Metals Fell Broadly, Lithium Carbonate Dropped Nearly 4%, SHFE Silver and SHFE Aluminum Led Declines, Alumina and Polysilicon Rose Over 2% [SMM Midday Review]

SMM April 21 News:

Metals market:

As of the midday close, base metals on the domestic market mostly fell. SHFE copper dropped 0.64%. SHFE aluminum fell 1.45%. SHFE lead rose 0.33%, SHFE zinc fell 0.76%. SHFE tin dropped 0.31%, SHFE nickel fell 0.69%.

In addition, the most-traded foundry aluminum futures fell 1.49%, the most-traded alumina futures rose 2.38%. The most-traded lithium carbonate futures fell 3.86%. The most-traded silicon metal futures fell 0.63%. The most-traded polysilicon futures rose 2.19%.

Ferrous metals mostly rose. Iron ore rose 0.64%, rebar rose 0.76%, hot-rolled coil rose 0.87%, stainless steel fell 0.53%. Coking coal and coke: the most-traded coking coal contract rose 1.49%, the most-traded coke contract rose 1.96%.

Overseas base metals, as of 11:40, LME metals fell across the board. LME copper dropped 0.2%. LME aluminum fell 0.89%, LME lead fell 0.1%, LME zinc fell 0.78%. LME tin dropped 0.68%. LME nickel fell 0.6%.

Precious metals, as of 11:40, COMEX gold fell 1.32%, COMEX silver fell 0.21%. Domestic precious metals: the most-traded SHFE gold futures fell 0.76%, the most-traded SHFE silver futures fell 2.7%.

In addition, as of the midday close, the most-traded platinum futures fell 1.18%, the most-traded palladium futures fell 0.78%.

As of the midday close, the most-traded Europe containerized freight index contract edged down 0.01%, at 2,114.1 points.

As of 11:40 on April 21, midday futures quotes for selected contracts:

Spot Market and Fundamentals

Copper:Today, Guangdong #1 copper cathode spot prices against the front-month contract: high-quality copper was quoted at a premium of 290 yuan/mt, up 30 yuan/mt from the previous trading day; standard-quality copper was quoted at a premium of 200 yuan/mt, up 30 yuan/mt from the previous trading day; SX-EW copper was quoted at a premium of 140 yuan/mt, up 30 yuan/mt from the previous trading day. The average price of Guangdong #1 copper cathode was 102,420 yuan/mt, down 460 yuan/mt from the previous trading day; the average price of SX-EW copper was 102,315 yuan/mt, down 460 yuan/mt from the previous trading day. Spot market: Guangdong inventory finally ended its 24-session consecutive decline...

Macro Front

China:

[Good Start! China's Raw Material Industry Value-Added Rose 4.6% YoY in Q1]According to a press conference held by the State Council Information Office this morning, China's raw material industry achieved a good start in Q1. Data showed that in Q1, the value-added of the raw material industry rose 4.6% YoY. Among them: the petrochemical and chemical industry value-added rose 7.4% YoY, and the non-ferrous metals industry value-added rose 2.6% YoY. Zhang Yunming, Vice Minister of MIIT, stated that in Q1, the cement industry reduced and retired nearly 30 million mt of capacity through volume replacement. Meanwhile, the green building materials industry saw steady revenue growth, with the number of certified green building material products increasing 5% from the end of 2025. Innovation achievements in the raw material sector also accelerated, with China's independently developed T1200-grade ultra-high-strength carbon fiber industrial-grade product making its global debut, which is expected to be deeply applied in strategic emerging industries such as aerospace, low-altitude economy, and humanoid robots. (CCTV News)

[MIIT: Fully Activate Innovation Engines, Accelerate Frontier Material Layout and Key Material Breakthroughs]Zhang Yunming, Vice Minister of MIIT, stated at the State Council Information Office press conference that in Q1, the ministry implemented the new round of work plans for stabilizing growth in ten key industries, focused on promoting capacity structure optimization and upgrading, and the raw material industry achieved a good start, with more vigorous transformation and stronger industrial foundations. Going forward, MIIT will thoroughly implement the deployment of the 15th Five-Year Plan outline, adhere to the combination of "consolidating fundamentals" and "fostering new growth," and strengthen overall planning and policy supply. On one hand, it will focus on strengthening the foundation for upgrading traditional industries and promoting the optimization of existing capacity and green and safe transformation; on the other hand, it will fully activate innovation engines, accelerate frontier material layout and key material breakthroughs, and provide more solid and reliable material support for developing new quality productive forces and advancing new-type industrialization. (Jin10)

[MIIT: Q1 Industrial Robot Production Rose 33.2% YoY, Drones, AI Glasses and Other Products Increasingly Diversified]This morning, the State Council Information Office held a press conference to introduce the industrial and information technology development in Q1 2026. In Q1, the application of new technologies such as artificial intelligence accelerated in the electronics and consumer goods industries, with end-use products such as drones and AI glasses becoming increasingly diversified. Production of industrial robots and integrated circuits rose 33.2% and 24.3% YoY, respectively. (CCTV News)

[PBOC Achieved Net Injection of 4 Billion Yuan via Reverse Repo Operations Today]The PBOC conducted 5 billion yuan of 7-day reverse repo operations today. As 1 billion yuan of 7-day reverse repos matured today, a net injection of 4 billion yuan was achieved. (Jin10)

US dollar:

As of 11:40, the US dollar index rose 0.11%, at 98.16. The US Congress will hold the first confirmation hearing for Fed Chairman nominee Kevin Warsh on local time Tuesday. Warsh will pledge to Congress members to maintain strict independence on interest rate matters. According to opening remarks obtained in advance by Politico, Warsh stated that interest rate decisions must be strictly independent of political considerations, and monetary policy should not be a tool for short-term political objectives. He also emphasized that the Fed's credibility comes from institutional constraints and policy discipline. Warsh said the central bank should listen to diverse opinions, and politicians expressing views on interest rates is not a real threat. Rather, it is the Fed's own discipline and rigor that sustains its independence. He stressed that price stability is the Fed's shield and pledged to take full responsibility for it, "making no excuses and no deflections." Warsh also warned against the post-crisis expansion of the Fed's functional boundaries, arguing that it should not extend its reach into fiscal or social policy areas where it lacks statutory authority. The US Senate Banking Committee will hold a confirmation hearing for Warsh at 10 PM Beijing time on April 21.

Fed Chairman nominee Kevin Warsh believes that upcoming productivity growth may give the Fed room to lower interest rates, provided that higher productivity enables low-inflation economic growth. However, economist Ed Yardeni, who also expects the economy to benefit from technological advances this decade, disagrees that such an outcome would justify lowering rates. Yardeni wrote: "While we share Warsh's optimism on productivity, we have a fundamentally different view on what this outcome means for monetary policy." Yardeni argues that faster growth will raise the natural rate of interest, or R*, the rate that neither stimulates nor restrains the economy. He wrote: "If the Fed lowers the federal funds rate below R*, the risk is that it fuels financial speculation and instability." (Jin10)

Other currencies:

The exact timing of the Bank of Japan's next rate hike remains uncertain, with significant uncertainty. However, Goldman Sachs analyst Akira Otani stated that the possibility of a rate hike in July still exists. The economist said in a research note: "By then, all the data needed to assess the impact of high oil prices on the economy, wages, and prices will be available." The Bank of Japan is likely to keep rates unchanged this month but may lower its economic growth forecast and raise its FY2026 inflation forecast to reflect the escalation of Middle East tensions and rising oil prices. Otani added that the Bank of Japan may consider the uncertainty surrounding this outlook to be high. (Jin10)

Data:

Data to be released today include US March retail sales MoM, US February business inventories MoM, US March pending home sales index MoM, Germany April ZEW economic sentiment index, UK February three-month ILO unemployment rate, UK March unemployment rate, UK March claimant count, Switzerland March trade balance, and Eurozone April ZEW economic sentiment index. In addition, attention should be paid to: the US Senate Banking Committee holding a confirmation hearing for Kevin Warsh's Fed Chairman nomination, and ECB President Lagarde delivering a keynote speech at the 75th anniversary annual reception of the Association of German Banks. Additionally, a new round of domestic refined oil price adjustment window will open.

Crude oil:

As of 11:40, both benchmarks fell. WTI crude dropped 0.96%, Brent crude fell 0.58%. Signs of resumed negotiations between Iran and the US boosted market sentiment, while international oil prices continued to decline on expectations of easing tensions. (Wall Street Insights)

Wall Street Insights reported that Iran's Supreme Leader Mojtaba Khamenei approved the dispatch of a negotiation delegation to Islamabad on the night of April 20. According to Xinhua citing the US Axios website, US Vice President Vance is expected to depart for the Pakistani capital on the morning of April 21 Eastern Time, with Trump envoy Steve Witkoff and presidential son-in-law Jared Kushner also joining the negotiations. (Wall Street Insights)

The market is still waiting to see whether some form of consultations will take place in Islamabad. Investors generally expect that the likelihood of reaching some preliminary agreement is higher than that of a comprehensive deal. Currently, the market is mainly reacting to the sentiment shift "from optimism to concern." However, it is widely believed that the most severe phase of the crisis and the accompanying energy supply disruptions may have passed. (Jin10)

Spot market overview:

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