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Published: 09-01-2026, 11:38 am Gold slipped to $4,374 Tuesday morning, down 1.65%. Silver fell to $65.14, down 2.12%. Traders are pricing in a Fed rate hike this month. But look past today’s tape, and a different story emerges. Five separate signals out of Wall Street and Washington this week point the same direction: institutions are quietly betting on gold, even as today’s data argues against it. Here’s the common thread connecting a wobbling bond market, a surging ETF, a widening silver deficit, a hawkish options desk, and this morning’s jobs numbers. Is Bessent’s Bond-Buyback Plan Already Losing Its Grip? The 30-year Treasury yield climbed back to 5.27% on Tuesday, according to Bloomberg. That nearly erases the entire drop that followed Treasury Secretary Scott Bessent’s mid-August decision to double the size of the government’s long-bond buyback program, when the yield fell from 5.26% to as low as 5.18%. That program does not even start until September 9. The mechanism matters more than the headline. Treasury buybacks reduce the supply of long bonds hitting the market, which can pull yields down temporarily. What buybacks cannot do is shrink the deficit that keeps issuing new debt behind the scenes. Our earlier look at the buyback’s funding source found the same pattern: a liquidity tool dressed up as a rate-control tool. A fix this size reversed by the market in under three weeks, before it even launched, is not noise. That is the market pricing the underlying fiscal math, not the intervention. Why Did Gold Funds Just Log Their Biggest Weekly Inflow in 10 Months? Bank of America’s latest fund-flow data tell a clear story. Gold-backed ETFs added $6.4 billion in holdings during a single week in August. That is the largest one-week gain in roughly ten months, and the strongest since October 2025. BofA strategist Michael Hartnett has continued to flag gold as insurance against dollar weakness and currency debasement. Crucially, the bank’s data show this was not an isolated spike. The four-week moving average of flows is rising too, which means the buying is broad-based, not one large investor’s single trade. Institutional money tends to move ahead of retail sentiment. So when flow data turns before the headlines do, that is usually the more reliable signal. Can the Silver Deficit Widen Even as Solar Demand Falls 19%? Yes, and that is exactly what is happening. The Silver Institute now projects a global silver deficit of 46.3 million ounces for 2026, wider than 2025’s shortfall of 40.3 million ounces, even as solar-panel manufacturers cut silver use by close to 19% this year. Companies including LONGi, Jinko, and Aiko are shifting toward copper-based contacts to use less silver per panel. Here is why the deficit still grows anyway: mine supply is shrinking faster than demand is falling. Roughly three-quarters of the world’s silver comes as a byproduct of mining other metals, so miners cannot simply ramp up production when silver prices rise. Silver was also added to the US critical minerals list in late 2025, and a White House tariff review due back by mid-July has not produced a public resolution, underscoring how supply-constrained this market already looks to policymakers. Our allocated-versus-ETF silver piece covers the ownership side of that same squeeze. Is Goldman’s Own Options Desk Betting Against a Selloff? According to Goldman Sachs derivatives strategist Brian Garrett, the options market looks unusually one-sided right now. Demand for gold call options is high. Meanwhile, almost nobody wants downside protection through puts. Garrett reads Fed Chair Kevin Warsh’s Jackson Hole message as hawkish. Yet Goldman’s own house view still expects the Fed to hold rates rather than hike. Even so, Garrett’s recommendation is to stay long gold. He favors option structures built to avoid overpaying for that increasingly expensive call skew, rather than backing off the position. This is a specific and useful signal. A derivatives desk making that call, on the same trading floor whose economists expect no September hike, means even a bank’s own risk-takers see more upside than downside in gold from here. What Do This Morning’s ISM and JOLTS Numbers Really Show? The Institute for Supply Management reported Tuesday that its Manufacturing PMI slipped to 54.6% in August, down from July’s 55.6%. Meanwhile, its New Orders Index dropped three points to 53.7%. The Bureau of Labor Statistics reported the same morning that job openings fell to 7.271 million in July. That is below the 7.3 million economists expected, and down from June’s 7.359 million. Both readings point toward a labor market and factory sector that are cooling, gradually, not collapsing. Yet CME FedWatch data still show roughly two-thirds odds of a September rate hike, up sharply from about 40% a week ago. In other words, the data are softening while the rate-hike odds are rising. That gap, between what the numbers actually show and what markets are pricing, is exactly what the Fed will have to explain at its September 15-16 meeting, less than two weeks from today. Why Does This Matter for What You Own? No single signal here is loud enough to move gold’s live price alone. Together, though, they describe a system under strain. The government’s fiscal-repair tools wear off in weeks. Real institutions are adding gold at the fastest pace in nearly a year. And the desks paid to price risk lean toward more upside than downside. Together, that is the structural case for owning gold and silver. It is not one crisis, but a system where every fix costs something else. Physical metal outside that system holds its value, regardless of which fix Washington tries next. Watch September 9, when the doubled buyback program launches. Then watch September 15-16, when the Fed has to reconcile cooling data with rising hike odds. Source： https://goldsilver.com/industry-news/goldsilver-news/wall-street-buying-gold-washington-mixed-signals/

August 2026 marked a critical juncture for the solid‑state battery industry, with multiple signals converging. On the policy front, the world’s first international standard for solid‑state batteries was approved by the IEC for development, while the exemption from consumption tax officially took effect on 1 September, elevating the institutional framework from “national standard” to “international yardstick.” On the materials side, sulfide electrolyte prices continued to decline, and hundred‑ton‑scale production lines entered trial production, restructuring upstream costs and removing barriers to industrialisation. On the project side, key milestones included the signing of the Chinese Academy of Sciences’ Institute of Physics square‑cell all‑solid‑state battery project in Suzhou, the groundbreaking of Tuoyi Guneng’s RMB 6 billion 30 GWh project, and the closure of over USD 100 million in financing for Xinjie Energy – capital and capacity resonating in tandem. August thus featured three defining characteristics: standard‑setting, concentrated commissioning of hundred‑ton‑level lines, and accelerated execution of all‑solid‑state projects. The industry is moving from “breakthroughs in isolation” to “systematic progress.” Preface: Materials Price Analysis In August 2026, prices of solid‑state battery materials generally declined. The sole exception was battery‑grade anhydrous lithium chloride (LiCl), which rose 6.6% month‑on‑month, driven by temporary supply tightness in upstream lithium concentrates and lithium chloride. The sharpest drop was seen in sulfide electrolyte LPSC, down 24.2% month‑on‑month, mainly due to cost‑reduction expectations from the sulfide route and slower downstream procurement. The 9‑series NCM cathode material (consumer type) averaged RMB 197,000/ton in August, down 3.0% month‑on‑month – slightly more than the 8‑series (‑2.4%), reflecting greater price pressure on high‑nickel consumer cathodes amid weak end‑market demand. Battery‑grade lithium metal fell 5.9%, continuing its downward trend. Other materials, such as LFP and silicon‑carbon anodes, saw smaller fluctuations, with declines within 2% or remaining largely flat. Overall, the solid‑state battery materials market in August underwent a weak correction, with high‑nickel cathodes and sulfide electrolytes leading the declines, while lithium chloride stood out as a rare gainer due to supply‑side disruptions. I. Solid‑State Battery Materials 1.1 Electrolytes In August, upstream material prices continued to show structural divergence. Sulfide electrolyte LPSC (Li₆PS₅Cl) prices gradually corrected from RMB 4,400/kg to RMB 4,300/kg, a weekly decline of about 2.27%. Battery‑grade lithium sulfide was quoted at around RMB 1,320/kg, down only 0.8% month‑on‑month, suggesting the decline is narrowing and a near‑term bottom may be forming. Oxide electrolyte LLZO remained steady at RMB 638/kg, and LATP at RMB 93/kg, having been flat for several consecutive weeks. The core logic behind the price divergence lies in differing supply rhythms: the sulfide route is on the cusp of concentrated hundred‑ton‑scale capacity release – Tianci Materials’ hundred‑ton‑class pilot line is expected to start trial production in Q3, with economies of scale pushing the price centre lower; oxide electrolytes, with more mature technology and a more stable competitive landscape, have already bottomed out. Capacity build‑out: Tianci Materials’ hundred‑ton‑class lithium sulfide (50 t/a) and sulfide solid‑state electrolyte (100 t/a) pilot lines have been fully completed and are entering trial production in Q3. Sinocera Materials has built an automated production line for sulfide solid‑state electrolytes, establishing initial mass‑production capability. Tianqi Lithium’s 50 t/a lithium sulfide pilot project is under construction and expected to be completed in the second half of the year; the preparation of argyrodite‑type sulfide electrolytes has achieved glove‑box‑free operation for most processes. Ronbay Technology’s 10 t/a solid‑state electrolyte project in Xiantao (RMB 50 million investment) is undergoing environmental impact assessment (EIA) publicity. The Dalian Institute of Chemical Physics’ high‑performance solid‑state battery core material pilot platform (total investment RMB 55 million) is also in the EIA stage, planning an annual output of 5 tonnes of solid‑state electrolyte materials. Technical breakthroughs: The team of Tu Jiangping and Zhong Yu at Zhejiang University reported in Nature Communications a kilogram‑scale liquid‑phase suspension synthesis platform, achieving a room‑temperature ionic conductivity of 5.42 mS·cm⁻¹ for LSPS₀.₄₅. An undergraduate team from Lanzhou University developed an oxynitride halide solid‑state electrolyte, LZCONx, which is simultaneously compatible with 4V‑class LCO cathodes and low‑voltage Li₁₃Si₄ anodes. 1.2 Cathodes Easpring has cumulatively shipped 50 tonnes of all‑solid‑state cathode materials and passed testing by multiple leading all‑solid‑state battery companies, with vehicle‑level validation underway; its dual‑phase composite solid‑state cathode material has achieved monthly stable shipments exceeding 100 tonnes. Ronbay Technology expects its solid‑state cathode material market demand to approach the hundred‑ton level this year, with small‑batch production commencing in 2027. GEM has joined forces with Professor Sun Xueliang (fellow of both Canadian and US academies) to establish a joint laboratory for solid‑state battery cathode materials. Tianhua New Energy’s subsidiary Jiangsu Yili has officially started its solid‑state battery cathode material mass‑production line, planning to form a 10,000‑ton‑class high‑nickel NCM cathode material capacity. 1.3 Anodes The Yibin Smart Solid‑State Battery Innovation Centre (led by Professor Zhang Qiang’s team from Tsinghua University) has achieved a leap from gram‑scale laboratory trials to kilogram‑scale roll‑to‑roll production of composite lithium metal anode materials, capable of boosting energy density to 400‑500 Wh/kg, targeting low‑altitude economy and embodied intelligence applications. Putailai’s silicon‑carbon anode and lithium metal anode products are applicable to solid‑state / semi‑solid battery fields; it has delivered dry‑electrode and solid‑state battery electrode equipment to leading domestic and overseas customers, with cumulative orders exceeding RMB 200 million. Dow Technology’s silicon‑carbon anode has achieved large‑scale production capability, with its 300‑ton capacity gradually ramping up. 1.4 Other Materials Senior Material and Ruigu New Materials have formed a strategic cooperation to jointly develop high‑performance solid electrolyte membranes; the “Gurui” series is compatible with semi‑solid, quasi‑solid and all‑solid routes. Mingguan New Material has completed client sample trials of its solid‑state battery aluminum‑plastic film, which shows significantly improved high‑temperature performance. Zhidongli is strategically positioning in solid‑state battery materials and plans to build a 5,000 t/a high‑purity lithium sulfide production base. II. Solid‑State Battery Technology 2.1 Technical Breakthroughs In August, the most eye‑catching progress came from both fundamental research and applied engineering. Fundamental research: A joint team from Stanford University and SLAC National Accelerator Laboratory published a study in Nature showing that applying planar biaxial mechanical compressive stress to garnet‑type solid electrolytes forces lithium dendrites to propagate horizontally rather than vertically, preventing short‑circuiting. Compressed cells operated stably for thousands of cycles even with extensive internal dendrite formation. Using synchrotron X‑rays, the team confirmed for the first time that dendrites nucleate at nano‑defects at the interface between pores and grain boundaries inside the electrolyte – ending a long‑standing debate. This means “bulk defect control + cell pre‑stress packaging” could become a second battleground beyond material formulation. Professor Sun Xueliang’s team published an analysis in Nature Energy, systematically revealing that the electronic conductivity of current mainstream inorganic solid electrolytes is generally in the 10⁻⁸–10⁻⁹ S/cm range – 6‑7 orders of magnitude higher than that of commercial polymer separators (10⁻¹⁵–10⁻¹⁸ S/cm). When electrolyte thickness is reduced from 1,000 μm to 20 μm, the capacity loss of a cell stored for one month soars from 3.9% to 94.5%. Baima Lake Laboratory, using a borohydride electrolyte route, developed a solid‑state battery that operates stably across a wide temperature range of ‑20°C to 120°C, with an energy density of 400 Wh/kg and cycle life exceeding 2,000 cycles. Applied engineering: High‑energy Digital Manufacturing successfully passed nail penetration tests on a 20 Ah sulfide‑based all‑solid‑state cell using self‑developed equipment and processes; a 4‑mm steel needle (stricter than the national military standard’s 3‑mm limit) was inserted through the cell, and no thermal runaway was observed for one hour with the needle retained. GAC’s Giant Charge self‑developed all‑solid‑state battery cells passed the GB38031‑2025 national standard nail penetration test; after puncture, a 40 Ah cell continued to power an external LED sign. Zhongke Yuanben’s sulfide‑based all‑solid‑state battery pack completed real‑vehicle road testing – the first publicly reported vehicle installation in China. 2.2 Product Progress Ganfeng Lithium has achieved small‑batch production of the world’s first 500 Wh/kg‑class 10 Ah product; its 400 Wh/kg battery has exceeded 1,100 cycles in cycle life and completed engineering validation. Farasis Energy disclosed two generations of sulfide‑based all‑solid‑state battery specifications: Gen‑1 400 Wh/kg (high‑nickel NCM + high‑silicon anode), Gen‑2 500 Wh/kg (lithium‑rich manganese‑based / high‑nickel NCM + lithium metal anode). Sunwoda’s 0.2 GWh solid‑state battery sample line is now operational; pilot production is to start within the year, with 320 Wh/kg and 360 Wh/kg semi‑solid batteries already in small‑batch production. Gotion High‑Tech’s “Jinshi” all‑solid‑state battery has passed multiple authoritative safety tests, and its mass‑production line design has been completed. EVE Energy’s “Longquan No.3” and “Longquan No.4” all‑solid‑state batteries (60 Ah) have been successfully rolled off the production line, focusing on power applications. Jinlongyu’s 20 Ah all‑solid‑state pouch cells have passed third‑party performance tests, achieving 400 Wh/kg. III. Solid‑State Battery Projects August saw a dense cluster of project announcements, featuring “large‑scale project starts, centralised delivery of pilot lines, and regional clustering.” 3.1 All‑Solid‑State Battery Projects The Institute of Physics, Chinese Academy of Sciences (CAS) signed an advanced square‑cell all‑solid‑state battery industrialisation project in Suzhou, with an initial 219‑mu (approx. 14.6 ha) site in Suzhou Industrial Park, led by Professor Li Hong. The project adopts a polymer‑oxide composite route (oxygen‑polymer all‑solid‑state) and focuses on five key processes: dry electrode, solid‑state processing, pre‑lithiation, interfacial thermal lamination, and centre‑liquid‑cooled cell design. Target product energy density is 400‑600 Wh/kg. The first phase will build a 0.2 GWh cell pilot line and a 4 GWh PACK line, aiming for mass production within two years. The project adopts a dual‑site model: “R&D & pilot in the park, mass production in Wuzhong.” Tuoyi Guneng officially broke ground on 13 August on a RMB 6 billion, 30 GWh solid‑state battery project in Hohhot, Inner Mongolia. Covering 1,000 mu (66.7 ha), the project is built in three phases, each with a RMB 2 billion investment and 10 GWh annual capacity. Phase I, occupying about 371 mu, is scheduled for construction from June 2026 to June 2028. Shen’an Lithium Energy invested approximately RMB 200 million in its Shaoxing intelligent manufacturing base, building a 500 MWh high‑standard cell production line with a planned annual output value of RMB 1 billion. 3.2 Pilot Lines and R&D Platforms The Sichuan Advanced Battery Innovation Centre (a key platform under Yibin’s “Jiangyuan Action”) is scheduled for delivery by end‑August, with a total floor area of over 8,600 m² and an investment of RMB 210 million. Phase I will set up two cell laboratory lines; Phase II will build a 0.2 GWh cell pilot line. Yibin has already established six high‑level solid‑state battery R&D platforms, covering composite lithium anodes (Tsinghua Zhang Qiang), sulfide electrolytes (Ouyang Minggao workstation), cathode materials and cells (Nankai Chen Jun), electrolytes (CAS Cui Guanglei), cathode materials (BIT Su Yuefeng), and lithium‑rich manganese‑based cathodes (BJUT Wei Haijun) – spanning various technical routes. The Dalian Institute of Chemical Physics high‑performance solid‑state battery core material pilot platform (EIA stage) plans annual outputs of 50 tonnes of high‑energy‑density cathode materials, 5 tonnes of solid‑state electrolyte materials, and 10 tonnes of high‑capacity composite anode materials. 3.3 Equipment Side Lyric Robot has delivered and achieved milestone acceptance on a full all‑solid‑state battery line for a leading automotive OEM, bridging the gap from lab technology to pilot scale; it has also received orders for key solid‑state battery equipment and pilot lines from two leading battery customers. United Winners Laser has delivered its all‑solid‑state battery assembly line to a top‑tier customer, which has now entered trial production. Putailai has delivered dry‑electrode and solid‑state battery electrode equipment to leading customers at home and abroad, with cumulative orders exceeding RMB 200 million. IV. Solid‑State Battery Financing and Collaboration Financing activity in the solid‑state battery space remained robust in August, with multiple large‑ticket deals closed. Xinjie Energy completed a Series B round of over USD 100 million (approx. RMB 670 million), led by Puhua Capital, to fund lithium‑metal solid‑state battery mass production and a new 3 GWh production line, expected to come online by end‑2026 to early‑2027. Its existing 2 GWh Phase I plant in Hangzhou (10 GWh total) is already in production, and a new 3 GWh base in East China has started construction. Saike Power raised hundreds of millions of RMB in a Series A round, co‑led by Saike Investment and CICC Capital, with participation from Dingfeng KeChuang and Qihang Investment, to fund pilot lines for solid‑state electrolyte materials and all‑solid‑state battery R&D. Weilan New Energy is advancing a RMB 2 billion Pre‑IPO financing at a pre‑money valuation of RMB 20 billion, targeting a listing on the ChiNext. Ruizhi New Energy completed a multi‑ten‑million RMB Pre‑A+ round, exclusively invested by the Shanghai Chenyao Yichuang Investment Fund (jointly established by Shanghai Guotou Kechuang and Yixing Economic Development), to expand its Yixing production base. Guxin Energy secured a RMB 100 million‑level round, led by Toukong Donghai with follow‑on from Jianyuan Fund. Collaborations: Guansheng Dongchi signed a strategic framework agreement with CNNC Haihui to jointly advance the deployment of semi‑solid batteries in wind‑solar‑storage and industrial/commercial energy storage applications. The China Electronics Standardisation Institute, JD.com, and Sunwoda jointly established a robot battery joint laboratory focused on standards development and product innovation for robot batteries. Tianneng and Weilan New Energy have achieved large‑scale batch delivery of their jointly produced 314 Ah semi‑solid cells, which have been first deployed in grid‑side energy storage. V. Overseas Solid‑State Battery Progress In August, overseas solid‑state battery companies entered a critical phase of engineering validation. The all‑solid‑state battery industry in 2026 is moving into engineering validation; Toyota, Honda, Nissan, Samsung SDI, and others are slightly ahead in small‑scale trial production, with Japanese automotive‑grade products having already verified certain performance metrics. Samsung SDI visited Tianci Materials’ Jiujiang base in August, inspecting the lithium sulfide and sulfide solid‑state electrolyte production lines (50 t Li₂S + 100 t sulfide electrolyte, Q3 trial production). Samsung SDI itself targets all‑solid‑state mass production around 2027, with urgent demand for high‑purity lithium sulfide – the visit is seen as a signal of willingness to outsource supply. Solid Power reported H1 revenue of USD 2.805 million and is progressing its continuous electrolyte pilot line as planned, continuing cooperation with Samsung SDI, BMW, and SK On. The company plans to establish a joint venture in South Korea with a targeted maximum capacity of 20,000 t/a of sulfide solid‑state electrolytes; initial facility scale is about 500 tonnes, with a partner announcement expected by end‑2026. QuantumScape generated USD 21.8 million in customer revenue in H1, already exceeding its full‑year 2025 figure; GAAP net loss was USD 199 million. The company reorganised into three business units – QSEV (automotive), QSDC (AI data centres), and QSAS (advanced solutions). Its all‑solid‑state lithium‑metal cells (QSE‑5) have been shipped to a major US defence contractor, and it has established a new partnership with Honda. Factorial Energy received its first commercial battery order (aerospace) in Q2 and is collaborating with Tulip Tech to advance commercial deployment of drone batteries. LG Energy Solution announced it will establish an all‑solid‑state battery pilot line using dry‑electrode technology in the second half of this year. Performance divergence is clear: domestic material suppliers have seen profits surge on price rebounds (Tianci Materials +900% YoY), while overseas start‑ups continue to suffer deep losses (QuantumScape half‑year net loss of USD 199 million). VI. Industry Voices Summit consensus: “Oxide first, sulfide later.” At the 6th Global Solid‑State Battery Annual Summit held in Chicago in August, the industry reached a clear consensus: oxide electrolytes will be prioritised for deployment over the next 2‑3 years, while sulfide‑based all‑solid‑state mass production will be pushed back to 2028‑2030. Company perspectives: Sunwoda’s Liang Rui stated that the industry has entered a stage of “true competition”, and the company will not engage in price wars. Gotion High‑Tech’s Zhou Fu noted that the battery consumption tax adjustment will accelerate industry consolidation, and the tax‑exempt window for solid‑state batteries will amplify the advantages of early technology leaders. VII. Policies and Regulations August saw landmark progress on the regulatory front. International standard: The Chinese‑proposed international standard proposal, “Secondary lithium‑ion batteries for electric vehicle propulsion – Guide to application, test items and conditions for solid‑state batteries,” was approved by the IEC for development, becoming the world’s first international standard for solid‑state batteries, with experts from France, South Korea, Japan and others participating. This standard will form a dual‑layer system with the national standard GB/T 43568‑2026 (effective 1 July). Consumption tax policy: According to Announcement No. 20 of 2026 issued by the Ministry of Finance, the General Administration of Customs, and the State Taxation Administration, lithium‑ion batteries will be subject to a consumption tax of 2% from 1 September 2026, rising to 4% from 1 September 2027. Sodium‑ion batteries, solid‑state batteries, and fuel cells are exempt until 31 December 2028. To qualify for the exemption, products must meet corresponding national standards; before the first declaration, a test report from a CMA‑accredited inspection body confirming compliance is required. The State Taxation Administration further clarified that semi‑solid batteries and hybrid cells that do not meet the standards are not eligible for the exemption. The policy is seen as using tax leverage to preferentially support new technology routes like solid‑state batteries, accelerating the elimination of lagging capacity. Summary August 2026 marked a month in which the solid‑state battery industry accelerated simultaneously across four dimensions: standards, materials, projects, and capital. The successful launch of an international standard and the consumption tax exemption cleared institutional hurdles for industrialisation; the concentrated commissioning of hundred‑ton‑level sulfide electrolyte production lines is restructuring upstream costs; and the groundbreaking of landmark projects such as the CAS Institute of Physics square‑cell all‑solid‑state project and Tuoyi Guneng’s 30 GWh facility signal that all‑solid‑state batteries are moving from the laboratory to scaled production. The industry has formed a clear consensus on the technical roadmap – “oxide first, sulfide later” – and the period of 2026‑2027 will be a critical window for pilot‑line deployment and vehicle‑level validation. **Note:** For further details or inquiries regarding solid-state battery development, please contact: Phone: 021-20707860 (or WeChat: 13585549799) Contact: Chaoxing Yang. Thank you!

As of Thursday, August 27, copper inventories in major regions nationwide fell to 109,500 mt, down 24,900 mt WoW from the previous Thursday and down 17,600 mt YoY, leaving absolute inventory at a low level. During the week, inventory destocking continued, driven mainly by the combined effect of supply contraction and month-end restocking. 1. Regional Divergence: Driven by Arrival Pace, Not a Broad Demand Recovery By region — in Shanghai, domestic supply arrivals picked up, so inventory built up slightly; the new arrivals weren't fully absorbed downstream, showing demand's ability to take supply is limited. In Jiangsu, domestic arrivals narrowed and supply got tight, and with consumption showing some resilience on top of that, inventory kept drawing down — but the main driver is shrinking arrivals, not a demand surge. In Guangdong, consumption had been persistently weak, but as copper prices pulled back, buying costs fell and wait-and-see sentiment eased, so demand is gradually recovering, withdrawals are up, and inventory keeps falling. 2. Demand Watch: The "Better-Than-Expected" Operating Rate Isn't All It Seems As the biggest chunk of downstream demand, major domestic refined copper rod makers' operating rate came in at 62.44% last week, up 1.24 percentage points from the week before — the second straight weekly rise. But this pickup isn't a natural, demand-driven jump: copper prices kept drifting higher this week, so new orders clearly slowed, and plants are mostly just running through the orders they took last week when prices pulled back; on top of that, some mills outside the sample shut down and their orders shifted into the sample, so the weekly rate got pushed up passively. Looking at end-use sectors, cables and magnet wire are being held back by high copper prices, keeping overall demand soft. Inventory tells the same story — with month-end approaching and spot material thin, mills restocked actively, lifting raw material inventory by 2.68 points week-on-week, but downstream pickup is steady with no wave of bulk restocking, and finished goods inventory only ticked up 0.16 points, which means real buying is still cautious. 3. Outlook: Supply and Demand Tighten at the Margin — Destocking Continues, but at a Slower Pace On the supply side, near-term domestic refined copper arrivals are shrinking while imports hold steady, so overall supply is getting a bit tighter at the margin. On the demand side, backlogged orders got released in a rush at month-end and restocking appetite picked up — but it's mostly essential-need refills, spot available material is broadly stable, and trading sentiment is warming. All in all, SMM expects national copper social inventory to keep edging lower next week. That said, the demand recovery still leans heavily on the month-end effect and essential refills — the fact that end users aren't buying much at high copper prices hasn't fundamentally changed, and whether destocking can last depends on whether a price pullback can unlock real orders. Next week, the rod mills in the sample that were down for maintenance or cutbacks will resume normal production, so SMM expects the rod operating rate to rise 0.95 points week-on-week. The uptick does lend some support to cathode copper consumption, but with downstream pickup steady and end demand limited, how much it really helps remains to be seen — and if rod finished-goods inventory builds up along the way, that would in turn hold back future buying.