[ADC12 Daily Price Review: Aluminum Alloy Futures and Spot Prices Fall in Tandem; ADC12 to Move Sideways in the Short Term] Today, aluminum alloy market quotes were broadly lower, with the SMM ADC12 price revised down by 200 yuan/mt. The pullback in futures further dampened spot market sentiment, and enterprises generally followed suit by lowering their quotes.

In North China today, spot #1 copper cathode prices were quoted against the front-month contract at a discount of 420-350 yuan/mt, with the average discount at 385 yuan/mt, down 80 yuan/mt from the previous trading day; the average transaction price was 107,870 yuan/mt, down 360 yuan/mt from the previous trading day.

SMM, August 13: Today, Guangdong #1 copper cathode spot prices against the front-month contract: high-quality copper was quoted at a discount of 20 yuan/mt, down 40 yuan/mt from the previous trading day; standard-quality copper was quoted at a discount of 120 yuan/mt, down 40 yuan/mt from the previous trading day; and SX-EW copper was quoted at a discount of 200 yuan/mt, down 60 yuan/mt from the previous trading day. The average Guangdong #1 copper cathode price was 108,250 yuan/mt, down 160 yuan/mt from the previous trading day, and the average SX-EW copper price was 108,100 yuan/mt, down 200 yuan/mt. Spot market: Guangdong inventories declined for two consecutive days, with fewer arrivals and slightly higher warehouse withdrawals. Today, the price spread between futures contracts widened further from yesterday to nearly 700 yuan/mt. With such a wide spread, downstream consumers purchased cautiously, and suppliers proactively cut prices to sell, causing premiums to keep falling. Even so, actual transactions remained very thin. Today, Guangdong copper cathode procurement sentiment was 2.21, down 0.03 from the previous trading day, and shipment sentiment was 3.03, down 0.04 from the previous trading day (historical data can be queried in the database). Overall, the price spread between futures contracts continued to widen, downstream restocking appetite remained subdued, and spot trades were sluggish.

SMM Morning Meeting Minutes: Overnight, LME copper opened at $14,230/mt, drifted higher early in the session to touch a high of $14,262/mt, then the copper price center shifted straight down, dipping to $14,096.5/mt near the end of the session, and finally closed at $14,109.5/mt, down 0.31%. Trading volume reached 16,900 lots, while open interest reached 263,000 lots, up 1,892 lots from the previous trading day, reflecting an increase in short positions. Overnight, the most-traded SHFE copper 2609 contract opened at 108,610 yuan/mt, immediately touched a high of 109,730 yuan/mt early in the session, then the copper price center drifted lower, dipping to 107,730 yuan/mt near the end of the session, and finally closed at 107,780 yuan/mt, down 0.36%. Trading volume reached 34,000 lots, while open interest reached 212,000 lots, down 2,364 lots from the previous trading day, reflecting a decrease in long positions.

Today, the iron ore futures moved steadily today. The most-traded DCE I2609 contract closed at 720.5 yuan/mt, up 0.14% from the previous session. Spot prices at Qingdao Port fell by 0–2 yuan/mt from the previous trading day. Traders mostly priced based on market conditions, while steel mills mainly procured on a rigid demand basis, leaving total spot volumes relatively low so far.

Iron ore futures moved steadily today. The most-traded DCE contract I2609 closed at 720.5 yuan/mt, up 0.14% from the previous session. Spot prices at Qingdao Port fell 0–2 yuan/mt from the prior trading day. Traders mostly followed market trends, while steel mills purchased based on rigid demand, with overall spot volume relatively low so far today. Demand support for iron ore weakened slightly this week. SMM data showed the blast furnace operating rate across 242 steel mills stood at 88.91%, down 0.13 percentage points WoW. The daily average hot metal output at sample mills was 2.4005 million mt, down 5,300 mt WoW. On the news front, frequent rumors are circulating, making it difficult to distinguish fact from fiction. The market is focused on progress in mine contract negotiations, with most funds staying on the sidelines awaiting clearer direction. Overall, ore prices may continue to move sideways in the near term, but iron ore fundamentals alone cannot currently drive a directional trend. The broader market still relies on news for direction. [SMM Steel]

[SMM Daily Review: August 12 Spot Lithium Carbonate Prices Continued to Rise] SMM battery-grade lithium carbonate spot prices continued to rise today compared with the previous working day. The lithium carbonate 2609 contract opened high at 146,200 yuan/mt today, with bulls actively entering the market after the open, consolidating and climbing; in early trading it quickly broke above 148,000 yuan/mt and shot up to 150,900 yuan/mt, a new intraday high; around midday it consolidated at highs in the 149,000–150,000 yuan/mt range; in the afternoon the price pulled back slightly but remained above the average price line, and near the close it moved sideways around 149,700 yuan/mt, finally closing up 2.97% at 149,700 yuan/mt, with open interest decreasing by 20,872 lots. In the spot market, the downstream maintained a cautious wait-and-see stance, and as prices consolidated and rose, downstream material plants mainly consumed long-term contracts and customer-supplied materials; in contrast, upstream lithium chemical plants showed an increased willingness to sell spot orders. Overall, market inquiries and actual transactions were relatively mediocre.

Entering Q3, the battery-grade nickel sulphate spot market appears to be "losing vitality," with reduced transaction frequency and relatively weak price trends. SMM believes this is primarily driven by a combination of three factors: weakening cost support, a gradually loosening supply-demand pattern, and a shift in market structure. This article will discuss these three factors in detail. I. Cost Side: Weakening Nickel Prices and Raw Materials Together In terms of nickel prices, August marks the period for the release of additional quotas in Indonesia, which has tempered market expectations of a significant shortage of Indonesian nickel ore. Coupled with the ongoing "shadow" of macroeconomic interest rate hikes, nickel prices have weakened. On the MHP payables front, following the concentrated arrival of sulphur in Indonesia, the supply of Indonesian intermediate products is expected to continue rising. According to SMM data, Indonesia's MHP supply-demand balance turned positive in July for the first time in a month. Meanwhile, downstream nickel and cobalt salt prices (especially cobalt salts) remain relatively weak, and downstream players are under pressure from losses, showing lower acceptance of high payables. Consequently, MHP payables remain under pressure overall. The market availability of high-grade nickel matte remains tight, and its payables are expected to hold steady. With both nickel prices and raw material payables declining, the spot production cost of nickel sulphate in August is expected to weaken overall from a spot cost perspective. II. Supply Side: High Raw Material Flexibility, Production Schedules Expected to Rise Since Q2, although MHP production schedules fell sharply at one point, nickel sulphate supply levels remained relatively stable, and no prolonged undersupply emerged. In Q3, as intermediate product production schedules gradually recover, this trend is expected to become more pronounced. According to SMM data, while battery-grade nickel sulphate production in July dipped 2% MoM due to production cuts or maintenance at some salt plants, August output is expected to rise over 8% MoM, returning supply to high levels. Total battery-grade nickel sulphate production from January to August 2026 grew 33% YoY. Behind this steady output lies strong supply flexibility in nickel salt raw materials. In addition to the adjustments using refined nickel raw materials and the substitution between high-grade nickel matte and MHP discussed in previous articles, recycled materials have also contributed a significant supply scale for nickel sulphate this year. On the one hand, after China opened up imports of lithium battery black mass last year, recycled raw materials have been able to be imported steadily, providing incremental raw material for recycled nickel sulphate. On the other hand, as the scale of ternary battery decommissioning gradually expands, and with some companies launching new recycling projects this year, the overall supply scale of black mass in the industry has risen. According to SMM data, the output from pulverising scrap ternary batteries in July doubled compared to the same period last year, providing significant flexibility for nickel sulphate supply. III. Demand Side: NMC Demand Supports Overall Consumption Volume but Fails to Directly Drive External Spot Purchases NMC demand exceeded expectations this year, serving as a key reason nickel sulphate maintained a relatively high premium. Consumption of nickel sulphate by downstream enterprises is expected to remain elevated in Q3. On one hand, with the September-October peak season for auto sales approaching, top-tier downstream players hold favorable demand expectations for mid-to-high nickel materials, driving higher production schedules at associated precursor plants. On the other hand, overseas high-nickel orders secured by leading firms have also stayed at high levels, supported by robust demand in Europe and other regions and by installation rush strategies triggered by adjustments to battery cell export tax rebate policies. According to SMM data, demand for battery-grade nickel sulphate in the new energy sector rose 1.55% MoM in July and is expected to grow a further 0.9% in August. However, the top-tier precursor enterprises with relatively strong orders are highly integrated, with several possessing refined nickel production capacity and ample flexibility to adjust in-house nickel sulphate output. As a result, the downstream demand increase provides limited direct stimulus to spot nickel sulphate procurement. According to SMM data, the combined production schedule of the five leading integrated and semi-integrated enterprises rose 11% MoM in August, and in-house output can meet over 80% of their raw material needs, meaning the incremental demand for externally purchased nickel sulphate was not significant. IV. Market Structure: Expanding Long-Term Contract Scale Squeezes Spot Order Space A notable structural shift in the Q3 nickel sulphate market is the expansion in the scale of long-term contracts. SMM estimates show that monthly spot orders for nickel sulphate stood at roughly 3,500-4,500 mt in metal content in 2025 and Q1 this year. Against the backdrop of rising NMC demand, this scale has shrunk to around 2,000 mt in metal content in Q3. At the start of the quarter, spot orders were expected to gradually retreat from monthly just-in-time procurement to a supplementary role for long-term contracts in corporate purchasing strategies, with additional purchases made only when clear downstream demand increments or raw material supply disruptions occur. This has suppressed market activity in August and early September. Moreover, with no significant decline in nickel sulphate supply, downstream acceptance of spot prices remains generally low. The expansion of long-term contracts stems from two factors. First, the high volatility in nickel prices and raw materials this year has intensified decision-making pressure on enterprises for spot orders, prompting a tendency to lock in demand through long-term contracts. Second, after persistent overcapacity, few new entrants have emerged, and industry supply chains have stabilized, with upstream and downstream enterprises gradually forming steady cooperative relationships. In the long term, the overall scale of long-term contracts is still expected to trend upward. V. Market Outlook As mentioned above, the supply and demand of nickel sulphate spot orders has shifted from relative tightness in Q2 to a slight surplus. From August to early September, prices are expected to be generally in the doldrums; after the downstream demand for the 'September-October peak season' becomes clear in September, the spot order market activity may recover to some extent, driving a rebound in nickel sulphate prices.

[SMM Stainless Steel Daily Comment] SS Futures Consolidate on a Strong Note; Spot Stainless Steel Holds Steady with Off-Season Need-Based Deals SMM reported on August 12: SS futures showed a consolidation pattern on a strong note overall, though gains were rather limited. As of the close, the most-traded SS futures contract settled at 14,535 yuan/mt. In the spot market, although SS futures edged up, spot quotes did not show notable fluctuations, with a focus on stable quotes and active selling. Market inquiry activity picked up somewhat, but against the backdrop of the demand off-season, actual transactions remained need-based. The most-traded SS futures contract. At 10:15 a.m., SS2610 was at 14,555 yuan/mt, up 35 yuan/mt from the previous trading day. Spot premiums for 304/2B in the Wuxi region were in the range of 315-765 yuan/mt. In the spot market, the average price of Wuxi cold-rolled 201/2B coil was stable; for cold-rolled raw edge 304/2B coil, average prices were flat in Wuxi and Foshan; cold-rolled 316L/2B coil prices in Wuxi were unchanged; for hot-rolled 316L/NO.1 coil, quotes in Wuxi were flat; and cold-rolled 430/2B coil prices in both Wuxi and Foshan were unchanged. This week, stainless steel futures were disrupted by both industry news and capital flows, experiencing wild swings with an intense tug-of-war between longs and shorts. News about additional nickel ore quotas under Indonesia’s RKAB repeatedly disturbed market expectations during the week, and with shifting capital flows in futures, SS futures rose first and then fell, briefly testing the 15,100 yuan/mt mark mid-week. However, as expectations of growth in nickel ore quotas heated up, bulls’ confidence evaporated, and futures pulled back to a weaker level…

[SMM Shanghai spot copper] Looking ahead to tomorrow, as delivery approaches and the inter-month backwardation spread widens further, the cost of rolling over positions for some suppliers has risen noticeably, boosting their willingness to sell spot cargoes, which has pushed mainstream standard-quality copper quotes quickly down to a discount range. Meanwhile, against the relatively strong front-month contract price, some deliverable material is being shifted to warrants, leading to a divergence in spot cargo flows. As of August 11, SHFE copper registered warrants stood at approximately 23,200 mt; as of the morning close on August 12, open interest in the SHFE copper 2608 contract remained around 23,000 lots. The pace of open interest pullback and warrant changes ahead of delivery still warrants close attention. On the demand side, end-use consumption remains sluggish, with downstream purchases still largely need-based, and low-priced non-registered copper trading relatively actively on price advantage but not yet driving a noticeable improvement in overall procurement. Taken together, with the widening backwardation spread, increased willingness to sell among suppliers, and weak end-use demand, spot copper prices against the SHFE 2608 contract are expected to remain under pressure tomorrow, and the spot is likely to stay at a discount.