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[SMM Metal Breakfast] Metal collective rise * Electrolytic aluminum inventory continues to decline * lead ingot inventory ends ten consecutive increases
Jul 28,2020 06:46CST
translation
Source:SMM
[SMM Metal Breakfast] Metal collective rise * electrolytic aluminum inventory continued decline * lead ingot inventory ended ten consecutive increases * more than 2% increase in tin opening in Shanghai broke the previous daily high * preference of steel mills to take orders in August * exports of ternary precursors decreased by 15.4% month-on-month in June * gold prices on the outer disk hit an all-time high * China imported 1.59 million tons of copper ore and its concentrates in June * the United States resumed funding for two rare earth processing projects.
The content below was translated by Tencent automatically for reference.

[overnight quotation] the outer plate metal rose across the board, Lunxi and Lunqin rose by more than 2%.

Forecast of Today's Financial and Economic data: the United States released the Conference Board Consumer confidence Index in July

Today's focus

[statistics Bureau: industrial profit growth continued to accelerate in June from decline to rise in the second quarter] Zhu Hong, senior statistician of the Industry Department of the National Bureau of Statistics: in the first half of this year, the profit growth rate of industrial enterprises showed a trend of "before low and then high, from falling to rising". From a quarterly point of view, the profits of industrial enterprises increased by 4.8% in the second quarter compared with the same period last year, while those in the first quarter decreased by 36.7%. Especially in May and June, profits increased by 6.0% and 11.5% respectively, and the growth rate accelerated month by month. "check the details.

[SMM analysis: the impact of the overseas epidemic on the import of copper concentrate may have reached its peak.] according to the latest customs data, a total of 1.5941 million tons of copper concentrate and its ore were imported in June 2020, a decrease of 5.8% from the previous month and an increase of 8.9% over the same period last year. SMM believes that the impact of overseas outbreaks on copper concentrate imports peaked in June, and copper concentrate imports will begin to pick up month-on-month in the following months. The production and shipment of Peruvian copper mines were most seriously disturbed in April, and there was a significant reduction in imports in June after considering the shipping schedule. "check the details."

[Tektronix Resources: the completion of the QB2 copper expansion project in Chile may be delayed by 6 months] recently, Canadian mining company (Teck Resources) said that due to the impact of the epidemic, the completion of its Quebrada Blanca Phase II (QB2) expansion project in Chile may be delayed by six months. Although the company is gradually resuming work on the QB2 project, it noted that the completion of the project may be five to six months longer than expected (fourth quarter of 2021).

[China imported the highest amount of copper ore and concentrate from the United States since September 2018 in June.] Customs data released on Sunday showed that China imported the highest amount of copper ore and concentrate from the United States in June since September 2018. processing companies took advantage of the easing of trade relations to buy duty-free metals at the beginning of the year. The General Administration of Customs announced that China imported 30734 tons of copper ore and its concentrate from the United States in June, accounting for 1.93 percent of the total import volume of 1.59 million tons in June.

[Zaldivar copper mine workers accept revised wage offer copper supply concerns are temporarily alleviated] workers at Chile's Antofagasta Zaldivar copper mine accepted the revised wage offer and the strike was avoided. It is reported that there are 387 votes in favor of the revised salary agreement and 236 votes against the revised salary agreement. Last Wednesday night, workers at Antofagasta and its Zaldivar copper mine decided to extend government-mediated negotiations on a new union contract to avoid a strike, according to the union.

[SMM data: inventory continues to decline slightly inventory of electrolytic aluminum fell 3000 tons to 699000 tons compared with the previous Thursday] July 27, inventory continued to decline slightly, SMM statistics domestic electrolytic aluminum social inventory fell 3000 tons to 699000 tons compared with the previous week. Xi Hangzhou and Henan contributed the main decline, inventory in Shanghai continued to be tired. "check the details."

[SMM data: July 27th SMM Seven zinc ingots social inventory] according to SMM, as of Monday, the total inventory of SMM seven zinc ingots was 205100 tons, down 1300 tons from last Friday and 7500 tons from last Monday. Inventory in the seven places fell slightly over the weekend, mainly in Shanghai. In the lower reaches of Shanghai, replenishment drives out of the warehouse at a low price, the total amount of imported zinc into the market is limited, and inventory is down; the market in Guangdong still arrives steadily, while the output of the warehouse decreases, and inventory increases slightly. "check the details.

[SMM analysis: lead ingot inventory ends ten consecutive increases & long-term consumption can expect short-term lead prices to be stronger] according to SMM research, the social inventory of lead ingots is 42000 tons, down 5700 tons from the previous week on July 17, ending 10 consecutive increases. SMM believes that at present, the cost of recycled lead supports superimposed consumption expectations, and lead fundamentals have a certain degree of support, but the peak season for battery replacement has not arrived after all. It is expected that lead prices will remain volatile before the peak season. "check the details.

[SMM analysis: imports of zinc concentrates in Peru fell sharply in June compared with the previous month] according to the latest customs data, imports of zinc concentrates in June 2020 totaled 213100 tons (physical tons), a decrease of 143600 tons (physical tons) compared to May, and an increase of 24600 tons (physical tons) over 2019. In July, the Antamina mine in Peru announced on May 27th that it was operating at 80% of its full capacity. After the production and shipment resumed, its zinc concentrate will resume to Hong Kong at the end of July, and other overseas mines will also gradually resume production. It is expected that imported zinc concentrate will pick up slightly in July compared with June. To sum up, overall, SMM expects imports of zinc concentrate to pick up to about 300000 physical tons in July. "check the details.

[SMM brief comment: Shanghai tin rose more than 2% in opening trading and broke the previous day's high.] Shanghai tin has maintained a strong trend since the end of April, stabilizing above the 20-day moving average and rising in shock. On July 13, the domestic macro-economy improved, the market mood was high, the stock market led the metal disk to rise, and the overall bulls were strong. Last Wednesday and Friday, Shanghai tin twice intended to push higher, affected by the closure of the Chinese embassy in Houston by the United States and the subsequent Chinese reaction, Shanghai tin fell back under the market risk aversion, but the bulls are still accumulating strength. The mood recovered on Friday night and this morning, and prices were able to rise above their previous day highs.

Can the shortage of domestic nickel mines in the Philippines reopen mining company be improved? Recently, the Philippine Department of Environment and Natural Resources (DENR) will allow mining companies closed by Genna Lopez (Gina Lopez) to resume operations. According to SMM research, the list of recoverable mines has not yet been determined, and most of the mines are in a state where there is no ore to go out, so the impact is small and can not reverse the shortage of domestic nickel mines.

[SMM brief comment: despite the mineral ban policy, the Indonesian island still exports about 300000 tons of nickel ore per month.] according to SMM research, the SEBUKU, exports mentioned by President du have been in this mode in recent years, with an export volume of almost 300000 tons a month, with a nickel grade of about 1.0% and an iron content of 48%. Can be regarded as low-nickel high iron ore, can also be regarded as nickel-bearing iron ore. But so far, this is the only one that has such an operation. "check the details."

[SMM analysis: the demand is not "virtual"-when will the terminal demand "arrive"? The end demand for rebar this year seems to be particularly worrying-the "doomed" extraordinary Boxer year, with torrential rains, flood seasons and epidemics. South China, Southwest China and East China have fallen one after another-since July, floods have occurred in 336 rivers in China above the warning water level, of which 115 have exceeded the guaranteed water level and 38 have exceeded the historical water level, according to the Ministry of Emergency Management. In this case, SMM conducted a detailed study on the current situation and future construction of more than 100 real estate (31% of the total sample) and infrastructure (69% of the total sample) industry according to the terminal demand. "check the details."

[SMM hot rolling mill order acceptance report: steel mills take orders stable in August may usher in a phased correction] generally speaking, both agreement steel mills and price-locked steel mills basically maintain a stable preference for orders in August, even driven by a continuous rebound in some terminal demand, some steel mills still have the phenomenon of overconnection. Superimposing the current inventory pressure of steel mills is small, so the overall willingness to raise prices is still strong. "check the details."

[SMM analysis: overseas markets are still in a state of destocking. In June, the export of ternary precursors decreased by 15.4% from the previous month.] in June 2020, the total export volume of ternary precursors was 5624 tons, a decrease of 15.4% from the previous month, and an increase of 7.4% over the same period Exports totaled 41922 tons from January to June, an increase of 40.3 percent over the same period last year. Due to the high inventory backlog of European car companies, Japan and South Korea battery enterprises and Sanyuan material enterprises, the demand for precursors has not yet recovered, and the export volume declined month by month in May and June. The electrification of the European market has accelerated obviously this year, and the effect of overseas destocking has begun to be reflected recently. the export volume of precursors is expected to increase month-on-month in July and August.

[SMM analysis: imports of cobalt raw materials increased slightly in June and the growth rate of raw materials arriving in Hong Kong from July to August may not be as expected] China's total imports of cobalt raw materials in June 2020 totaled 4400 tons of metal tons, up 17% from the previous month and 42% lower than the same period last year. From January to June 2020, China imported 36800 tons of cobalt raw materials, an increase of 3 percent over the same period last year. According to the survey, the transport efficiency in Africa is still lower than expected, and there is no sign of improvement. SMM estimates that the domestic cobalt raw materials arriving in Hong Kong will be about 6800 tons of metal tons in July and 7200 tons in August. The improvement in the supply of cobalt raw materials is not as good as previously expected. "check the details.

[precious metals have repeatedly pushed up gold prices on the outer disk to reach record highs] recently, precious metal futures have been surging, and gold and silver have been pulled up one after another. At the height of the novel coronavirus epidemic, silver underperformed gold, but recently rebounded above $20 an ounce. Yesterday, as the dollar fell and global economic concerns boosted safe-haven demand, gold futures hit another record high. The most active gold futures COMEX December contract broke an all-time high of US $1941.2 / oz, and there is still an upward trend. "check the details.

Important news of metals and industry

[a breakdown of China's imports of copper ore and its concentrate in June] according to the online inquiry platform of the General Administration of Customs, China's imports of copper ore and its concentrate were about 1.59 million tons in June, down 5.8% from the previous month; an increase of 8.9% over the same period last year. Chile remains China's largest supplier of copper ore and its concentrates, with exports to China of 621962 tons, up 3 per cent from a month earlier and down 0.6 per cent from a year earlier.

[Chinalco Guinea Alumina Project Feasibility study report approved by the Guinean Government] recently, the Guinean Government Ministry of Geology and Mineral Resources organized relevant experts to review the feasibility study report of the Guinean Alumina Project of Chinalco Hong Kong Co., Ltd., submitted by Shenyang Aluminum and magnesium Design and Research Institute Co., Ltd. After listening to the report of the Shenyang Institute project team on the feasibility study report, the Guinean government evaluation experts agreed that the Shenyang Institute showed it a high-quality work result within the specified time, and the report was detailed and well-justified. in line with the relevant provisions of the Mining Agreement.

[Rusal: aluminum production fell 1.4 per cent in the second quarter compared with 927000 tons in the second quarter] Rusal announced that aluminum production in the second quarter of 2020 totaled 927000 tons (down 1.4 per cent on a quarter-on-quarter comparison), with Siberian smelters accounting for 93 per cent of total aluminum production. Aluminium sales in the second quarter of 2020 were 976000 tons (an increase of 6.8 per cent on a quarter-on-quarter basis). Under the influence of COVID-19, the company's sales of value-added products fell to 363000 tons (down 14% on a quarter-on-quarter basis), resulting in a decline in the share of value-added products in the total sales portfolio to 37% (compared with 46% in the first quarter of 2020).

[development and Reform Commission: operation of the Iron and Steel Industry from January to June 2020] Iron and steel output has increased steadily. According to the data of the National Bureau of Statistics, from January to June, the national output of pig iron, crude steel and steel products was 432.68 million tons, 499.01 million tons and 605.84 million tons respectively, an increase of 2.2%, 1.4% and 2.7% respectively over the same period last year. Steel exports continued to decline and imports increased sharply. According to the General Administration of Customs, steel exports totaled 28.704 million tons from January to June, down 16.5 percent from the same period last year; steel imports totaled 7.343 million tons, an increase of 26.1 percent over the same period last year.

[Jinxi heavy Industry sets a new record for the largest export profile steel roll ring in China] in July 2020, the largest export Φ 1530 large section roll ring was sent off the line in Jinxi heavy Industry, a subsidiary of the Group's equipment manufacturing subsidiary and a national high-tech enterprise, and sent to (Evraz), one of Russia's largest steel producers, to use the (NTMK), of Tajir Iron and Steel Co., Ltd. to roll H-beam on a universal rolling mill. Φ 1500-Φ 2200 roll ring is suitable for rolling super large steel and steel sheet piles. because of its thick wall, large tonnage, complex casting process and difficulty in manufacture, it is a scarce product in the market and few domestic enterprises are in production. This order, signed by both sides in March this year, covers Φ 1530 × 320 and Φ 1530 × 380 series roll rings.

[Tangshan Iron and Steel Co., Ltd. has become the first domestic enterprise to successfully develop 40MnB5 high-grade automobile stabilizing rod steel] recently, the 40MnB5 automotive stabilizing rod steel of Hegang Tangshan Iron and Steel Co., Ltd. is well used, and its properties meet the demand and reach the international advanced level. It marks that Tangshan Iron and Steel Co., Ltd. has become the first domestic enterprise to successfully develop 40MnB5 high-level automobile stabilizing rod steel. European automobile stabilizer rod steel has been gradually transformed from 34MnB5 to high-end 40MnB5, and the product is in the stage of research and development. With the help of the development advantages of 26MnB5 and 34MnB5 automobile stabilizer rod, the technical team of Tangshan stainless Steel Co., Ltd. of Hegang has completed the research and development of high-grade stabilizer rod steel 40MnB5 in nearly 3 months.

[Jiangsu Province issues the measures for the implementation of Iron and Steel capacity replacement (draft for soliciting opinions)] the website of Jiangsu Iron and Steel Industry Association published a notice on soliciting opinions on the revision of the "measures for the implementation of Iron and Steel capacity replacement" and extensively solicited opinions. As can be seen from the notice, compared with the "measures for the implementation of capacity replacement in the Iron and Steel Industry" issued by the Ministry of Industry and Information Technology in January 2018, the number of "measures for the implementation of capacity replacement in the Iron and Steel Industry" has increased from 12 to 16 "check details".

[quantitative change to qualitative change steel industry starts a new round of "capacity loss"] Xia Nong, a first-class inspector of the Industrial Development Department of the National Development and Reform Commission, revealed at the 2020 China Iron and Steel Development Forum a few days ago that from cracking down on strip steel to the removal of zombie enterprises, a number of ineffective and inefficient production capacity gradually withdrew from the market, and the capacity utilization rate of the iron and steel industry gradually returned to a reasonable range. However, a number of experts said that the pressure to prevent steel overcapacity will exist for a long time. In the next step, the iron and steel industry will continue to strictly prohibit the expansion of steel production capacity and reduce the proportion of capacity replacement, promote major strategic mergers and restructuring, and start a new round of "capacity removal" from quantitative change to qualitative change.

[rare earth giant Lynas Corp plans to complete the planning of a rare earth plant in Texas by mid-2021.] following funding from the US Department of Defense, Australian rare earth giant Linus Mining Company (Lynas Corp) recently signed a contract with the US Department of Defense to begin preliminary design work for a large rare earth separation plant in Texas, which is expected to be completed in mid-2021. The initial stages of design and planning may cost about $30 million.

[the United States resumes funding for two rare earth processing projects] the U.S. Department of Defense has resumed funding for two rare earth mineral processing projects. The assessment believes that the two projects that can provide rare earth products for the military are in the best interests of the US government. On April 22nd, the Pentagon announced funding for rare earth separation projects in Texas and California, respectively, for Australia's Linus (Lynas) and privately held company (MP Materials). But on April 29th, the Pentagon announced that it would shelve its sponsorship for the time being, pending further research.

[sudden! Gold and silver hit a new high] data show that as of July 24, the gold position of the world's largest gold ETF SPDR Gold Shares was 1228.81 tons, an increase of 49.91 tons compared with the end of June 2020, once again setting an all-time high. Silver holdings of the world's largest silver ETF iShares Silver Trust was 17379.97 tons, an increase of 1890.21 tons from the end of June 2020.

[gold futures hit a record high due to increased demand for safe havens ahead of the Fed meeting]: gold futures traded at an all-time high as the dollar plummeted and concerns about the global economy boosted demand for safe-haven assets. and contract delivery further boosted gold's rise. Contract switching is another stimulus to the rise in gold prices. Although the final figures were not released until last Friday during the Asian trading session, December contracts surpassed August contracts last Thursday, becoming the most outstanding contracts. "check the details."

Macro focus

[profits of industrial enterprises at and above the national scale dropped 12.8% from January to June 2020] from January to June, the total profits of industrial enterprises above the national scale reached 2.51149 trillion yuan, down 12.8% from the same period last year, or 6.5 percentage points lower than in the January-May period. From January to June, the total profits of the mining industry totaled 164.7 billion yuan, down 41.7 percent from the same period last year; the total profits of the manufacturing industry totaled 2.1223 trillion yuan, down 9.8 percent; and the total profits of the electricity, heat, gas and water production and supply industries totaled 224.5 billion yuan, down 8.7 percent.

[Ministry of Industry and Information Technology: focus on expanding effective demand] multiple measures will be taken to boost consumption, comprehensively implement the "same line, same standard and same quality" for domestic and export products, strive to stabilize traditional bulk consumption, and increase efforts to replace new energy vehicles in public areas such as public transportation and taxis. We will carry out activities for new energy vehicles to the countryside, speed up the development of new consumption formats, and promote the deep integration of the Internet and all kinds of consumption formats. We will actively expand effective investment, accelerate investment in major manufacturing projects, and support enterprises to strengthen intelligent, green, high-end and service-oriented transformation.

[us hotel industry CEO jointly asked the federal government to increase the effectiveness of novel coronavirus testing] (CEO), chief executive of 14 US hotel and other travel companies, wrote a joint letter to President Trump and the Speaker of Congress on the 27th local time. Congress is required to pass legislation to step up testing of novel coronavirus across the United States in order to effectively control the spread of the epidemic. The CEO of these hotels includes the heads of Marriott, Hilton, Kai Yue and other brands.

[euro zone economic performance will outperform the United States] compared with Europe, the United States failed to contain the epidemic and contained the economic rebound. In Europe, many of the worst-hit areas of previous outbreaks have managed to restore economic activity without causing a similar surge in infections. Business activity in the eurozone returned to growth in July as more once-blocked parts of the economy reopened and consumers returned to work or spending out of their homes, according to the survey.

Terminal information

[Tesla's German factory will produce batteries] it is reported that Tesla is currently building a new factory in Glenn Hyde, on the outskirts of the German capital Berlin. The economy minister of the German state of Brandenburg confirmed the news: "Tesla has begun to plan to produce electric cells in a German factory." In addition, Tesla CEO Elon Musk (Elon Musk) also revealed when announcing the company's latest quarterly results: "in order to meet the needs of the German factory, the company will produce batteries locally." Currently, the plant is carrying out foundation construction and is expected to start production as early as July 2021, with an initial focus on the production of Model Y models.

Come to change the electricity? Recently, another big news broke out that Ulai plans to set up a battery asset management company, which aims to promote the separation of the automobile and battery business, and vigorously promote the BaaS battery service (Battery as a Service). The battery asset management company, which will receive investment from an energy fund, will be set up as soon as August and is still seeking more financing, according to sources. It is also revealed that the Ningde era has made clear the investment intention.

[Daimler's second-quarter net loss of 1.9 billion euros is expected to be positive for the full year.] on July 23, Daimler released its second-quarter financial results. Financial results show that the company has withstood the impact of the novel coronavirus pandemic and performed better than expected. Specifically, in the second quarter of this year, Daimler sold 541800 passenger and commercial vehicles, down 34% from 821700 in the same period last year, while revenue fell 29% to 30.2 billion (same period 2019: 42.7 billion).

[power battery PACK market is $186.3 billion! Ningde / BYD / SAIC are all scrambling] despite the "black swan" of the epidemic this year, manufacturers' enthusiasm for the construction of PACK production lines continues unabated. Recently, Suzhou an has successfully signed a contract to settle in Banan Economic Park with a total investment of 50 million yuan and plans to build a new lithium battery PACK production line, which is mainly engaged in scientific research, production and technical services of military lithium power system. The project is expected to be completed and put into operation in December 2020 and will reach full production within five years, with an annual output value of about 200 million yuan.

[Toyota: solid-state battery prototype products but industrialization will not wait until 2025] for the commercial mass production of solid-state battery, Toyota is basically consistent with the industry's prediction, and it is not expected to be market-oriented until around 2025. Recently, Keiji Kaita, executive vice president and general manager of Toyota Motor Powertrain, revealed that "Toyota plans to mass-produce solid-state batteries by 2025." Although the application of solid-state battery in electric vehicles is expected to be four or five years away, this does not hinder automakers' enthusiasm for solid-state battery technology. solid-state battery is expected to become one of the breakthrough technologies to eliminate battery life anxiety, safety anxiety and charging anxiety of electric vehicles.

Related market

[the turnover of foreign exchange futures in June on the Singapore Exchange increased 14% from the previous month to US $120 billion] in June, the total turnover of foreign exchange futures on the Singapore Exchange reached US $120 billion, up 13.5% from the previous month, but down 1.06% from the same period last year. A total of 2.19 million foreign exchange futures contracts were traded on the Singapore Stock Exchange in June (up 9.6 per cent from the previous month and 9.4 per cent from a year earlier). The second wave of infection cast a shadow over the recovery in China's economic activity data; the outstanding contract volume of SGX dollar / offshore RMB futures remained strong.

What is the next tipping point in the crude oil market after the roller coaster? At present, there is still no big mainline logic for future market variables. As trading volume and positions continue to shrink, it is very difficult for funds to find opportunities for full participation. Therefore, in the short term, we seem to have to continue to wait for the possible tipping point of the market to emerge. This tipping point may be another huge good news from the vaccine, or it may be a further escalation of friction between China and the United States. In short, before the market is clear, it is recommended to operate with caution.

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