to be addressed, making this a key focus for future enterprise deployment. In addition, they also mentioned that in H2 this year, NEV-related subsidies in Southeast Asia may be gradually phased out, and Thailand's EV 4.0 policy and the year-end tax rebate policy will also undergo adjustments. Drawing on China's NEV development experience, local automakers will gradually break free from reliance on policy subsidies and instead compete in the market by leveraging product strength and market-based pricing. This year, Thailand's NEV sales are conservatively estimated to reach 120,000 units, with a potential to hit 160,000 units. Compared with Japanese car models, Chinese NEV models have ample room for price adjustment, offering a clear advantage. Currently, battery enterprises are actively assisting automakers in expanding markets and securing more orders, while also suggesting that automakers moderately raise vehicle selling prices. The industry generally believes that automakers will most likely offset the operational pressure from subsidy reductions through price adjustments in the future. Procurement Matchmaking Meeting >Click to view more highlights from the event Check-in & Networking This is the end of the 2026 SMM (3rd) ASEAN Automotive Supply Chain Conference . Thank you for the support of all industry peers. See you next year!

I. Key Points In H1 2026, nickel prices exhibited wide fluctuations characterized by a “rebound from lows—consolidation at highs—pullback and consolidation” pattern. The most-traded LME nickel contract surged from $14,000/mt at the beginning of the year to near $20,000 in May, before pulling back to $16,000-17,000 in July; the most-traded SHFE nickel contract climbed from 110,000 yuan/mt to above 150,000 yuan/mt, and then retreated to 125,000-130,000 yuan/mt. The driving logic of this market move was the intertwined resonance of three main themes: a shift in Indonesia’s resource policies, repeated fluctuations in global macro liquidity expectations, and the impact of geopolitical conflicts on raw material costs. The center of nickel prices did rise compared to 2025, but the “shadow of surplus” has not dissipated. In H2 2026, the key variables for tracking nickel prices are as follows: First, the approval results of Indonesia’s RKAB quota revision in July. A significant increase in the quota would substantially narrow the supply deficit and weigh on nickel prices. Second, the Fed’s policy path — whether the hawkish signal from the June dot plot will persist — which affects the US dollar index and the valuation center of commodities. Third, sulphur supply and the situation in the Strait of Hormuz, which determines the cost support strength along the MHP–nickel sulphate–refined nickel chain. Fourth, demand from stainless steel and NEV ternary power batteries. Fifth, the pace of global visible inventory destocking. Sustained destocking would serve as a real support signal, while high inventories would limit price elasticity. Under a neutral scenario, LME nickel prices are expected to trade in the range of $15,500-17,500/mt in H2. II. Macro Environment – Reversal of Liquidity Expectations, Substantial Impact of Geopolitical Costs, and the ‘Dual Strength’ Pattern of the RMB 1. Fed Policy Path: ‘From Dovish to Hawkish’ At the beginning of the year, the market widely expected 50-100 bp of rate cuts in H1 2026, and the US dollar index fell below 97 at one point, creating a relatively loose liquidity environment. However, mid-year, new Fed Chair Kevin Warsh’s hawkish stance surprised the market. The June meeting kept rates unchanged and the dot plot signaled a bias toward rate hikes, leading to a systematic revision of the previously priced “dovish delivery” logic. This directly weighed on the valuation of industrial metals such as nickel, serving as a key macro trigger for the nickel price decline in June. 2. Geopolitical Conflicts Expanded from ‘Safe-Haven Trades’ to ‘Real Cost Shocks’ The Middle East situation (tensions among the US, Israel and Iran, and disturbances in the Strait of Hormuz) not only pushed up energy and safe-haven premiums, but also, through the critical link of sulphur supply, directly raised the production cost of Indonesia’s MHP (each mt of MHP in metal content consumes about 10 mt of sulphur), forming the core driver of the pulse-like surge in nickel prices in May. After a ceasefire agreement was reached between the US and Iran in mid-June, energy and safe-haven premiums receded, leading to a peak and subsequent pullback in commodities, confirming the dual impact of geopolitical variables on nickel prices. 3. China’s Macroeconomy and RMB ‘Dual Strength’ Provide a Unique Offset Against a generally stronger US dollar, the onshore RMB bucked the trend, appreciating from 6.98 to 6.79 (a gain of about 2.9%). The relative strength of the RMB, with the exchange rate declining (USD/CNY fell), caused import costs to drop sharply, opening the import window and generating arbitrage profits. However, as large volumes of imported nickel flowed into the domestic market, the spot supply of nickel plates in China increased, accelerating the pace of inventory buildup and weighing on domestic prices. At the same time, LME nickel inventories decreased, leading to a repair of the SHFE/LME nickel price ratio, and the import window closed again in May. III. Indonesia's Industrial Policy—Systemic Transformation from "Expanding Capacity" to "Controlling the Chain to Raise Prices" In H1 2026, Indonesia's nickel industry policy completed a strategic shift, systematically deploying a policy package centered on "controlling supply, stabilizing prices, and enhancing resource added value," which became the core fundamental variable driving wide fluctuations in nickel prices. 1. Significant tightening of total RKAB quotas and tilted allocation structure At the beginning of the year, Indonesia's ESDM announced that the 2026 nickel ore quota would be drastically cut from 379 million wmt in 2025 to 270 million wmt. The world's largest single nickel mine project, WBN, saw its 2026 quota suffer a "cliff-like" reduction; its quota was exhausted in May, leading to full-scale production cuts and shutdowns, stoking persistent concerns over tight supply in H1. The Indonesian authorities have clarified that July 1 to 31, 2026 will be the mid-year application period for supplementary RKAB quotas, prioritizing compliant miners with integrated domestic downstream smelting capacity (such as supporting NPI or HPAL projects). The mid-year policy game over RKAB quotas is intensifying. 2. HPM pricing formula reform shifts from single nickel pricing to multi-element comprehensive pricing The new formula effective April 15 incorporates associated elements such as iron, cobalt, and chromium into the value component for the first time. Indonesia sought to recapture the undervalued value of associated resources into the pricing system, raising benchmark prices for nickel ore and intermediate products across the cost side. However, this reform met strong opposition from the domestic smelting industry, which argued that it would further squeeze smelting profits amid already surging sulfur and energy costs. 3. Indonesian government officially releases new export control regulations for ferronickel (FeNi) and NPI In July, Indonesia further strengthened export supervision of high-value-added nickel products under Finance Minister Regulation (KMK) No.32/MK/BC/2026 (implementing Trade Minister Regulation No.17/2026). The new regulation targets products under HS Code Ex.7202.60.00, including ferronickel (FeNi) ingots and lumps with nickel content ≥8%, sponge ferronickel (Sponge FeNi) and granular ferronickel (Nugget FeNi) with nickel content ≥4%, as well as low-grade ferronickel products with 2% ≤ Ni <4% and iron content ≥75% (covering some NPI products). Export requires a surveyor's report (LS) and relevant export licenses; from January 1, 2027, export will generally only be allowed through state-owned export enterprises (BUMN Ekspor), with exemptions under specific circumstances. Overall, Indonesia is currently tightening quotas, raising taxes and fees, and imposing export controls to elevate resource value, seeking to keep nickel prices within its officially recognized desired range ($19,000-20,000/mt) over the long term. On the other hand, it must balance stability of the industry chain and foreign investor confidence in actual implementation, thus exhibiting a game-like characteristic of "tight first then loose, adjusting while implementing."The extreme policy uncertainty was one of the core reasons behind the wide fluctuations in nickel prices in H1. IV. Changes in Nickel Intermediate Product Raw Materials: Restructuring of the Cost Transmission Chain 1. MHP and High-Grade Nickel Matte: A Dynamic Game Dominated by "Auxiliary Material Costs" There are three main production routes for nickel sulphate raw materials: MHP (hydrometallurgy): the dominant route with the largest long-term growth, but highly dependent on sulphur; high-grade nickel matte (pyrometallurgy RKEF conversion / oxygen-enriched side-blowing route): an alternative route with low dependence on sulphur and relatively stable cost elasticity; nickel briquette dissolution: the least economical, feasible only within specific price spread windows. The sharp fluctuations in sulphur prices in H1 reshaped the cost structure of the entire nickel industry chain. Producing one mt in metal content of MHP requires approximately 10 mt of sulphur, while tensions in the Strait of Hormuz disrupted Indonesia’s sulphur import channels, forcing Huayou Cobalt’s Huafei Nickel-Cobalt to cut production on some lines starting in May. Sulphur prices surged, with the SMM sulphur CIF Indonesia price peaking at $1,300/mt, and the cost shock was transmitted step by step along the “sulphur—MHP—nickel sulphate—electrodeposited nickel” chain, becoming one of the core drivers behind the rapid nickel price rise in May. The high-grade nickel matte route, relying on pyrometallurgy, is far less dependent on sulphur than MHP. Consequently, during the sulphur price spike, high-grade nickel matte’s cost advantage over MHP widened significantly, creating direct substitution pressure on MHP’s market share. In terms of production trends, Indonesia’s MHP production edged up about 0.02% YoY to 206,000 mt in metal content in January-June 2026. Over the same period, high-grade nickel matte posted the most impressive growth, with production up about 123% YoY to 185,000 mt in metal content, strengthening its position in the competition for nickel sulphate raw materials. In the medium and long term, however, once sulphur supply normalizes and MHP costs pull back, the MHP route, with its scale effects and relatively mature cost curve, will reclaim its dominant share of the nickel sulphate raw material market; after all, MHP projects’ capacity base is far larger than that of high-grade nickel matte, and its cobalt by-product also provides a substantial marginal revenue contribution (about $4,500/mt Ni). 2. Production Capacity Switching Game Between High-Grade Nickel Matte and NPI High-grade nickel matte and NPI share the same RKEF production lines and laterite nickel ore resources, differing only in whether a sulphidation conversion stage is added at the end. The conversion decision is essentially a profit-maximization problem: when the marginal revenue of high-grade nickel matte relative to NPI covers the additional equipment and process losses of sulphidation conversion, lines switch to high-grade nickel matte; otherwise, they tend toward NPI. The conversion profit chart shows that profit for NPI-to-high-grade-nickel-matte conversion appeared only in April-May. After MHP production cuts in May, the monthly nickel sulphate raw material deficit was about 8,000 mt Ni, theoretically requiring increased high-grade nickel matte production to fill. However, due to RKAB quota constraints and the continued decline in NPI feed grade, integrated enterprises prioritized supplying stainless steel, making it difficult for high-grade nickel matte to offset the MHP raw material shortfall. This was a key reason why nickel sulphate prices remained firm even after refined nickel prices fell sharply in May. 5. Refined Nickel Supply-Demand Pattern: High Inventory vs. Structural Tightness Expectations 1. Supply Side: Electrodeposited Nickel Capacity Continues to Expand, Production Hits Repeated Records The most certain trend on the supply side is the sustained release of electrodeposited nickel capacity and production in China and Indonesia. According to SMM data, from January to June 2026, China’s refined nickel production was 215,000 mt, a YoY growth rate of 9%; Indonesia’s refined nickel production was 56,000 mt, a YoY growth rate of 97%. Meanwhile, at the beginning of 2026, China’s refined nickel trade pattern underwent a temporary reversal. Previously, benefiting from the explosion in electrodeposited nickel capacity, China had once been expanding its net exports of refined nickel. However, entering Q1 2026, as the price spread between Chinese and overseas markets opened up and the import arbitrage window was activated, China turned back into a net importer of refined nickel, with net imports exceeding 80,000 mt in January-April. 2. Demand Side: New Energy Recovery, Stainless Steel Support, and Steady Alloy & Special Steel In H1 2026, stainless steel, the largest downstream application of nickel, maintained mild growth. Total stainless steel production in China and Indonesia from January to June was approximately 23 million mt, up about 2% YoY. Steel mills maintained relatively high operating rates throughout H1, with stable apparent consumption. In the new energy (ternary battery) sector, nickel demand saw a strong recovery. From January to June, China’s ternary cathode precursor production was 528,000 mt, up 32% YoY; ternary cathode material production was 493,000 mt, up 40% YoY. Alloy & special steel and electroplating, although accounting for a relatively low share of total primary nickel consumption, played a critical role in refined nickel demand in H1 due to their irreplaceability. From January to June, China’s total refined nickel demand was approximately 140,000 mt, up 9% YoY. Military and aerospace demand strengthened, while high-end manufacturing demand remained steady with moderate growth. 3. Inventory Side: Global Visible Inventory Remains at Historical Highs Despite wild swings in nickel prices in H1, global visible nickel inventory remained at relatively high historical levels. LME nickel inventory fluctuated in the range of 270,000-280,000 mt for an extended period. China’s social inventory and exchange warrants experienced significant buildup. As of July, SMM refined nickel social inventory reached 130,000 mt, with total global inventory hitting a high of 497,000 mt. High visible inventory posed a significant constraint on nickel price rises. In June, after digesting supply disruption narratives, the market refocused on the fundamental reality of “high inventory and lackluster demand,” and nickel prices pulled back from a temporary high to around $16,100/mt. 6. H2 2026 Risk Alerts and Nickel Price Forecasts Based on the logic of H1, nickel price trends in H2 are expected to maintain a fundamental pattern dominated by policy gaming, with macro factors amplifying volatility. The following variables merit close monitoring: 1. The final outcome of the RKAB quota revision approval in Indonesia in July; 2. whether the US Fed's policy path in H2 will continue its hawkish stance; 3. whether sulfur supply can substantially return to normal, and whether there is a risk of repeated disruptions in the Strait of Hormuz situation; 4. whether end-use demand from stainless steel and new energy sectors can show a substantial improvement; 5. the destocking pace of global visible inventory. Based on the above price influencing factors, a scenario analysis for nickel prices is conducted: Bearish scenario (quotas being more accommodative than expected): quota increase ≥30% + sulfur pullback + high inventory pressure → LME nickel $14,000—$16,000/mt. Neutral scenario (highest probability): quota slightly increased but still tight + sulfur consolidates at highs → LME nickel $15,500—$17,500/mt. Bullish scenario (tight quotas + secondary cost surge): quotas continue to tighten + export controls + repeated geopolitical tensions push up sulfur → LME nickel $17,000—$19,000/mt.

Tightening supply policy in Indonesia, new import quotas and carbon costs in the EU, and tariff walls in the US pushed benchmark stainless steel prices higher across nearly every major market in the first half of 2026 — even as real demand stayed weak everywhere, turning global trade increasingly into a fight over market access rather than supply and demand.