SMM data: Output and Recycling Volume of China's Lithium Battery and its Raw Materials in November 2022

In the spot market, on Aug 26, the premiums of Jinchuan nickel were quoted at 4,000-4,500 yuan/mt, with an average price of 4,250 yuan/mt, down 50 yuan/mt from the previous trading day.

LME base metals closed mostly with gains, while its counterparts on SHFE closed mixed. The investors were generally cautious ahead of the Jackson Hole symposium and awaited more clues to future rate hike. In China, slightly easing power rationing is expected to push up the supply.

In the short term, traders should be aware of the market's concerns about the falling aluminium supply, which could push up the aluminium prices; but in the long run, the demand will remain weak, and the aluminium prices will face downward pressure once the production resumes in the future.

In Tianjin, #0 zinc ingot was mostly traded at 25,600-25,810 yuan/mt, Zijin zinc 25,750-25,880 yuan/mt, and Huludao zinc 30,260 yuan/mt.

SHFE and LME base metals closed mixed amid disappointing economic readings. Overnight, August U.S. PMI continued to hit a new low in more than two years; Eurozone PMI hit a new low in 18 months, and remained in the contraction range for two months in a row; the two major economies - Germany and France – fell into contraction; Japan PMI fell below the 50-point mark as well.

SHFE 2209 lead contract price fell slightly last week, and the average SMM 1# lead ingot price dropped by 75 yuan/mt. However, secondary refined lead smelters still suffered narrow losses. The absolute price of secondary refined lead fell slightly and the average SMM secondary refined lead price only fell by 25 yuan/mt.

According to SMM, as of August 17, nearly 20 steel mills in north-west regions (Sichuan, Guizhou, Yunnan and Chongqing) suspended the production.

Futures: LME lead opened at $2,172.5/mt last night and fell 0.94% to $2,154.5/mt, with the highest and lowest prices at $2,197.5/mt and $2,145.5/mt respectively. The open interest decreased by 529 lots to 90,386 lots from the previous trading day. The most traded SHFE 2209 lead contract opened at 15,040 yuan/mt and rose by 0.7% to end at 15,130 yuan/m, after briefly hitting the lowest point at 15,025 yuan/mt and rising to the highest level at to 15,175 yuan/mt. The open interest decreased by 2,083 lots to 51,358 lots from the previous trading day.

LME and SHFE base metals closed mostly with losses as the US dollar index recording a losing session last Friday. Though the expectation for the Fed to continue to raise interest rates sharply declined, a number of Fed officials warned the fight against inflation is far from over.

Iron ore futures rebounded for two days after putting an end to three-day losing streak. However, the rally is not always smooth. The iron ore contract experienced both ups and downs yesterday (July 6), and closed the day with a gain of 1.84% at 747 yuan/mt.