Copper:
Overnight, copper prices both domestically and internationally showed a weak, oscillating trend, with China's spot refined copper import window closing once more. On the macroeconomic front, the U.S. Bureau of Economic Analysis announced methodological adjustments to three sub-components of the PCE price index, set for September 30, aimed at reducing core inflation metrics. Geopolitically, it is reported that the U.S. and Iran agreed to halt mutual attacks, with former President Trump stating talks would occur Tuesday in Doha, Qatar, while Iran denied having any negotiation plans with the U.S. in the coming days, noting the parties have not entered final agreement negotiations and emphasizing vessels must pass through the Strait of Hormuz via the "Iranian route." Inventory-wise, LME stocks decreased by 3,375 tonnes to 333,100 tonnes; Comex stocks increased by 1,114 tonnes to 602,404 tonnes; SHFE copper warehouse receipts decreased by 1,239 tonnes to 73,289 tonnes; BC copper warehouse receipts decreased by 602 tonnes to 8,229 tonnes. Amid expectations for Federal Reserve interest rate hikes and a persistently strong U.S. dollar index, copper prices may still face phased correction pressure. Domestically, following the international market's lead during the off-season, this trend could persist until mid-to-late month. If, at that time, macroeconomic conditions show initial signs of improvement (e.g., reduced Fed rate hike expectations) coupled with low prices spurring downstream restocking, copper prices may see some recovery.
Nickel & Stainless Steel:
Overnight, LME nickel fell 2.14% to $16,400 per tonne, while SHFE nickel fell 2.55% to 125,830 yuan per tonne. Regarding inventories, LME stocks decreased by 372 tonnes to 274,434 tonnes; SHFE warehouse receipts increased by 1,034 tonnes to 98,091 tonnes. Looking at premiums/discounts, the LME 0-3 month spread remained in negative territory; the import nickel premium/discount increased by 100 yuan per tonne to -200 yuan per tonne. Supply is actively tightening, partly due to quota issues leading to an Indonesian mine entering a maintenance phase—attention is needed on the quota situation for the second half of the year. Additionally, following previous policy adjustments to HPM, nickel ore and sulfur prices have caused some Indonesian projects to reduce operating rates, though a subsequent expected easing in sulfur supply could boost related capacity utilization. While supply is tightening in a sustained, segmented manner, based on total production schedules, June reductions are more evident in nickel pig iron and a small amount of refined nickel, with other areas still seeing increases. Meanwhile, primary nickel inventory pressure continues to build. On the demand side, based on June production schedules, ternary cathode material output is expected to be flat month-on-month, while stainless steel nickel consumption is projected to decline slightly. Currently, within the nickel industry chain, inventory pressure remains the core conflict. Additionally, nickel ore prices may continue to weaken, potentially eroding cost support. It is also important to note that if quotas continue to be issued in the second half of the year, prices could remain under pressure.
Alumina, Primary Aluminium & Aluminium Alloy:
Overnight, alumina prices showed a weak, oscillating trend, with the AO2609 contract settling at 2,995 yuan per tonne, down 0.82%. Open interest increased by 7,370 lots to 282,000 lots. Aluminium prices were also weak; overnight LME aluminium settled at $3,088 per tonne, down 2.88%, with stocks decreasing by 1,500 tonnes to 305,000 tonnes. The AL2608 contract settled at 22,515 yuan per tonne, down 2.19%, with open interest increasing by 23,815 lots to 300,000 lots. Aluminium alloy prices were weak; overnight the main AD2608 contract settled at 22,520 yuan per tonne, down 1.08%. Open interest decreased by 2,349 lots to 8,558 lots. On the spot side, SMM's alumina price rebounded to 2,777.8 yuan per tonne. Aluminium ingot spot discounts narrowed to parity. Foshan A00 prices rebounded to 22,930 yuan per tonne, trading at parity with Wuxi A00. Aluminium billet processing fees in Baotou, Henan, and Linyi held steady, while other regions saw decreases of 20-30 yuan per tonne. Aluminium rod 1A60 series processing fees were stable; 6-series and 8-series processing fees were also stable, with low-carbon 6/8 series fees increasing by 60 yuan per tonne. Guangxi alumina is entering a new production ramp-up phase, sufficiently offsetting reductions from environmental controls in Shanxi, making "south-to-north" material flow the dominant theme. Alumina finds bottom support, with marginal pricing showing mixed movements. Influenced by Federal Reserve rate hike expectations and falling crude oil prices, aluminium faces short-term sentiment-driven pressure. However, aluminium has shown some resilience against declines due to its own unexpectedly strong destocking pace. Both domestic and international orders are facing significant reductions, but export resilience exists due to the price differential favoring international markets, leaving room for potential upward momentum later. Focus will be on downstream purchasing enthusiasm following any aluminium price corrections.
Industrial Silicon & Polysilicon:
On the 29th, industrial silicon prices showed a firm, oscillating trend. The main 2609 contract settled at 8,415 yuan per tonne, up 0.36% on the day, with open interest increasing by 8,979 lots to 298,000 lots. Baichuan's industrial silicon spot reference price was 9,121 yuan per tonne, unchanged from the previous trading day. The price for the lowest deliverable grade fell to 8,600 yuan per tonne, with the spot premium narrowing to 305 yuan per tonne. Polysilicon prices were also firm; the main 2609 contract settled at 35,215 yuan per tonne, up 0.63% on the day, with open interest decreasing by 1,051 lots to 107,300 lots. The standard for the lowest deliverable grade was lowered to 34,985 yuan per tonne, with the spot premium narrowing to 240 yuan per tonne. Industrial silicon producers in Southwest China are gradually accelerating resumption of operations, narrowing the price gap between high and low grades. The futures-spot spread for industrial silicon and concentrated de-registrations are leading warehouse receipt flow back into the market. Downstream sectors still show no concentrated restocking, keeping marginal inventory pressure on industrial silicon and limiting significant upside. Expectations for large-scale polysilicon production cuts have not materialized, with the market returning to a pattern of low-level oscillation. Market attention is on potential updates to energy consumption policies following key meetings, with news flow possibly causing repeated disturbances. Caution is warranted against sharp market fluctuations.
Lithium Carbonate:
Yesterday, the lithium carbonate futures 2609 contract rose 3.34% to 153,920 yuan per tonne, with open interest decreasing by 6,415 lots to 437,000 lots on the day. Regarding spot prices, the average price for battery-grade lithium carbonate fell by 750 yuan per tonne to 151,750 yuan per tonne. The average price for industrial-grade lithium carbonate fell by 750 yuan per tonne to 147,750 yuan per tonne. The price for battery-grade lithium hydroxide (coarse particles) remained at 139,000 yuan per tonne. For warehouse receipts, inventory decreased by 55 tonnes to 48,489 tonnes yesterday. On the supply side, weekly production increased by 243 tonnes week-on-week to 26,642 tonnes. June lithium carbonate production is estimated to have increased 2.6% month-on-month to 116,275 tonnes. On the demand side, according to SMM data, June production for ternary cathode material is estimated flat month-on-month at 88,990 tonnes; lithium iron phosphate is estimated up 3% month-on-month to 504,150 tonnes; lithium cobalt oxide is estimated up 3% month-on-month to 8,250 tonnes; lithium manganate is estimated down 2% month-on-month to 10,780 tonnes. According to other institutions' production schedules, June cathode material output is expected to increase 6.5% month-on-month, while battery output is expected to increase 6.2% month-on-month. Based on market statistical schedules, global lithium-ion battery production is expected to increase 8.9% month-on-month. Regarding inventories, large-sample inventories decreased by 1,207 tonnes week-on-week to 129,959 tonnes; small-sample inventories decreased by 833 tonnes week-on-week to 95,812 tonnes. Using the large-sample口径 (caliber), inventories in other segments decreased by 2,924 tonnes week-on-week to 66,179 tonnes; smelter inventories increased by 122 tonnes week-on-week to 15,495 tonnes; downstream inventories increased by 1,595 tonnes week-on-week to 48,285 tonnes. Yesterday, influenced by news that project resumption may be finalized, lithium carbonate prices experienced a rapid decline followed by a sharp rebound as open interest decreased. Fundamentally, while social inventories are still being drawn down, and the short-term矛盾 (contradiction) exposed by warehouse receipts and the basis has slightly eased, attention is needed. If July production schedules exceed expectations, destocking could accelerate, providing short-term stimulus to prices. However, considering that shipments of lithium ore from Zimbabwe are expected to arrive in late July, adding to supply increment expectations, short-term prices may trade within a range.
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