This week, China's manganese-based battery materials market showed a differentiated operating trend: battery-grade Mn3O4 prices dropped back slightly, EMD prices edged up slightly, and LMO remained in a weak balance amid the tug-of-war between sellers and buyers. Although the three major products showed different trends, all were supported by the cost side......

SMM February 24: Today, spot prices of #1 copper cathode in Guangdong against the front-month contract were at a discount of 300 yuan/mt to a premium of 0 yuan/mt, with the average discount at 150 yuan/mt, down 110 yuan/mt from before the holiday. SX-EW copper was quoted at a discount of 380 yuan/mt to 340 yuan/mt, with the average discount at 360 yuan/mt, down 200 yuan/mt from the previous trading day. The average price of #1 copper cathode in Guangdong was 100,925 yuan/mt, up 735 yuan/mt from the previous trading day, while the average price of SX-EW copper was 100,715 yuan/mt, up 645 yuan/mt from the previous trading day. Spot market: After the Chinese New Year holiday, Guangdong's inventory increased significantly by 35,000 mt, the largest post-holiday increase on record. The substantial inventory buildup and some suppliers' urgency to make shipments led to a sharp decline in prices for cargoes with invoices dated this month, with standard-quality copper quoted at a discount of 300 yuan/mt. However, most downstream consumers had not yet resumed production, with only a few large plants having procurement demand. Today, the procurement sentiment for copper cathode in Guangdong was 2.1, up 0.2 from the previous trading day, while the shipment sentiment was 2.5, down 0.1 from the previous trading day (historical data can be queried in the database). As of 11:00, high-quality copper against the front-month contract was quoted at 0 yuan/mt, standard-quality copper at a discount of 300 yuan/mt, and SX-EW copper at a discount of 360 yuan/mt. Standard-quality copper against the next-month contract was quoted at a discount of 460 yuan/mt. Overall, the significant inventory increase and some suppliers' urgency to make shipments prompted active price reductions, leading to lower spot premiums, with overall trading activity remaining sluggish.

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According to data from the National Bureau of Statistics (NBS), the Producer Price Index (PPI) for industrial producers fell by 0.4% MoM in May, the same rate of decline as the previous month. On a YoY basis, it decreased by 3.3%, with the rate of decline expanding by 0.6 percentage points compared to the previous month. The main reasons for the MoM decline in PPI this month are as follows: Firstly, international imported factors influenced the price decline in related domestic industries. The downturn in international crude oil prices affected the price decline in domestic petroleum-related industries, with prices in the oil and natural gas extraction industry falling by 5.6%, prices in refined petroleum product manufacturing falling by 3.5%, and prices in the chemical raw materials and chemical products manufacturing industry falling by 1.2%. Collectively, these three industries contributed to approximately 0.23 percentage points of the MoM decline in PPI, accounting for over half of the total decline. Secondly, there was a phased downturn in the prices of certain domestic energy and raw materials. Coal demand was in the off-season, with sufficient coal reserves at power plants and ports. Additionally, the low cost and strong substitution effect of new energy power generation led to a 3.0% decline in prices in the coal mining and washing industry and a 1.1% decline in coal processing prices. Increased high-temperature and rainy weather in south China affected the construction of some real estate and infrastructure projects. Coupled with the adequate supply of building materials such as steel and cement, prices in the ferrous metal smelting and rolling processing industry and the non-metallic mineral products industry both fell by 1.0%. Collectively, these four industries contributed to approximately 0.18 percentage points of the MoM decline in PPI. In May 2025, the Producer Price Index for industrial producers fell by 3.3% YoY. In May 2025, the Producer Price Index for industrial producers nationwide fell by 3.3% YoY and 0.4% MoM, while the purchasing price index for industrial producers fell by 3.6% YoY and 0.6% MoM. On average from January to May, both the ex-factory prices and purchasing prices for industrial producers fell by 2.6% compared to the same period last year. I. Year-on-Year Changes in Producer Prices for Industrial Products In May, among the ex-factory prices for industrial producers, the price of means of production fell by 4.0%, contributing to a decline of approximately 2.98 percentage points in the overall level of ex-factory prices for industrial producers. Specifically, prices in the mining industry fell by 11.9%, prices in the raw material industry fell by 5.4%, and prices in the processing industry fell by 2.8%. The price of means of subsistence fell by 1.4%, contributing to a decline of approximately 0.36 percentage points in the overall level of ex-factory prices for industrial producers. Specifically, food prices fell by 1.4%, clothing prices remained flat, general daily necessities prices rose by 0.6%, and durable consumer goods prices fell by 3.3%. Among the purchasing prices for industrial producers, prices in the fuel and power category fell by 9.8%, prices in the ferrous metal materials category fell by 7.3%, prices in the chemical raw materials category fell by 5.4%, prices in the agricultural and sideline products category fell by 2.6%, prices in the textile raw materials category fell by 2.5%, and prices in the building materials and non-metals category fell by 1.1%. Prices in the non-ferrous metal materials and wire category rose by 4.6%. II. Month-on-Month Changes in Industrial Producer Prices In May, among the ex-factory prices of industrial producers, the prices of means of production decreased by 0.6%, contributing to a decline of approximately 0.44 percentage points in the overall ex-factory price level of industrial producers. Specifically, prices in the mining industry decreased by 2.5%, prices in the raw material industry decreased by 0.9%, and prices in the processing industry decreased by 0.3%. Prices of consumer goods remained flat. Among them, food prices decreased by 0.1%, clothing prices increased by 0.2%, and prices of general daily necessities and durable consumer goods both increased by 0.1%. Among the purchase prices of industrial producers, prices of fuels and power decreased by 2.1%, prices of chemical raw materials decreased by 1.2%, prices of ferrous metal materials decreased by 0.6%, prices of textile raw materials decreased by 0.4%, prices of building materials and non-metals decreased by 0.2%, and prices of non-ferrous metal materials and wires decreased by 0.1%; prices of agricultural and sideline products remained flat. CPI Slightly Declined in May 2025, While Core CPI Increased on a YoY Basis —Interpretation of CPI and PPI Data for May 2025 by Dong Lijuan, Chief Statistician of the Urban Department, National Bureau of Statistics (NBS) In May, the Consumer Price Index (CPI) decreased by 0.2% MoM and 0.1% YoY. Excluding food and energy prices, core CPI increased by 0.6% YoY, with the growth rate expanding by 0.1 percentage points from the previous month. The Producer Price Index (PPI) for industrial producers decreased by 0.4% MoM, with the decline remaining the same as the previous month, and decreased by 3.3% YoY, with the decline expanding by 0.6 percentage points from the previous month. China is boosting consumption with greater intensity and more precise measures, fostering the growth of new quality productive forces, improving the supply-demand relationship in some areas, and prices are showing positive changes. I. CPI Slightly Declined, While Core CPI Increased on a YoY Basis The shift from an increase to a decrease in CPI on a MoM basis was mainly influenced by the decline in energy prices. Energy prices decreased by 1.7% MoM, contributing to a decline of approximately 0.13 percentage points in CPI on a MoM basis, accounting for nearly 70% of the total decline in CPI. Among them, gasoline prices decreased by 3.8%, with the decline expanding by 1.8 percentage points from the previous month. Food prices decreased by 0.2%, with the decline being 1.1 percentage points less than the seasonal level, contributing to a decline of approximately 0.04 percentage points in CPI on a MoM basis. Among them, the market supply of seasonal vegetables increased, and fresh vegetable prices decreased by 5.9%; prices of eggs, pork, and poultry meat slightly decreased, with declines ranging from 0.3% to 1.0%; affected by factors such as heavy rainfall in some areas and the summer fishing moratorium, the supply of fresh fruits, freshwater fish, and marine fish decreased, and prices increased by 3.3%, 3.1%, and 1.5%, respectively. Consumer demand continued to recover, coupled with the impact of holidays and cultural, sports, and entertainment activities held across the country. As a result, hotel accommodation and tourism prices rose by 4.6% and 0.8%, respectively, both exceeding seasonal levels. The increase in hotel accommodation prices reached a new high for the same period in the past decade. With the arrival of the summer season and the launch of new summer clothing collections, clothing prices rose by 0.6%. The CPI declined slightly YoY, with the decline remaining the same as the previous month. Among them, energy prices fell by 6.1% YoY, with the decline widening by 1.3 percentage points from the previous month, contributing to a decrease of approximately 0.47 percentage points in the CPI YoY, which was the main factor behind the CPI's YoY decline. Policies aimed at boosting consumption continued to show positive effects, with prices in some areas showing positive changes. Core CPI rose by 0.6% YoY, with the increase widening by 0.1 percentage point from the previous month. Among them, industrial consumer goods prices excluding energy rose by 0.6%, with the increase widening by 0.2 percentage point from the previous month. Prices of gold jewelry, home textiles, and cultural and recreational durable consumer goods rose by 40.1%, 1.9%, and 1.8%, respectively, with all increases widening. Prices of gasoline-powered passenger cars and new energy passenger cars fell by 4.2% and 2.8%, respectively, with the declines narrowing. Service prices rose by 0.5%, with the increase widening by 0.2 percentage point from the previous month. Among services, rental fees for transportation vehicles, airfares, and tourism prices all turned from decline to increase, rising by 3.6%, 1.2%, and 0.9%, respectively. II. PPI Remained Low, with Prices in Some Sectors Showing Marginal Improvement The main reasons for the MoM decline in PPI this month are as follows: First, international imported factors influenced the decline in domestic prices of related industries. The decline in international crude oil prices affected the decline in domestic prices of petroleum-related industries, with prices in the oil and natural gas extraction industry falling by 5.6%, prices in the refined petroleum product manufacturing industry falling by 3.5%, and prices in the chemical raw materials and chemical products manufacturing industry falling by 1.2%. These three industries collectively contributed to a decrease of approximately 0.23 percentage points in PPI MoM, accounting for more than half of the total decline. Second, domestic prices of some energy and raw materials declined on a temporary basis. Coal demand was in the off-season, with sufficient coal reserves at power plants and ports. Additionally, the low cost and strong substitution effect of new energy power generation led to a 3.0% decline in prices in the coal mining and washing industry and a 1.1% decline in coal processing prices. Increased high-temperature and rainy weather in south China affected the construction of some real estate and infrastructure projects. Coupled with sufficient supply in the production of building materials such as steel and cement, prices in the ferrous metal smelting and rolling processing industry and the non-metallic mineral products industry both fell by 1.0%. These four industries collectively contributed to a decrease of approximately 0.18 percentage points in PPI MoM. Coupled with factors such as a higher comparison base in the same period last year, the YoY decline in PPI widened by 0.6 percentage points from the previous month. However, from the perspective of marginal changes, China has intensified the implementation of macro policies, leading to improvements in the supply-demand relationship in some industries and a positive trend in prices in certain sectors. First, the continuous growth of new consumption momentum has driven a YoY rebound in prices of consumer goods. The continuous effectiveness of policies aimed at boosting consumption has led to the release of demand for some consumer goods, driving a rebound in prices in related industries. The MoM decline in consumer goods prices turned to flatness from a 0.2% decrease in the previous month. Among them, prices for clothing, general daily necessities, and durable consumer goods rose by 0.2%, 0.1%, and 0.1%, respectively, driving the YoY decline in consumer goods prices to narrow by 0.2 percentage points compared to the previous month. From an industry perspective, prices for arts and crafts and ceremonial goods manufacturing rose by 12.8% YoY, footwear manufacturing prices increased by 0.8%, and computer whole machine manufacturing prices rose by 0.2%. The YoY declines in prices for household washing machines, television manufacturing, and automobile whole vehicle manufacturing narrowed by 1.6, 1.4, and 0.6 percentage points, respectively, compared to the previous month. Second, the development of industries such as high-end equipment manufacturing has driven a YoY increase in prices in related sectors. The steady progress in the high-end, intelligent, and green transformation of industrial development, along with the expansion of demand for high-tech products, has led to a YoY increase in prices in related industries. Prices for integrated circuit packaging and testing series, as well as aircraft manufacturing, both rose by 3.6%. Prices for wearable smart device manufacturing increased by 3.0%, microwave communication equipment prices rose by 2.1%, server prices increased by 0.8%, and prices for semiconductor device manufacturing equipment rose by 0.7%. In addition, the supply-demand relationship in new energy industries such as PV and lithium batteries has improved, with narrower YoY declines in prices. Prices for PV equipment and components manufacturing, as well as lithium-ion battery manufacturing, fell by 12.1% and 5.0%, respectively, with declines narrowing by 0.4 and 0.3 percentage points, respectively, compared to the previous month. Recommended Reading: 》National Bureau of Statistics (NBS): CPI Down 0.1% YoY and 0.2% MoM in May

According to data from the National Bureau of Statistics (NBS), in May, the national consumer price index (CPI) decreased by 0.1% YoY. Specifically, prices in urban areas remained flat, while those in rural areas decreased by 0.4%. Food prices decreased by 0.4%, while non-food prices remained flat. Prices of consumer goods decreased by 0.5%, while service prices increased by 0.5%. On average from January to May, the national CPI decreased by 0.1% compared to the same period last year. In May, the national CPI decreased by 0.2% MoM. In May 2025, the national CPI decreased by 0.1% YoY. The NBS announced that in May, the national CPI decreased by 0.1% YoY. Specifically, prices in urban areas remained flat, while those in rural areas decreased by 0.4%. Food prices decreased by 0.4%, while non-food prices remained flat. Prices of consumer goods decreased by 0.5%, while service prices increased by 0.5%. On average from January to May, the national CPI decreased by 0.1% compared to the same period last year. In May, the national CPI decreased by 0.2% MoM. In May, the Producer Price Index (PPI) for industrial producers decreased by 0.4% MoM, the same rate of decrease as the previous month, and decreased by 3.3% YoY, with the rate of decrease expanding by 0.6 percentage points compared to the previous month. In May 2025, the national CPI decreased by 0.1% YoY. Specifically, prices in urban areas remained flat, while those in rural areas decreased by 0.4%. Food prices decreased by 0.4%, while non-food prices remained flat. Prices of consumer goods decreased by 0.5%, while service prices increased by 0.5%. On average from January to May, the national CPI decreased by 0.1% compared to the same period last year. In May, the national CPI decreased by 0.2% MoM. Specifically, prices in urban areas decreased by 0.2%, while those in rural areas also decreased by 0.2%. Food prices decreased by 0.2%, while non-food prices also decreased by 0.2%. Prices of consumer goods decreased by 0.3%, while service prices remained flat. I. Year-on-Year Changes in Prices of Various Goods and Services In May, prices of food, tobacco, and alcohol increased by 0.1% YoY, contributing to an increase of approximately 0.02 percentage points in the CPI. Among food items, prices of fresh fruits increased by 5.5%, contributing to an increase of approximately 0.12 percentage points in the CPI; prices of aquatic products increased by 2.5%, contributing to an increase of approximately 0.05 percentage points in the CPI; prices of meat increased by 0.7%, contributing to an increase of approximately 0.02 percentage points in the CPI, with pork prices increasing by 3.1%, contributing to an increase of approximately 0.04 percentage points in the CPI; prices of fresh vegetables decreased by 8.3%, contributing to a decrease of approximately 0.17 percentage points in the CPI; prices of eggs decreased by 3.5%, contributing to a decrease of approximately 0.02 percentage points in the CPI; prices of grains decreased by 1.4%, contributing to a decrease of approximately 0.02 percentage points in the CPI. Prices in the other seven categories saw six increases and one decrease YoY. Specifically, prices for other goods and services, clothing, and education, culture, and recreation rose by 7.3%, 1.5%, and 0.9%, respectively, while prices for healthcare, housing, and household goods and services increased by 0.3%, 0.1%, and 0.1%, respectively. In contrast, prices for transportation and communication fell by 4.3%. II. Month-on-Month Changes in Prices of Various Goods and Services In May, prices for food, tobacco, and liquor decreased by 0.2% MoM, contributing to a decrease of approximately 0.05 percentage points in the CPI. Among food items, prices for fresh vegetables decreased by 5.9%, contributing to a decrease of approximately 0.12 percentage points in the CPI; prices for eggs decreased by 0.9%, contributing to a decrease of approximately 0.01 percentage points in the CPI; prices for meat decreased by 0.2%, contributing to a decrease of approximately 0.01 percentage points in the CPI, with pork prices decreasing by 0.7%, contributing to a decrease of approximately 0.01 percentage points in the CPI. Conversely, prices for fresh fruit increased by 3.3%, contributing to an increase of approximately 0.07 percentage points in the CPI, and prices for aquatic products increased by 0.8%, contributing to an increase of approximately 0.02 percentage points in the CPI. Prices in the other seven categories saw four increases, one flat, and two decreases MoM. Specifically, prices for other goods and services and clothing increased by 0.7% and 0.6%, respectively, while prices for education, culture, and recreation and healthcare both increased by 0.1%. Housing prices remained flat. Prices for transportation and communication and household goods and services decreased by 1.2% and 0.8%, respectively. CPI Slightly Declined in May 2025, with YoY Growth in Core CPI Expanding —Interpretation of CPI and PPI Data for May 2025 by Dong Lijuan, Chief Statistician of the Urban Department, National Bureau of Statistics In May, the Consumer Price Index (CPI) decreased by 0.2% MoM and 0.1% YoY. Excluding food and energy prices, core CPI increased by 0.6% YoY, with the growth rate expanding by 0.1 percentage points from the previous month. The Producer Price Index for Industrial Products (PPI) decreased by 0.4% MoM, with the decline remaining the same as the previous month, and decreased by 3.3% YoY, with the decline expanding by 0.6 percentage points from the previous month. China is boosting consumption with greater intensity and more precise measures, fostering the growth of new quality productive forces, and improving the supply-demand relationship in some areas, leading to positive changes in prices. I. CPI Slightly Declined, with YoY Growth in Core CPI Expanding The shift from an increase to a decrease in CPI MoM was mainly influenced by the decline in energy prices. Energy prices decreased by 1.7% MoM, contributing to a decrease of approximately 0.13 percentage points in the CPI MoM, accounting for nearly 70% of the total decline in the CPI. Among them, gasoline prices decreased by 3.8%, with the decline expanding by 1.8 percentage points from the previous month. Food prices decreased by 0.2%, with the decline being 1.1 percentage points less than the seasonal level, contributing to a decrease of approximately 0.04 percentage points in the CPI MoM. Among these, the market supply of seasonal vegetables increased, leading to a 5.9% decline in fresh vegetable prices. Prices of eggs, pork, and poultry meat remained stable with slight decreases, ranging from 0.3% to 1.0%. Affected by factors such as heavy rainfall in some regions and the summer fishing moratorium, the supply of fresh fruits, freshwater fish, and marine fish decreased, with prices rising by 3.3%, 3.1%, and 1.5%, respectively. As consumer demand continued to recover, coupled with the impact of holidays and cultural and recreational activities held across the country, hotel accommodation and tourism prices rose by 4.6% and 0.8%, respectively, both exceeding seasonal levels. The increase in hotel accommodation prices reached a record high for the same period in the past decade. With the arrival of the summer season and the launch of new summer clothing collections, clothing prices rose by 0.6%. The CPI declined slightly YoY, with the same rate of decrease as the previous month. Among these, energy prices fell by 6.1% YoY, with the rate of decrease expanding by 1.3 percentage points from the previous month, contributing to a decrease of approximately 0.47 percentage points in the CPI YoY, which was the main factor behind the CPI's YoY decline. Policies aimed at boosting consumption continued to show positive effects, with prices in some sectors showing positive changes. Core CPI rose by 0.6% YoY, with the rate of increase expanding by 0.1 percentage point from the previous month. Among these, industrial consumer goods prices excluding energy rose by 0.6% YoY, with the rate of increase expanding by 0.2 percentage point from the previous month. Prices of gold jewelry, home textiles, and cultural and recreational durable consumer goods rose by 40.1%, 1.9%, and 1.8%, respectively, with all rates of increase expanding. Prices of gasoline-powered passenger cars and new energy passenger cars fell by 4.2% and 2.8%, respectively, with the rates of decrease narrowing. Service prices rose by 0.5%, with the rate of increase expanding by 0.2 percentage point from the previous month. Among services, rental fees for transportation vehicles, airfares, and tourism prices all turned from decline to increase, rising by 3.6%, 1.2%, and 0.9%, respectively. II. PPI Remained Low, with Marginal Improvements in Prices in Some Sectors The main reasons for the MoM decline in PPI this month are as follows: Firstly, international imported factors influenced the decline in domestic prices of related industries. The decline in international crude oil prices affected the decline in domestic prices of petroleum-related industries, with prices in the oil and natural gas extraction industry falling by 5.6%, prices in refined petroleum product manufacturing falling by 3.5%, and prices in the chemical raw materials and chemical products manufacturing industry falling by 1.2%. These three industries collectively contributed to a decrease of approximately 0.23 percentage points in PPI MoM, accounting for more than half of the total decline. Secondly, domestic prices of some energy and raw materials declined temporarily. Coal demand was in the off-season, with sufficient coal reserves at power plants and ports. Additionally, the low cost and strong substitution effect of new energy power generation led to a 3.0% decline in prices in the coal mining and washing industry and a 1.1% decline in coal processing prices. Increased high-temperature and rainy weather in south China affected the construction of some real estate and infrastructure projects. Coupled with sufficient production and supply of building materials such as steel and cement, prices in the ferrous metal smelting and rolling processing industry and the non-metallic mineral products industry both fell by 1.0%. These four industries collectively contributed to a decrease of approximately 0.18 percentage points in PPI MoM. Compounded by factors such as a higher base for comparison with the same period last year, the YoY decline in PPI expanded by 0.6 percentage points compared to the previous month. However, from the perspective of marginal changes, with the intensified implementation of macro policies in China, the supply-demand relationship in some industries has improved, and prices in certain areas have shown a positive trend. Firstly, the continuous growth of new consumption momentum has driven a YoY rebound in prices of consumer goods. The continuous effectiveness of policies aimed at boosting consumption has led to the release of demand for some consumer goods, driving up prices in related industries. The MoM decline in consumer goods prices turned to flatness from a 0.2% decrease in the previous month. Among them, prices for clothing, general daily necessities, and durable consumer goods rose by 0.2%, 0.1%, and 0.1%, respectively, driving the YoY decline in consumer goods prices to narrow by 0.2 percentage points compared to the previous month. From an industry perspective, prices for arts and crafts and ceremonial items manufacturing rose by 12.8% YoY, footwear manufacturing prices increased by 0.8%, computer whole machine manufacturing prices rose by 0.2%, and the YoY declines in prices for household washing machines, television manufacturing, and automobile whole vehicle manufacturing narrowed by 1.6, 1.4, and 0.6 percentage points, respectively, compared to the previous month. Secondly, the development of industries such as high-end equipment manufacturing has driven a YoY increase in prices in related industries. The steady advancement of high-end, intelligent, and green transformation in industrial development, along with the expansion of demand for high-tech products, has led to a YoY increase in prices in related industries. Prices for integrated circuit packaging and testing series, aircraft manufacturing all rose by 3.6%, wearable smart device manufacturing prices increased by 3.0%, microwave communication equipment prices rose by 2.1%, server prices increased by 0.8%, and prices for semiconductor device manufacturing equipment rose by 0.7%. In addition, the supply-demand relationship in new energy industries such as PV and lithium battery has improved, with narrowed YoY declines in prices. Prices for PV equipment and components manufacturing, and lithium-ion battery manufacturing fell by 12.1% and 5.0%, respectively, with declines narrowing by 0.4 and 0.3 percentage points, respectively, compared to the previous month.

According to data from the National Bureau of Statistics (NBS), in May, the national consumer price index (CPI) decreased by 0.1% YoY. Among them, prices in urban areas remained flat, while those in rural areas decreased by 0.4%; food prices decreased by 0.4%, and non-food prices remained flat; consumer goods prices decreased by 0.5%, while service prices increased by 0.5%. From January to May, the national CPI decreased by 0.1% compared to the same period last year. In May, the national CPI decreased by 0.2% MoM. NBS data also showed that in May, the Producer Price Index (PPI) for industrial producers decreased by 0.4% MoM, the same rate of decline as the previous month, and decreased by 3.3% YoY, with the rate of decline expanding by 0.6 percentage points compared to the previous month. The main reasons for the MoM decline in PPI this month are as follows: Firstly, international imported factors influenced the price decline in related domestic industries. The decline in international crude oil prices affected the price decline in domestic petroleum-related industries, with prices in the oil and natural gas extraction industry decreasing by 5.6%, prices in refined petroleum product manufacturing decreasing by 3.5%, and prices in the chemical raw materials and chemical products manufacturing industry decreasing by 1.2%. The combined impact of these three industries on the MoM decline in PPI was approximately 0.23 percentage points, accounting for more than half of the total decline. Secondly, there was a phased decline in the prices of some domestic energy and raw materials. Coal demand was in the off-season, with sufficient coal reserves in power plants and ports. Additionally, the low cost and strong substitution effect of new energy power generation led to a 3.0% decrease in prices in the coal mining and washing industry and a 1.1% decrease in coal processing prices. The increase in high-temperature and rainy weather in the south China region affected the construction of some real estate and infrastructure projects. Coupled with the sufficient supply of building materials such as steel and cement, prices in the ferrous metal smelting and rolling processing industry and the non-metallic mineral products industry both decreased by 1.0%. The combined impact of these four industries on the MoM decline in PPI was approximately 0.18 percentage points. CPI Slightly Declined in May 2025, While Core CPI YoY Growth Rate Expanded —Interpretation of CPI and PPI Data for May 2025 by Dong Lijuan, Chief Statistician of the Urban Department, National Bureau of Statistics In May, the CPI decreased by 0.2% MoM and 0.1% YoY. Excluding food and energy prices, core CPI increased by 0.6% YoY, with the growth rate expanding by 0.1 percentage points compared to the previous month. The PPI for industrial producers decreased by 0.4% MoM, the same rate of decline as the previous month, and decreased by 3.3% YoY, with the rate of decline expanding by 0.6 percentage points compared to the previous month. China is boosting consumption with greater intensity and more precise measures, fostering the growth of new quality productive forces. The supply-demand relationship in some areas has improved, and prices have shown positive changes. I. CPI Slightly Declined, While Core CPI YoY Growth Rate Expanded The shift from an increase to a decrease in the MoM CPI was mainly influenced by the decline in energy prices. Energy prices fell 1.7% MoM, contributing to a decrease of approximately 0.13 percentage point in the month-on-month decline of the CPI, accounting for nearly 70% of the total CPI decline. Among them, gasoline prices dropped 3.8%, with the decline widening by 1.8 percentage points from the previous month. Food prices decreased 0.2%, with the decline being 1.1 percentage points smaller than the seasonal level, contributing to a decrease of approximately 0.04 percentage point in the month-on-month decline of the CPI. Among them, the supply of seasonal vegetables increased, leading to a 5.9% drop in fresh vegetable prices. Prices of eggs, pork, and poultry meat declined slightly and steadily, with declines ranging from 0.3% to 1.0%. Affected by factors such as heavy rainfall in some regions and the summer fishing moratorium, the supply of fresh fruits, freshwater fish, and marine fish decreased, with prices rising by 3.3%, 3.1%, and 1.5%, respectively. As consumer demand continued to recover, coupled with the impact of holidays and cultural and recreational activities held across the country, hotel accommodation and tourism prices rose by 4.6% and 0.8%, respectively, both higher than the seasonal levels. Among them, the increase in hotel accommodation prices reached a record high for the same period in the past decade. With the arrival of the summer clothing season, clothing prices rose by 0.6%. The CPI declined slightly YoY, with the decline remaining the same as the previous month. Among them, energy prices fell 6.1% YoY, with the decline widening by 1.3 percentage points from the previous month, contributing to a decrease of approximately 0.47 percentage point in the year-on-year decline of the CPI, which was the main factor behind the year-on-year decline of the CPI. Policies aimed at boosting consumption continued to show effects, with prices in some areas showing positive changes. The core CPI rose 0.6% YoY, with the increase widening by 0.1 percentage point from the previous month. Among them, prices of industrial consumer goods excluding energy rose 0.6%, with the increase widening by 0.2 percentage point from the previous month. Prices of gold jewelry, home textiles, and cultural and recreational durable consumer goods rose by 40.1%, 1.9%, and 1.8%, respectively, with all increases widening. Prices of gasoline-powered passenger cars and new energy passenger cars fell by 4.2% and 2.8%, respectively, with both declines narrowing. Service prices rose 0.5%, with the increase widening by 0.2 percentage point from the previous month. Among services, rental fees for transportation vehicles, airfares, and tourism prices all turned from decline to increase, rising by 3.6%, 1.2%, and 0.9%, respectively. II. PPI Remains Low, with Price Improvements in Some Sectors The main reasons for the month-on-month decline in PPI this month are as follows: First, international imported factors have influenced the decline in prices of related domestic industries. The decline in international crude oil prices has affected the decline in prices of domestic petroleum-related industries, with prices in the oil and natural gas extraction industry falling by 5.6%, prices in the refined petroleum product manufacturing industry falling by 3.5%, and prices in the chemical raw materials and chemical products manufacturing industry falling by 1.2%. These three industries collectively contributed to a decrease of approximately 0.23 percentage point in the month-on-month decline of the PPI, accounting for more than 50% of the total decline. Second, the prices of some domestic energy and raw materials declined in phases. Coal demand was in the off-season, with sufficient coal reserves at power plants and ports. Coupled with the low cost and strong substitution effect of new energy power generation, the prices of coal mining and washing industry fell by 3.0%, and coal processing prices dropped by 1.1%. Increased high-temperature and rainy weather in south China affected the construction of some real estate and infrastructure projects. Additionally, the supply of building materials such as steel and cement was sufficient. As a result, the prices of ferrous metal smelting and rolling processing industry, and non-metallic mineral products industry both declined by 1.0%. The combined impact of these four industries on PPI was a MoM decline of approximately 0.18 percentage points. Coupled with factors such as a higher comparison base in the same period last year, the YoY decline in PPI expanded by 0.6 percentage points compared to the previous month. However, from the perspective of marginal changes, China's macro policies have been intensively implemented, the supply-demand relationship in some industries has improved, and prices in some areas have shown a positive trend. First, the continuous growth of new consumption momentum has driven the YoY rebound in prices of consumer goods. Policies aimed at boosting consumption have continued to take effect, and the release of demand for some consumer goods has driven price increases in related industries. The MoM decline in consumer goods prices turned to flatness from a 0.2% decline in the previous month. Among them, the prices of clothing, general daily necessities, and durable consumer goods rose by 0.2%, 0.1%, and 0.1%, respectively, driving the YoY decline in consumer goods prices to narrow by 0.2 percentage points compared to the previous month. From an industry perspective, the prices of arts and crafts and ceremonial products manufacturing increased by 12.8% YoY, the prices of footwear manufacturing rose by 0.8%, the prices of computer whole machine manufacturing increased by 0.2%, and the YoY declines in the prices of household washing machines, television manufacturing, and automobile whole vehicle manufacturing narrowed by 1.6, 1.4, and 0.6 percentage points, respectively, compared to the previous month. Second, the development of industries such as high-end equipment manufacturing has driven YoY price increases in related industries. The transformation of industries towards high-end, intelligent, and green development has steadily advanced, with an expanded demand for high-tech products, leading to YoY price increases in related industries. The prices of integrated circuit packaging and testing series, and aircraft manufacturing both rose by 3.6%, the prices of wearable smart device manufacturing increased by 3.0%, the prices of microwave communication equipment rose by 2.1%, the prices of servers increased by 0.8%, and the prices of semiconductor device manufacturing equipment increased by 0.7%. In addition, the supply-demand relationship in new energy industries such as PV and lithium battery has improved, with narrowed YoY price declines. The prices of PV equipment and components manufacturing, and lithium-ion battery manufacturing fell by 12.1% and 5.0%, respectively, with declines narrowing by 0.4 and 0.3 percentage points, respectively, compared to the previous month.

This week, stainless steel continued to show a trend of weakening spot prices and production costs in tandem. Amid the off-season for consumption, demand remained persistently weak. Stainless steel traders offered discounts to facilitate transactions, leading to a continuous decline in prices. On the cost side, although high-grade NPI prices rose slightly due to the firm support from nickel ore prices, the prices of stainless steel scrap and high-carbon ferrochrome both pulled back amid production cuts by stainless steel mills due to losses, resulting in sustained losses for stainless steel mills. Taking 304 cold-rolled products as an example, based on the raw material prices of the day, the cash cost decreased by 55.47 yuan/mt this week, with the loss ratio narrowing to 5.82%. If calculated based on the cost of raw material inventory, although the cash cost decreased by 81.88 yuan/mt, the loss ratio remained at 4.77%. Regarding the cost of nickel-based raw materials. At the beginning of the week, supported by the strong nickel ore prices, NPI traders showed strong reluctance to budge on prices, significantly reducing the number of low-priced offers in the market and driving a slight increase in high-grade NPI prices. However, stainless steel enterprises, facing prolonged losses due to the mismatch between costs and selling prices, were extremely cautious about purchasing high-priced raw materials, resulting in low purchase willingness. Additionally, as the stainless steel market entered the traditional consumption off-season and news of production cuts by steel mills emerged frequently, the loose supply situation in the high-grade NPI market did not see substantial improvement. On Friday, a major stainless steel mill maintained its purchase price for high-grade NPI at 940 yuan/mtu, severely denting market confidence and leading to a further decline in retail quotations. By the close of trading on Friday, the price of high-grade NPI with a grade of 10-12% had fallen by 3 yuan/mtu cumulatively, ultimately closing at 951 yuan/mtu. In the stainless steel scrap market, prices continued to decline in tandem with stainless steel finished products. Despite the narrowing economic disadvantage of stainless steel scrap compared to high-grade NPI, it still lacked cost advantages. As of Friday, the price of 304 off-cuts in east China had fallen by 100 yuan/mt cumulatively, with the latest quotation dropping to 9,850 yuan/mt. Regarding the cost of chrome-based raw materials, domestic high-carbon ferrochrome production has continued to rise recently, significantly increasing the availability of retail supplies in the market. Meanwhile, chrome ore prices showed a downward trend during the week. Overseas mines not only sold off spot chrome ore in bonded zones but also lowered their futures quotations for chrome ore, further weakening the cost support for ferrochrome. Coupled with the continuous news of production cuts by stainless steel mills, market expectations for ferrochrome demand decreased accordingly, denting the confidence of ferrochrome traders and driving a continuous decline in retail prices. However, recent production halts by overseas ferrochrome enterprises have led to a significant contraction in ferrochrome supply in the international market, and it is expected that China's ferrochrome imports will decrease. Considering the need to secure raw material supply, stainless steel mills may exercise relative restraint in lowering prices during ferrochrome procurement tenders. Data shows that high-carbon ferrochrome prices in Inner Mongolia fell by 100 yuan per 50 base tons this week, with the latest quotation at 7,850 yuan per 50 base tons. Overall, the current stainless steel market continues to experience sluggish consumption. Despite production cuts implemented by steel mills, the extent of these cuts has not yet matched the pace of demand decline. Under the dual pressures of supply surplus and high shipping pressure, stainless steel prices are expected to remain in the doldrums in the short term. As the scope of production cuts by steel mills expands, demand for raw materials such as nickel and chromium continues to shrink, further exacerbating the downward pressure on furnace charge prices. If this situation persists, the stainless steel industry may fall into a vicious cycle of production contraction, low prices, and declining costs, posing significant challenges to market recovery.

[SMM Silicon-based PV Morning Meeting Summary: Significant Differentiation in Cell Prices, New Glass Order Prices Decline] The mainstream quotations for Topcon 183 solar cells (with efficiency of 25% and above) are around 0.25-0.255 yuan/W; the mainstream transaction price for Topcon 210RN is 0.265 yuan/W, with a quotation range of 0.265-0.27 yuan/W; the price for Topcon 210N solar cells is around 0.26-0.265 yuan/W. Price differentiation has emerged across sizes: 183 and 210N cells continue to decline in price, with the former experiencing reduced orders and ongoing inventory buildup, forcing transaction prices down, while the latter sees market transaction prices fall due to significant shipments by certain enterprises at month-end. Orders for 210RN cells have increased due to demand, with producers generally optimistic about the demand outlook for June, leading to price recovery. It is expected that the differentiation in price trends across sizes will remain stable in the near term.

[SMM Silicon-Based PV Morning Meeting Summary] Wafer: The actual production schedule in May changed slightly, with the domestic actual production reaching approximately 58.06 GW. Driven by production cuts at multiple specialized enterprises, wafer production decreased in June. High-purity quartz sand: Currently, the domestic prices for inner-layer sand are 60,000-70,000 yuan/mt, middle-layer sand are 33,000-43,000 yuan/mt, and outer-layer sand are 17,000-24,000 yuan/mt. This week, domestic quartz sand prices remained stable for the time being. However, spot order prices for imported sand slightly decreased. Crucible enterprises' purchase sentiment remained weak, and the operating rate at the wafer end also fell short of expectations. Overall, market demand weakened, and prices fell.

China urges the US to completely eliminate unilateral tariff hikes. SHFE tin prices continue to decline during the night session [SMM Tin Morning News]. (1) Cui Dongshu: From January to April this year, China accounted for 68% of the global new energy vehicle market share and 12% of the overseas new energy vehicle market share for domestic brands. (Bullish ★) (2) Ministry of Commerce: China urges the US to completely eliminate unilateral tariff hikes. (Bullish ★) (3) US Fed's Goolsbee: If tariffs are avoided through agreements or other means, it may return to a situation where interest rate cuts are possible. (4) Global tariffs - ① The US Court of International Trade has halted Trump's "Liberation Day" trade policy, and the Trump administration has filed a notice of appeal. ② Hassett: The tariff ruling will be overturned, and the ruling will not affect the current progress of trade agreements. ③ US trade advisor: The court ruling has not changed the course of events, and our side has a strong chance of winning. ④ Japanese Prime Minister Fumio Kishida had a 25-minute phone call with Trump. Kishida stated that if necessary, he might visit the US before the G7 Summit. ⑤ Indian officials: The US trade team will visit India from June 5 to 6. Trade negotiations are proceeding as planned, and the impact of the US court ruling on tariff decisions is being studied. (Neutral)