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[SMM Metal Breakfast] LME Metal Downline * Copper Tube Enterprise orders continue to be poor * Electrolytic aluminum inventory continues to be tired.
Sep 11,2020 06:49CST
translation
Source:SMM
[SMM Metal Breakfast] LME metal all-line downline * copper tube enterprise orders continue to be poor * Electrolytic aluminum inventory continues to be tired * the implementation of the new solid waste method to implement the import of nickel sulfate raw materials is affected to a certain extent * can the elimination of hot coil inventory come as promised? * the concentrated landing period of new capacity is approaching, is the steel market ready? * the decline in demand and production capacity has greatly increased the price of sponge zirconium. How much longer is it going to fall?
The content below was translated by Tencent automatically for reference.

[overnight quotation] the outer disk metal closed down across the board. EIA crude oil stocks unexpectedly rose and oil prices fell again.

[macro Prospect] China announces the scale of social financing in August

 

Today's focus

[SMM analysis: copper tube enterprises' orders continue to be poor and the operating rate is expected to continue to decline month-on-month in September] the operating rate of copper pipe enterprises is expected to be 75.60% in September. According to a survey by SMM, the operating rate of copper pipe enterprises is expected to be 75.60% in September, down 2.27% from the previous month and 2.46% from a year earlier. According to the production scheduling plans of key air-conditioning enterprises in September, there is still a drop of more than 20% compared with August, copper tube consumption is prolonged in the off-season, and the "Golden Nine and Silver Ten" is expected to fail. Most copper tube companies report that orders have not improved in September compared with August, and the off-season market may continue until October. "check the details."

[SMM analysis: the scrap copper rod market weakens slightly in August and still looks pretty good compared with the same period last year.] the operating rate of scrap copper rod enterprises in August was 68.28%, down 1.13% from the previous month, which was smaller than expected and rose sharply by 17.37% compared with the same period last year. In August, as the demand for copper in the cable industry downstream of the scrap copper rod was in a downward trend, the order of the scrap copper rod was naturally dragged down. in addition, the high copper price for a long time also restrained the purchasing efforts downstream, and the performance of the scrap copper rod industry was weaker than the previous month. However, according to the disk deduction data of the SMM Jiangxi area resistance rod, the average discount of the scrap copper rod in Jiangxi to the monthly contract of Shanghai copper in August is 1100 yuan / ton, and the price is still quite cheap to attract the downstream cable industry to continue to purchase scrap copper rods. In August, the scrap copper rod industry as a whole maintained quite good. "check the details.

[SMM analysis: delivery is approaching now return to Guangdong aluminum rising downward pressure] yesterday SMM A00 aluminum (Foshan) price quoted 14690 yuan / ton, for Shanghai aluminum 2009 contract up 160 yuan / ton, for Shanghai aluminum 2010 contract up 310 yuan / ton, for Shanghai aluminum 2011 contract up 440 yuan / ton. The base difference of Guangdong aluminum has dropped by about 60 yuan / ton from Tuesday's high, and the monthly difference of 09x10 contract has increased from 90-110 yuan / ton to 150-170 yuan / ton. the October / November difference has not changed much, maintaining the range of 100-140 yuan / ton. Considering that the Shanghai Aluminum 2009 contract is due to be delivered next Tuesday, the current spot premium of more than 150 yuan / ton is obviously on the high side, in the last three trading days, arbitrage funds are likely to erode this part of the spot premium. "check the details.

[SMM data: inventory continued small tired domestic electrolytic aluminum society inventory increased by 3000 tons to 764000 tons] on September 10, weekly inventory continued to be small tired, domestic electrolytic aluminum social inventory weekly warehouse 3000 tons to 764000 tons. "check the details.

[national Aluminum Bar inventory Weekly Review: the inventory of aluminum bars increased by 3400 tons to 63600 tons compared with last Thursday.] the inventory of aluminum bars increased by 3400 tons to 63600 tons compared with last Thursday. Inventory in Foshan, Changzhou, Huzhou and Nanchang all increased, with the largest increase in Nanchang inventory and only a slight decline in Wuxi inventory.

[SMM Analysis: outlook for Zinc Ingot Market in September] on the supply side, in August, after the processing fees went up further, some mines went into traditional maintenance, and the mine operating rate in August was more stable than that in July, while in September, domestic mines mainly resumed production and increased production, and the overall operating rate increased slightly, and the domestic zinc mine output was still at a low level in recent years. For refineries, the smelter took the initiative to increase production driven by good profits in August, and some smelters were overhauled and resumed production. Zinc output increased by 16300 to 509100 tons. With the increase in start-up, the refinery raw material inventory dropped slightly to 27.75 days. In September, although processing fees have been reduced in some areas, they still remain relatively high. under the trend of high profits, smelters are still mainly resuming production and increasing production, and refined zinc output is expected to increase by 36900 tons to 545900 tons month-on-month in September. "check the details.

[SMM survey: the implementation of the new solid waste law to implement the import of nickel sulfate raw materials is affected to a certain extent] according to the SMM survey, after the introduction of the new solid waste law, the inspection cycle for imported waste can be extended to 21 days, and the import of nickel-containing waste has also been reduced. The supply end of nickel sulfate raw material is mainly nickel-containing waste, nickel wet intermediate and nickel bean / powder. due to the long-standing shortage of domestic nickel waste market, there is a certain demand for foreign waste import in the nickel sulfate market. The new solid waste law landed, the amount of imported nickel waste is reduced, and it is expected to have a certain impact on the supply end of nickel sulfate raw material. "check details.

[the upgrading project of the US $90 million Vale nickel smelter has been postponed until next year.] it is understood that due to the impact of the epidemic on logistics and transportation, Vale Indonesia postponed its US $90 million upgrade plan for its Sorowako nickel smelter in South Sulawesi Island until next year. Bernardus Irmanto, the financial director of the Indonesian branch, said at a virtual shareholder meeting that the upgrading of the Sorowako smelter had been planned since 2017 and had been scheduled to take five months, but was now postponed to May 2021.

[SMM Hot Volume: Jinjiu has arrived. Can inventory demurrage come as promised? This week, the total inventory of hot-rolled coil was 3.9465 million tons, with a month-on-month ratio of-0.06% and + 20.07% compared with the same period last year. On the one hand, the supply of hot rolling increased slightly this week, resulting in a small increase in factory inventory; on the other hand, after market sentiment weakened, traders in many places began to sell and reduce their stocks, resulting in a slight decline in the stock. Under the action of the two phases, the total hot rolling inventory remained basically stable this week. The sharp correction of this week's volume has led to a sharp decline in the spot market atmosphere and great changes in inter-regional price differentials. After East China has accepted the inflow of northern wood for several weeks in a row, the contradiction between supply and demand in the market broke out centrally after the weakening of the volume. "check the details.

[SMM Steel: the new capacity will be concentrated on the ground soon. Is the steel market ready? According to the preliminary research data of SMM, from September 2020 to June 2021, there will be a net increase of ironmaking capacity of-3.59 million tons and a net increase of steelmaking capacity of 4.622 million tons. Among them, the new ironmaking capacity is 54.242 million tons and the steelmaking capacity is 50.34 million tons. The corresponding replacement capacity will eliminate 57.839 million tons of backward ironmaking capacity and 45.723 million tons of steelmaking capacity. With the arrival of gold, silver and silver, the expectation of the market for the outbreak of demand and the elimination of inventory has also reached the 2020 deadline. Under the expectation of high supply to maintain stability, inventory digestion is more likely to become a weather vane of the steel market in the fourth quarter. "View details

[thread inventory report: there is no return in the peak season. As of September 10, the total inventory of building materials nationwide was 11.4883 million tons, with a month-on-month ratio of-0.7%, which was + 49.4% compared with the same period last year. In the short term, although rebar production has fallen still high, inventory growth is as high as about 50% year-on-year-fundamental support is there but not very solid. As a result, when the strong expectations of the peak season, which have lasted for about two months, have not been fully realized, the "strong expectations" that promote the early rally will gradually turn into the risk of promoting the downward trend of spot prices, and the continuous decline of snails in recent days is a sign of the realization of the risk. I'm afraid the price adjustment is not over yet. "check the details.

[SMM thread scheduling report: although the output drop is still high, there is only a "arm's distance" above the steel price.] according to the survey of SMM, the actual thread production of blast furnace steel mills mainly producing building materials in September was 8.4548 million tons, down 4.19 percent from August, and the reel production was 2.6925 million tons, down 1.39 percent from the previous month. In addition, the export performance is relatively stable, the thread export volume is basically the same as the previous month, and the reel is 20,000 tons more than the previous month. "check the details.

[MMi iron ore port spot index report (10th)] yesterday even the iron chain continued to decline, the port spot market early quotation lower than yesterday by about 5-15 yuan / ton. Steel mill enquiries are relatively general, some bargain purchases; afternoon trading continues to decline, some traders' mentality weakens, bargaining room is expanded. "check the details.

[SMM analysis: weak steel price trend blast furnace operating rate fell for three consecutive weeks] according to SMM research, the blast furnace operating rate in the second week of September was 88.6%, down 1% from last week, a decline for three consecutive weeks. Recently, Tangshan environmental protection production restrictions have affected the superimposed profitability, and the overhaul of blast furnaces in steel mills has increased, leading to a continuous decline in the operating rate of blast furnaces. "check the details.

SMM analysis: demand decline capacity greatly increased sponge zirconium price collapse! How much longer is it going to fall? Recently, the price decline of sponge zirconium has intensified. Last week, the price of sponge zirconium has been reduced to 140-150 yuan / kg, and the price has stabilized this week. According to SMM, the larger decline in sponge zirconium prices is mainly due to increased supply and sluggish demand. "check the details.

Important news of metals and industry

[the word "strict" is at the head of escorting the resumption of work at the Mirado Copper Mine] on August 26, local time in Ecuador, the ball mill at the Mirado Copper Mine roared again, and the mine, which had been suspended for more than five months due to the epidemic, fully resumed production. On the same day, the ore handling capacity of the concentrator reached 23891 tons. The copper concentrate produced by the Milado Copper Mine has also been transported back to Tongling Nonferrous smelter for processing. After reaching the standard, it will bring 96000 tons of copper metal to Tongling Nonferrous Metal every year.

[national Development and Reform Commission: national output of ten non-ferrous metals increased by 3.3% in July compared with the same period last year] in July, the national output of ten non-ferrous metals increased by 3.3% over the same period last year, or 0.7 percentage points higher than the same period last year. Among them, copper production grew zero compared with the same period last year, up 4.8 percent in the same period last year; electrolytic aluminum production increased by 3.1 percent, falling by 2 percent in the same period last year; lead production increased by 18.9 percent, an increase of 5.7 percent over the same period last year; and zinc production decreased by 0.2 percent, compared with an increase of 17.4 percent in the same period last year. The prices of major non-ferrous metals are up from last month. The average trading prices of copper and electrolytic aluminum on the Shanghai Futures Exchange in July were 51104 yuan / ton and 14485 yuan / ton, respectively, up 9.6% and 5.7% over the previous month, and 9.3% and 5% over the same period last year. The average trading prices of lead and zinc were 15206 yuan / ton and 17694 yuan / ton respectively, up 5.4% and 6.1% over the previous month, down 6.6% and 9% from the same period last year.

[initial appearance of the overall smooth operation of aluminum and zinc options on the full moon] as of Wednesday, September 9, aluminum and zinc options have been operating for a total of 23 trading days. Data show that aluminum options trading is stable, the scale of trading positions has expanded steadily, with a cumulative turnover of 65600 lots, a cumulative turnover of 52.2143 million yuan, and an after-hours position of 12800 lots on the 9th. Among them, the average daily trading volume of aluminum options accounted for 1.38% of the average daily trading volume of the underlying futures in the same period, and 4.18% of the futures positions in the after-hours aluminum period on the 9th. Zinc options trading is more active, the size of the transaction position is expanding rapidly, with a cumulative trading volume of 138900 lots, a cumulative turnover of 199.1057 million yuan, and an after-hours position of 12300 positions on the 9th. "check the details."

At 11:16 on September 9, the last 146m electrolytic cell of the third section of the 500000 ton hydropower and aluminum project of Wenshan Aluminum Company completed electrification, marking the completion of the completion of electrification of all the 500000 electrolytic cells of the hydropower and aluminum project. After nearly 4 months, the project went into production and ran out of "acceleration", which further accelerated the pace of the company to build a benchmarking enterprise in the whole industry chain. Up to now, the project has opened a total of 346 electrolytic cells, with a daily output of about 1000 tons of molten aluminum, and the electrolytic production line is expected to be fully put into production on September 14.

[India plans to build lithium battery recycling plant to develop local battery metal supply chain to reduce external dependence] India's State-owned Electronic Technology Materials Center (C-MET) plans to establish facilities for lithium battery recycling as part of the country's strategy to develop a local battery metal supply chain and reduce dependence on imports. The recycling facility has developed technologies for extracting cobalt, nickel, lithium, copper, aluminum, gold and platinum from scrapped lithium-ion batteries on a pilot scale. The selected partner will be responsible for using C-MET 's technology to stabilize the facility.

[South Korea: the average annual growth rate of renewable energy demand will rise from 6.3% to 8.0%] according to the "medium-term Energy demand Outlook 2020" report released by the Korea Energy Economic Research Institute on the 9th, coal demand will decrease by 0.7% annually from 2019 to 2024, and coal dependence will drop from 27.0% to 24.0%. According to analysis, due to the government's policy of shutting down the units of old power stations and the haze prevention and control project in spring, the demand for coal for power generation will show a decreasing trend. The 9th Electric Power Development Plan, issued in May this year, will shut down 30 units with an operating life of 30 years by 2034, accounting for half of all thermal power units. The demand for renewable energy will grow at an average annual rate of 5.7%, and the degree of dependence will rise from 6.3% to 8.0%.

[Shougang Tonggang Co., Ltd. has the production capacity of color steel tile] recently, the color steel tile production line of Tong Steel Co., Ltd. was successfully tested and produced the first batch of color steel tile products. At present, the production line mainly produces YX15-225900and YX35-125750 colored steel tiles with a thickness of 0.6mm to 1.0mm, with an annual production capacity of 260000 cubic meters, which can not only meet the needs of various business departments of the company, but also meet the needs of surrounding enterprises and residents, with an estimated annual efficiency of 200000 yuan.

[Dalian Customs seized 149.2 tons of "foreign garbage" which is prohibited from import.] on September 7, Dayaowan Customs, which belongs to Dalian Customs, seized 149.2 tons of "foreign garbage". When the customs officer inspected a batch of goods imported from abroad named sub-zinc oxide, they found that it was gray-black powder with a small amount of silver particles and scum, which was suspected to be prohibited from importing solid waste in our country, so they were immediately sampled and submitted for inspection. Through the attribute analysis and identification of the solid waste of the sample, the zinc oxide content of the sample does not meet the limit requirements of the standard, and is identified as a zinc dust collection produced by smelting process containing zinc, copper and other wastes. does not meet the national, local or industry standards for the production of substituted raw materials, the goods are determined to be prohibited from import of solid waste.

[national Mineral Development Corporation of India raises iron ore prices by more than 10 per cent] (NMDC), India's state-run iron ore miner, has raised the price of iron ore (lump ore and fine ore) with effect from Saturday, September 5, 2020. NMDC raised lump ore prices by 10.16 per cent in September from the previous month to 3250 rupees / tonne, compared with 2950 rupees / tonne in August. Powder prices rose 11.27% to 2960 rupees / ton in September and 2660 rupees / ton in August. The new price will take effect from September 5th.

[Russia's NLMK Group faces risks in suspending iron ore concentrate production of pig iron and steel] Novolipietsk??Steel (NLMK), Russia's largest steelmaker, has suspended iron ore concentrate production at its Stoilensky mine as a result of the Sept. 7 accident. According to sources, all of NLMK Group's iron ore concentrate comes from the project, so the company's pig iron and steel production is under threat.

[semi-annual report: profits of aluminum enterprises gradually improve in the first half of the year, net profits vary.] the global outbreak and growing uncontrollable situation of COVID-19 has plunged the world into panic and uncertainty, accompanied by a collapse in oil prices. commodity prices, including electrolytic aluminum, have fallen sharply. With the phased achievements in the prevention and control of the domestic epidemic situation, the comprehensive resumption of work and production, the rapid recovery of primary aluminum consumption, the delayed concentrated release of orders, the increase in the replacement of scrap aluminum, speculative hoarding in the market, and so on, aluminum inventory has dropped sharply. Shanghai Aluminum continues to rebound "check the details."

[semi-annual report: zinc upstream enterprises were fully frustrated under the epidemic in the first half of the year. Luoping Zinc Power's net profit plummeted 2156.17%] the epidemic broke out in mid-late January and gradually spread around the world. After the Spring Festival, Shanghai zinc began to plummet, with an intraday low of 14245 yuan per ton, refreshing its lowest level since 2016. Due to the low price of zinc, the performance of enterprises is generally affected. From the zinc upstream enterprises understood by SMM, only Zijin Mining increased its operating income and net profit compared with the same period last year, while the net profits of other companies all decreased compared with the same period last year, of which Luoping Zinc Power dropped the most, and the net profit belonging to shareholders of listed companies plummeted 2156.17% in the first half of the year. "check the details.

[gold ETF holdings rose to an all-time high of 3824 tonnes] gold-backed ETF and similar products recorded inflows for the ninth consecutive month in August, but the lowest level since 2020, according to the World Gold Council. Gold ETF rose by 39 tons this month, equivalent to $2.1 billion, or 0.9% of assets under management, as gold prices hit a record high of $2067 in early August. So far this year, global capital inflows have been 938tonnes ($51.2 billion), pushing gold ETF holdings to an all-time high of 3824 tonnes, up 38 per cent.

Macro focus

[Chinese and Indian Foreign Ministers issued Joint Press release the two sides reached a five-point consensus] according to news from Moscow on September 10, Chinese State Councilor and Foreign Minister Wang Yi and Indian Foreign Minister Su Jiesheng held a bilateral meeting in Moscow on the same day. The foreign ministers of the two countries discussed the development of the Sino-Indian border situation and Sino-Indian relations in a frank and constructive manner. The two foreign ministers agreed that the two sides should follow a series of important consensus reached by the leaders of the two countries on the development of Sino-Indian relations, including not letting differences between the two countries escalate into disputes, that the current situation in the border areas is not in the interests of both sides, and that the border defense forces of the two countries should continue their dialogue, disengage from contacts as soon as possible, maintain the necessary distance, and ease the current situation.

 

According to CME Fed Watch, the probability of the Fed keeping interest rates in the 0% won 0.25% range in September is 100%, and the probability of raising interest rates by 25 basis points to 0.25% is 0%. The probability of keeping interest rates in the 0% won 0.25% range in November is 100%, and the probability of raising interest rates by 25 basis points is 0%.

[Brexit clouds hang over the pound again] the pound fell against the euro and the dollar on Wednesday, extending its seventh consecutive session of decline, the biggest percentage decline since the novel coronavirus epidemic triggered the market crisis in March. The pound has fallen 2.3 per cent against the euro and 3.9 per cent against the dollar in the past seven trading days. A new round of negotiations on future trade relations began this week. British officials said they would not compromise on certain requirements and were ready to suspend trade in the absence of a new agreement.

[additional unemployment benefits authorized by Trump will end after six weeks.] the funds authorized by US President Donald Trump in early August to replenish weekly unemployment benefits are drying up. States will receive funding for six weeks under the lost wage Assistance Program, which uses relief funds to allow the federal government to provide an additional $300 a week for most of the unemployed, FEMA said in an emailed statement on Thursday. Montana and Texas announced on Wednesday that they had learned that the money would not last beyond the week that ends Sept. 5. The end of supplementary unemployment benefits will make life more difficult for millions of Americans who rely on unemployment benefits. It could also undermine the spending power of consumers across the economy, which in turn weakens the incomes of businesses. Congress remains deadlocked over another stimulus bill.

[6.39 million COVID-19 in the United States] according to the statistics of Johns Hopkins University in the United States, as of 17:28 eastern time on 10 September, there were 6390840 confirmed cases and 191612 deaths in the United States by COVID-19. Compared with 24 hours ago, there are 35971 new confirmed cases and 1023 new deaths in the United States.

Terminal information

[charging Alliance: as of August, the number of charging piles nationwide increased by 27.9 percent compared with the same period last year.] on September 10, the China Electric charging Infrastructure Promotion Alliance (hereinafter referred to as: charging Alliance) released charging pile operation data for August 2020. As of August 2020, a total of 592000 public charging piles have been reported by member units in the alliance, including 341000 AC charging piles, 250000 DC charging piles and 488 AC / DC integrated charging piles. From September 2019 to August 2020, about 11000 new public charging piles have been added every month.

[19 photovoltaic projects 1.25GW! Qianxinan Prefecture Energy Bureau on starting 2020 Photovoltaic Power Generation Project filing notice] according to Qianxinan Prefecture Energy Bureau, Qianxinan Prefecture organizes 19 photovoltaic projects with a total installed capacity of 1.25 million kilowatts, all of which are included in the national subsidy list.

[China Automobile Association: sales of new energy vehicles reached 109000 in August to set a new record for that month] the China Association of Automobile Manufacturers released the production and sales of the automobile industry in August 2020. In that month, the overall situation of automobile production and marketing in China was stable, the output decreased slightly from the previous month, the sales volume increased slightly, and continued to grow compared with the same period last year. Specifically, China's automobile production and sales reached 2.119 million and 2.186 million respectively in August, with production down 3.7% from the previous month, sales up 3.5% from the previous month, 6.3% and 11.6% from the same period last year.

[Dailham stops local expansion to invest in the fast-growing Chinese market] major car companies are struggling as the epidemic continues to hit the global economy, and Daimler (Daimler), the world's largest luxury carmaker, is no exception. Germany's oldest carmaker has said it will stop expanding at home and turn to invest in the fast-growing Chinese market. Daimler, the parent company of German car giant Mercedes-Benz, has ruled out expanding production at home as it prepares to further cut costs in response to a sharp decline in global car sales, according to media reports.

[Ningde Times and Changan Automobile signed Strategic Cooperation Agreement] recently, Ningde Times and Changan Automobile signed a strategic cooperation agreement in Ningde. According to the agreement, the two sides will establish a long-term and in-depth partnership in the fields of intelligent network-connected electric vehicles and smart energy ecology to jointly promote the construction and development of China's new energy vehicle industry. Prior to this cooperation, Changan Automobile invested in Ningde era in 2017 by acquiring the share of Zhenjiang Demao Hairun Equity Investment Fund Partnership (Limited Partnership). Not long before this acquisition plan, Changan Automobile officially released its brand-new new energy strategy, the "Shangri-La Plan", announcing that Changan Automobile would stop selling traditional fuel vehicles in 2025, while spending 100 billion yuan to develop new energy vehicles. Ningde era investment is also among them.

[the second phase of Ates 6GW photovoltaic module project Yancheng Dafeng started] on September 8, 2020, Yancheng Dafeng Ates Solar Power held the opening ceremony of the second phase of 6GW module. It is reported that the 6GW module project has a total investment of 1.5 billion yuan and plans to build 16 high-efficiency solar module production lines, which will be implemented in two phases.

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