Metals generally declined, with polysilicon falling by over 2% to hit a new listing low, SHFE silver dropping by over 1%, and European container shipping falling by over 4% [SMM Daily Review]

SMM June 19 Report:

Metal Market:

As of the daytime close, domestic market base metals generally declined, with only SHFE lead and SHFE nickel rising together. SHFE lead rose by 0.53%, and SHFE nickel rose by 0.46%. SHFE zinc fell by 0.59%, while the declines in other metals fluctuated slightly. The main alumina contract rose by 0.1%, and the main casting aluminum contract rose by 0.61%.

In addition, the main lithium carbonate contract fell by 0.17%, and the main polysilicon contract fell by 2.55%, hitting a record low of 32,680 yuan/mt during the session since its listing. Silicon metal rose by 0.47%. The main European container shipping contract fell by 4.01%.

In the ferrous metals series, most prices rose. Stainless steel rose by 0.68%, and iron ore rose by 0.43%. Rebar and HRC both rose by 0.13%. In the coking coal and coke segment, coking coal fell by 0.13%, and coke fell by 0.11%.

In the overseas market, as of 15:05, overseas market base metals generally declined, with LME zinc leading the decline at 0.8%. LME tin fell by 0.74%, while other metals all dropped slightly.

In precious metals, as of 15:05, COMEX gold fell by 1.06%, and COMEX silver fell by 1.47%. Domestically, SHFE gold fell by 0.49%, and SHFE silver fell by 1.91%.

Market conditions as of 15:05 today

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Macro Front

Domestic Developments:

[National Development and Reform Commission and relevant departments of five Central Asian countries reached four cooperation agreements] From June 16 to 18, 2025, President Xi Jinping attended the second China-Central Asia Summit in Kazakhstan. During the summit, the National Development and Reform Commission (NDRC) and relevant departments of the five Central Asian countries reached four cooperation agreements on jointly building the "Belt and Road," China-Europe (Asia) freight trains, and artificial intelligence. The agreements are as follows: 1. "Action Plan for High-Quality Co-construction of the 'Belt and Road' between China and Central Asian Countries." 2. "Initiative of the Governments of the People's Republic of China, the Republic of Kazakhstan, the Kyrgyz Republic, the Republic of Tajikistan, Turkmenistan, and the Republic of Uzbekistan on Deepening Cooperation in China-Europe (Asia) Freight Trains." 3. "Memorandum of Understanding between the National Development and Reform Commission of the People's Republic of China and the Ministry of Digital Development and Technological Innovation of the Kyrgyz Republic on Jointly Establishing the China-SCO Countries (Kyrgyz Republic) Artificial Intelligence Application Cooperation Center." 4. "Memorandum of Understanding between the National Development and Reform Commission of the People's Republic of China and the Agency for Innovation and Digital Technologies of the Republic of Tajikistan on Deepening Artificial Intelligence Cooperation." (Financial News Agency)

The central bank conducted 203.5 billion yuan in 7-day reverse repo operations today, with the operating interest rate remaining unchanged at 1.40%. Today, reverse repo operations worth 119.3 billion yuan matured. As reverse repo operations worth 119.3 billion yuan with a 7-day tenor matured today, a net injection of 84.2 billion yuan was achieved.

[Cui Dongshu: National Passenger Vehicle Market Inventory Reached 3.45 Million Units and Lasted for 54 Days at the End of May]Cui Dongshu, Secretary General of the China Passenger Car Association, stated in an article that at the end of May 2025, the inventory of the national passenger vehicle industry stood at 3.45 million units, a decrease of 50,000 units MoM and an increase of 160,000 units compared to May 2024, indicating a sustained high level of inventory. The current policy initiatives have brought overall optimism among producers, with relatively high production under trade-in policies and active wholesale activities by manufacturers, leading to a new high in industry inventory in nearly two years. With the promotion of central government policies to boost consumption and the active marketing activities such as auto shows across the country, as sales gradually enter the off-season from June to August, sales are expected to decline over the next three months. Therefore, based on the comprehensive estimation of inventory at the end of May 2025 and future sales, the existing inventory is projected to support future sales for 54 days, slightly increasing the overall inventory pressure compared to 54 days in May 2023 and 51 days in May 2024. (Financial Link)

►The central parity rate of the RMB against the US dollar in the interbank foreign exchange market on June 19 was set at 7.1729 RMB per US dollar.

US dollar:

As of 15:05, the US dollar index rose by 0.18% to 99.04. On the 18th local time, the US Fed released a statement on its interest rate decision, maintaining the target range for the federal funds rate at 4.25% to 4.5%. This marks the fourth consecutive decision by the US Fed to maintain interest rates unchanged this year. The dot plot indicates an expectation of two interest rate cuts within the year, with the expectation of interest rate cuts next year reduced to one. The economic outlook shows that the US Fed has revised up its inflation forecast for the year and revised down its forecast for total economic output.

In the US, initial jobless claims decreased by 5,000 last week but remained stable near the highest level in eight months. The number of initial jobless claims for the week ending June 14 was 245,000, in line with expectations, and the previous figure was revised from 248,000 to 250,000. The number of continuing jobless claims for the week ending June 7 was 1.945 million, compared to expectations of 1.932 million, and the previous figure was revised from 1.956 million to 1.951 million. The US Fed once again held steady, with Powell adopting a hawkish stance, believing that tariffs have made inflation more stubborn and that confidence in declining inflation is needed before initiating interest rate cuts. (Wenhua Comprehensive)

Macro:

Today, data such as Australia's RBA Foreign Exchange Transactions - Market Channel for May, Australia's seasonally adjusted unemployment rate for May, the change in employed population in Australia for May, Switzerland's central bank policy rate for June, China's total electricity consumption for May - monthly, and the UK's central bank benchmark rate for June will be released. In addition, the following events are noteworthy: The US Fed's Federal Open Market Committee (FOMC) announced its interest rate decision and Summary of Economic Projections; Fed Chairman Powell held a press conference on monetary policy; Fed Chairman Powell held another press conference on monetary policy; The Swiss National Bank announced its interest rate decision; The Bank of England announced its interest rate decision; The 2025 Lujiazui Forum was held in Shanghai.

》Public holiday in the US today, overview of overseas market exchange closures

Crude oil:

As of 15:05, oil prices in both markets rose simultaneously, with US oil up 0.8% and Brent oil up 0.68%. Investors are weighing the possibility of US intervention in the Israel-Iran conflict and are hesitant to establish new positions, while the Fed maintains interest rates unchanged.

Goldman Sachs stated on Wednesday that a geopolitical risk premium of around $10 per barrel is reasonable, considering reduced Iranian supply and the potential for broader supply disruptions that could push Brent crude above $90 per barrel.

According to CCTV News, the Israel-Iran conflict has been ongoing for a week, with the situation escalating and the US making frequent moves in recent days. Analysts say that direct US involvement would expand the conflict and expose the region's energy infrastructure to a higher risk of attacks. Priyanka Sachdeva, a senior market analyst at Phillip Nova, said that due to the long-standing unpredictability of Trump's foreign policy, "the market remains nervous, awaiting clearer signals that could affect global oil supply and regional stability."

Iran is the third-largest oil producer in OPEC, with a daily output of about 3.3 million barrels. More importantly, about 19 million barrels of oil and oil products pass through the main waterway of the Strait of Hormuz every day, and there are widespread concerns that the fighting could disrupt trade flows in the Strait. (Wenhua Comprehensive)

SMM Daily Review

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