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[SMM Metal Breakfast] the dollar index fell below the 96 mark in intraday trading * how much space is there above the Guangdong aluminum base difference * iron ore prices are expected to hit a new high?
Jul 16,2020 07:10CST
translation
Source:SMM
[SMM Metal Breakfast] how big is the space above the aluminum base difference in Guangdong * the domestic electrolytic aluminum production capacity is expected to increase by 2.87 million tons in 2020 * the short-term macro environment determines the trend of zinc price * stainless steel exports are expected to weaken to a certain extent in the later period of metal manganese procurement * reduction in iron ore import vessels are expected to detect new crown virus * interpretation of Shanghai hot roll inventory * Congo (DRC) requires mining companies to lift restrictions on workers * cloud South Africa stores 40,000 tons of tin ingots * South Africa's May gold production fell by more than 20% compared with the same period last year
The content below was translated by Tencent automatically for reference.

"[Summit Forecast] is the new high bull market in copper prices coming? Watch this big talk!

"Today's Financial data Forecast: focus on China's second-quarter GDP annualized rate and the number of Americans claiming unemployment benefits that week

"[overnight market] the dollar index hit a new low and the international gold price hit a new high in nearly eight years.

Today's focus

[large trading house: free delivery fee for all futures varieties from August 1, 2020 to March 31, 2021] according to the study, from August 1, 2020 to March 31, 2021, all futures delivery fees (including standard warehouse receipt period cash fee) are exempted. "View details

[more than 3.46 million cases of New Crown pneumonia in the United States] according to the statistics of the New Crown epidemic at Johns Hopkins University in the United States, as of 1435 EDT on the 15th, 3465031 cases of New Crown pneumonia in the United States had been confirmed, with 136940 deaths. There were 58086 new confirmed cases and 696 new deaths in the United States from 17:33 on the 14th to 1435 EDT on the 15th.

SMM analysis: how big is the space above the Guangdong aluminum base difference for the spot high rising water for the month? Before analyzing the basis change, let's take a look at today's data: the stock of aluminum ingots in Guangdong public warehouse is 173500 tons, an increase of about 23000 tons from the low of 150500 tons on June 22nd; the price of imported aluminum ingots in Guangdong is 60 RMB100m / ton cheaper than that of domestic aluminum ingots, and the import window continues to open; after the close of trading in Shanghai, the difference between 2008 / 09 and 2009 / October is close to 300yuan / ton, while the difference in 2009 / October is 165RMB / ton. "View details

[SMM analysis: the new capacity project of pre-baked anode in 2020-2021 is gradually landing in southwest China.] according to SMM statistics, the annual production capacity of electrolytic aluminum in China is expected to exceed 6 million tons in 2020-2021, of which 2.87 million tons are expected to be put into production in 2020 and 3.13 million tons in 2021. Mainly distributed in Yunnan, Inner Mongolia, Guangxi, Sichuan, Shanxi and other places. "View details

[SMM analysis: consumption off-season vs peak season expectation short-term macro environment determines zinc price trend] the main reason for the rise in zinc price this time is: 1. The whole world is under water, and the macro-positive situation has promoted a general rally in stock markets and commodities. Copper, aluminum and lead in non-ferrous metals have all filled the gap after the whole year, and only zinc and nickel have not returned to their previous price levels. Market funds have made up the logic to push zinc prices up strongly. 2. The market remains optimistic about infrastructure consumption during the year, believing that higher-than-expected consumption will occur in the peak season. Looking forward to the second half of the year, this article discusses the short-term macro changes and future consumption expectations. "View details

[SMM brief comment: stainless steel export orders concentrated release in March and a small drop in April-May is expected to weaken stainless steel exports to a certain extent in the later period.] according to customs statistics, China's exports of stainless steel coil to the European Union in 2019 accounted for about 10% of the total export volume in 2019, accounting for about 16% of the export coil volume. In the first quarter, due to the influence of the epidemic, China's stainless steel market was greatly affected, but since the second quarter, demand and production have been strongly improved and recovered, but foreign markets have been affected to varying degrees, and customs data show that stainless steel exports declined slightly from April to May after the concentrated release of orders in March, and it is expected that stainless steel exports will still weaken to a certain extent in the later period. "View details

[SMM summary review: Japan's crude steel output drops to a new low metal manganese procurement is expected to decline] according to SMM, Japan is one of the main domestic manganese export destinations, unwrought manganese from January to May 2020; the total import of scrap and powder is 22500 tons, second only to South Korea and the Russian Federation. Among them, the public bidding volume of basic electrolytic manganese sheet in JFE Steel Plant of Japan is about 1600 tons, and the demand area of steel at home and abroad is gradually reduced under the influence of the epidemic, so the shutdown of blast furnace at the end of July will reduce the procurement of metal manganese in the later stage. "View details

SMM Iron and Steel: new Crown virus detected by imported iron ore ships is expected to hit a new high? It is initially estimated that the inspection will affect the unloading of subsequent ships, and the efficiency of unloading ports will also be affected to a certain extent. The ship unloaded 82387 tons of iron ore in Lianyungang. Considering the inspection cycle, this part of the supply is difficult to reach the ordering steel plant in time, which may affect the normal production rhythm of the steel plant. On the other hand, due to tighter inspection, other ships calling at Lianyungang will also be affected to varying degrees, and the possibility that other ports will also follow up and tighten inspection will not be ruled out. In this way, the supply side of iron ore will add variables, once again give reasons for long capital speculation, ore prices hit a new high may be expected. "View details

[SMM thread: has the inventory in Hangzhou increased? This week Hangzhou thread stock is 1.085 million tons, month-on-month ratio + 19000 tons, year-on-year + 439000 tons. Hangzhou continues to accumulate inventory this week, the inventory growth rate is larger than last week, the current Hangzhou inventory has approached the peak at the beginning of the year, but also to challenge the limit of Hangzhou building materials storage capacity. Recently, the high inventory of thread in Hangzhou has aroused the concern of many traders and terminals in the market, and it is also one of the main reasons to restrain the price rebound in Hangzhou building materials market. "View details

[interpretation of Shanghai Hot Volume inventory (July 8-July 15)] this week Shanghai Hot Volume inventory 347900 tons, month-on-month + 5600 tons, year-on-year-119400 tons. Recently, although driven by iron ore, the trend of the volume is gratifying, and the spot market sentiment has also warmed up, but because the price has risen too fast and too high, the terminal acceptance has weakened, so the overall terminal consumption situation is relatively general, and inventory has thus accumulated slightly. In addition, the current volume of goods in the market is still not much, and the fundamentals are still in a state where supply is slightly less than demand, so it is expected that in the case of steady release of terminal demand, spot prices will maintain a volatile trend.

[SMM Steel] today Qiang expects the story to continue, and the protagonists are still "GDP" and "the growth rate of new real estate construction area". The author believes that if the growth rate of GDP exceeds expectations, it will be interpreted as bad, and loose monetary policy will probably enter the observation period. The growth rate of new real estate construction is an important leading indicator for the choice of steel direction! We should pay close attention to it. At present, the multi-empty life and death festival is whether the demand will return strongly after the end of the southern flood season; if it fails to return on time, the rebound will end; otherwise, the rebound will carry on the past and forge ahead into the future. No, no. In the areas where the disturbance of the flood season ends, such as Guangzhou in South China, the demand return period should be a high probability event! As for the so-called high temperature affecting demand, it is a short night road whistle! There is no substantial change in the spot static fundamentals, the only change is that the cost support is slightly strengthened, and it is certain that the flood season will have a certain impact on demand. "View details

Important news of metals and industry

[Nevada Copper announces financing of $71 million to deal with financial difficulties.] Nevada Copper aims to restart Pumpkin Hollow, this quarter. Production growth at the mine was restricted by the government earlier this year to control the outbreak of covid-19. The company insisted that it would still restart the plant in underground mines in August, but would have to modify it in the light of the impact of the covid-19 pandemic and other factors. The goal is to reach full capacity production in the fourth quarter.

[Democratic Republic of the Congo (DRC) requires miners to lift restrictions on workers] the Democratic Republic of the Congo has given copper and cobalt mining companies a month to stop restricting workers to the workplace. The Labor Minister says all mining companies that keep workers on site need to resume normal operations within a month.

On the morning of July 12, the signing ceremony of Nanping Aluminum Industry Min Aluminum Light weight mixed Reform listing Project was solemnly held in the conference room on the first floor of Nanping Aluminum Co., Ltd. Nanping City, Societe Generale Securities, Fujian Metallurgy, Nanping Aluminum, Min Aluminum Light and other relevant leaders attended the signing ceremony. Founded in December 2016, the lightweight automobile project has achieved remarkable results under the leadership of Fujian Metallurgy and Nanping Aluminum Industry. The signing ceremony is of great significance for Nanshan Aluminum Company to further enhance the competitive advantage of the industrial chain.

[Chinalco successfully won the bid for the first largest diameter special-shaped aluminum structure construction project in China] Liuye Science and Technology heavy Industry, a member of Chinalco Group, successfully won the bid for the construction project of aluminum alloy reticulated shell structure of Jianchuan Comprehensive Exhibition Hall in Chengdu, Sichuan Province. this is also the first special-shaped aluminum structure construction project with the largest diameter in the country. As the first special-shaped aluminum structure building with the largest diameter and weight in China, the project is mainly made of 6061-T6 aluminum plate and cast aluminum 114, with a total aluminum consumption of about 280t, with a maximum aluminum double-layer reticulated shell diameter of 68.87m, a total height of 24.45m, an installation height of 8m and a maximum of 32.5m. There are many special-shaped aluminum alloy components in this project, with cast aluminum joints and rectangular webs as load-bearing members, the joints and members are connected by core insertion and bolting, and double-layer aluminum orifice plates are used as decorative components, so there are many technical difficulties in manufacture and installation. The project is scheduled to start in mid-July this year and be completed before the Spring Festival in 2021.

[Yunnan Province collects and stores 40,000 tons of tin ingots] Yunnan Provincial Department of Industry, Information and Finance [2020] issued a document No. 179 to support key enterprises to carry out commercial collection, storage and discount of non-ferrous metal products from July 10, 2020. The plan is to collect and store 40, 000 tons of tin ingots (GB/T 728) with a storage period of one year, which is aimed at the industry leading storage enterprises registered in Yunnan for industry and commerce.

[, PT Huadi (smelter invests 6.5 trillion rupiah to add six new nickel iron furnaces] according to recent Indonesian media reports, the management of nickel alloy company has successfully established two smelters since 2012. The management of, PT Huadi nickel alloy company has invested 6.5 trillion rupiah again, and six more furnaces have been added since 2020. "View details

[South Korea's Posco's third blast furnace resumes production of crude steel, which is expected to increase by 25%.] South Korea's Posco said it had restarted production of its third blast furnace, despite the global recession triggered by the new crown pneumonia epidemic. The third blast furnace had previously carried out maintenance work worth about 400 billion won (US $332.6 million). The maintenance increased the annual crude steel output of the third blast furnace by 25% to 4.6 million tons. The resumption of production of the blast furnace was delayed twice in May and June as the outbreak led to a decline in demand from carmakers, construction companies and shipbuilders, including Posco, which has five blast furnaces in Guangyang and four in Posang, about 375km southeast of Seoul.

[South Africa: gold production in May fell by more than 20% year on year] A few days ago, data released by South Africa's Bureau of Statistics showed that South Africa's gold production in May was 20.3% lower than a year earlier, and in April it was revised down 60.2% from a year earlier, with an initial value of 59.6%. South Africa's platinum group metal production fell 27.3 per cent in May from a year earlier. The statistics bureau also announced that the country's total mining output fell 29.8% in May from a year earlier, after a revised decline of 50.3% in April, with an initial decrease of 47.3%.

[China Iron and Steel Association: the average daily output of crude steel in key iron and steel enterprises decreased by 0.53% in the first ten days of July] in early July 2020, iron and steel enterprises produced a total of 21.3071 million tons of crude steel, 19.1726 million tons of pig iron, 19.8003 million tons of steel and 3.2454 million tons of coke. The average daily output of this ten-day period was 2.1307 million tons of crude steel, down 0.53% from the previous month, up 5.81% from the same period last year; pig iron was 1.9173 million tons, up 0.11% from the previous month and 7.61% over the same period last year; and steel was 1.98 million tons, down 7.20% from the previous month and up 5.61% from the same period last year. "View details

[Angang shares: expected first-half net profit of 500 million yuan down 64.91% compared with the same period last year] recently Anshan Iron and Steel Co., Ltd. issued a performance forecast that the net profit belonging to shareholders of listed companies in the first half of 2020 is expected to be 500 million yuan, down 64.91% from the same period last year. The reason for the change in performance shows that in the first half of the year, due to the impact of the new crown pneumonia epidemic, the demand for steel products was weak, sales prices fell, raw material prices rose periodically, steel profit margins were compressed, and the company's profits declined compared with the same period last year.

[Shougang shares: expected profit for the first half of the year is 470 million yuan-520 million yuan] Shougang shares recently issued a semi-annual performance forecast, the company said that it expects to make a profit of 470 million yuan to 520 million yuan in the first half, compared with the same period last year, the expected change is-53.09%. 48.10%. This is mainly because since the beginning of this year, due to the impact of the overall economic environment and the epidemic, the price of raw fuel such as iron ore upstream is relatively high, the demand for downstream steel products has weakened, and steel prices have fallen sharply compared with the same period last year. In the face of the severe market situation, the company insists on both epidemic prevention and management. While stabilizing the situation of production and operation, the company increases the optimization of product structure and cost control, but the reduction of cost and efficiency has not completely offset the reduction of profits in the supply and demand market. Operating performance has declined.

Macro focus

Li Keqiang presided over an executive meeting of the State Council, calling for the good use of local government special bonds, strengthening the docking of funds and projects to improve the efficiency of the use of funds.

Ministry of Foreign Affairs: on July 15, 2020, State Councilor and Foreign Minister Wang Yi and French President's Foreign Affairs adviser John Boehner co-chaired the 20th China-France Strategic Dialogue. Wang Yi said: in the next step, while doing a good job in epidemic prevention and control, China and France should pay more attention to the "post-epidemic era", strengthen strategic communication and cooperation, and promote Sino-French relations to "start again."

[the Ministry of Finance decided to renew the fourth issue of 2020 special treasury bonds for the first time] the Ministry of Finance decided to renew the special treasury bonds for 2020 (four issues) (10 years) for the first time. The total face value of competitive bidding is 70 billion yuan, and no additional bidding by Category A members will be carried out. Bidding on July 21, 2020; the end of the tender for distribution on July 22; and the merger and listing of treasury bonds issued in the same period from July 24 onwards.

The Federal Reserve's beige book: employment has increased in almost all regions as business has reopened and economic activity has increased. Especially in the retail and medical industries.

Terminal information

[Federation of passengers: overall retail sales of cars fell 9 per cent year on year from 1 to 12 July] according to the Federation of passengers, retail sales in the automobile market got off to a weak start in July, with an average daily retail sales of 25000 vehicles in the first week of July, down 15 per cent from the same period last year and 3 per cent lower than in the first week of June. Retail performance was weak in the first week. Retail sales in the second week of July averaged 31000 vehicles a day, down 5 per cent from a year earlier and 21 per cent from the same period in June. Overall retail sales fell 9% from July 1 to 12 from a year earlier, down 15% from the same period in June.

[Tesla adjusts Model Y production and sales plans] US electric car maker Tesla said recently that it would cancel the production of the lower standard mileage crossover model Model Y and reduce the price of the long mileage Model Y by $3000 to boost sales. Some analysts pointed out that the price reduction of, Model Y and the cancellation of the standard mileage version production plan show a decline in demand related to the US market, and Tesla may need further price cuts in order to promote the rise in demand for Model Y.

[LG Chemical Global share Chao Ningde era: 870 billion orders have been busy for the next five years] South Korean battery maker LG Chemical said recently that it currently has 150 trillion won (872.5 billion yuan) worth of orders, which will keep it busy for the next five years and will help it survive the pandemic crisis. In addition, the strong performance of LG Chemical has made it a leader in the battery industry this year, surpassing the Ningde era in global market share.

[Ministry of Industry and Information Technology, Ministry of Agriculture and Village, and Ministry of Commerce jointly organized activities for new energy vehicles to the countryside] according to news from the Ministry of Industry and Information Technology, the Ministry of Industry and Information Technology, the Ministry of Agriculture and Village, and the Ministry of Commerce jointly organized activities for new energy vehicles to the countryside to promote the promotion and application of new energy vehicles in rural areas, guide rural residents to upgrade their travel modes, and promote the strategy of beautiful rural construction and rural revitalization. The event will take place from July to December 2020, with participating automobile companies including Great Wall Motor, BYD shares and so on.

[national Energy Administration: newly installed 767.5MW for household photovoltaic in June] the State Energy Administration announced the latest information on household photovoltaic projects. By June 2020, the country had installed 767500 kilowatts of new household photovoltaic units; from January to June, the cumulative installed capacity of household photovoltaic in China had reached 2.0393 million kilowatts.

Related market

[Guangzhou issues 30 million yuan of "cultural travel Huimin consumption coupons", which is expected to boost consumption of 150 million yuan. On July 15, Guangzhou City adopted new measures to promote the recovery of the cultural tourism market after the epidemic. The Guangzhou Municipal Bureau of Culture, Radio, Television and Tourism will start from 8: 00 p.m. on July 17. through the WeChat mini program "Love to visit Guangzhou", 30 million yuan of "Guangzhou Culture Travel Huimin consumption coupons" will be issued to the whole society. Chen Yongliang, a party member and deputy director of the Guangzhou Municipal Bureau of Culture, Radio, Television and Tourism, revealed that the consumption voucher campaign will last for three months and is expected to boost consumption of 150 million yuan.

OPEC + sources: OPEC + discussed on Wednesday on reducing production cuts to 7.7 million barrels per day, with Iraq and other oil-producing countries making compensatory production cuts.

[China Shipbuilding Group and the Maritime Safety Administration of the Ministry of Transport signed a strategic cooperation agreement to help build a maritime power] China Shipbuilding Group Co., Ltd. and the Maritime Safety Administration of the Ministry of Transport signed a strategic cooperation framework agreement in Beijing on the 15th. The two sides will strengthen strategic interconnection, policy exchange and technical standards docking in the fields of marine equipment manufacturing and maritime supervision, and jointly speed up the construction of a transportation power and a maritime power. According to the agreement, the two sides will carry out comprehensive and in-depth cooperation in the fields of intelligent transportation equipment, ship and sea high-end equipment, ship and sea environmental protection technology, maritime policy and technical regulations research, international maritime affairs, ship and sea safety equipment and personnel training.

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