China and the US Issue Joint Statement, Metals Rise Across the Board, SHFE Nickel, LME Zinc, and Polysilicon Lead the Gains, European Container Shipping Rate Hits Upper Limit [SMM Daily Review]

SMM, May 12:

Metal Market:

As of the daytime close, domestic market base metals all rose. SHFE nickel increased by 2%, SHFE aluminum by 1.66%, SHFE lead by 1.22%, SHFE zinc by 1.08%, while SHFE copper and SHFE tin both rose by less than 1%. The main alumina contract rose by 0.67%.

In addition, the main lithium carbonate contract rose by 0.53%, the main polysilicon contract by 2.49%, and the main silicon metal contract by 0.24%. The main European container shipping contract surged, ultimately closing at the daily limit of 16%.

The ferrous metals series collectively rose, with rebar and HRC increasing by 1.52% and 1.51%, respectively. Iron ore rose by 3.16%, and HRC by 1.51%. In the coking coal and coke sector, coke rose by 0.75%, and coking coal by 0.68%.

In the overseas market, as of 15:31, LME base metals all rose. LME lead increased by 0.86%, LME zinc by 1.75%, LME aluminum by 1.68%, LME copper by 1.23%, LME tin by 0.99%, and LME nickel by 0.51%.

In the precious metals sector, as of 15:31, COMEX gold fell by 2.81%, and COMEX silver by 0.21%. Domestically, SHFE gold fell by 2.01%, and SHFE silver rose by 1.02%.

Market conditions as of 15:31 today

》Click to view SMM Market Dashboard

Macro Front

Domestic Aspect:

[Ministry of Commerce: Crack Down on Smuggling and Export of Strategic Minerals, Increase Inspection and Enforcement Efforts at Ports] A spokesperson for the Ministry of Commerce responded to questions from reporters regarding the special campaign to crack down on the smuggling and export of strategic minerals. Question: We have noticed that the National Export Control Coordination Mechanism Office recently deployed a special campaign to crack down on the smuggling and export of strategic minerals. What considerations are behind this campaign? What other work will be carried out? Answer: Strengthening export controls on strategic mineral resources is crucial for national security and development interests. Since implementing export controls on some strategic minerals, we have discovered that some foreign entities have colluded with domestic lawbreakers to evade export control measures through smuggling and other means. To curb smuggling and other trends, the National Export Control Coordination Mechanism Office held an on-site meeting in Shenzhen, Guangdong Province, on May 9, focusing on cracking down on the smuggling of strategic minerals, and made special arrangements. A series of actions will also be organized in the near future. The on-site meeting further clarified the task divisions among the Ministry of Commerce, the Ministry of Public Security, the Ministry of State Security, the General Administration of Customs, the State Post Bureau, and other departments in this special campaign. It required relevant departments to strengthen law enforcement collaboration, severely crack down on the smuggling and export of strategic minerals, form a high-pressure situation of "joint management and control," take practical and effective measures, and resolutely prevent the illegal outflow of strategic minerals.Relevant departments immediately took action to swiftly launch cross-departmental investigations and case consultations targeting recent illegal and irregular activities in the strategic minerals sector aimed at evading export controls, such as false declarations, concealment, smuggling through concealment, and transshipment via "third countries." They intensified inspection and enforcement efforts at ports, delved deep into uncovering illegal entities and smuggling networks operating behind the scenes, and rigorously and swiftly investigated and handled illegal cases. This ongoing effort aims to continuously enhance the effectiveness of export control law enforcement and effectively safeguard national security and development interests. (Cailian Press)

[The Meeting on Strengthening the Whole-Chain Management and Control of Strategic Minerals Exports was Held] To thoroughly implement the decisions and arrangements of the CPC Central Committee and the State Council, on May 12, 2025, the Office of the National Export Control Coordination Mechanism organized the Ministry of Commerce, the Ministry of Industry and Information Technology, the Ministry of Public Security, the Ministry of State Security, the Ministry of Natural Resources, the Ministry of Transport, the State-owned Assets Supervision and Administration Commission of the State Council, the General Administration of Customs, the State Administration for Market Regulation, the State Post Bureau, and local authorities from strategic minerals-rich provinces such as Inner Mongolia, Jiangxi, Hunan, Guangdong, Guangxi, Guizhou, and Yunnan to convene the Meeting on Strengthening the Whole-Chain Management and Control of Strategic Minerals Exports in Changsha City, Hunan Province.

►The central parity rate of the RMB exchange rate in the inter-bank foreign exchange market on May 12 was 1 US dollar to 7.2066 yuan.

US dollar:

As of 15:31, the US dollar index rose by 1.08% to 101.49. The release of the joint statement on the China-US Geneva Economic and Trade Talks has alleviated market concerns about tariffs. The spokesperson for the Ministry of Commerce made remarks on the joint statement. This round of high-level economic and trade talks between China and the US has achieved substantive progress, significantly reducing bilateral tariff levels. The US has removed a total of 91% of the tariff hikes, and China has correspondingly removed 91% of the retaliatory tariffs. The US has suspended the implementation of 24% of the "reciprocal tariffs," and China has also correspondingly suspended the implementation of 24% of the retaliatory tariffs. Beth Hammack, President of the Federal Reserve Bank of Cleveland, stated on Friday that the US Fed needs more time to observe the economy's response to US tariffs and other policies before finding the right countermeasures, noting that much of the government's agenda remains unclear. Traders are closely watching the US Consumer Price Index (CPI) to be released on Tuesday for new signals regarding the monetary policy outlook of the Federal Reserve (Fed).

Macro:

[Joint Statement on the China-US Geneva Economic and Trade Talks] ① Both sides committed to taking a series of measures before May 14, 2025, including revising and removing tariffs imposed on each other's goods, as well as suspending or removing non-tariff retaliatory measures.② Both sides will establish a mechanism to continue consultations on economic and trade relations, and may hold discussions in China, the US, or a third country. (Xinhua News Agency) 》Click for details

Also worth monitoring: Data to be released today include China's M2 money supply YoY for April, China's total social financing (TSF) year-to-date for April, China's new RMB loans year-to-date for April, changes in Canada's employment for April, Canada's unemployment rate for April, etc. Also note the speech by Federal Reserve Governor Adriana Kugler; the National Energy Administration's release of nationwide electricity consumption data around the 15th of each month is also worth monitoring.

Crude oil:

As of 15:31, crude oil futures rose across the board, with WTI up 2.82% and Brent up 2.61%. Oil prices rose as easing global trade tensions boosted market sentiment.

Toshitaka Tazawa, an analyst at Fujitsu Securities, said that easing trade tensions supported market confidence, but OPEC's plans to increase production limited gains. Tazawa was referring to the plan by the Organization of the Petroleum Exporting Countries and its allies (collectively known as OPEC+) to accelerate production increases in May and June, which will add more crude oil to the market.

However, surveys showed that OPEC's oil production fell in April. (Wenhua Comprehensive)

SMM Daily Review

►Copper inventories in major regions across China increased slightly by 3,000 mt over the weekend [SMM Weekly Data]

►Poor price ratios in the morning session led to sluggish offers and thin trading activity [SMM Yangshan Spot Copper]

►Increased production cuts in secondary lead led to a slight decline in social inventory of zinc ingots [SMM Social Inventory of Zinc Ingots]

►SMM's social inventory of zinc ingots in seven regions increased by 2,200 mt [SMM Data]

►[SMM Daily Review of Nickel Sulphate] On May 12, nickel sulphate prices held steady

►[SMM Iron Ore Shipping Data] Global shipments continued to decline slightly, while port arrivals increased slightly

►[SMM Steel Shipping] China's total steel exports fell 18% MoM last week

►[SMM Coking Coal Shipping] Total coal arrivals at SMM ports reached 7.101 million mt

►Progress made in China-US economic and trade talks; precious metal prices corrected in the morning session, with overall spot trading remaining sluggish [SMM Daily Review]