Copper: (Zhan Dapeng, Practicing Qualification Number: F3013795; Trading Advisory Qualification Number: Z0013582) Overnight, copper prices both domestically and internationally initially declined before rising, with China's refined copper imports remaining at a loss. On the macroeconomic front, initial jobless claims in the U.S. for the week ending January 10 dropped to 198,000, significantly below market expectations of 215,000 and the previous figure of 208,000, indicating continued resilience in the labor market. The President of the Federal Reserve Bank of Kansas City stated there is currently no reason to cut interest rates, suggesting that doing so could hinder progress on inflation control and offer no benefit to the labor market. Domestically, the central bank announced a 0.25 percentage point reduction in the interest rates for various structural monetary policy tools. Regarding inventories, LME stocks decreased by 500 tonnes to 141,125 tonnes; Comex inventories increased by 4,653 tonnes to 488,720 tonnes; SHFE copper warrant stocks rose by 13,378 tonnes to 162,717 tonnes, while BC copper warrants increased by 2,098 tonnes to 11,286 tonnes. On the demand side, as copper prices climbed again, downstream enterprises turned cautious in their procurement, with transactions primarily driven by rigid demand. Furthermore, the widening import loss is gradually opening the export window, which may benefit export demand in the first quarter. In terms of news, Trump stated he would temporarily refrain from imposing tariffs on key minerals like copper. Risks stemming from the U.S.-Iran situation and high volatility in precious metals have spilled over, revealing instability in copper prices at elevated levels. Domestically, the continuous registration of SHFE and international copper warrants indicates pressure from domestic hedging funds and corroborates signs of a weakening domestic fundamental picture during the current off-season. However, judging from last night's LME performance, bullish sentiment among overseas funds remains strong, creating a significant divergence from the industrial reality, warranting a cautious view. Nickel & Stainless Steel: (Zhu Xi, Practicing Qualification Number: F03109968; Trading Advisory Qualification Number: Z0021609) Overnight, LME nickel fell 1.04% to $18,590 per tonne, while SHFE nickel dropped 0.24% to 146,880 yuan per tonne. Inventory-wise, LME stocks increased by 624 tonnes to 285,282 tonnes, and SHFE warrant stocks rose by 1,700 tonnes to 41,972 tonnes. Looking at spreads, the LME 0-3 month spread remained in negative territory; the import nickel premium held steady at 600 yuan per tonne. On the news front, the Ministry of Energy and Mineral Resources (ESDM) indicated it would reduce the nickel ore production target in the 2026 Work Plan and Budget (RKAB) to approximately 250-260 million tonnes, down from 364 million tonnes in last year's RKAB. From a fundamental perspective, as prices surged rapidly, product prices across the nickel industry chain strengthened. Primary nickel output schedules increased significantly by 18.5% month-on-month to 37,200 tonnes, and hedging demand may exert some pressure on futures prices. Indonesia's confirmation of its policy to tighten nickel ore quotas within the 250-260 million wet tonne range could potentially create a supply-demand deficit for global primary nickel, stimulating stronger nickel prices. Subsequent attention should be paid to the actual implementation and market sentiment. In the short term, it is advisable to watch for opportunities to go long near the cost line. Alumina, Primary Aluminum & Aluminum Alloy: (Wang Heng, Practicing Qualification Number: F3080733; Trading Advisory Qualification Number: Z0020715) Overnight, alumina prices trended weaker with fluctuations. The AO2605 contract closed at 2,749 yuan per tonne, down 1.33%, with open interest increasing by 21,764 lots to 531,000 lots. Primary aluminum (SHFE) also trended weaker; the AL2603 contract closed at 24,320 yuan per tonne, down 0.59%, with open interest rising by 924 lots to 348,000 lots. Aluminum alloy prices moved lower with fluctuations; the main AD2603 contract closed at 23,070 yuan per tonne, down 0.82%, with open interest decreasing by 141 lots to 21,487 lots. On the spot market, the SMM alumina price retreated to 2,650 yuan per tonne. The spot discount for aluminum ingots widened to 130 yuan per tonne. Foshan A00 aluminum was quoted lower at 24,220 yuan per tonne, at a 30 yuan per tonne premium over Wuxi A00. Aluminum billet processing fees held steady in Baotou and Linyi but increased by 20-150 yuan per tonne in other regions. Processing fees for aluminum rod (1A60 series) and 6/8 series rods remained stable, while low-carbon aluminum rod fees decreased by 530 yuan per tonne. Alumina plants maintain high raw material ore reserves, leading to low willingness for premium purchases in the short term, thereby continuing cost pressure. With environmental controls ending and production resuming steadily, coupled with import supplements, inventories at both producers and downstream users continue to accumulate, sustaining the logic of spot prices converging towards futures. As profits for delivering stocks from Xinjiang re-emerge, warrant registrations may exert a new round of pressure on the futures market. The conclusion of environmental controls, combined with the cancellation of export tax rebates, has prompted a rush for exports among photovoltaic companies. Operating rates in the processing sector are expected to remain resilient, slightly alleviating inventory accumulation pressure for aluminum ingots. The divergence between macroeconomic factors and micro fundamentals is gradually narrowing, with overheated optimism giving way to rational correction. Aluminum prices continue their high-level trend, while the spot discount is persistently narrowing. Industrial Silicon & Polysilicon: (Wang Heng, Practicing Qualification Number: F3080733; Trading Advisory Qualification Number: Z0020715) On the 15th, industrial silicon prices showed strength with fluctuations. The main 2605 contract closed at 8,730 yuan per tonne, up 0.46% for the day, with open interest decreasing by 4,469 lots to 231,000 lots. The Baichuan spot reference price for industrial silicon held steady at 9,628 yuan per tonne compared to the previous trading day. The price for the lowest deliverable grade remained stable at 8,850 yuan per tonne, with the spot premium widening to 120 yuan per tonne. Polysilicon prices trended weaker; the main 2605 contract closed at 48,670 yuan per tonne, down 0.38% for the day, with open interest decreasing by 641 lots to 47,798 lots. The Baichuan price for N-type recycled polysilicon material dropped to 54,750 yuan per tonne. The price for the lowest deliverable polysilicon grade was 54,750 yuan per tonne, with the spot premium widening to 6,080 yuan per tonne. A major producer in Xinjiang has entered a maintenance period. Silicon plants are engaging in hedging at high levels and actively selling to spot-and-carry traders. Producer inventories are gradually shifting to intermediate channels, increasing hidden stocks. Recent cost movements have been largely stable with minor adjustments. Industrial silicon supply and demand are both decreasing, maintaining a fluctuating pattern. Frequent news regarding anti-internal competition and industry self-discipline, coupled with pre-holiday logistics suspension pressures in Xinjiang, has prompted producers to rush shipments before the Spring Festival, leading to concentrated warrant registrations. Overheated speculative sentiment is cooling, limiting the upside premium space for polysilicon. Lithium Carbonate: (Zhu Xi, Practicing Qualification Number: F03109968; Trading Advisory Qualification Number: Z0021609) Yesterday, the lithium carbonate futures contract 2605 fell 1.31% to 163,220 yuan per tonne. Regarding spot prices, the average price for battery-grade lithium carbonate decreased by 4,000 yuan per tonne to 159,000 yuan per tonne. The average price for industrial-grade lithium carbonate dropped by 4,000 yuan per tonne to 155,500 yuan per tonne. The price for battery-grade lithium hydroxide (coarse particle) fell by 3,500 yuan per tonne to 150,500 yuan per tonne. In terms of warrants, warrant inventories increased by 47 tonnes yesterday to 27,205 tonnes. On the supply side, weekly production increased by 70 tonnes week-on-week to 22,605 tonnes. Breakdown: spodumene-based production increased by 165 tonnes to 14,124 tonnes; lepidolite-based production decreased by 20 tonnes to 2,936 tonnes; salt lake-based production decreased by 40 tonnes to 3,145 tonnes; and recycled material-based production decreased by 35 tonnes to 2,400 tonnes. Lithium carbonate production for January 2026 is forecast to decrease by 1.2% month-on-month to 97,970 tonnes. On the demand side, ternary material production for January 2026 is projected to decrease by 5% month-on-month to 78,180 tonnes. LFP (Lithium Iron Phosphate) production is expected to drop by 10% month-on-month to 363,400 tonnes. Ternary power battery production for January 2026 is forecast to fall by 6.15% month-on-month to 28.7 GWh, while LFP power battery production is expected to decrease by 9.77% to 90.01 GWh. LFP energy storage battery production is projected to increase by 0.99% to 63.15 GWh. Regarding inventories, weekly social inventories of lithium carbonate decreased by 263 tonnes week-on-week to 109,679 tonnes. Specifically, downstream inventories fell by 888 tonnes to 35,652 tonnes; inventories in other segments decreased by 720 tonnes to 54,300 tonnes; while upstream producer inventories increased by 1,345 tonnes to 19,727 tonnes. Considering factors like the export tax rebate adjustment, strong terminal expectations, battery manufacturers' anti-internal competition efforts, and upward revisions to cathode material production schedules, even though the current sharp rise in raw material prices might suppress terminal demand, this may be difficult to disprove in the short term. Simultaneously, given the trading logic based on low downstream inventories and a medium-to-long-term bullish view on lithium prices, we believe that restocking demand and speculative fund interest will persist even if prices fall. Therefore, as long as demand remains unrefuted, the overall price performance tends to be easier to rise than fall, though short-term fund fluctuations warrant caution.
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