US Dollar Weakens, Metals Generally Decline; Polysilicon and NYMEX Silver Fall Over 3%, European Shipping Rates Plunge Nearly 7% [SMM Daily Review]

SMM News on June 20:

Metal Market:

As of the daytime close, domestic market base metals generally declined, with SHFE tin leading the losses at 1.2%, while other metals fell by less than 1%. The main alumina contract fell by 0.48%, and the main aluminum casting contract fell by 0.53%.

Additionally, the main lithium carbonate contract fell by 1.93%, and the main polysilicon contract fell by 3.91%, hitting a new all-time low of 31,630 yuan/mt during the session and recording four consecutive days of losses. The main silicon metal contract fell by 0.67%, and the main European container shipping contract plunged by 6.99%.

In the ferrous metals series, most prices rose, with stainless steel falling by 0.44% and iron ore rising by 0.93%. Other metals saw minor fluctuations in gains. In the coking coal and coke sector, coking coal rose by 1.08%, and coke rose by 1.21%.

In the overseas market, as of 15:11, only LME tin rose among the base metals, gaining 0.28%. LME nickel fell by 0.57%, LME zinc fell by 0.53%, and LME lead fell by 0.5%. Other metals saw minor fluctuations.

In precious metals, as of 15:11, COMEX gold fell by 1.43%, and COMEX silver fell by 3.5%. Domestically, SHFE gold fell by 0.81%, and SHFE silver fell by 2.79%.

Market conditions as of 15:11 today

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Macro Front

Domestic Aspects:

[The "National Subsidy" for Trade-in Policy Will Continue, Central Funds to Be Disbursed in Batches] The National Development and Reform Commission (NDRC), Ministry of Finance, Ministry of Commerce, and other departments are jointly implementing the expanded "program of large-scale equipment upgrades and consumer goods trade-ins" policy, directly allocating 300 billion yuan in national debt funds to local governments to expand the implementation of the trade-in policy for consumer goods throughout the year. Currently, the use of subsidy funds for consumer goods trade-ins nationwide accounts for approximately 50% of the annual scale, with overall progress in line with expectations.

[National Energy Administration: Total Electricity Consumption in May Up 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. By sector, electricity consumption in the primary industry was 11.9 billion kWh, up 8.4% YoY; in the secondary industry, it was 541.4 billion kWh, up 2.1% YoY; in the tertiary industry, it was 155 billion kWh, up 9.4% YoY; and in urban and rural residential living, it was 101.3 billion kWh, up 9.6% YoY. From January to May, cumulative total electricity consumption reached 3,966.5 billion kWh, up 3.4% YoY, with power generation from industrial enterprises above designated size at 3,726.6 billion kWh.

The central bank conducted 161.2 billion yuan in 7-day reverse repo operations today, with the operating interest rate remaining unchanged at 1.40%. As RMB 202.5 billion in 7-day reverse repo operations matured today, a net withdrawal of RMB 41.3 billion was realized.

►The central parity rate of the RMB against the US dollar in the inter-bank foreign exchange market on June 20 was set at 7.1695 RMB per US dollar.

US dollar:

As of 15:11, the US dollar index fell by 0.1% to 98.67. US President Trump once again called on the US Fed to cut interest rates on Thursday, stating that rates should be lowered by 2.5 percentage points. In a post on Truth Social, he said, "Powell is costing our country hundreds of billions of dollars... Our interest rates should be another 2.5 percentage points lower."

Macro:

Today, data such as China's one-year Loan Prime Rate (LPR) for June, China's five-year 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 for May, the eurozone's seasonally adjusted year-on-year M3 money supply for May, the US's 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 eurozone's preliminary consumer confidence index for June will be released. Additionally, notable events include a speech by Bank of Japan Governor Kazuo Ueda at the Trust Association Annual Meeting and a speech by Russian President Vladimir Putin at the 28th St. Petersburg International Economic Forum.

Crude oil:

As of 15:11, oil prices in both markets showed mixed performance, with US oil rising by 0.29% and Brent oil falling by 2.32%. The decline in Brent oil was mainly due to a slight easing of geopolitical conflicts, but it is expected to rise on a weekly basis.

Phil Flynn, an analyst at The Price Futures Group, stated, "Oil prices surged due to concerns about increased US involvement in the Israel-Iran conflict. However, the White House press secretary later said there was still time to de-escalate the situation."

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

SMM Daily Review

►Silver prices continue to correct, with sluggish trading in the spot market [SMM Daily Review]

SMM Weekly Review

►The second round of mid-year negotiations made no progress, with production cuts at overseas smelters becoming increasingly significant [SMM Copper Concentrates Spot Weekly Review]

►The US dollar-denominated copper market was sluggish this week, with the price spread between warehouse warrants and B/L gradually narrowing [SMM Yangshan Copper Weekly Review]

►Weak end-use demand shows no signs of improvement, with both month-on-month and year-on-year declines in wire and cable operating rates [SMM Wire and Cable Market Weekly Review]

►Bismuth prices stabilize with a slight increase [SMM Bismuth Spot Weekly Review]

►Antimony prices weaken but gradually stabilize, with an increase in antimony smelter shutdowns [SMM Antimony Market Spot Weekly Review]