New Round of RKAB Approval in October for Upcoming 2026? NPI Prices Keep Rising

This week, the overall operating rate of China's downstream aluminum processing leading enterprises rose by 0.8 percentage points MoM to 59.5%, indicating a mild market recovery. In specific segments, the operating rate of primary aluminum alloy increased by 1.0 percentage points to 56.6%, with a notable increase in primary aluminum consumption by top-tier enterprises. The operating rate of aluminum plate/sheet and strip rose by 1.0 percentage points to 65.0%, driven by stockpiling orders for can stock, automotive sheets, and other peak-season products. The operating rate of aluminum wire and cable increased by 0.8 percentage points to 62.6%, as the accelerated power grid construction cycle boosted terminal cargo pick-up. The operating rate of aluminum extrusion slightly rose by 1.0 percentage points to 50.5%, with automotive and PV orders maintaining growth, while construction extrusions remained sluggish. The operating rate of aluminum foil rebounded by 0.9 percentage points to 69.3%, mainly driven by the restart of air-conditioner foil production lines and the recovery of decorative foil demand. The operating rate of secondary aluminum slightly declined by 0.1 percentage points to 53.0%, as the off-season and ongoing losses continued to exert pressure, and policy impacts forced producers to cut production. It is expected that the aluminum wire and cable, aluminum plate/sheet and strip sectors will continue their upward momentum in late August, while the approaching traditional peak season of "September-October peak season" may further boost demand for aluminum foil and aluminum extrusion.

Futures: Overnight, LME copper opened at $9,775.5/mt, initially plunged straight to a low of $9,714/mt, then fluctuated considerably upward, touching a high of $9,780/mt near the close, and finally settled at $9,777/mt with a 0% change.

SMM Morning Meeting Summary: Overnight, LME copper opened at $9,775.5/mt, initially dropping straight down to a low of $9,714/mt, before fluctuating considerably upward throughout the session. It reached a high of $9,780/mt near the close, ultimately closing at $9,777/mt with a 0% change. Trading volume reached 15,000 lots, and open interest stood at 269,000 lots. Overnight, the most-traded SHFE copper 2509 contract opened at 78,760 yuan/mt, initially reaching a high of 78,960 yuan/mt, before the center of price moved downward to a low of 78,740 yuan/mt. It rebounded near the close, forming a "V"-shaped trend, ultimately closing at 78,940 yuan/mt with a decline of 0.23%. Trading volume was 18,000 lots, and open interest was 152,000 lots.

Overnight, LME lead opened at $1,988/mt, fluctuated downward during the Asian session, rebounded after hitting a low of $1,980/mt in the European session, reached a high of $1,996.5/mt, and finally closed at $1,990/mt, up $2/mt or 0.10%.

[SMM Aluminum Morning Meeting Summary: Under the Game Between Macro and Fundamentals, Aluminum Prices Hold Up Well in the Short Term but Face the Risk of Jumping Initially and Then Pulling Back] In terms of macro, although Thursday's US data did not shake the rationale for an interest rate cut in September, it did spark market concerns that tariffs could still fuel inflation in the coming months and alter the trajectory of interest rate cuts for the remainder of the year. Fundamentally, in terms of supply, there have been relatively small changes, with the operating production of electrolytic aluminum showing a steady and slight increase. On the cost side, the total weekly cost for the electrolytic aluminum industry stood at 16,738 yuan/mt, with the industry still enjoying high profits. Demand side, as the September-October peak season approaches, downstream weekly operating rates have shown signs of recovery this week. However, under the influence of the off-season, consumption from terminals to processed materials has struggled to exceed expectations. The growth rates of industries that previously provided strong support, such as home appliances and PV, have slowed down. Some aluminum terminal export orders have also declined, and the construction industry continues to experience a super-seasonal decline. Amidst the off-season atmosphere, aluminum prices are fluctuating at highs, while consumption recovery remains relatively weak. Against the backdrop of still sufficient supply, the trend of inventory buildup continues in the short term. Overall, the combination of macro tailwinds both domestically and overseas, along with potential risks in electrolytic aluminum supply, has kept aluminum prices holding up well. However, during the consumption off-season, the pressure of inventory buildup remains significant. After the positive sentiment is digested, the center of aluminum prices may face the risk of jumping initially and then pulling back, with the 21,000 yuan/mt threshold still under pressure.

[SMM Zinc Morning Meeting Summary: PPI Data Posts Largest Increase in Three Years, LME Zinc Falls First Then Rises]: Overnight, LME zinc opened at $2,845/mt, hitting a high of $2,851/mt in the early session. It then fluctuated downward, reaching a low of $2,810/mt at the end of the session, closing down at $2,811.5/mt, a fall of $36.5/mt or 1.28%. Trading volume decreased to 6,970 lots...

Daly: A significant interest rate cut next month does not seem appropriate. SHFE tin prices drop back slightly [SMM Tin Morning News] Macro: (1) According to informed sources, the Trump administration is negotiating with Intel (INTC.O) to allow the US government to take a stake in the struggling chipmaker, helping the company expand its domestic manufacturing. The deal would help support Intel's plans for a factory hub in Ohio. Intel had promised to turn the factory into the world's largest chip manufacturing plant, although this promise has been repeatedly delayed. The informed sources said that these plans stemmed from a meeting this week between Trump and Intel's CEO. The idea is for the US government to pay for the stake, with details being finalized. The plan remains uncertain, and the potential size of the stake is unclear. Affected by the news, Intel's stock price rose by 8.9% at one point in the after-hours trading, reaching $24.2. As of Wednesday's close, the stock had risen by 11% year-to-date.