[SMM survey] the weekly operating rate of renewable lead refineries is 47.1 per cent.

Domestic industrial silicon metal output stood at 300,000 mt in November, an increase of 10% month on month and 29.5% year on year, according to SMM survey.

SMM data shows that China's industrial silicon output was 300,000 mt in December, an increase of 10% month on month and 29.5% year on year.

The domestic ferromolybdenum output totalled about 13,950 mt in October, down 410 mt or 2.86% on the month.

Lead prices bottomed out after the settlement as bears sold out positions. Domestic lead concentrate supply remained tight, and the quotations were chaos, but the smelters did not reduce production significantly. The primary lead supply was sufficient.

The State Council of China established a task force to curb unreasonable price increases for commodities in a bid to prevent transmission to consumer prices. As such, SHFE copper prices fell for three consecutive days.

US CPI far exceeded market expectations, triggering market concerns that the US will tighten liquidity ahead of schedule. As a result, the US dollar index stopped falling and rebounded. The decline in the US dollar index is likely to be limited, weighing on copper prices in the short term. Informal financing in China fell short of expectations in April

The most-traded SHFE aluminium contract opened at 19,800 yuan/mt last week and closed at 19,315 yuan/mt, down 540 yuan/mt or 2.72%. Longs reduced positions by 92,000 lots to 179,000 lots. LME aluminium dropped 3.79% last week. The outlook for market liquidity is not as optimistic as earlier. The Fed has maintained its stance over monetary easing policy. However, the increase in US PPI in April was higher than expected, triggering market concerns of inflation. Commodity prices fell last Friday after the State Council sent a signal that it would effectively respond to the overheating in commodity prices. 

The SHFE/LME copper price ratio fell to a three-year low last week as LME copper outperformed SHFE copper prices, expanding import losses. Some smelters have begun to export as export profit occurred. With increased reverse arbitrage operations and exports, SHFE copper prices are expected to strengthen this week.

Social inventory of lead ingots continued to rise to more than 70,000 mt, further weighing on lead prices. The production of primary lead smelters was stable, and the inventory of finished products decreased on the month as some smelters delivered spots.

At the economic work conference (Two Sessions), China emphasised the "stability" of macroeconomic policies and the strengthening of regulations of raw materials markets to ease the cost pressure of enterprises. That depressed market bullishness. US President Biden officially announced a package of over $2 trillion in infrastructure and economic stimulus, aiming at optimising the development of infrastructure, manufacturing and the Internet. US Treasury yields are expected to surge to high levels amid economic recovery in the US from the COVID-19. The US dollar index is expected to remain in an upward track. Copper prices are expected to meet strong resistance from 68,000 yuan/mt.