SMM Morning Meeting Summary: Overnight, LME copper opened at $13,653/mt, swung wildly in early trading to probe a high of $13,666/mt. The copper price center then fluctuated downward to touch a low of $13,512.5/mt, before swinging wildly again near the end of the session to finally close at $13,516/mt, down 0.69%, with trading volume at 23,700 lots and open interest at 270,300 lots, an increase of 1,898 lots from the previous trading day, indicating bears adding positions. Overnight, the most-traded SHFE copper 2607 contract opened at 104,470 yuan/mt, swung wildly in early trading to touch a high of 104,670 yuan/mt. The copper price center then dropped sharply to probe a low of 103,800 yuan/mt, before fluctuating upward to finally close at 104,010 yuan/mt, down 0.9%, with trading volume at 43,400 lots and open interest at 180,500 lots, a decrease of 942 lots from the previous trading day, indicating bulls reducing positions.

[Hawkish US Fed Expectations Heat Up, Aluminum Prices Under Pressure and in the Doldrums] On the fundamentals, the tight spot cargo situation in the ex-China aluminum market continued. LME aluminum inventory remained at low levels, cancelled warrants continued to grow, reflecting tight available supplies. Meanwhile, Japan's Q3 spot aluminum premiums were further raised, also indicating resilient Asian spot demand. Multiple factors jointly supported LME aluminum's performance. On the China side, driven by improved export margins, aluminum semis exports recovered and are expected to remain at a relatively high level in the near term. However, the pace of China's inventory drawdown was slow, spot transactions were lackluster, and downstream purchasing remained cautious, limiting SHFE aluminum's upside room. Overall, aluminum prices are expected to continue moving sideways with LME outperforming SHFE in the near term.

SMM May 28 News: Metals market: Overnight, domestic market base metals fell across the board. SHFE copper fell 0.9%. SHFE aluminum fell 1.24%, SHFE lead fell 0.81%. SHFE zinc fell 0.48%. SHFE tin fell 0.64%. SHFE nickel fell 0.48%. In addition, the most-traded alumina futures contract rose 0.17%, and the most-traded foundry aluminum futures contract fell 1.02%. Overnight, ferrous metals mostly rose. Iron ore fell 0.13%, stainless steel rose 0.23%, rebar rose 0.32%, and hot-rolled coil rose 0.36%. Coking coal and coke: the most-traded coking coal futures contract rose 2.13%, and the most-traded coke futures contract rose 1.88%. Overnight, overseas market metals saw broad declines in LME base metals. LME copper fell 0.69%. LME aluminum fell 1.28%, LME lead fell 0.72%. LME zinc fell 0.58%. LME tin rose 0.08%. LME nickel fell 0.63%. Overnight precious metals : COMEX gold fell 1.03%, COMEX silver fell 2.25%. Overnight, the most-traded SHFE gold contract fell 1.26%, and the most-traded SHFE silver contract fell 2.28%. As of 7:11 am on May 28, overnight closing prices: Macro front China: [Li Qiang: Accelerate the construction of commodity resource allocation hubs to provide reliable support for coordinating development and security] Li Qiang, member of the Standing Committee of the Political Bureau of the CPC Central Committee and Premier of the State Council, conducted a survey in Zhoushan and Ningbo, Zhejiang Province from May 25 to 27. He emphasized the need to thoroughly implement General Secretary's important remarks and instructions on building a major-country reserve system, adhere to government leadership, social co-construction, and diversified complementarity, manage commodity and important material reserve adjustments, strengthen strategic security, macroeconomic regulation, and emergency response functions, continuously enhance industry chain and supply chain resilience, and accelerate the construction of commodity resource allocation hubs to provide reliable support for coordinating development and security. (Xinhua News Agency) [Ministry of Industry and Information Technology: Strengthen top-level design of automotive standards system] According to the Ministry of Industry and Information Technology, the 2026 automotive standardization system has been completed. This system covers many aspects, strengthens the top-level design of the standards system, and empowers high-quality development of the automotive industry. In promoting innovative development in emerging fields, it focuses on accelerating standard development and iteration in areas such as driving automation, connected functions and applications, information security and data security, resource management and information services, automotive software, automotive data, and "vehicle-road-cloud integration." It efficiently carries out the development and revision of standards for key system components such as automotive electronics and automotive chips. In addition, targeting future industry directions such as automotive artificial intelligence and new-form vehicles, it conducts forward-looking standard breakthrough actions and advances standard planning and layout. (CCTV News) US dollar: Overnight, the US dollar index rose 0.08% to 99.23. US Fed Vice Chair Jefferson said he expected inflation to cool later this year as the effects of tariffs and rising energy costs fade, but warned that inflation risks remain tilted to the upside. In prepared remarks for a speech at a Bank of Japan-hosted conference in Tokyo on Thursday morning, Jefferson said he was watching for signs that rising energy costs from the Iran war were dragging on consumer spending. He also warned that he continued to see signs of labour market weakness. Jefferson reiterated his view that the central bank's current policy stance is well positioned to respond to any developments. Jefferson said, "I am not prejudging the next meeting and look forward to engaging with my colleagues on the best policy to achieve our dual mandate goals." According to CME "FedWatch": the probability of the US Fed maintaining rates unchanged through June is 99.9%, with a 0.1% probability of a cumulative 25 basis point interest rate cut. The probability of the US Fed maintaining rates unchanged through July is 91.4%, with an 8.5% probability of a cumulative 25 basis point rate hike. US Fed Governor Lisa Cook said in a speech at a Stanford University event on Wednesday local time that inflation is moving in the wrong direction, and she is prepared to raise interest rates if this continues. While Cook said she currently favors keeping borrowing costs unchanged and expects price growth to cool again in the coming months, her remarks align her with many US Fed officials' view that accelerating inflation is now a bigger policy concern than the labour market. Cook said: "I want to be clear about my risk assessment: risks remain tilted toward higher inflation." Cook said that inflation above the US Fed's 2% target for five years poses the risk of price pressures becoming embedded in price and wage-setting behavior. "Therefore, if the expected inflation pullback does not materialize in a timely manner, I am prepared to raise interest rates," she said. (Jin10 Data APP) Macro: Data to be released today include the eurozone May industrial confidence index, eurozone May economic sentiment index, Canada Q1 current account, US initial jobless claims for the week ending May 23, US April core PCE price index YoY, US April personal spending MoM, US Q1 real GDP annualized QoQ revised, US April core PCE price index MoM, and US April durable goods orders MoM. In addition, attention should be paid to: the ECB publishing the minutes of its April monetary policy meeting; FOMC permanent voting member and New York Fed President Williams delivering a keynote speech at a conference co-organized by the Central Bank of Iceland; 2028 FOMC voting member and St. Louis Fed President Musalem delivering a speech. Crude oil: Overnight, both oil futures fell, with WTI down 4.77% and Brent down 3.92%. The prospects for US-Iran talks remain uncertain. After the decline on the 27th, WTI crude oil edged up at the open on May 28, as the US and Iran still have disagreements on how to reopen the Strait of Hormuz. Trump said he was "not satisfied" with the negotiations. The White House denied Iranian reports of a draft agreement that said Iran and Oman would oversee strait shipping. Despite the challenges, crude oil prices are still on track for a second consecutive weekly decline due to optimism that the warring parties can at least reach an interim agreement. The sticking points in these protracted negotiations include Iran's desire to retain control over the Strait of Hormuz and the fate of the country's nuclear program. (Jin10 Data APP) According to CCTV News, earlier on Wednesday, Iranian media disclosed a "preliminary informal document" regarding the framework of a memorandum of understanding between Iran and the US, covering issues such as the Strait of Hormuz, regional military deployments, and future agreement arrangements. Data released by the American Petroleum Institute (API) showed that US crude oil and gasoline inventories both declined last week. US API crude oil inventory for the week ending May 22 was -2.819 million barrels, versus expectations of -4.367 million barrels and a prior value of -9.11 million barrels. US API gasoline inventory for the week ending May 22 was -3.199 million barrels, versus expectations of -2.896 million barrels and a prior value of -5.795 million barrels. (Jin10 Data APP)

SMM May 28: Overnight, LME lead opened at $2,016/mt, rising first then falling during the Asian session with a high of $2,021/mt. It then fluctuated downward after entering the European session, dipping to $2,000/mt near the close, and finally settled at $2,001/mt, down 0.72%. Overnight, the most-traded SHFE lead 2607 contract opened lower with a gap at 16,690 yuan/mt, briefly touching a high of 16,710 yuan/mt at the start of the session. After bulls reduced positions, it fluctuated downward to a low of 16,580 yuan/mt, and finally settled at 16,615 yuan/mt, down 0.69%. End-use demand for lead-acid batteries weakened, with retail stores seeing new battery inventory buildup and low scrap battery recycling volumes. Sales promotions were frequent in the market, and manufacturers' willingness to purchase lead ingots remained subdued. Additionally, multiple secondary lead enterprises plan to resume production after maintenance ends in early to mid-June, concentrating short-term bearish factors on lead prices. Subsequent focus should be on scrap battery supply and its impact on enterprises' production resumption progress. Data source disclaimer: Data other than public information is derived from public information, market communication, and SMM's internal database models, processed by SMM for reference only and does not constitute decision-making advice.

Futures: Overnight, LME lead opened at $2,016/mt, rising first then falling during the Asian session with a high of $2,021/mt. It then fluctuated downward during the European session, dipping to $2,000/mt near the close, and finally settled at $2,001/mt, down 0.72%. Overnight, the most-traded SHFE lead 2607 contract opened lower with a gap at 16,690 yuan/mt, briefly touching a high of 16,710 yuan/mt early in the session. After bulls reduced positions, it fluctuated downward to a low of 16,580 yuan/mt, and finally settled at 16,615 yuan/mt, down 0.69%. On the macro front: Samsung's union approved a wage agreement, averting strike risks. Reports indicated that TSMC will raise 3nm prices by 15% in H2, with a potential further 10% increase next year. The Reserve Bank of New Zealand kept interest rates unchanged for the third consecutive time, signaling that earlier and larger rate hikes may be needed. EU sources: EU member state governments have approved legislation to implement tariff reductions on US goods imports. China's State Administration for Market Regulation deployed local market regulators to carry out a special campaign on credit-empowered rectification of "involution" competition, May-December. ChangXin Technology's STAR Market IPO was approved by the listing committee. HKEX: launched a full-market trading fee waiver for gold futures. NBS: From January to April, total profits of China's above-scale industrial enterprises reached 2,435.84 billion yuan, up 18.2% YoY. From January to April, rapid development of semiconductor-related industries drove profit growth in electronic specialty materials manufacturing, optical fiber manufacturing, and optoelectronic device manufacturing by 601.7%, 347.6%, and 51.0%, respectively. : Circulating cargoes in the Jiangsu, Zhejiang, Shanghai market were limited, with few quotations from suppliers. SHFE lead continued to hold up well yesterday, and suppliers showed moderate willingness to ship, though mainly cargoes self-picked up from production site of primary lead smelters, with relatively firm quotations. Secondary lead smelters shipped along with the market, with some quotations turning to discounts. Secondary refined lead was quoted at premiums of -25~0 yuan/mt against SMM #1 lead, while a few regions quoted at premiums of +50 yuan/mt. As lead prices rebounded, downstream enterprises were cautious about purchasing at high prices, with some enterprises negotiating more. Only cargoes at large discounts (against the most-traded SHFE lead contract) saw transactions. On the inventory front: On May 27, LME lead inventory decreased by 1,350 mt to 284,350 mt. As of May 25, total SMM lead ingot social inventory across five locations decreased by 3,200 mt compared with May 18. Lead price forecast for today: End-use demand for lead-acid batteries weakened, with new battery inventory accumulating at stores and scrap battery recycling volume remaining low. Frequent market sales promotions have dampened manufacturers' willingness to purchase lead ingots. Coupled with several secondary lead enterprises planning to resume production after maintenance in early-to-mid June, factors pressuring lead prices have converged in the short term. Going forward, focus should be placed on scrap battery supply and its impact on the pace of enterprise production resumptions. Data source disclaimer: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and SMM's internal database models. The data are for reference only and do not constitute decision-making advice.

The average price of wolframite concentrates on May 26 was 400,500 yuan/standard tonne (65%WO3 basis), showing signs of stabilization after a nearly 62% decline over more than two months. Currently, downstream procurement demand in the tungsten market increased. Transactions across the entire tungsten industry chain — from tungsten concentrates, APT, and powder to tungsten scrap — recovered. Low-priced supplies in the market gradually diminished, and the industry as a whole showed signs of stopping falling and stabilizing. Wolframite Concentrates Fell 61.88% over 2+ Months, Prices Stabilized on the 26th The downward pace of tungsten concentrate prices slowed, with in-market transactions dominated by medium- and low-grade ore, while high-grade ore transactions remained relatively sluggish. As industry inventory continued to be cleared, downstream restocking demand picked up, mine auction transactions proceeded smoothly, and transaction prices were slightly higher than spot prices for scattered spot cargo in the market, effectively boosting market sentiment. On the 25th, a tungsten enterprise in Guangdong announced that its long-term contract prices for 55% wolframite concentrates for the second half of May were higher than spot order prices in the market, providing strong support for the market bottom and further consolidating the industry's trend of stopping falling. The specific long-term contract prices were: 55% wolframite concentrates at 414,000 yuan/standard tonne (65%WO3 basis), 55% scheelite concentrates at 413,000 yuan/standard tonne (65%WO3 basis), and APT long-term contract prices at 660,000 yuan/mt. After tungsten prices hit a record high on March 16, they were on an overall pullback trend due to weak demand, and tungsten prices underwent a deep correction over more than two months. According to SMM quotes, on May 26, the quotation range for wolframite concentrates (≥65%) was 400,000–401,000 yuan/standard tonne (65%WO3 basis), with an average price of 400,500 yuan/standard tonne (65%WO3 basis), unchanged from the previous trading day. Compared with the record high of 1,050,500 yuan/standard tonne (65%WO3 basis) on March 16, the average price of wolframite concentrates fell by 650,000 yuan/standard tonne (65%WO3 basis) in just over two months, a staggering decline of 61.88%! Since May, maintenance and production cuts by China's APT enterprises, along with measures to cut production to hold prices firm, effectively digested earlier inventory. As raw material prices gradually stabilized, smelters' willingness to hold prices firm strengthened, downstream just-in-time procurement gradually followed, and market trading activity rebounded slightly. Combined with the support formed by major producers' long-term contract pricing being finalized, APT prices stopped falling, and the market gradually entered a consolidation-at-lows phase. The tungsten powder market continued to see catch-up declines, though the pace of decline slowed down. Recently, the tungsten scrap market stopped falling and stabilized, recycled tungsten enterprises showed insufficient willingness to sell at low prices, and tungsten scrap transactions improved somewhat. Outlook Regarding the outlook for tungsten, overall, driven by orderly inventory destocking, the return of downstream just-in-time procurement, and the formation of pricing consensus among industry leaders, the tungsten market as a whole entered a bottoming-out and recovery phase. Going forward, close attention should be paid to the execution of long-term contracts and the pace of end-use demand recovery. According to an SMM survey, downstream cemented carbide alloy enterprises have seen their inventory drop to low levels, with expectations of rigid restocking demand. However, influenced by the market not yet being fully stabilized, enterprises remain cautious in procurement, generally adopting a small-order purchasing model. If upstream raw material inventory continues to be cleared and supply-demand imbalances are alleviated, tungsten prices are expected to enter a stabilization and consolidation phase in June-July. In the medium and long-term, the gap in Q3 mining quota transitions may lead to a contraction in market supply, coupled with expectations of the traditional "September-October peak season" consumption boom, the industrial supply-demand structure will continue to optimize, thereby providing bullish support for tungsten prices. Recommended reading:

Following the formal announcement by India’s Minister of Commerce and Industry, the India–Oman Comprehensive Economic Partnership Agreement (CEPA) will take effect on 1 June 2026. Market attention has largely focused on the surface-level benefit that “Oman will exempt an average 5% import tariff on 98% of Indian export goods.”

[SMM Steel] Brazil’s steel import quotas reached an average utilization rate of 60% as of May 20, up from 56% in late April, according to Siscomex data. The quota system, valid from February 24 to June 23, allows 445,469 mt of finished steel imports at regular tariff rates. Utilization rates reached 77% for Galvalume, 72% for zinc-coated steel, and 54% for CRC, while HRC quota usage remained relatively low at 18%. Imports exceeding quota volumes are subject to a 25% tariff. Market participants said Brazilian steelmakers continue pushing for stronger trade protection measures against imported steel.

[SMM Steel] Indian state-owned steelmaker RINL issued a new export tender for 30,000 mt of prime continuous cast steel billets in SAE-1008, SAE-1010, and SAE-1018 grades. The tender covers 150×150 mm billets on an FOB stowed basis, with shipment scheduled by July 20, 2026. The minimum bidding volume is 10,000 mt, while bids must be submitted by May 27 and remain valid until June 1. Payment terms require irrevocable sight letters of credit.

As of May 26, the Shanghai-LME zinc price ratio stood at 6.97, continuing its downward trend from 7.4 recorded in late March, which has led to a widening import loss of refined zinc ingots in China. According to calculations by Shanghai Metals Market (SMM), the current import loss of China’s refined zinc ingots has expanded to approximately RMB 3,800 per metric ton of metal.