Overview of Base Metal Production in August 2025
Copper Cathode
In August, SMM's China copper cathode production decreased by 2,800 mt MoM, a decline of 0.24%, and increased by 15.59% YoY. The cumulative output from January to August increased by 978,800 mt, up 12.30% YoY.
The slight decrease in August copper cathode production can be attributed to several factors: 1) Only three smelters underwent maintenance in August, affecting only 4,000 mt. 2) Two new smelters in east China continued to ramp up production, though at a slightly lower pace than expected. 3) Although the "Notice on the Implementation of Policies for Regulating Investment Promotion" has been issued, its impact on secondary copper anode and electrolytic copper production is relatively small, as these enterprises still have raw material inventories and long-term contracts with downstream enterprises, making them hesitant to breach agreements; however, many will start cutting production from September, as reflected in the operating rate, which for smelters not using copper concentrates (copper scrap or anodes) was 68.1%, down 0.4 percentage points MoM. 4) Sulfuric acid prices, still at their annual high in August, effectively offset smelting losses, but began to pull back in mid-to-late August, showing signs of peaking; if sulfuric acid prices continue to fall, it will dampen smelter production enthusiasm. 5) Copper concentrate TCs experienced a retreat after rapid rise, with the imported copper concentrate index (weekly) at - $41.48/mt as of August 29, down $3.8/mt from the mid-August peak, and likely to continue declining.
Overall, the sample operating rate for the copper cathode industry in August was 87.97%, down 0.21 percentage points MoM; large smelters had an operating rate of 91.33%, up 0.21 percentage points MoM, medium-sized smelters 86.28%, up 0.66 percentage points MoM, and small smelters 59.61%, down 7.67 percentage points MoM. The operating rate for smelters using copper concentrates was 92.1%, down 0.2 percentage points MoM; for those not using copper concentrates (copper scrap or anodes), it was 68.1%, down 0.4 percentage points MoM.
Entering September, according to our statistics, five smelters have maintenance plans, involving 1 million mt of crude refining capacity, leading to a greater reduction in production due to maintenance compared to the previous month, estimated at 14,000 mt. In addition to routine maintenance, the widespread production cuts (affecting 60% of our survey sample) due to tight supply of copper anodes are the main reasons for the significant drop in September production. This is also reflected in the substantial decline in the operating rate for smelters not using copper concentrates (copper scrap or anodes), which fell to 59.9%, down 8.3 percentage points MoM, and we expect this situation may persist until year-end. The implementation of the NDRC's Notice No. 770 (2025) will determine the production of secondary anodes and significantly impact copper cathode output.
Based on individual production schedules, SMM expects domestic copper cathode production in September to decrease by 52,500 mt, a 4.48% decline MoM, and increase by 114,700 mt, up 11.42% YoY. Cumulative output from January to September is expected to increase by 1.0935 million mt, up 12.20% YoY. The sample operating rate for the copper cathode industry in September is 84.04%, down 3.93 percentage points MoM; large smelters 88.78%, down 2.56 percentage points MoM, medium-sized smelters 79.2%, down 7.08 percentage points MoM, and small smelters 52.78%, down 6.83 percentage points MoM. The operating rate for smelters using copper concentrates is 89%, down 3 percentage points MoM; for those not using copper concentrates (copper scrap or anodes), it is 59.9%, down 8.3 percentage points MoM. We anticipate that October production will continue to decline, as six smelters have maintenance plans, and the supply of anodes will remain tight.
Aluminum
According to SMM, in August 2025 (31 days), domestic aluminum production grew by 1.22% YoY and 0.33% MoM. August marked the transition between the off-peak and peak seasons, with some regions reporting signs of recovery in downstream demand. The proportion of liquid aluminum in August rebounded, increasing by 1.3 percentage points MoM to 75.07%. Based on SMM's data on the proportion of liquid aluminum, the casting ingot volume in August decreased by 10.38% YoY and 4.68% MoM to around 930,600 mt.
Capacity Changes: By the end of August, SMM estimates that domestic aluminum capacity stands at approximately 45.79 million mt (SMM adjusted the figure by accounting for capacity swaps and old plant demolitions, removing duplicate calculations). The operating capacity is about 44 million mt, with a slight MoM increase in August, mainly due to:
1) The second phase of the Shandong-Yunnan aluminum capacity swap project has started production;
2) Some earlier swap projects in Guizhou have commenced operation;
3) Technological transformation projects in Guangxi have gradually resumed production;
4) A small amount of idle capacity in Yunnan has resumed production.
Production Forecast: Entering September 2025, with the gradual commissioning of swap projects, domestic aluminum operating capacity is expected to see a slight increase, with earlier commissioned projects starting to produce, leading to an increase in daily average aluminum ingot production. Regarding the proportion of liquid aluminum, as September enters the traditional peak season, some enterprises have indicated plans to increase direct sales of liquid aluminum next month, and the proportion of liquid aluminum is expected to rebound slightly. Future attention should be paid to the fulfillment of the traditional peak season, the commissioning pace of swap projects, and trends in the proportion of liquid aluminum.
Alumina
According to SMM data, in August 2025 (31 days), China's metallurgical-grade alumina production increased by 1.15% MoM and 7.16% YoY. By the end of August, China's metallurgical-grade alumina capacity stood at approximately 110.32 million mt, with actual operating capacity rising by 1.15% MoM, and the operating rate at 82.6%.
In August, alumina operating capacity saw both increases and decreases, with a net increase of about 1.04 million mt. On one hand, the average spot price of alumina in August was moderate, and based on the daily cost-profit model, the theoretical profit margin for the industry was above 300 yuan/mt, encouraging companies to maintain high production levels, with some even increasing their operating capacity. Additionally, newly commissioned projects further ramped up, contributing to the growth in production. On the other hand, some companies slightly reduced production due to raw material issues, while some northern companies lowered their roasting load due to the September 3rd parade, and some southern companies conducted regular maintenance, reducing their roasting load, which to some extent limited the increase in production.
By Region:
In August, there was a significant divergence in spot alumina prices between the north and south, with southern prices remaining relatively firm. One reason for this is the ongoing maintenance of alumina capacity in the south, preventing the operating capacity from maintaining a high level. The annualized operating capacity in the south decreased by about 270,000 mt MoM, while in the north, it increased by about 1.3 million mt.
Next Month Forecast: Entering September, although spot alumina prices are in the doldrums, they have not yet reached a point where a large number of alumina producers are incurring losses, so the intention to cut production is not strong. Currently, only some companies' regular maintenance plans will continue into early September, and some will reduce roasting loads due to the September 3rd parade, extending into early September. The operating capacity of metallurgical alumina in September is expected to grow slightly to around 91.35 million mt/year.
Overseas Aluminum
According to SMM, in August 2025, total overseas aluminum production increased by 2.9% YoY; the monthly average operating rate was 88.8%, flat MoM and up 0.5% YoY. As of the end of August, cumulative production for 2025 was up 2.9% YoY.
On the 7th of this month, Century Aluminium announced the restart of a 50,000 mt production line at its Mt. Holly facility in South Carolina, aiming to increase the plant's capacity from the current 75% to full production. The resumption plan, costing approximately $50 million, targets full production by June 30, 2026, for the first time since 2015. Additionally, South32, due to the lack of agreement with the government and energy supplier HCB, announced plans to place its Mozal aluminum smelter in Mozambique under care and maintenance in March 2026, resulting in a $372 million impairment charge. The company expects its share of production in the 2026 fiscal year (July 1, 2025, to June 30, 2026) to drop to 240,000 mt (from 355,000 mt in the 2025 fiscal year). The plant has a total capacity of 580,000 mt, with a total production of 511,000 mt in 2024.
Alcoa announced that the restart, delayed due to a nationwide power outage in spring, resumed in August. The company aims to gradually complete the restart and increase operating load by mid-2026.
Looking ahead to September, PT. Kemajuan Aluminium Industry in Indonesia is expected to start production at the beginning of the month, with the first batch of products to be produced in October. Additionally, Vedanta's Balco aluminum smelter in India is gradually ramping up. The expected operating rate for overseas aluminum in September is 88.7%, down 0.2% MoM and up 0.4% YoY.
Overseas Metallurgical-Grade Alumina
According to SMM, in August 2025, overseas metallurgical-grade alumina production increased by 7.2% YoY; the average operating rate for overseas alumina enterprises rose to 81.6%, up 0.5% MoM and 1.5% YoY. As of the end of August, cumulative production for 2025 was up 3.8% YoY.
The month's increase mainly came from Indonesia: Nanshan Group's PT Bintan Alumina Indonesia (BAI) Phase III (1 million mt/year) began feeding raw materials in June, produced its first batch of alumina in July, and is expected to reach full capacity by year-end, with the Phase IV commissioning plan to commence immediately afterward. Meanwhile, Indonesia's Borneo Alumindo alumina refinery started construction on August 11 for the Phase II "coal-to-gas" energy facility, aimed at reducing costs and improving operational stability.
In the Americas, Century Aluminum announced it will invest up to $30 million in its Jamalco alumina refinery in Jamaica by 2026 to reduce energy consumption and raise the operating rate from 80% to 100%. The plant's total capacity is 1.4 million mt.
Looking ahead to September, overseas metallurgical-grade alumina production is expected to increase by 7.4% YoY, with the operating rate reaching 82.1%, up 0.5% MoM and 2.3% YoY.
Primary Lead
China's primary lead production in August 2025 edged up, rising 0.32 percentage points MoM and 2.92 percentage points compared to the same period last year. Cumulative primary lead production from January to August 2025 increased by 8.23 percentage points YoY.
It is understood that in August, medium and large primary lead smelters in central, northern, and east China gradually resumed production after maintenance, contributing to an expected overall supply increase. However, some smelters in northern, northeastern, and southern China experienced larger-than-expected reductions due to maintenance and ore undersupply, resulting in the overall August production increase being largely offset and falling short of expectations.
For September, increased maintenance at primary lead smelters, especially a large enterprise in central China planning maintenance in September, is likely to be the main factor dragging down production this month. Concurrently, the resumption of production after maintenance at primary lead smelters in northeastern and northern China will offset some of the production decline. SMM expects September primary lead production to decrease by 1.3 percentage points MoM.
Additionally, demand for lead concentrates was robust from August to September, with lead smelters generally in a "stockpiling" mode. Lead concentrate TCs fell consistently, with the SMM imported concentrate pb60 monthly TC for September reported at -110~(-70) $/dmt, down $30/dmt from the previous month, and an increase in transactions around -150 $/dmt. This implies higher smelting costs, and shrinking profits have dampened production enthusiasm among lead smelters. Some smelters planning maintenance indicated they have built up certain crude lead inventories, so even if the crude smelting system undergoes maintenance, the impact on primary lead production will be limited.
Secondary Lead
Secondary lead production in August 2025 increased less than expected, up 0.71% MoM and 7.73% YoY; secondary refined lead production fell 3.54% MoM but increased 1.98% YoY.
Secondary lead production edged up in August, primarily due to the resumption of production after maintenance completion at a secondary crude lead smelter in central China and the unstable output following the restart at another secondary crude lead smelter in east China. Secondary refined lead production, however, saw a slight decline: (1) Most smelters in east China and north China reduced or halted production due to tight raw material supply and severe losses, while a secondary lead smelter in south-west China suspended operations mid-month due to equipment failure. The overall reduction exceeded 40,000 mt. (2) A large smelter in Inner Mongolia resumed production in late July, as did a medium-sized smelter in Anhui, with both ramping up normally in August, contributing to the increase; a large new secondary lead capacity in south-west China was officially released in late July and ramped up normally in August, also adding to the increment; additionally, a large smelter in Jiangxi reported that output returned to normal levels as raw material arrivals improved in August. The combined increase surpassed 30,000 mt.
Entering September, large smelters in east China and north China still indicated plans to reduce or halt production, mainly due to lack of confidence in end-use consumption and a bearish outlook on lead prices, with only a few citing routine maintenance; coupled with tight scrap battery supply in north China during the September 3 military parade period, significant raw material restocking by smelters may be delayed until mid-September, thus limiting production. SMM estimates that secondary refined lead production in September will decrease by approximately 40,000 mt MoM.
Refined Zinc
SMM China's refined zinc production in August 2025 increased by over 3% MoM and about 28% YoY, with cumulative production from January-August up more than 7% YoY, exceeding expectations. Domestic zinc alloy production in August also rose MoM. In August, domestic smelter output increased, with production resumptions after maintenance being the main driver in Shaanxi, Inner Mongolia, Qinghai, Yunnan, Hunan, and Guangxi, aside from routine maintenance in areas like Hunan and Gansu; additionally, new capacities continued to be released in Jiangxi, Inner Mongolia, Henan, and Yunnan, pushing overall production to a new high.
SMM expects China's refined zinc production in September 2025 to decline by over 2% MoM but increase by more than 22% YoY, with cumulative production from January-September 2025 projected to rise over 9% YoY. Maintenance at smelters in September is mainly concentrated in Henan, Inner Mongolia, Hunan, and Yunnan, while some secondary zinc enterprises saw output drop due to rising raw material prices and tight supply; however, production increases in Hunan, Shaanxi, Gansu, Inner Mongolia, Hunan, and Hubei contributed, leading to an overall downward adjustment in output.
Refined Tin
Based on SMM's data processed from market communication, China's refined tin production in August 2025 decreased by 3.45% MoM and fell 0.5% YoY. This decline was mainly influenced by maintenance halts at some enterprises, with a detailed regional analysis as follows:
According to General Administration of Customs data, China's imports of tin concentrates by physical content reached 10,278 mt in July 2025, down slightly MoM. Imports of tin concentrates from Africa (DRC and Nigeria) declined, mainly due to extended transportation cycles and geopolitical disruptions such as the deadlock in DRC's power agreement negotiations. Imports from Myanmar remained sluggish; although mining license approvals were granted, the rainy season hindered production resumptions, and coupled with Thailand's land transit ban (prohibiting transit shipments), short-term supply is unlikely to improve.
Yunnan: Raw material shortages remained severe, with smelter raw material inventories generally below 30 days. One enterprise has largely completed its maintenance shutdown and is preparing to resume production, with refined tin output expected next month. However, considering another smelter is scheduled for a maintenance shutdown in September, overall tin ingot production in Yunnan is likely to continue declining.
Jiangxi:
Break in scrap supply chain: The tin scrap recycling system was under pressure, with secondary material circulation volume dropping over 30%. The undersupply of crude tin directly constrained refined production growth. Most smelters maintained normal production this month.
Other regions:
Dual raw material shortage: Supplies of both tin concentrates and tin scrap were weak. Operating rates have long been below 70% of planned capacity, and planned maintenance at some enterprises further suppressed output, with operating rates at some smelters falling to yearly lows.
Based on SMM calculations, refined tin production in September is expected to drop 29.89% MoM. Driving factors: Some smelters in Yunnan and Guangxi underwent maintenance shutdowns.
Refined Nickel
In August 2025, SMM's refined nickel production increased 7% MoM and 21% YoY, with cumulative growth up 26% YoY. The operating rate for domestic refined nickel enterprises was 66%. Top-tier enterprises raised their operating rates, while other smelters maintained stable output, leading to an overall rise in refined nickel production. Price-wise, the average spot price of SMM #1 refined nickel in August was 121,945 yuan/mt, down 292 yuan/mt MoM, with prices in the doldrums. In the spot market, the average premium for Jinchuan nickel in August was 2,300 yuan/mt, up 200 yuan/mt MoM, reflecting strong producer reluctance to budge on prices. Premiums and discounts for mainstream domestic electrodeposited nickel remained relatively stable in the range of -100-300 yuan/mt. On the demand side, August remained in the downstream off-season, with alloy and electroplating plants showing weak procurement demand, only stockpiling for rigid needs when futures prices were low. Spot trading volume differed little from July. With the traditional September-October peak season approaching, downstream orders are expected to recover, demand is anticipated to pick up, and spot trading activity should increase.
Refined nickel production in September is projected to increase 4% MoM, with new refined nickel projects slowly commencing production, contributing to further output growth.
Nickel Pig Iron (NPI)
In August 2025, China's NPI production by physical content rose 4.89% MoM, while metal content increased 11.77% MoM. In August, China's NPI production in both physical content and metal content increased MoM. NPI prices continued to rebound during the month, and production also increased beyond expectations. Supply side, Philippine nickel ore prices saw a slight correction in August, but core costs such as auxiliary materials and electricity prices continued to rise, keeping the NPI cost line firm and providing bottom support for NPI prices. Demand side, macro sentiment coupled with peak season expectations supported stable stainless steel futures, and as the peak season gradually approached, downstream consumption slowly recovered, with stainless steel inventory continuing destocking. Overall, supported by both supply and demand, NPI prices continued to recover, smelter profitability improved to some extent, and downstream purchases gradually increased, leading to a rebound in both NPI physical content and metal content in August.
Looking ahead, with the September-October peak season approaching, SMM expects stainless steel production to continue growing in September, driving China's NPI production up 4.22% MoM in physical content and 3.92% MoM in metal content in September 2025. Meanwhile, supported by recovering demand and the cost line, SMM expects NPI prices to continue rising in September.
Indonesian NPI
In August 2025, Indonesian NPI production increased 1.15% MoM in physical content and 2.60% MoM in metal content. Entering August, as NPI prices rose, Indonesian smelters' profits improved to some extent, leading to increased production. Driven by economic benefits and downstream demand, the grade of Indonesian NPI also rose MoM, resulting in growth in both physical content and metal content in August.
For September 2025, Indonesian NPI production is expected to increase 1.10% MoM in physical content and 1.27% MoM in metal content. With the arrival of the peak consumption season and continued improvement in losses, SMM expects Indonesian smelters' operating rates to continue recovering.
Nickel Sulphate
According to SMM data, in August 2025, SMM nickel sulphate production increased about 4.80% MoM but decreased about 4.19% YoY. Demand side, approaching the September-October peak season for auto sales, orders from some precursor plants increased in August, driving higher nickel salt demand. Supply side, some producers ramped up output, and some integrated enterprises engaged in stockpiling of nickel sulphate, leading to increased nickel salt supply in the market. Looking ahead to the September market, nickel sulphate raw material supply remains tight, but precursor plants' demand for nickel salt is expected to further rise, and nickel sulphate supply is projected to see slight growth. SMM expects nickel sulphate production to increase to about 31,700 mt in metal content in September, with physical content production estimated at 144,100 mt, up about 4.02% MoM but down about 2.23% YoY.
Battery-Grade Manganese Sulphate
In August 2025, high-purity manganese sulphate production increased significantly MoM, with a certain YoY growth as well. Supply side, manganese salt plants actively maintained production schedules this month, coupled with the approaching September-October peak season, enterprises released stockpiling demand, driving up the execution volume of long-term contracts for high-purity manganese sulphate, which boosted market vitality and directly led to a noticeable increase in monthly supply, with a prominent MoM increment; meanwhile, all manufacturers steadily advanced long-term contract deliveries. However, the market still exhibited localized sluggishness: spot order procurement remained low, with no hoarding observed, manganese salt plants mostly adopted a produce-based-on-sales model, and downstream ternary cathode precursor plants primarily made just-in-time procurement. Looking ahead to September, the downstream ternary cathode precursor market is expected to maintain steady growth, likely further driving production at manganese salt plants, with high-purity manganese sulphate production projected to achieve MoM growth again and maintain a certain YoY growth rate.
EMD
In August 2025, EMD production showed a trend of "slight MoM decline, YoY increase". Specific reasons are as follows: on one hand, the primary battery market was in the traditional off-season, MnO2 manufacturers focused on fulfilling existing orders, with few new orders, and high temperatures caused unstable battery production, leading manufacturers to prioritize destocking as their core goal, making it difficult for production to rise; on the other hand, the LMO market, downstream of MnO2 used for LMO battery, faced fierce competition, with most enterprises switching to more cost-effective Mn3O4 to control costs, resulting in decreased demand and inability to achieve incremental production schedules. Looking ahead to September, driven by the traditional September-October peak season and numerous macro tailwinds in the manganese market, enterprise production schedules are expected to increase further, potentially with new orders emerging. Overall, total EMD production in September is projected to show a growth trend.
Mn3O4
In August 2025, Mn3O4 production exhibited a trend of "slight MoM decline, with a certain YoY growth rate". By product grade, both electronic-grade and battery-grade Mn3O4 production decreased. Specific reasons are as follows: on one hand, the LMO market experienced significant volatility in August, downstream procurement of battery-grade Mn3O4 was cautious, Mn3O4 enterprises focused on maintaining normal production without additional hoarding; on the other hand, although the LMFP market is in the development stage and still uses Mn3O4 as the manganese source in production, the industry's growth is slow, making it difficult to provide strong support to the battery-grade Mn3O4 market. Additionally, the electronic-grade Mn3O4 market entered the traditional off-season, with enterprises maintaining original production levels and fulfilling existing orders, while market demand remained weak. Looking ahead to September, market expectations are positive. With a potential slight recovery in the LMO market, battery-grade Mn3O4 demand is expected to receive a further boost, driving an increase in its production schedule. Overall, total Mn3O4 production in September is projected to maintain an upward trend, with the YoY growth rate remaining optimistic.
High-Carbon Ferrochrome
According to SMM data, China's high-carbon ferrochrome production continued to increase in August 2025, up 1% MoM and 1.76% YoY. In northern Inner Mongolia, some producers conducted maintenance with shutdowns or production cuts, leading to a slight 1.07% MoM decrease in output. In southern regions such as Sichuan, Guizhou, and Guangxi, many plants planned centralized production leveraging the rainy season advantage, resulting in more production resumptions and output increases, with output rising 8.7% MoM.
The steel mill tender price for high-carbon ferrochrome in August fell slightly by 100-200 yuan/mt (50% metal content), largely in line with previous market bearish expectations. However, macro tailwinds supported a gradual rise in downstream stainless steel, providing some demand boost for ferrochrome and helping to stabilize the chrome market. Meanwhile, chrome ore prices had already declined earlier, prompting many ferrochrome producers to purchase and stockpile, reducing production cost pressure. Additionally, due to previously low ferrochrome production coupled with significant production cuts overseas, a supply gap for ferrochrome persisted, stimulating domestic producers to maintain active production and high operating rates.
For September 2025, high-carbon ferrochrome production is expected to continue rising. On August 25, Tsingshan announced the September tender price for high-carbon ferrochrome at 8,295 yuan/mt (50% metal content), up 300 yuan MoM from August, exceeding the market's mainstream expectation of a 100-200 yuan increase and significantly boosting market confidence. Retail ferrochrome prices also rose accordingly, expanding producers' profit margins and maintaining high production enthusiasm, with many planning output increases. In northern Inner Mongolia, producers that had halted for maintenance resumed normal operation; southern plants leveraged low electricity prices during the rainy season to control costs, focusing on centralized production in September, further driving up ferrochrome output. Moreover, during the month, major South African chrome company Glencore-Merafe repeatedly indicated no plans to resume ferrochrome production within 2025, suggesting overseas output will remain low and imported ferrochrome supply will continue to decrease. Concurrently, entering the September-October peak season, the downstream stainless steel market showed clear signs of recovery, with high planned production boosting procurement demand for ferrochrome. Under these dual positive factors, domestic ferrochrome producers are actively producing to fill the supply gap.
Stainless Steel
SMM survey data shows China's stainless steel production in August 2025 increased 3.62% MoM and 2.23% YoY. By series, 200-series output rose 8.97% MoM; 300-series output increased 2.44% MoM; 400-series output fell 0.5% MoM.
In August, overall stainless steel production showed a trend of stopping the decline and rebounding, although it was slightly weaker than the initial expectations at the beginning of the month. However, with the approach of the traditional September-October peak season, stainless steel production generally exhibited a recovery trend. Driven by continuous macro tailwinds, market confidence in stainless steel gradually recovered this month, and market purchases and transactions improved compared to earlier periods. Meanwhile, social inventory of stainless steel continued to decrease throughout the month, with overall inventory levels pulling back to the level at the beginning of the year, significantly alleviating the pressure of destocking. Additionally, as stainless steel prices gradually strengthened, the phenomenon of cost-price inversion for stainless steel mills was somewhat repaired, leading to a gradual increase in the demand for raw materials and a resurgence in production enthusiasm within the month.
Looking ahead to September, stainless steel production is expected to further increase. With the arrival of the traditional September-October peak season, despite the fact that the recovery of downstream end-use consumption has not met expectations, the gradual end of high-temperature and heavy rain weather, along with a gradual increase in infrastructure and real estate demand, suggests that the market demand is in the process of recovering. The overall confidence of stainless steel mills is strong, and there has been a significant increase in the recent enthusiasm for purchasing raw materials, with prices of nickel, chromium, and molybdenum continuously strengthening. Furthermore, the continuous pullback in stainless steel inventory in July and August has released the inventory pressure on stainless steel mills. Coupled with expectations for US Fed interest rate cuts and the push from domestic quantitative easing policies, the market generally expects commodity prices to rise, and it is anticipated that stainless steel prices will continue to hold up well in September under the combined effect of an improved supply-demand pattern and macro tailwinds. However, caution is needed regarding the potential constraint on price increases due to the slower-than-expected pace of actual end-use consumption recovery.
EMM
In August 2025, EMM production increased MoM. The main reasons were: stainless steel production stopped falling and rebounded, coupled with continuous macro tailwinds, which led to a gradual recovery in market confidence for stainless steel this month, and an increase in purchase and transaction activities, thereby driving up the procurement demand for EMM, and manganese plants correspondingly increased their production schedules; additionally, some previously shut-down manganese plants resumed operations in August, also slightly boosting market activity. Looking ahead to September, with the arrival of the traditional September-October peak season, although the recovery of downstream end-use consumption has not met expectations, the gradual end of high-temperature and heavy rain weather, along with a gradual release of infrastructure and real estate demand, indicates that the market demand is in the process of recovering. Overall, EMM production in September is expected to increase MoM.
SiMn alloy
In August 2025, China's total SiMn alloy production saw a noticeable increase, rising both YoY and MoM. In terms of regional production changes, most of the increase came from south China, with Yunnan showing the largest increase, while Guangxi and Guizhou also experienced slight growth MoM. Production in various northern regions also increased to varying degrees.
August production rose MoM, primarily due to two reasons. First, SiMn market sentiment was warm, boosting factory operating enthusiasm. At the end of July, the national "anti-involution" policy was introduced, with macro-level discouragement of excessive price competition in the industry, leading to strong expectations of price increases in the SiMn sector and a subsequent climb in SiMn futures prices. Entering early to mid-August, the initial positive impact of the policy continued, with SiMn alloy prices fluctuating at highs, boosting the confidence of SiMn alloy plants. Operating enthusiasm increased in both northern and southern markets, especially in Yunnan, where benefits from preferential electricity rates during the rainy season provided production cost advantages, leading to relatively active operations. Second, both the HBIS steel tender price and volume increased MoM in August, boosting delivery enthusiasm in the SiMn market, advancing market transactions, and increasing activity. Additionally, in early August, there were numerous instances of high-price hedging by SiMn alloy plants in both north and south, which effectively locked in profits while alleviating subsequent shipment pressure. Multiple favorable factors drove the growth in SiMn alloy production.
Looking ahead to September 2025, SiMn alloy production is expected to continue its upward trend. On one hand, cost advantages in Inner Mongolia and Ningxia will persist, and regions like Yunnan will still be within the preferential electricity period of the rainy season, with most plants indicating no intention to cut production. On the other hand, the September-October peak consumption season arrives, potentially increasing downstream rigid demand for SiMn alloy. Furthermore, ahead of the National Day holiday, steel mills may restock early, which could also boost SiMn alloy production to some extent.
Wafer
In August, wafer enterprises slightly raised production, with output up 6.24% MoM. This month, the PV "anti-involution" meeting was held in Beijing, and following polysilicon price increases, top-tier wafer enterprises began reporting price hikes and actively purchasing raw materials, driving market sentiment upward. By size, overall shipments of 18X and 210 were better than 210R, and the transmission of price increases across different battery sizes this round also corroborated this fact. Based on the above, wafer output in September is expected to continue rising.
Polysilicon
Domestic polysilicon production in August increased compared to July, up approximately 22.29% MoM. The significant increase was mainly because August is a production release month for polysilicon during the rainy season, with output in Yunnan and Sichuan reaching relative peaks, boosting overall polysilicon production. For September, polysilicon production was previously expected to continue increasing, but influenced by industry self-discipline, anticipated output may decline MoM, with the main reductions coming from regions like Inner Mongolia and Qinghai.
Silicon Metal
According to SMM market communication, silicon metal production in August 2025 increased 14% MoM but decreased 19% YoY. From January to August 2025, silicon metal production decreased 20% YoY.
In August, silicon metal production increased significantly MoM, mainly driven by higher operating rates in Xinjiang, Yunnan, and Sichuan. Xinjiang's monthly production rose by nearly 20,000 mt, primarily due to production resumptions at some top-tier enterprises in the region. Yunnan and Sichuan saw seasonal operating rate increases during the rainy season. Additionally, Qinghai and Inner Mongolia contributed minor increments.
Silicon metal production is expected to continue rising in September, as output from furnaces added in August will be reflected, coupled with anticipated further production increases by top-tier enterprises. Meanwhile, production cuts in Sichuan and Yunnan during the dry season are not expected until late October or early November, meaning limited supply reductions in September. Silicon metal production is projected to increase around 5% MoM in September.
PV Modules
In August, PV module producers raised their production schedules, with output up about 3.75% MoM from July. Recent module demand has weakened, as overseas stockpiling has largely ended and domestic distributed demand has declined somewhat. However, with module costs gradually rising and a clear upward trend in future module prices, manufacturers are increasing production to build inventories of lower-cost modules. The production schedule for August is expected to continue increasing slightly, with operating rates projected to rise about 2.45% MoM.
Solar Cells
In August, solar cell production increased further from July, up 1.4% MoM. Influenced by export and international trade policies, overseas orders rose significantly due to stockpiling demand. Export-oriented producers focused on delivering overseas orders, while domestic orders for large-size high-efficiency cells remained strong. The market overall was in a tight supply-demand balance, with minimal inventory buildup.
PV Film
In August, the total production schedule for the PV film industry increased 6.24% MoM. This was mainly due to a slight rise in module production schedules and higher operating rates at some film producers. With module schedules still trending upward in September, overall PV film production is expected to increase slightly.
PV-Grade EVA
In August, PV-grade EVA production schedules rose 15.91% MoM, primarily because some petrochemical producers completed maintenance. According to SMM, with module production schedules slightly increasing in September and film producers' operating rates likely to rise, along with some petrochemical companies receiving PV orders or switching to PV-grade material and others finishing maintenance, PV-grade output is expected to trend upward in September.
PV Glass
In August, domestic PV glass monthly production declined again, down 1.26% MoM from July. Although production days remained unchanged, the drop was mainly due to earlier cold repairs and idled capacity, reducing operational capacity domestically. However, with no new cold repairs in August and about 1,500 mt/day of furnace capacity resuming production, output was higher than expected. In terms of September supply, overall glass production is expected to decline due to fewer production days for PV glass. However, as enterprises' willingness to produce is likely to strengthen following the anticipated price increase, the decrease in production is projected to be limited, with the operating rate estimated to drop by nearly 1.35% MoM compared to August.
DMC
In August, domestic silicone DMC production increased by 11.7% MoM and 2.8% YoY. Previously idled facilities in Zhejiang resumed normal operations, and monomer facilities in other regions operated at relatively high utilization rates. Although some monomer plants began maintenance plans and reduced output toward month-end, the impact over the entire month was relatively small, leading to a significant rise in August production. Looking ahead, due to factors such as reduced operating rates at some monomer plants and facility maintenance, overall production is expected to decline slightly in September, with silicone production projected to decrease by about 2.4% MoM compared to August.
Magnesium Ingot
According to SMM data, China's primary magnesium production in August 2025 decreased by 1.50% MoM, with the operating rate falling to 60.95%.
In August, magnesium ingot smelters in major producing regions continued with routine maintenance. Six smelters underwent maintenance during the month, two of which had relatively large capacities. Notably, two primary magnesium smelters that began maintenance in late July resumed production in August, two magnesium plants that restarted in July operated normally in August, and one plant that had been under maintenance for two years resumed production by feeding raw materials at the end of August, contributing to an increase in output. However, considering the ongoing impact of high temperatures on smelting efficiency, the production increase from resumed operations was smaller than the decrease from maintenance, leading to a downward trend in primary magnesium production in August.
In September, previously idled magnesium plants are gradually resuming production. One plant is expected to restart in mid-to-late September, boosting magnesium ingot supply. On the other hand, one plant is awaiting new equipment for replacement, which may somewhat reduce supply. Overall, primary magnesium production in September is projected to increase by 6.5% MoM. SMM will continue to monitor the production status of magnesium plants.
Magnesium Alloy
SMM data show that China's magnesium alloy production in August 2025 decreased by 2.15% MoM but increased by 4.72% YoY, with the operating rate falling to 58.68%.
Affected by high temperatures, the commissioning progress at top-tier enterprises slowed down. Magnesium alloy production showed a slight upward trend in August. The main reason for the increase in magnesium alloy production is that new national standards for EVs, which impose dual requirements on weight and plastic limits, have prompted leading two-wheeler EV manufacturers to use magnesium alloys to reduce vehicle weight. According to SMM, some magnesium die-casting producers have received orders from brands such as Yadi, Aima, and Luyuan. A magnesium die-casting producer in Guangdong reported receiving an order for 20,000 sets of EV magnesium alloy parts this month. As a result, alloy demand in August showed significant improvement compared to previous years. Magnesium alloy orders performed well, and magnesium alloy production exhibited an upward trend.
Looking ahead to September, the market competitiveness of magnesium alloy materials is accelerating. As mainstream producers continue to intensify market promotion, its core advantage in cost-effectiveness has gradually gained widespread recognition across the industry. This positive signal is driving substantive changes on the industrial side—some die-casting enterprises have begun adjusting production processes, gradually replacing traditional aluminum alloy materials with magnesium alloy. Although the current material substitution process has not yet generated large-scale orders, and market demand release remains gradual, it has successfully driven an overall mild increase in magnesium alloy demand, laying the foundation for subsequent production growth and creating clear expectations. Supported by the earlier demand recovery and stable preparations on the production side, magnesium alloy production in September is expected to show an upward trend.
Magnesium Powder
According to SMM data, China's magnesium powder production in August 2025 was down 10.41%, with the operating rate falling to 43.83%.
The magnesium powder market showed significant divergence in August. Affected by policy factors, production trends among magnesium powder producers diverged. Some producers faced dual pressures from both domestic and external demand: the domestic consumer market remained sluggish, while shrinking procurement demand from international steel enterprises led to a decline in export orders. Some enterprises proactively reduced their capacity utilization rates. In contrast, other producers saw excellent order performance, with their magnesium powder production rising. However, the increase in magnesium powder production from the earlier period was smaller than the decrease, leading to an overall downward trend in magnesium powder production for August.
Titanium Dioxide
According to SMM data, China's titanium dioxide production in August 2025 decreased by 2.10% MoM.
This month, the titanium dioxide market continued its production cut strategy. After mid-August, nearly 30 titanium dioxide producers collectively issued price adjustment notices, raising prices for all types of titanium dioxide. Domestic prices increased by an average of 500 yuan/mt, while US dollar prices increased by an average of $50/mt. Currently, the effects of earlier production cuts are gradually becoming apparent, with producer inventories effectively cleared. Combined with steadily recovering downstream demand, the previous declining trend in the titanium dioxide market has been successfully halted. Looking ahead to September, as rigid market demand gradually returns, titanium dioxide prices are expected to enter a steady upward channel. Based on current market performance, sulphuric acid-process titanium dioxide prices have already taken the lead with a slight increase of about 200 yuan/mt; meanwhile, chloride-process titanium dioxide prices remain in a low consolidation phase due to unresolved inventory pressure.
Sponge Titanium
According to SMM data, China's sponge titanium production in August 2025 decreased by 9.39% MoM.
This month in the sponge titanium market, some enterprises actively responded to the national "anti-involution" policy and began implementing production cuts, with the planned reduction reaching 30%, aiming to proactively control market capacity. Another key reason is that after the significant capacity expansion in the earlier period, downstream demand struggled to absorb the surplus supply, leading market prices into a downward trend. SMM survey data indicated that the actual production cut this month was slightly lower than the planned amount announced by enterprises. This phenomenon mainly stemmed from the multifaceted cost-side adjustments involved in production cuts; the implementation and transmission of related measures require a certain period and cannot be fully realized quickly. However, it is noteworthy that the decline in sponge titanium prices this month has gradually moderated. Based on the current market situation, sponge titanium prices are expected to remain low in September.
Light Rare Earth
In August, Pr-Nd oxide production continued to grow MoM, with the main increments concentrated in Shandong, Jiangsu, and Jiangxi. This growth was primarily attributed to a further increase in the operating rates of scrap recycling enterprises. However, some separation enterprises reported that reduced imports of US ore had impacted their production activities. Nevertheless, by increasing the use of monazite and domestic ore, the operating rates of these enterprises did not decline significantly. Looking ahead, however, raw ore output of rare earth oxides is expected to decrease starting from Q4.
In August, Pr-Nd alloy production saw a slight decline MoM, mainly due to production cuts in Inner Mongolia and Sichuan. In Inner Mongolia, output at some alloy plants decreased due to reduced toll processing orders and ongoing plant renovations. In Sichuan, production plan adjustments at individual enterprises also led to shutdowns. Looking forward to September, with the peak season for the NdFeB industry arriving, orders for alloy enterprises are expected to stabilize, and Pr-Nd alloy production is likely to operate steadily.
Medium-Heavy Rare Earth
In August, the production of medium-heavy rare earth oxides continued to increase, primarily driven by higher operating rates at scrap recycling enterprises, leading to a significant rise in output from the recycling sector. However, from the perspective of raw ore producers, there was no significant change in production volume from this segment.
Recently, trading activity in the ion-adsorption ore market has been relatively sluggish. Separation enterprises tend to consume existing raw material inventories, showing low purchasing enthusiasm. Additionally, some raw ore separation enterprises indicated plans to halt production starting from Q4, which may lead to a reduction in the circulation of medium-heavy rare earth oxides in the future market. In response, downstream demand side indicated that after the peak season ends, the demand for rare earth raw materials in Q4 may decrease correspondingly, so medium-heavy rare earth oxides may not face a severe shortage.
NdFeB
China's NdFeB magnetic material production in August 2025 showed a MoM decline, mainly due to the following reasons: First, the core raw materials for NdFeB, Pr-Nd oxide and Pr-Nd alloy, maintained high price levels throughout July-August, suppressing magnetic material enterprises' purchase willingness; moreover, the sharp price increase in the latter half of August led enterprises with insufficient raw material inventory to suspend order acceptance and proactively control order scale to avoid cost risks. Second, end-use demand weakened overall; home appliances like air conditioners entered the traditional off-season after summer, with the effects of consumption-boosting policies fading, while the consumer electronics sector, such as mobile phones and earphones, remained sluggish due to the conclusion of subsidy policies and the end of the back-to-school season stockpiling cycle, making enterprises more cautious in procurement strategies, with significant reductions in low-end magnetic material orders. Additionally, the NEV September-October peak season stockpiling cycle is nearing its end, slowing down the industry chain's procurement pace, compounded by intensified overseas trade barriers and accelerated technological substitution in some sectors (e.g., some low-end products using ferrite instead of NdFeB, and some enterprises improving formulas to reduce Pr-Nd alloy usage), further suppressing demand for NdFeB. Finally, macro policies like export controls increased enterprise costs, and medium-heavy rare earth restrictions led downstream enterprises to adjust formulas, collectively reducing reliance on Pr-Nd materials, coupled with accumulated social inventory of motors and end-use goods and strong market wait-and-see sentiment, all exacerbating the production decline.
Molybdenum concentrate
According to SMM data, China's molybdenum concentrate production in August 2025 decreased by 8% MoM and 10.8% YoY. Total molybdenum concentrate production from January to August 2025 decreased by 0.3% YoY.
By province, China's molybdenum concentrate in August mainly came from Shaanxi, Henan, Heilongjiang, and other regions. Among them, a mine in Henan had lower output due to technological transformation, resulting in a MoM decrease of 1,090 mt in metal content for Henan's molybdenum concentrate in August, while Inner Mongolia also showed a MoM decline in production due to a mine not resuming operation. Production fluctuations in other regions were relatively small. China's molybdenum concentrate production in August declined both YoY and MoM, due not only to reasons like mine suspensions and technological transformations but also related to declining molybdenum ore grades in some mines. In recent years, with the mining of molybdenum resources, molybdenum concentrate market circulation tightened within the month, supported by increased demand from downstream sectors like ferromolybdenum, leading to a rising trend in domestic molybdenum concentrate prices during the month. As of now, mainstream transactions for domestic 45%-50% grade molybdenum concentrate are concentrated at 4,530-4,560 yuan/mtu, up 5.8% from the beginning of the month.
Entering September, technological transformation at a molybdenum mine in Henan may still require some time, while increments in other regions are limited. Domestic molybdenum concentrate operating rates are still unlikely to rebound, and production is expected to remain largely flat MoM. Subsequent attention is still needed on the progress of mine maintenance and shipments from mainstream mines.
Ferromolybdenum
According to SMM data, domestic ferromolybdenum production in August 2025 increased by 4.08% MoM and 12.5% YoY. Total ferromolybdenum production from January to August 2025 increased by 9.9% YoY.
In August, downstream demand in the domestic ferromolybdenum market was robust, and steel tender prices gradually rose. Profits in the ferromolybdenum industry improved, driving an uptick in industry operating rates. Data shows the domestic ferromolybdenum industry operating rate increased by 2 percentage points MoM to around 60% in August, although some enterprises still faced constraints from molybdenum concentrate shortages, leading to lower operating rates. By province, Shaanxi's ferromolybdenum production saw an increase of 800 mt MoM, while production in regions like Liaoning remained relatively stable, and Henan also showed a slight increase.
Entering September, domestic production of molybdenum-containing steel, such as stainless steel, is expected to maintain growth. Domestic steel mills concentrated their entries in late August, with ferromolybdenum steel tender volume reaching 13,000 mt in August, most of which requires delivery in September. Domestic ferromolybdenum production in September is forecast to maintain a slight increase.
Ammonium Paratungstate (APT)
According to SMM data, domestic APT production in August 2025 decreased by approximately 10% MoM and 8% YoY, indicating a significant industry contraction.
In August, domestic tungsten concentrate prices rose rapidly, with a monthly increase of 33.6%. Tight ore supply and difficulty in sourcing material led to challenges in restocking for some APT enterprises, resulting in lower industry operating rates. Some enterprises faced significant cost pressure and opted for maintenance. By province, maintenance shutdowns at several enterprises in Jiangxi led to a production decrease of about 1,000 mt MoM in the province. Production changes in Fujian and Hunan were relatively small, with most enterprises producing and shipping based on orders.
Entering September, tight supply in the domestic tungsten concentrate market is expected to persist, with market circulation remaining tight. APT enterprises may still face high cost pressures and difficulties in raw material restocking, making an improvement in industry operating rates challenging. However, demand from end-user industries like cemented carbide is expected to improve driven by the September-October peak season. The tungsten market is entering a phase of supply-demand mismatch. Subsequent attention is needed on information regarding domestic tungsten concentrate mining quotas and mine shipment situations.
Silver
Silver production in August 2025 increased by approximately 0.43% MoM from July. The impact of routine maintenance and production cuts at copper smelters in regions like Yunnan and Gansu was offset by production resumptions following maintenance at lead smelters in regions like Inner Mongolia and Henan. Regarding production changes at other smelters, a smelter in Shandong province slightly reduced output before resuming production by month-end, while a smelter in Hunan province saw a slight production increase with the addition of a new production line. Entering September, autumn maintenance at smelters increased. Maintenance at a lead smelter in Henan province and at copper smelters in Anhui and Inner Mongolia may subsequently have a minor impact on silver ingot production. Additionally, a lead smelter in Hunan province mentioned tight supply of silver-lead ore, which may lead to a slight decline in silver ingot production in September. SMM expects refined silver production in September to decrease by about 3% MoM.
Silver Nitrate
In August 2025, silver nitrate production increased by 3.96% MoM, continuing its upward trend. Although some silver nitrate producers reported that downstream consumption orders remained sluggish from August to September, the situation was better than early in Q2. Furthermore, newly commissioned capacity at a silver nitrate facility in Hunan province, which had not been operating normally previously, saw a slight production increase in August. It is understood that by the end of August, quoted processing fees in the silver nitrate market had generally stabilized. Many enterprises reported slight losses amid low-price competition, suggesting that the price decline for silver nitrate in September might be relatively limited. Entering September, one silver nitrate producer stated that it had already exceeded its cumulative planned production target for January-August in H1, and therefore expects operating rates to potentially halve in Q4. Silver nitrate enterprise operating rates are expected to remain stable in September, with production likely to continue a slight accumulating trend.
Antimony Ingot
According to SMM assessment, China's antimony ingot production (including antimony ingot, converted crude antimony, antimony cathode, etc.) in August 2025 increased by approximately 22.5% MoM compared to the previous month. In detail, among the 33 surveyed producers currently assessed by SMM, 13 were shut down (a decrease of 4 from the previous month), 18 had reduced production (an increase of 4 from the previous month), and 2 maintained normal production levels (unchanged from the previous month). Looking at antimony ingot production, after overall production fell below 4,000 mt in July, it rebounded to above 4,000 mt in August. Many market participants view this as a normal phenomenon, although production around 4,000 mt remains significantly below normal levels. Imported ore sources are still unable to enter the domestic market in large quantities. Market participants indicate that national antimony ingot production in September 2025 is not expected to change significantly compared to August, with possibilities of remaining stable or experiencing minor fluctuations.
Note: Since May 2022, SMM has been publishing its assessed national antimony ingot production (including antimony ingot, converted crude antimony, antimony cathode, etc.). Benefiting from SMM's high coverage rate of the antimony industry, the survey covers a total of 33 antimony ingot producers distributed across 8 provinces in China, with a total sample capacity exceeding 20,000 mt and a total capacity coverage rate of over 99%.
Sodium Pyroantimonate
According to SMM assessment, China's production of first-grade sodium pyroantimonate in August 2025 is estimated to decrease by approximately 8.93% MoM compared to the previous month. After experiencing significant fluctuations in production for several consecutive months, China's production of first-grade sodium pyroantimonate saw a rebound in June, followed by a pullback for two consecutive months in July and August, leading many market participants to lament the inevitability of weak demand during the summer off-season. Market participants consider this a normal phenomenon, as July-August is traditionally the off-season for PV glass producers' orders, coupled with the overall weakness in antimony prices, making the decline in sodium pyroantimonate production reasonable. In terms of detailed data, among SMM's 13 survey subjects, four producers were either shut down or in the debugging stage in August, while one sodium pyroantimonate producer saw some growth in production. However, most producers experienced stable or declining output. Consequently, China's overall production of first-grade sodium pyroantimonate saw a slight decline in August. Market participants expect that the likelihood of a continued decline in national sodium pyroantimonate production in September compared to August is relatively small. With the arrival of the golden autumn in September, the market is expected to emerge from the off-season, making it more likely for production to remain flat or rebound slightly.
Note: SMM has been publishing the assessed national production of sodium pyroantimonate since July 2023. Benefiting from SMM's high coverage rate of the antimony industry, the total number of sodium pyroantimonate producers surveyed by SMM is 13, distributed across six provinces in China, with a total sample capacity exceeding 86,000 mt and a coverage rate of up to 99%.
Refined Bismuth
According to SMM assessments, China's refined bismuth production in August 2025 is expected to increase by about 14% MoM compared to July. In recent months, after a sudden significant decline in bismuth production in May, output continued to decline for two consecutive months, with the first rebound occurring in August, which was within the expectations of many market participants. Market participants indicated that the continuous decline in bismuth prices over the past month reflects the supply pressure on fundamentals due to increased supply. However, the 14% rebound is relatively small, and under the overall tight supply of bismuth raw materials, production is expected to remain at a low level. In terms of detailed data, among SMM's 24 survey subjects, three producers saw a significant increase in output in August, while almost no producers experienced a notable decline. The output of the remaining producers remained largely unchanged. Many market participants expect that the tight supply of raw materials for national bismuth producers will remain difficult to alleviate in September, and production is likely to continue to be constrained. The possibility of stable or slightly increasing refined bismuth production is relatively high, while the likelihood of another significant decline is relatively small.
Note: SMM has been publishing the assessed national production of refined bismuth since October 2022. Benefiting from SMM's high coverage rate of the bismuth industry, the total number of refined bismuth producers surveyed by SMM is 24, distributed across eight provinces in China, with a total sample capacity exceeding 50,000 mt and a coverage rate of over 99%.
Lithium Carbonate
In August 2025, China's monthly total lithium carbonate production hit a new record, exceeding 85,000 mt, up 5% MoM and surging 39% YoY. The primary driver of the sustained production growth remained spodumene-derived output, with toll processing orders for non-integrated lithium chemical plants in full swing. Meanwhile, driven by continuously improving downstream demand, the industry's overall supply capacity also increased.
By raw material, spodumene-based output saw significant growth, while lepidolite-based production pulled back noticeably.
Spodumene-derived lithium carbonate: Total production in August increased 19% MoM. On one hand, robust downstream demand stimulated some flexible production lines to switch to lithium carbonate production, contributing to the increase; on the other hand, high operating rates at non-integrated lithium chemical plants, sustained by incentives from futures hedging profits, further drove production growth.
Lepidolite-derived lithium carbonate: Total production decreased 24% MoM. A leading mine in Jiangxi province suspended production due to mining permit issues, and its associated lithium chemical plant maintained minimal output in August using ore inventory and spot orders. However, compared to previous high operating rates, the output decline was significant. Production at other lepidolite-based lithium chemical enterprises remained relatively stable. Overall, output of lepidolite-derived lithium carbonate decreased significantly, affected by the leading mine and its supporting lithium chemical plant.
Salt lake-derived lithium carbonate: Total production decreased 12% MoM, mainly due to production cuts or suspensions at some salt lake enterprises caused by extraction issues, while other enterprises maintained stable production under favorable weather conditions.
Scrap-derived lithium carbonate: Total production in August increased 14% MoM, primarily benefiting from rising lithium carbonate prices, which boosted production enthusiasm among recycling enterprises, though the overall production scale remained limited.
In September, the lithium carbonate market still faces uncertainty regarding mining policies in Jiangxi province. However, as the deadline for submitting relevant reports has not yet passed, these mines currently maintain normal production. Additionally, new production lines from both spodumene and salt lake sources are expected to commence operation, coupled with downstream demand entering the traditional peak season, sustaining positive market expectations. Total lithium carbonate production in September is expected to maintain growth potential. SMM will continue to closely monitor the specific implementation of mining policies in Jiangxi province.
Lithium Hydroxide
SMM data shows China's lithium hydroxide production fell 13% MoM and 31% YoY in August. The decrease stemmed from two main areas: smelting-side production dropped about 12% MoM due to maintenance at a leading producer's production line mid-month; causticisation-side production, despite significant output increases at some enterprises from robust mid-month orders, could not offset the gap left by planned maintenance at others, resulting in an overall significant decline.
Looking ahead to September, as lithium chemical plants that underwent maintenance earlier gradually resume production, coupled with some enterprises flexibly adjusting their production schedules based on orders on hand, lithium hydroxide production is expected to increase by 12% MoM, but still down 21% YoY.
Cobalt Sulphate
In August 2025, SMM cobalt sulphate production decreased by 1.56% MoM, but increased by 6.26% YoY.
By raw material, cobalt intermediate products accounted for about 55%, MHP for about 18%, and recycled materials for about 27%. Due to the extension of the DRC ban, cobalt intermediate product prices continued to rise, leading to a gradual reduction in cobalt intermediate product inventory at smelters, with recycled materials and MHP substituting for cobalt intermediate products. However, coefficients for MHP and recycled materials also saw significant increases recently, reducing enterprises' willingness to procure these materials for production, thus the substitution effect weakened.
Supply side, cobalt sulphate production costs remained inverted in August. Some cobalt sulphate smelters, due to weak production economics or shortages of raw material inventory, continued to reduce cobalt sulphate output or shift to producing cobalt products with better economics, such as cobalt chloride and Co3O4. After several months of adjustments, cobalt sulphate enterprises' production plans are basically stable, with limited further downside room.
Demand side, downstream buyers gradually began stockpiling for the peak season in August. Orders for both ternary and Co3O4 enterprises improved, with some enterprises having low raw material inventory starting to purchase in the market.
By September, small and medium-sized cobalt sulphate enterprises are expected to have limited room for further production decreases, while integrated cobalt sulphate enterprises with ternary and Co3O4 capabilities may see a slight production increase due to improved downstream demand. Cobalt sulphate production schedule for September is projected to rise by 2.67% MoM.
Co3O4
In August 2025, Co3O4 production increased by 13% MoM and 38% YoY. This growth was mainly driven by increased production schedules at LCO cathode enterprises, as battery cell manufacturers actively raised capacity utilization rates to meet consumer electronics peak season demand, boosting procurement demand for Co3O4. In September, against the backdrop of resilient end-use demand, Co3O4 production is expected to continue growing, with a projected MoM increase of about 5%. However, attention should be paid to the impact of cobalt salt price fluctuations and enterprise inventory strategies on actual production.
Ternary Cathode Precursor
In August 2025, domestic ternary cathode precursor production showed significant growth, up 8.55% MoM and 11.30% YoY. By product series, the 6-series maintained its dominant position in the domestic market, accounting for 42.43%. Benefited by the demand boost from the domestic power market's traditional September-October peak season, the share of 6-series materials remained high in recent months. The proportion of 5-series materials was 15.06%, basically flat. High-nickel products increased slightly this month, with the 8-series and 9-series accounting for 28.17% and 11.07%, respectively. Demand side, August was mainly driven by traditional peak season stockpiling, with most producers seeing increased orders, but the growth remained concentrated in the power market. The consumer market's overall demand performed well, but growth was relatively limited. Currently, with nickel and cobalt raw material prices at high levels and downstream cathode material manufacturers having limited acceptance of price increases, precursor producers face significant cost pressure and tend to be cautious when taking orders; actual order intake may be lower than market demand. Looking ahead to September, demand is expected to maintain August's level. However, due to potentially tight raw material supply and continued price increases, some producers may fulfill orders by drawing down inventory, and the growth rate of production schedules is expected to narrow. On the other hand, influenced by early stockpiling for the National Day holiday, September demand is expected to receive some support. Overall, production in September is forecast to increase by 3.89% MoM and 12.93% YoY.
Ternary Cathode Material
In August 2025, domestic ternary cathode material production increased by 6.99% MoM but still decreased by 5.07% YoY. The overall industry operating rate continued to rebound, reaching 48%. In terms of product structure, the proportion of 5-series materials was 15.63%, basically flat; the share of 6-series materials was 37.49%, further increasing driven by demand from the domestic power market's September-October peak season, squeezing the market share of some high-nickel products. The proportion of high-nickel products declined slightly, with the 8-series accounting for 28.94% and the 9-series for 15.67%. In the power market, order volumes generally rebounded for various producers in response to the traditional peak season, but significant increases were still concentrated among suppliers to some leading battery cell manufacturers. In the consumer market, as good growth was already seen in July, end-use demand did not increase substantially this month, and production performance was basically flat. Looking ahead to September, end-use demand is expected to maintain the current relatively good level. However, as producers' production growth was rapid in August, partially fulfilling September demand in advance through early stockpiling, and coupled with current high costs and expected continued price increases for raw materials like nickel, cobalt, and lithium, along with expectations of tight supply, some manufacturers will comprehensively assess cost factors when accepting downstream orders; actual order intake may be lower than demand levels. Overall, production in September is forecast to decrease slightly by 1.51% MoM and decline by 1.78% YoY.
Iron Phosphate
Domestic iron phosphate production in August showed significant growth, with a MoM increase of 5% and a notably higher YoY increase of 59%, indicating a clear trend of production expansion. From the perspective of incremental driving factors, the core logic centers on two major dimensions: demand boost and capacity release. On one hand, integrated LFP enterprises have ample orders, directly driving up the production of internally consumed iron phosphate, which serves as a key support for production growth. On the other hand, some iron phosphate producers actively release output scale to match capacity expansion plans, further boosting the industry's total production. Coupled with fluctuations in lithium carbonate prices in August, this market change directly stimulated downstream LFP battery cell manufacturers to accelerate stockpiling, indirectly boosting iron phosphate market demand. However, as integrated LFP enterprises continue to expand their market share, demand space for non-integrated iron phosphate is shrinking. Against this backdrop, iron phosphate capacity in the industry remains on a continuous expansion track, while overall market demand growth is relatively limited. The subtle changes in the supply-demand relationship are forcing iron phosphate enterprises to adjust pricing strategies or upgrade product competitiveness to secure downstream customer orders and maintain market share. Cost side, in August, iron phosphate enterprises faced dual pressures of "one loose, one tight": the industrial-grade MAP market entered the traditional off-season, with prices declining significantly, providing some buffer for cost control; but ferrous sulphate prices continued to rise, significantly increasing cost pressure on iron source procurement and squeezing profit margins. Looking ahead to September, with further release of downstream demand, the traditional peak season for the iron phosphate industry is approaching, market confidence is gradually recovering, and most iron phosphate enterprises hold optimistic expectations for the September market. In terms of production forecast, domestic iron phosphate production in September is expected to maintain growth, up about 4% MoM and up to 40% YoY, with the industry likely to continue its favorable operating trend.
LFP
In August, China's LFP material production increased about 8.8% MoM and 50% YoY, with an industry operating rate of approximately 62%. LFP enterprises performed well overall this month, maintaining high production enthusiasm, especially top-tier material producers operating at overload, with ample orders for both NEV and ESS applications. Demand from leading battery cell manufacturers diverged, while second- and third-tier cell manufacturers saw overall improving demand, particularly driven by the traditional auto sales peak season "September-October peak season," where cell manufacturers actively produced and stockpiled, leading to increased orders for material producers. The ESS sector also showed excellent performance this month; according to the latest survey results, no ESS cell manufacturers have shown a trend of reducing volume, indicating high industry prosperity. Looking ahead to September, driven by the "September-October peak season," the industry is expected to maintain strong growth momentum, with an anticipated growth rate of over 5%.
LCO
In August 2025, LCO production showed a significant increase, up 19% MoM and 55% YoY. This was mainly driven by the traditional peak season for consumer electronics, with new models being released in Q3, coupled with summer sales promotions and back-to-school stockpiling, effectively stimulating downstream battery enterprises' purchase willingness for LCO cathodes. It is expected that as end-use consumption momentum continues, LCO production will maintain an upward trend in September, with a projected 8% MoM increase. Downstream order demand remains robust, and the overall operating rate of the industry stays at a high level.
LMO
In August 2025, LMO production exhibited a "down MoM, up YoY" trend. During the month, lithium carbonate prices fluctuated frequently, leading to a strong wait-and-see sentiment among LMO producers. Market quotes closely followed adjustments in lithium carbonate prices, and both shipments and production were cautious. In early August, due to a noticeable rise in LMO prices, battery cell manufacturers, concerned about future price hikes, engaged in advance stockpiling. However, as lithium carbonate prices rebounded slightly after a decline, battery cell manufacturers returned to a wait-and-see stance, reducing orders. Coupled with the off-season in the downstream battery market and sluggish demand, LMO producers tightened their production schedules, resulting in a decrease in market supply in August. Looking ahead to September, the LMO market is expected to gradually exit the off-season, with market activity likely to improve and inquiries potentially increasing steadily, further motivating enterprise production. Under this impetus, it is anticipated that LMO supply in September will see a MoM increase, and the YoY growth rate will continue to expand.
*Methodology
SMM's production survey is conducted by professional analysts through methods such as telephone and on-site surveys, regularly tracking Chinese metal producers on a monthly basis, and issuing China's metal production reports based on these findings.
During the survey, the basic coverage ratio of samples is ensured and continuously expanded. At the same time, sample selection and allocation are reasonably made, taking into account factors such as capacity scale, geographical distribution, and enterprise nature, ensuring that each sub-item of data is representative.
The data is released through official channels at the end of each month, including SMM's official website (www.smm.cn), WeChat subscription account (Jinri Youse), and mobile site (m.smm.cn).
Data Source Statement: Apart from publicly available information, other data is processed by SMM based on public information, market communication, and SMM's internal database model, for reference only and not intended as decision-making advice.