US dollar falls, metals show mixed performance, SHFE aluminum and NYMEX gold rise over 1%, European container shipping rises over 5% [SMM Daily Review]

SMM May 13 Report:

Metal Market:

As of the daytime close, domestic base metals generally rose, with SHFE nickel falling by 1.52%, SHFE zinc closing flat at 22,325 yuan/mt, and SHFE aluminum rising by 1.27%. The gains of the remaining metals were all within 1%. The main alumina contract rose by 0.89%.

In addition, the main lithium carbonate contract fell by 0.69%, the main polysilicon contract rose by 0.91%, and the main silicon metal contract fell by 0.6%. The main European container shipping contract rose by 5.79%.

In the ferrous metals series, as of the daytime close, iron ore led the gains with a 1.06% increase, rebar rose by 0.88%, and HRC rose by 0.78%. In the coking coal and coke sector, coking coal fell by 0.85%, and coke fell by 0.69%.

In the overseas market, as of 15:02, overseas base metals showed mixed performance, with LME tin leading the losses with a 0.99% decline and LME nickel falling by 0.29%. LME lead rose by 0.56%. LME aluminum was temporarily flat at $2,480/mt, with the remaining metals experiencing minor fluctuations.

In precious metals, as of 15:02, COMEX gold rose by 1.22%, and COMEX silver rose by 2.01%. Domestically, SHFE gold fell by 1.63%, and SHFE silver rose by 0.44%.

Market conditions as of 15:02 today

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Macro Front

Domestic Aspect:

[SASAC: Plan a Batch of Strategic, Foundational, and Leading Major Projects Around Key Areas and Links in Economic and Social Development] The Party Committee of the State-owned Assets Supervision and Administration Commission of the State Council (SASAC) held an expanded meeting on May 13. The meeting emphasized the need to implement the decisions and deployments of the CPC Central Committee and the State Council, focus on current work, and strive to achieve the annual goals and tasks. It called for an objective assessment of the development achievements of state-owned assets and central state-owned enterprises (CSEs) during the 14th Five-Year Plan period, summarizing achievements while comprehensively reviewing shortcomings and issues to provide a solid foundation for formulating the 15th Five-Year Plan. It urged an in-depth analysis of the situation, scientific assessment of changes in the external environment, and comprehensive evaluation of technological and industrial development trends to formulate ideas and measures for the development, reform, supervision, and Party building of state-owned assets and CSEs, enhancing the foresight, forward-looking nature, and pertinence of the work. It stressed the need to set scientific goals, focusing on the primary task of high-quality development, enhancing the "five values," and formulating ambitious goals for state-owned assets and CSEs. It called for placing greater emphasis on developing new quality productive forces in line with local conditions, effectively optimizing the layout of strategic emerging industries and future-oriented industries, accelerating breakthroughs in key core technologies, and playing a pivotal role in technological innovation, industrial control, and security support. It emphasized the importance of implementing major projects, planning a batch of strategic, foundational, and leading major projects around key areas and links in economic and social development, combining national needs with the strengths of CSEs, and continuously strengthening the strategic support role of the state-owned economy.

►On May 13, the central parity rate of the RMB exchange rate in the interbank foreign exchange market was 7.1991 yuan per US dollar.

US dollar:

As of 15:02, the US dollar index fell by 0.23%. US Fed Governor Adriana Kugler stated on Monday local time that trade policies are evolving and may continue to change. However, even if tariffs remain near the currently announced levels, they still appear likely to have significant economic impacts. Kugler pointed out that the current average US tariff rate remains much higher than it has been in decades. She added, "If tariffs remain significantly higher than they were earlier this year, the economic impacts are likely to be similar, which would include higher inflation and slower economic growth."

The market is also awaiting the release of the US Consumer Price Index (CPI) report later in the day for new signals regarding the trajectory of the US Fed's monetary policy. Current market pricing indicates that the US Fed is expected to begin cutting interest rates in September, with a total of 55 basis points in cuts this year, compared to expectations of July last week.

Macro:

Today, data including China's April M2 money supply year-on-year growth rate, China's April total social financing year-to-date, China's April new RMB loans year-to-date, the US April CPI year-on-year growth rate (unadjusted for seasonal factors), the US April core CPI year-on-year growth rate (unadjusted for seasonal factors), the US April energy CPI year-on-year growth rate (unadjusted for seasonal factors), the Eurozone's May ZEW Economic Sentiment Index, Germany's May ZEW Economic Sentiment Index, Australia's ANZ Consumer Confidence Index for the week ending May 11, the UK's March unemployment rate (ILO standard), and the UK's March average weekly earnings including bonuses year-on-year growth rate (three-month average) will be released.

In addition, the Bank of Japan will release the summary of opinions from the April Monetary Policy Meeting, Bank of England Governor Andrew Bailey will deliver a speech, and US President Trump will visit Saudi Arabia, Qatar, and the UAE from May 11 to 14.

Crude oil:

As of 15:02, oil prices in both markets rose together, with US crude oil up by 0.18% and Brent crude oil up by 0.12%. Analysts at ING stated, "Although demand has been a major concern in the oil market, the increase in supply by OPEC+ means that the oil market will be well-supplied for the remainder of the year." They added that how well-supplied the market will be depends on whether OPEC+ adheres to its plan to actively increase supply in May and June. Since April, OPEC has increased oil production more than previously expected, with production in May expected to rise by 411,000 barrels per day.

Meanwhile, analysts hold differing views on crude oil inventories. Preliminary survey results indicate that US crude oil and gasoline inventories likely declined last week, while distillate inventories are expected to increase. Before the release of weekly inventory data, the average forecast from five surveyed institutions suggests that US crude oil inventories are projected to decrease by approximately 2 million barrels in the week ending May 9. However, Walt Chancellor, an energy strategist at Macquarie, expects US crude oil inventories to increase by 7.6 million barrels.

The American Petroleum Institute (API) will release its weekly inventory report at 4:30 on Wednesday, and the US Energy Information Administration (EIA) will publish its weekly crude oil inventory report at 22:30 on Wednesday. (Wenhua Comprehensive)

SMM Daily Review

►Aluminum prices continue to rise, with aluminum scrap prices following suit [[Aluminum Scrap Daily Review]]

►May 13: The most-traded SHFE aluminum contract approaches the critical level of 20,000, with processing fees under pressure to pull back and trading activity remaining moderate [[Aluminum Billet Spot Daily Review]]

►Policy transmission may still require time to materialize; short-term market transaction prices are under pressure [[NPI Daily Review]]

►[[SMM MHP Daily Review]] On May 13, Indonesia's MHP prices rose

►[[SMM Nickel Sulphate Daily Review]] On May 13, the nickel salt market experienced weak supply and demand

►[[SMM Nickel Ore Daily Review]] Philippine nickel ore prices are under pressure due to downstream constraints, while prices for Indonesia's local ore diverge between pyrometallurgical and hydrometallurgical processes

►Steel mill tenders continue, with manganese plant quotes remaining firm [[SMM EMM Daily Review]]

►Silicon metal transaction prices remain stable on a need-based basis [[SMM Silicon Daily Review]]

►Silver prices remain in the doldrums, with overall spot trading activity remaining sluggish [[SMM Daily Review]]