US dollar weakens, base metals generally decline, with silver, polysilicon, and Brent crude oil all falling over 2%, while ferrous metals series mostly rise [SMM midday review]

SMM News on June 20:

Metal Market:

As of the midday close, domestic base metals fell across the board, with SHFE nickel down 0.21%. SHFE copper fell 0.47%, and SHFE aluminum fell 0.51%. SHFE zinc fell 0.18%, and SHFE tin fell 0.97%. SHFE lead fell 0.27%.

In addition, the main continuous futures contract for foundry aluminum fell 0.25%, and the main continuous contract for alumina fell 0.07%. Lithium carbonate fell 1%, silicon metal fell 0.13%, and polysilicon fell 2.5%.

The ferrous metals series mostly rose, with iron ore up 1.08%, rebar up 0.2%, and HRC up 0.26%. Stainless steel fell 0.32%. In the coking coal and coke sector: coking coal rose 1.65%, and coke rose 1.21%.

In the overseas metal market, as of 11:40, LME metals generally fell, with LME copper down 0.12% and LME nickel down 0.21%. LME zinc fell slightly. LME tin rose 0.61%. LME lead fell 0.33%, and LME aluminum rose 0.26%.

In the precious metals sector, as of 11:40, COMEX gold fell 1.17%, and COMEX silver fell 2.99%. Domestically, SHFE gold fell 0.7%, and SHFE silver fell 2.51%.

As of the midday close, the most-traded contract for the European Containerized Freight Index fell 1.88%, closing at 1993.9.

As of 11:40 on June 20, the midday futures market movements for some contracts were as follows:

》SMM Metal Spot Prices on June 20

Spot and Fundamentals

Copper: Today, spot Guangdong #1 copper cathode was quoted at a premium of 50 yuan/mt to a premium of 130 yuan/mt against the front-month contract, with an average premium of 90 yuan/mt, down 45 yuan/mt from the previous trading day. SX-EW copper was quoted at a discount of 10 yuan/mt to a premium of 10 yuan/mt, with an average premium of 0 yuan/mt, down 40 yuan/mt from the previous trading day. The average price of Guangdong #1 copper cathode was 78,455 yuan/mt, down 220 yuan/mt from the previous trading day, and the average price of SX-EW copper was 78,365 yuan/mt, down 215 yuan/mt from the previous trading day. Spot Market: Guangdong's inventory has declined for four consecutive days. As the weekend approaches, downstream procurement volume has increased somewhat. However, arrivals remain low, leading to a continued decline in inventory... 》Click for details

Macro Front

Domestic Aspect:

[National Energy Administration: Total electricity consumption in May increased 4.4% YoY] The National Energy Administration released data on total electricity consumption in May. In May, total electricity consumption reached 809.6 billion kWh, up 4.4% YoY. In terms of electricity consumption by sector, the primary industry consumed 11.9 billion kWh, up 8.4% YoY; the secondary industry consumed 541.4 billion kWh, up 2.1% YoY; the tertiary industry consumed 155 billion kWh, up 9.4% YoY; and urban and rural residents' electricity consumption reached 101.3 billion kWh, up 9.6% YoY. From January to May, the total electricity consumption in society reached 3,966.5 billion kWh, up 3.4% YoY. Among this, the power generation of industries above designated size was 3,726.6 billion kWh.

The central bank conducted reverse repo operations worth 161.2 billion yuan for 7 days today, with the operating interest rate remaining unchanged at 1.40%. As reverse repo operations worth 202.5 billion yuan for 7 days matured today, a net withdrawal of 41.3 billion yuan was achieved.

►On June 20, the central parity rate of the RMB exchange rate in the inter-bank foreign exchange market was 7.1695 yuan per US dollar.

US dollar:

As of 11:40, the US dollar index fell by 0.17% to 98.6. After the US Fed maintained interest rates steady on Wednesday, US President Trump fiercely criticized Fed Chairman Powell on Thursday, calling him "destructive". Trump claimed that Powell, who was "too late" to cut interest rates, had cost the US "hundreds of billions of dollars" and made similar criticisms. Powell has repeatedly ignored Trump's pressure to cut interest rates. Powell stated on Wednesday, "For now, we are prepared to wait for more information about where the economy may be headed before considering any adjustments to our policy." His term will end in May 2026. (Huitong Finance)

Other currencies:

The International Monetary Fund (IMF) warned that European economic growth may face the risk of stagnation if urgent actions are not taken to address slowing growth, weak investment, and rising geopolitical threats. The Washington-based institution stated in a declaration on Thursday that trade tensions and sluggish demand are stifling growth momentum, with risks clearly skewed to the downside. The eurozone's economy is expected to grow by only 0.8% in 2025, despite record-low unemployment and inflation close to the target. To revive productivity, the IMF called on the EU to take "decisive action" to advance long-delayed deepening reforms of the single market, stating that cross-border fragmentation is stifling innovation and corporate growth. (Huitong Finance)

Data:

Today, data such as China's one-year Loan Prime Rate (LPR) for June, China's five-year Loan Prime Rate (LPR) for June, the UK's seasonally adjusted month-on-month retail sales for May, the UK's seasonally adjusted month-on-month core retail sales for May, China's year-on-year total electricity consumption in society for May, the eurozone's seasonally adjusted year-on-year M3 money supply for May, the US Philadelphia Fed Manufacturing Index for June, Canada's month-on-month retail sales for April, Canada's month-on-month core retail sales for April, and the preliminary eurozone consumer confidence index for June will be released. In addition, it is worth noting that Bank of Japan Governor Kazuo Ueda will deliver a speech at the Trust Association Annual Meeting, and Russian President Vladimir Putin will speak at the 28th St. Petersburg International Economic Forum.

Crude Oil:

The futures of the two crude oil benchmarks showed mixed performance. As of 11:40, WTI crude oil rose by 0.22%, while Brent crude oil fell by 2.26%. Brent crude oil slipped on Friday but remained on track for a third straight weekly gain, as the week-long conflict between Israel and Iran showed no signs of either side backing down, keeping markets on edge. Phil Flynn, an analyst at The Price Futures Group, said, "Oil prices remain elevated due to tanker freight rates doubling and ships avoiding the Strait of Hormuz route. Although there have been no major disruptions to Iranian exports, supply risks keep them on edge."

Iran is the third-largest oil producer in the Organization of the Petroleum Exporting Countries (OPEC), with crude oil production of approximately 3.3 million barrels per day. Around 18 million to 21 million barrels of oil and oil products pass through the Strait of Hormuz, located off Iran's southern coast, each day. There are widespread concerns that the Israel-Iran conflict could disrupt trade flows and impact oil supplies. (Webstock Inc.)

Spot Market Overview:

►Continuous outflow of warrants suppresses premiums. Keep an eye on next week's arrivals. [SMM South China Spot Copper]

►Weaker copper prices slightly boost downstream buying interest. Market trading activity has rebounded. [SMM North China Spot Copper]

►[SMM Analysis] The tug-of-war between longs and shorts is unlikely to break through. Iron ore prices are expected to experience sideways movement in the price range next week.

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