Metals mostly rose, polysilicon surged over 5%, and LME nickel, SHFE zinc, lithium carbonate, NY silver, etc., rose more than 1% [SMM Midday Comment]

SMM August 7 News:

Metal market:

As of midday close, domestic market base metals nearly all rose. SHFE copper added 0.56%, SHFE aluminum rose 0.86%, SHFE lead gained 0.48%, SHFE zinc advanced 1.35%, SHFE tin fell 0.3%, and SHFE nickel edged up 0.44%.

Additionally, the most-traded cast aluminum futures contract edged up 0.32, while the most-traded alumina contract slipped 0.33%. Lithium carbonate most-traded contract rose 1.23%. Silicon metal most-traded contract surged 2.21%. Polysilicon most-traded futures contract jumped 5.03%.

Ferrous metals all rose. Iron ore futures gained 0.28%, rebar edged higher, and hot-rolled coil rose 0.43%. Stainless steel advanced 1.39%. For coking coal and coke: the most-traded coking coal contract rose 2.6%, and the most-traded coke contract jumped 3.22%.

In the overseas market, as of 11:40 AM, LME base metals rallied across the board. LME copper gained 0.69%, LME aluminum edged up 0.31%, LME lead rose 0.4%, LME zinc advanced 0.44%, LME tin added 0.42%, and LME nickel surged 1.61%.

In the precious metals space, as of 11:40 AM, COMEX gold rose 0.43% and COMEX silver gained 1.45%. For domestic precious metals: SHFE gold edged up 0.28%, and the SHFE silver most-traded contract added 0.11%.

Additionally, as of midday close, the most-traded platinum futures contract fell 1.71%, and the most-traded palladium futures contract dropped 1.55%.

As of midday close, the most-traded European container shipping futures contract rose 1.79% to 1,682 points.

As of 11:40 AM on August 7, here are some futures midday quotes:

Spot and fundamentals

Copper: Today, Guangdong #1 copper cathode spot prices against the front-month contract: high-quality copper was quoted at 160 yuan/mt, up 70 yuan/mt from the previous trading day; standard-quality copper was quoted at a premium of 60 yuan/mt, up 50 yuan/mt from the previous trading day; SX-EW copper was quoted at 0 yuan/mt, up 30 yuan/mt from the previous trading day. The average price of Guangdong #1 copper cathode was 108,355 yuan/mt, up 455 yuan/mt from the previous trading day; the average price of SX-EW copper was 108,245 yuan/mt, up 425 yuan/mt from the previous trading day...

Macro front

Domestic side:

[Over 30 trillion yuan! China's goods trade imports and exports continued to grow in the first seven months this year] The General Administration of Customs announced today that in the first seven months, China's goods trade imports and exports totaled 30.13 trillion yuan, up 17.3% YoY, extending a solid growth momentum. Exports were 17.44 trillion yuan, up 14%, while imports were 12.69 trillion yuan, up 22%. In July alone, imports and exports amounted to 4.66 trillion yuan, up 19.2% YoY. Of which, exports stood at 2.71 trillion yuan, up 17.8%, and imports stood at 1.95 trillion yuan, up 21.2%.

[National Energy Administration: Boost Independent R&D of Key Power Equipment, Promote Key Technology Breakthroughs in Power Chips and UHV Components]The National Energy Administration issued the "Power Safety Production '15th Five-Year' Action Plan." Among them, it is mentioned to strengthen "AI+" safety governance, innovate high-precision fault prediction and health management methods for equipment, promote the integration of AI technology into intelligent safety tools and equipment, and research AI large model-based auxiliary decision-making technologies for power safety production. Boost independent R&D of key power equipment, strengthen the R&D of new-type protective materials, set up special plans for technical breakthroughs in core components of power equipment, and promote key technology breakthroughs in power chips, UHV components, etc. Promote the innovation of safety and quality control technologies in power construction projects, research and build intelligent supervision systems for power construction projects, and use AI, big data and other means to strengthen off-site supervision and quality supervision of key power projects. (National Energy Administration)

[General Administration of Customs: Integrated Circuit Cumulative Exports, January-July, Up 99.5% YoY]Data released by the General Administration of Customs showed that China's integrated circuit export value reached $38.74 billion in July, and the cumulative export value from January to July reached $216 billion, up 99.5% YoY. (Jin10 Data)

[PBOC Open Market Operations Net Drain: Today (133 Billion Yuan), This Week (1,225.5 Billion Yuan)]The PBOC conducted 1 billion yuan of 7-day reverse repo operations today. With 134 billion yuan of 7-day reverse repos maturing, this resulted in a net drain of 133 billion yuan on the day. This week, the PBOC carried out 176.5 billion yuan of 7-day reverse repo operations, 300 billion yuan of overnight reverse repo operations, and 500 billion yuan of outright reverse repo operations. With 116.5 billion yuan of 7-day reverse repos and 900 billion yuan of overnight reverse repos maturing, the weekly net drain amounted to 1,225.5 billion yuan. (Jin10 Data)

As of 11:40, the US dollar index edged up 0.02% to 99.96. The market focused on the US non-farm payrolls data for clues on the interest rate outlook. According to the CME FedWatch Tool, the probability of the Fed keeping rates unchanged in September was 45%, while the chance of a cumulative 25bp rate hike stood at 55%. For October, the probability of rates staying unchanged was 31%, with a 51.9% chance of a cumulative 25bp hike and a 17.1% chance of a cumulative 50bp hike. (Jin10 Data APP)

US Fed’s Musalem: Currently, inflation is far above the Fed’s 2% target. Monetary policy must effectively curb underlying inflation, rather than tolerating current high inflation in hope of future productivity gains.

US Q2 labour productivity grew faster than expected, mainly as enterprises sought to ease pressure from rising costs. Data released on Thursday showed that nonfarm productivity grew at an annualized rate of 1.4% in Q2, up from an upwardly revised 0.8% increase in Q1, a result that also exceeded general market forecasts. Unit labour costs, however, rose 1.3%, below expectations. Fed officials, investors, and economists have been looking for signs of whether hundreds of billions of dollars in AI investments are boosting labour productivity. However, given the large quarterly fluctuations in official data, it will still take time to observe a clear trend. Labour costs are one of the largest expense items for many enterprises, and efficiency improvements can allow wages to rise without pushing up inflation. In the long term, higher productivity helps improve living standards, but some economists worry that if AI-driven productivity gains persist, some enterprises may delay hiring or even cut staff. The Q2 productivity growth was supported by the strongest output growth since Q3 2025, alongside a relatively mild increase in hours worked. (Jin10 Data APP)

Data:

Today will see the release of France's Q2 ILO unemployment rate, Germany’s June seasonally adjusted industrial output m/m, Germany’s June seasonally adjusted trade balance, the UK’s July Halifax seasonally adjusted house price index m/m, France’s June trade balance, Switzerland’s July consumer confidence index, Canada’s July employment change, the US July unemployment rate, the US July seasonally adjusted nonfarm payrolls, the US July average hourly earnings y/y, the US July average hourly earnings m/m, the US July New York Fed 1-year inflation expectations, China’s July trade balance in USD terms, China’s July foreign exchange reserves, and China’s July trade balance. Attention: 2028 FOMC voter, St. Louis Fed President Musalem will speak on the US economy and monetary policy; 2027 FOMC voter, Richmond Fed President Barkin will speak.

Crude oil:

As of 11:40, oil prices in both markets rose, with WTI up 1.01% and Brent up 1.06%. Market concerns over navigation prospects in the Strait of Hormuz supported oil prices.

According to preliminary US government data, US crude oil imports from Saudi Arabia fell to zero in July this year, the first time since 1985 that no Saudi crude was imported in an entire month. Data released by the US Department of Energy (DOE) on Wednesday local time showed that Saudi crude oil shipments to the US completely ceased in July. This drop is particularly striking given that US refineries were purchasing an average of over 800,000 barrels per day of Saudi crude earlier this year. As the closure of the Strait of Hormuz and other war-related supply disruptions pushed up crude prices linked to global benchmarks, US refineries have been seeking alternative supplies for Saudi crude. Saudi crude deliveries to the US have historically fallen to zero in individual weeks, but July marked the first time in over 40 years that deliveries were at the lowest level for an entire month. According to Kpler data, US crude imports from Saudi Arabia are expected to recover to around 300,000 barrels per day this month, in line with recent historical norms. (Jin10 Data APP)

Saudi Arabia lowered its key crude prices for Asia, while negotiations were underway on an agreement aimed at easing shipping pressures in the Strait of Hormuz. The price cut came despite threats from Houthi militants that jeopardized the alternative route for eastbound crude shipments through the Red Sea. A price list showed that Saudi Aramco, the state oil company, lowered the price of Arab Light crude for delivery to Asian customers next month by 50¢ per barrel, to a level $2 below the regional benchmark. A previous survey showed that traders had expected Saudi Aramco to keep the price of its flagship crude unchanged. This week, the global benchmark Brent crude price fell sharply and is now trading near $80 per barrel. (Jin10 Data APP)

Spot Market Overview:

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