[overnight quotation] most of the outer disk metals closed higher, Lenny rose 2.46%, and the dollar index fluctuated at a low level.
[macro outlook] US releases New York Fed manufacturing index for August
Today's focus
[SMM analysis: copper prices are falling, scrap copper merchants cherish the recent tight supply] as of August 14, the tax gap between the bright line and electrolytic copper was 2179 yuan / ton, down 664 yuan from the peak of 2844 yuan / ton. Recently, copper prices fluctuated in a wide range, but showed a downward trend as a whole. Scrap copper suppliers are bullish and hesitant to sell, while scrap brass prices are relatively resistant to fall. alloy enterprises tend to enter the market to purchase scrap copper with falling prices, therefore, the decrease in supply and the increase in procurement led to a sudden tightening of scrap copper supply compared with last week, and it is not easy for scrap enterprises to receive goods, so they need to purchase at a higher price. In addition to the decline in copper prices, there are also factors contributing to the relatively strong price of scrap copper. "check the details."
[SMM analysis: reduction of inventory pressure on imported copper in East China] Copper prices fell sharply last week, hitting the 50000 mark many times. Downstream and traders still have demand and enter the market for purchases at low prices. In the case of easing inventory pressure, traders offered high prices firmly. On Friday, the spot price of electrolytic copper in Shanghai was quoted at 90 yuan / ton to 130 yuan / ton for that month, with an average price of 110 yuan / ton, up 10 yuan / ton from Monday. The price of wet copper also rose, with the average price rising from 35 yuan / ton at the beginning of the week to 40 yuan / ton at the weekend. In the case of off-season consumption, there is pressure on the discount to rise sharply. Under the weak supply and demand, it is expected that the spot market stalemate will continue to "check the details."
[SMM analysis: new production capacity of electrolytic aluminum stimulates anode demand to 77.04% in July] SMM expects the prebaked anode market to operate steadily in the future, and the industry operating rate will continue to rise in August, mainly due to the following reasons: the new electrolytic aluminum production capacity in southwest China will stimulate anode demand; in August, an electrolytic aluminum plant in Shandong raised the spot purchase price of prebaked anode again to 2760 yuan / ton. "check the details.
[SMM Weekly Survey: off-season aluminum downstream processing orders overall slightly decline aluminum foil consumption is still relatively exuberant] Last week, aluminum downstream enterprises started a slight increase of 0.2%, the slight increase in leading enterprises does not mean an increase in overall demand downstream. In addition to aluminum foil in the peak season of consumer demand, profiles, cables, strip and other plate small and medium-sized processing enterprise orders have declined to a certain extent. On the export side, the increase in new orders due to the overseas summer break is still slow, and due to the poor export environment in places such as the European Union, India and Brazil, some enterprises are still pessimistic about export orders in the fourth quarter. "check the details."
[SMM analysis: alumina prices may hit bottom and demand rises and costs form support at the bottom] the market formed a large-scale transaction before the weekend after the continued stalemate last week, but the focus of the transaction moved further down. However, as we have shown in previous reports, the main reason for this round of decline is the excess supply and demand in the alumina spot market and the lack of smooth upward transmission of downstream profits. But we think this wave of decline may be approaching and bottoming out. "check the details.
[SMM analysis: base price drop inventory drop Guangdong aluminum bar market improved] last week, Guangdong aluminum bar market trading activity increased: Shanghai aluminum main contract week decline of nearly 300 yuan / ton, spot base price decline slightly, Guangdong aluminum bar processing fee center of gravity moved slightly up. The inventory of aluminum bars in China's main consumer areas totaled 69400 tons on Thursday, a decrease of 6400 tons compared with last Thursday. Stocks in Foshan, Changzhou, Huzhou and Nanchang declined, of which Foshan inventory dropped the most.
[SMM analysis: why does the price difference between Gongyi aluminum ingots and East China rise in a short period of time] since August, the price difference between Gongyi and East China has gradually narrowed from a discount of 150 yuan / ton to near a small rise, mainly due to the following points: 1) the high aluminum price pullback, SMM A00 aluminum price fell from 15000 yuan / ton on August 4 to 14560 yuan / ton on August 14, down 440 yuan / ton. Gongyi market trading focused on absolute price. Therefore, this round of Shanghai Aluminum callback is of great help to the rise of Gongyi discount. 2) the inventory of Gongyi negotiable aluminum ingots is low. "check the details.
[SMM analysis: from the perspective of data statistics, the impact of 27 EU countries on the anti-dumping of Chinese aluminum sheet, strip and foil] according to foreign media reports, in response to the joint application of 27 EU countries, the European Commission said on August 14 that it would launch an anti-dumping investigation against China's flat-rolled aluminum products (aluminium flat-rolled products). According to customs data collated by SMM, China exported 2.6162 million tons of aluminum plate and strip in 2019, of which 259100 tons were exported to 27 countries of the European Union, accounting for 9.9% of the total export volume of that year; and 1.295 million tons of Chinese aluminum foil were exported in 2019, of which 155700 tons were exported to 27 countries of the European Union, accounting for 12.02% of the total export volume of the year. "check the details.
[SMM analysis: internal and external fundamentals continue to differentiate and import losses narrow to the margin of safety] with the promotion of overseas economic restart, international trade has recovered one after another, due to the small impact of the epidemic on the production of overseas smelters, coupled with the fact that the processing fees of long-term cooperation are at a higher level, the profits are more abundant, the production enthusiasm of smelters is higher, the output is maintained at a high level, and the recovery rate of superimposed consumption is slow from stagnation. The level of overseas hidden inventory is not expected to be low. According to the data, LME zinc stocks have increased by more than 90, 000 tons since July. As of August 14, the inventory has reached 214000 tons, mainly from Asia and the Americas, Singapore and Malaysia warehouses in Asia have increased by 48400 tons to 108800 tons since July, and New Orleans warehouses in the Americas have increased by 39900 tons to 60400 tons. "check the details.
[SMM survey: Henan refineries increased production led to a month-on-month increase in primary lead operating rate] according to the SMM (SMM) survey, last week (August 10-August 14) the weekly operating rate of SMM primary lead smelter was 56.4%, an increase of 1.1% compared with the previous week; the operating rate of Henan primary lead smelter was 69.6%, up 2.1% from the previous month; and the operating rate of Yunnan primary lead smelter was 35.8%. The operating rate of Hunan primary lead smelter is 47.2%. The output of Jinli in Henan has increased slightly, mainly due to the increase in the purchase of crude lead, the month-on-month increase in the output of electrolytic lead, the relatively stable production of refineries in other areas and the abundant supply of raw materials. "check the details.
[SMM research: lead battery consumption is stable in peak season] according to SMM research, the weekly comprehensive operating rate of lead battery enterprises in the five provinces of SMM last week (August 10-August 14) was 72.1%, which is basically stable compared with Friday. According to the research, the market of electric bicycles and car batteries is in the traditional peak season, and the orders of major enterprises are OK, especially the battery prices of electric bicycles have been raised twice since August, and the market trading atmosphere is good. In addition, in terms of enterprise production, since July, major enterprises have gradually increased the factory operating rate; after entering August, the operating rate of medium and large enterprises can basically be maintained at more than 80%, some of them can reach full capacity, and basically maintain production during the week. "check the details.
[SMM analysis: infrastructure investment keeps growing. Sales of excavators surged 54.8% in July compared with the same period last year.] excavators are not only in power, roads and other infrastructure construction and real estate development, mining and other markets there is a lot of demand. Moreover, due to the serious floods in many places in China in July this year, after the rainy season, post-disaster reconstruction has become a key work in many places, further increasing the market demand for the purchase and rental of excavators. SMM believes that as far as the building materials market is concerned, a number of downstream industries have been released recently, among which the sharp increase in excavator sales in July compared with the same period last year shows that the downstream recovery is better, which is good for the iron and steel industry, and the relationship between supply and demand remains in good condition. "check the details.
[SMM analysis: nickel sulfate demand picks up month by month for three consecutive months] China's total demand for nickel sulfate in July 2020 is 55300 physical tons, of which the output of ternary precursors corresponds to 43400 physical tons of nickel sulfate, up 10% from the previous month and 44% from the same period last year. Orders for ternary precursors may continue to increase slightly in August, and downstream concerns about the short-term tight supply of nickel sulfate, this month may have a stock of raw materials, SMM expects the total demand for nickel sulfate to increase to about 58000 physical tons. China's nickel sulfate continued to go to the warehouse last month in July 2020, and the inventory balance of that month showed the removal of 2776 physical tons of inventory. China's nickel sulfate will continue to go to the warehouse in August, and SMM expects the national nickel sulfate removal stock to increase by 9.8% month-on-month to 3046 physical tons in August. "check the details.
According to SMM, as of Friday, the total amount of pure nickel inventory in SMM six places was 45237 tons, which was 910 tons lower than that of last Friday. In terms of warehousing, a small number of Russian nickel bills of lading came to Hong Kong for customs clearance this week, and nickel plates also flowed into the country in the bonded area, all of which entered the Shanghai social inventory. Out of the warehouse, due to the correction of nickel prices this week, the release of downstream demand at the beginning of the week, so in addition to Jiangsu, Liaoning, all over the nickel plate inventory has a certain out of the warehouse. The output of nickel beans in Shanghai is 100 to 1300 tons, and a long-term supply is expected to arrive in Hong Kong at the end of the month, when the weak pattern of supply and demand is expected to be alleviated. To sum up, the spot inventory of warehouse receipts in the original three places decreased by 671 tons, and the social inventory of pure nickel in SMM decreased by 910 tons. "check the details.
According to SMM, the ex-factory price of spot resources from the main producing areas of electrolytic manganese has been relatively stable since the beginning of August. Among them, the negotiations on retail spot resources in the manganese triangle area are mostly around 10000-10100 yuan / ton. Some parts of Guangxi region do not have more spot quotations during the week of the opening manganese factory, and the delivery period order status has been maintained in the near future. The price of electrolytic manganese steel in Posco, South Korea, has increased in September. According to SMM, the ex-factory price of the main producing area of electrolytic manganese has been relatively stable since the beginning of August. Although some retail bulk orders are inquiring in the market, the willingness to accept the goods is less than 9800-9900 yuan / ton, and the manufacturers and traders are not willing to accept it. Although most of the price of steel in August showed a slight downward trend compared with the previous month, but the manufacturers' positive price and sales sentiment has not diminished. "check the details.
[SMM analysis: the upstream momentum of praseodymium, neodymium, terbium, terbium, terbium and terbium does not diminish the upstream momentum of praseodymium, neodymium, terbium, dysprosium, etc. Light rare earths, lanthanum and cerium are still tired, praseodymium and neodymium are unboiled. With the tight spot supply in the market, enterprise quotations are gradually raised, while downstream inquiries are affected and become more active. Some of the holders can not cover the market, some of the prices of the holders are higher, the procurement of downstream manufacturers and consumers are mainly rigid demand, procurement costs continue to rise. Metal praseodymium and neodymium are also sold. Downstream magnetic material manufacturers mostly order production and demand, take orders cautiously and lock metal prices. "check the details."
Important news of metals and industry
[SMM analysis: processing fees for fine waste copper rods quickly narrowed the operating rate of electrolytic copper rods began to pick up] affected by the continuous correction in copper prices, the monthly contract fell from a peak of 53520 yuan / ton on July 13 to 49970 yuan / ton on August 14 today, a drop of 3550 yuan / ton. Affected by this, recently, the price difference of processing fees for fine copper rods has rapidly narrowed, resulting in a decline in the operating rate of waste copper rod enterprises, and the operating rate of electrolytic copper rod enterprises has warmed up. "check the details.
[SMM analysis: domestic demand supports zinc oxide operating rate in August is expected to increase slightly compared with the previous month] according to a survey conducted by SMM (SMM), the operating rate of zinc oxide enterprises in July 2020 was 49.03%, up 1.46% from the previous month, and 1.02% higher than the same period last year. Competition in the industry caused by excess capacity of zinc oxide has always existed. After the completion of the new phase of projects invested in the construction of some large factories, they enter the production process, which squeezes some small enterprises. It is the general direction of the industry to exceed the big and the strong. In addition, from the point of view of competition, the processing cost of zinc oxide produced by zinc plating plant is lower, and there is more room for profit adjustment. In recent years, the proportion of zinc oxide slag production in zinc oxide enterprises has increased significantly, and the actual zinc consumption demand of zinc oxide enterprises has declined. "check the details.
[SMM analysis: railway transport resumes superimposed foreign brands flowing into Tianjin zinc ingots.] the rising water in Tianjin fluctuated greatly last week, and the discount quotation for rising water at the beginning of the week remained strong, among which the mainstream general brand basically reported a rise of 280,330 yuan / ton for the September contract, while the high-priced brand Zijin raised the discount again, up to 450,480 yuan / ton. As the weekend approached, Gaoshengshui quotation was not maintained, and traders lowered the discount quotation, including ordinary brands quoted at 250-300 yuan / ton, Zijin quoted to 350-380 yuan / ton. "check the details."
[SMM survey: the weekly operating rate of recycled lead has risen to 58.2% in the peak season] according to the (SMM) survey of SMM, last week (August 10-August 14) the weekly operating rate of SMM recycled lead smelting enterprises in the four provinces was 58.2%, up 4.07% from the previous month. According to SMM research, starting this week, some enterprises in Anhui, Guizhou and other places will gradually increase production, and it is expected that the operating rate of recycled lead smelting enterprises may continue to rise. "check the details.
According to recent reports, as the novel coronavirus epidemic may lead to a global recession, the Philippines, as one of the countries with the highest mineral content in the world, may further decline its nickel production this year. Due to the lack of processing facilities, the Philippines mainly sells unprocessed nickel ores. Bravo (Dante Bravo), president of the Philippine nickel industry association (PNIA), said that although it is difficult to predict, the uncertainty in the Philippine nickel industry may come from Chinese demand for stainless steel. China is currently the largest export market for Philippine nickel mines, mainly used in the production of stainless steel.
[SMM analysis: precious metals high diving metals fall in Shanghai tin difficult to reverse the trend short-term correction fundamentals to support the medium-term market] since the high correction of precious metals at the beginning of last week, gold and silver have fallen one after another by the limit, and the overall Shanghai metal market has fallen for two days in a row, and tin will inevitably be affected. Tin rose a lot in July, with an overall increase of 6.02% in July, with a maximum of 154400 yuan per ton, the highest price since 2018, and was the leader in the overall Shanghai metal market rally, with a large influx of funds. When the macro mood changes, money turns or retreats temporarily, it also falls more than other metals. This week, Shanghai Fuxi successively broke the 20-day moving average, the middle rail of the Bolin belt and the 40-day moving average, and the price fell back to the overall platform running in July. "check the details."
SMM point of view: how much room is there to repair the upside of nickel prices after the sharp fall in Shanghai nickel prices in recent days? The leading factors of this round of early rise are related to the financial side, but then the fundamentals have followed up to a certain extent. The fundamentals performed better than expected in the third quarter, while the latest price decline, it depends on the progress of vaccine research, the better-than-expected non-farm data in the United States, and the failure of the latest US stimulus policy to agree on a number of news related to bullish US dollar bearish commodities, and a number of early support levels run through one after another. SMM believes that the current performance of fundamentals can support the stabilization and rebound of more than 110000 of Shanghai nickel. The high output of stainless steel and the tightening of domestic nickel spot due to reduced imports make the fundamentals stable for the time being. After the sharp decline, there is some room for upward repair. It is estimated that this week, Shanghai nickel 110000-115000 yuan / ton, Lunni 14000-14400 US dollars / ton "check the details."
[Vale: approves the SerraSul120 project to increase production capacity by 20 million tons] Vale said its board of directors approved the expansion of the SerraSul120 iron ore project in the Brazilian city of Cana ã dosCarajas (PA). The project includes increasing the capacity of the S11D mine by 20 million tons per year, bringing the total capacity to 120 million tons per year.
[Rusal: aluminum prices will continue to be depressed in 2020] Rusal announced that in the six months ended June 30, 2020, the company realized income of US $4.015 billion, down 15.22% from the same period last year; adjusted EBITDA of US $219 million, down 58.52% from the same period last year; net loss of US $124 million, net profit of US $625 million for the same period last year; net recurrent loss of US $76 million, and recurrent net profit of US $666 million for the same period last year; A loss of $0.0082 per share; no dividend.
[Alphamin Resources: produced 2739 tons of tin in the second quarter, up 29% from the previous quarter] Alphamin Resources Corp. The financial performance of the Bisie tin mine in Congo for the first half of the year was reported, and tin production increased by 29 per cent over the previous quarter to 2739 tons. The production guidance for the third quarter of 2020 is that the tin content is 2600-2800 tons. During the quarter, mining exceeded factory production by about 4000 tons, increasing mine inventories. The processing plant is performing well, and various measures aimed at increasing production are also under way.
[Sumitomo Metals: electrolytic nickel production in the second quarter increased by 11.2% from 13344 tons in the second quarter] recently, Sumitomo Metals released its second-quarter results. In terms of nickel, electrolytic nickel production in the second quarter was 13344 tons, an increase of 1339 tons over 12005 tons in the previous quarter, and ferronickel production was 3192 tons, a decrease of 3192 tons compared with 3557 tons in the previous quarter. Production of, Coral Bay Nickel Corporation is less affected by the spread of new coronavirus infections than in the same period last year, but production of Taganito HPAL Nickel Corporation is expected to be affected by the epidemic.
[SMM special topic: will the tripod pattern of China, Japan and South Korea change when the army of European power batteries is about to attack? Recently, Verkor, a French battery manufacturer, announced that it will open a lithium battery production plant with an annual capacity of 16GWh in France in 2023, and expand its annual output to 50GWh according to the development of the market. It is reported that the batteries produced by Verkor will be used in the field of electric vehicle (EV) and fixed energy storage. This is not the only news about European power battery manufacturers recently. in addition to the current pattern of tripartite confrontation between China, Japan and South Korea in the power battery market, new forces from Europe are rising. For example, a series of manufacturers such as Swedish Northvolt, British Britishvolt, Norwegian Freyr and so on are actively laying out "check the details."
[Hudbay Minerals copper production fell 40.6% year-on-year gold production rose 16% year-on-year] Hudbay Minerals copper production in the second quarter totaled 18026 tons, down 40.6% from the same period last year; gold production totaled 32614 ounces, up 16% from the same period last year; silver production totaled 580817 ounces, down 28.5% from the same period last year; zinc production totaled 31222 tons, down 2% from the same period last year; and molybdenum production totaled 124t, down 63% from the same period last year.
[Peru Mining Phase II one-step formal transfer of production] on August 2, Luan Shuwei, vice president of China Copper Co., Ltd. And chairman of Peru Mining Co., Ltd., presided over the second phase one-step transfer meeting by videoconference. Luan Shuwei pointed out that the Peruvian Mining Industry Phase II formally handed over production in one step, and the transfer process was smooth. Through the joint efforts of the production and construction teams, the results were remarkable, showing the cooperative spirit of the two teams, which was also the root cause of the smooth transfer.
Macro focus
[the Ministry of Foreign Affairs responds to the Sino-US High-level Economic and Trade consultation] it is reported that questions will be raised on the upcoming economic and trade dialogue between China and the United States. In this regard, a reporter asked what results China expects to achieve in the dialogue. Zhao Lijian said: since the signing of the first phase of the economic and trade agreement between China and the United States in January this year, China has conscientiously implemented the agreement, and relevant departments have done a lot of work to promote the implementation of the agreement. Restrictions such as the COVID-19 epidemic and the tightening of US export controls on China have undoubtedly had a certain impact on the import of some goods and services. Under the current situation, it is necessary for both sides to make joint efforts and strengthen cooperation to overcome the difficulties. China hopes that the US side will stop its restrictive measures and discriminatory practices against Chinese enterprises and create conditions for the implementation of the first phase of economic and trade agreements.
[Bureau of Statistics: China mainly depends on domestic demand. China and the United States are still highly complementary to each other.] the Bureau of Statistics said that China's economy used to rely relatively heavily on external demand, but now China mainly depends on domestic demand. For the development of China and the United States, the economies of China and the United States are still highly complementary, and we still hope to maintain equality and mutual benefit, peaceful development, and jointly promote world economic growth. Cooperation between China and the United States benefits both sides, while struggle hurts both sides, and struggle is disadvantageous to the whole world.
[reporters asked if Trump would put pressure on Alibaba and other Chinese companies Trump replied: Yes) Trump was asked at a press conference whether he would impose a ban on other Chinese companies, including Alibaba. Trump replied: "well, we are thinking about something, yes." Foreign media came up with the headline: "Trump said he was considering putting pressure on other Chinese companies after the byte jumped."
[Cudlow: the Trump administration is satisfied with the progress of China's procurement of the first phase of the trade agreement] White House economic adviser Larry Cudlow (Larry Kudlow) said on Thursday that the Trump administration is satisfied with China's progress in implementing its commitment to buy American goods in the first phase of the trade agreement, indicating that the agreement will be approved in a preliminary review on Saturday. Kudlow said that we have great differences with China on other issues, but the United States is actively participating in the first phase of the trade agreement.
The director of the Gamaliya National Research Center for Epidemiology and Microbiology under the Russian Ministry of Health said that large-scale vaccination of the novel coronavirus vaccine in Russia could begin within a month.
Terminal information
[Wang Qingfeng: the order for the "Han" model of BYD's "14th five-year Plan" layout has reached 30,000.] Wang Qingfeng, deputy general manager of BYD Automobile sales Co., Ltd., said that recently, the newly launched "Han" model will also make a breakthrough in the car field, and now the entire order has reached 30,000, and 80% of the entire sales structure is basically on the product. Why is the whole market now more likely to make breakthroughs in the high-end market? I think good products for Chinese products, for Chinese consumers are also willing to choose high-end brands, "Han" this product is also equipped with stronger technology, this from the current market orders to verify this stage.
[Chuan Geely's acquisition of Lifan plus Southwest Market may be the main reason] while Lifan shares announced that they had entered the bankruptcy reorganization process, another piece of news spread widely in the automobile circle, that is, "Geely Motor's acquisition of Lifan Co., Ltd. has become a foregone conclusion." In this regard, Geely Motor sought confirmation from the Public Relations Department of Geely Holdings Group, and the other side said bluntly that it "did not know" and did not affirm or deny it. Media reports show that if Geely buys Lifan, it will take over the shell resources, production qualifications and financial licenses of listed companies in Lifan, while Lifan will only retain the motorcycle plate.
[BAIC New Energy sold 2009 vehicles in July and accumulated sales of 16700 vehicles from January to July] on August 12, BAIC Langu (600733) disclosed that its subsidiary BAIC New Energy produced and sold KuaiBao in July 2020. BAIC's new energy production in July this year was 1121, down 71% from the same period last year; sales were 2009, down 83% from the same period last year. From January to July, BAIC's cumulative production of new energy was 9574 vehicles, down 36.91% from the same period last year, and cumulative sales were 16700 vehicles, down 78.49% from the same period last year. What is noteworthy is that BAIC Langu disclosed a non-public stock offering plan on the evening of August 3, which intends to raise no more than 5.5 billion yuan for ARCFOX brand high-end model development and network construction projects, 5G intelligent network connection system promotion and other projects. All the fundraising projects are implemented by BAIC New Energy, a wholly owned subsidiary of BAIC Blue Valley.
[the number of fast charging piles for electric vehicles in the UK has surged by 363 per cent over the past five years] it is reported that the latest official figures show that the number of fast charging piles for public electric vehicles in the UK has increased by 363 per cent in the past five years. According to figures released jointly by the Department of Transport and Zap-Map, there are 3206 public quick-charging piles in the UK as of July 2020. At the same time, the total number of public charging piles (including fast and slow charging) in the UK is also increasing, with the total number of charging piles in the UK rising 11 per cent so far this year to 18265. Last year, the number of charging piles in the UK exceeded the number of gas stations for the first time.
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