Copper: Overnight, both domestic and international copper prices experienced a volatile decline, while the spot import of refined copper in China remained at a loss. On the macroeconomic front, reports indicated that the Russian government is considering a return to the US dollar settlement system to gain more support from the Trump administration, a potential shift signaling significant geopolitical changes. Additionally, a sharp drop in US stock markets overnight renewed concerns about market liquidity. Recent copper price movements have shown some correlation with overseas financial markets and precious metals, suggesting that the current trading logic still relies on financial attributes and market sentiment. Overall, the market is viewed as oscillating with a bullish bias. Strategically, a buy-on-dips approach is recommended. However, with the Spring Festival holiday approaching and potential geopolitical disruptions in overseas markets during the break, it is advisable to maintain light positions.
Nickel & Stainless Steel: Overnight, LME nickel fell 4.51% to $17,250 per ton, while SHFE nickel dropped 3.74% to 135,070 yuan per ton. In terms of inventory, LME stocks increased by 636 tons to 286,386 tons, while SHFE warrant levels held steady at 52,027 tons. The LME cash-to-three-month spread remained in negative territory, and the import nickel discount persisted at 50 yuan per ton. On the news front, Tri Winarno, Director General of Minerals and Coal at the Ministry of Energy and Mineral Resources, revealed that approved nickel ore production quotas are between 260 million and 270 million tons, significantly lower than last year's RKAB production target of 379 million tons. Meanwhile, reports suggested that nickel ore exports from Indonesia may double. Fundamentally, nickel ore premiums have strengthened, and nickel pig iron prices are fluctuating at high levels. According to SMM data, nickel ore inventory indices for Indonesian pyrometallurgical and hydrometallurgical processes declined, mainly due to monitoring system delays and new project commissioning. Coupled with expectations of tighter Indonesian quotas, concerns over resource supply constraints may persist, pushing up cost support levels. For stainless steel, weekly inventories accumulated due to the Spring Festival impact in February, although supply-side maintenance was widespread. In the new energy sector, spot trading of nickel sulfate remained subdued due to holiday factors, and ternary material output is also expected to weaken sequentially. While demand has softened temporarily, cost support remains solid. Given ongoing disruptions from Indonesian news, light long positions near cost levels may be considered. If visible inventories decline significantly, it could further support prices. However, weakening market sentiment and potential overseas disruptions during the holiday period warrant caution. Light positioning is advised.
Alumina, Primary Aluminum & Aluminum Alloy: Overnight, alumina prices weakened slightly, with the AO2605 contract closing at 2,811 yuan per ton, down 0.46%, and open interest falling by 11,147 lots to 286,000 lots. Primary aluminum prices also edged lower, with the AL2603 contract settling at 23,395 yuan per ton, down 0.91%, and open interest decreasing by 881 lots to 159,000 lots. Aluminum alloy prices trended lower, with the AD2604 contract closing at 22,140 yuan per ton, down 0.4%, and open interest dropping by 157 lots to 12,604 lots. On the spot market, SMM alumina prices fell to 2,617 yuan per ton. The discount for aluminum ingots narrowed to 160 yuan per ton. Foshan A00 aluminum was quoted at 23,430 yuan per ton, at a 70-yuan premium to Wuxi A00. Aluminum billet processing fees held steady in most regions, with increases of 50–70 yuan per ton in Nanchang, Guangdong, and Wuxi. Aluminum rod processing fees for 1A60 series remained unchanged, while fees for 6/8 series were stable, and low-carbon aluminum rod fees decreased by 4 yuan per ton. Rising overseas alumina prices and early winter stocking by domestic aluminum smelters initially supported alumina futures. However, pressure from high social inventories and expiring warrants limited further gains. As the pre-holiday week progresses, downstream processors have begun holidays, keeping demand weak and social inventories accumulating rapidly. Market risk premiums have retreated, pulling aluminum prices and volatility lower. Ongoing tensions between the US and Iran warrant attention for potential risk repricing.
Silicon Metal & Polysilicon: On February 12, silicon metal prices weakened, with the main 2605 contract closing at 8,335 yuan per ton, down 0.42%, and open interest falling by 652 lots to 307,000 lots. The Baichuan spot reference price held steady at 9,458 yuan per ton. The lowest deliverable grade price remained at 8,850 yuan per ton, with the spot premium widening to 515 yuan. Polysilicon prices strengthened slightly, with the main 2605 contract closing at 49,015 yuan per ton, up 0.44%, and open interest decreasing by 611 lots to 37,702 lots. Baichuan's N-type polysilicon price dropped to 53,250 yuan per ton, with the lowest deliverable grade also at 53,250 yuan per ton, and the spot premium narrowing to 4,235 yuan. Yunnan producers are delivering final pre-holiday orders and will gradually reduce output this week, while Xinjiang continues to cut production. Traders are actively selling, but downstream restocking is winding down, leaving little upward momentum before the holiday. New orders in the polysilicon market have stalled, and wafer pricing has shifted to case-by-case negotiations. Except for module traders selling at discounts due to funding pressures, other segments have stabilized amid sluggish transactions. With the focus on fund repatriation ahead of the holiday, polysilicon futures remain weak, as market attention turns to post-holiday expectations and confidence.
Lithium Carbonate: Yesterday, lithium carbonate futures (2605 contract) rose 3.66% to 149,420 yuan per ton. Spot prices also increased, with battery-grade lithium carbonate averaging 142,500 yuan per ton, up 4,500 yuan, and industrial-grade lithium carbonate averaging 139,000 yuan per ton, up 4,500 yuan. Battery-grade lithium hydroxide (coarse particles) rose 2,000 yuan to 136,500 yuan per ton. Warrant inventories increased by 1,755 tons to 37,282 tons. On the supply side, weekly production fell by 560 tons to 20,184 tons. February production schedules show battery-grade lithium carbonate output down 17.6% month-on-month to 58,835 tons, and industrial-grade output down 12.7% to 23,095 tons. Demand-side projections indicate ternary material output falling 14.6% to 69,250 tons, and lithium iron phosphate output down 10.7% to 354,000 tons in February. Social inventories of lithium carbonate decreased by 2,531 tons to 102,932 tons, with downstream stocks up 835 tons to 44,492 tons, other segments down 1,930 tons to 41,520 tons, and upstream stocks down 1,436 tons to 16,920 tons. Negative sentiment has weakened, and optimism about post-holiday demand has driven prices higher. However, recent trading volumes suggest downstream holiday restocking is largely complete, with some strategic stocking already in place. If prices remain strong in the short term, a divergence between futures and spot markets may reemerge. January shipment data from Chile showed a significant monthly increase, but this was due to advanced shipments ahead of the holiday and is unlikely to persist. Supply pressure may become apparent after the holiday. Meanwhile, domestic production is expected to resume in March, shifting pressure to demand-side performance. Sustained inventory declines post-holiday could provide significant support. Short-term prices are likely to fluctuate within a wide range.
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