China Great Wall: Basic metal prices fluctuate and adjust to maintain the "stronger than the market" rating of the nonferrous metal industry.

China Great Wall released a research report stating that it maintains a "stronger than the overall market" rating for the non-ferrous metal industry. Driven by geopolitical tensions and concerns about supply chain security, the strategic status of metals and other essential materials is improving. At the same time, the global base metals market is undergoing a structural reshaping of the long-term supply and demand pattern. On the demand side, the accelerated transition of energy, the strong and sustained demand for copper and aluminum from green industries such as new energy vehicles, photovoltaics, and wind power, is forming a strong and continuous pull; while on the supply side, factors such as long-term underinvestment, declining resource grades, and extended project production cycles are increasingly highlighting supply rigidity. In the short term, prices may be affected by macroeconomic sentiment, but in the medium to long term, the central price of base metals is expected to further rise. China Great Wall's main points are as follows: - China's export amount in December has maintained stable growth - In December, China's export amount increased by 6.6% year-on-year (compared to +5.9% previously), with exports to the US decreasing by 30% year-on-year (compared to -29% previously). The US Consumer Price Index (CPI) growth rate remained stable in December, with a year-on-year increase of +2.7% (compared to +2.7% previously) and a core CPI increase of +2.6% year-on-year (compared to +2.6% previously). - Aluminum: Aluminum prices are high, and some processing companies may close early for the holidays - The operating capacity of the electrolytic aluminum industry increased by 0.5 tons month-on-month. This week, the operating capacity of electrolytic aluminum enterprises was 44.25 million tons, an increase of 0.5 million tons from the previous week. The industry's instant profit per ton exceeded 6000 yuan/ton. With high aluminum prices, the continued suppression of demand is leading to increasing inventories of domestic aluminum ingots by 39,000 tons month-on-month. - Aluminum Oxide: The pattern of inventory accumulation continues to put pressure on prices - Short-term production reductions and resumptions are occurring simultaneously. According to Shanghai Aladdin Biochemical Technology Co., Ltd, the weekly operating capacity of aluminum oxide is 96.25 million tons, an increase of 40 tons month-on-month. Inventories continue to accumulate at high levels, with an increase of 75,000 tons month-on-month, reaching historical highs. The extent of instant profit and loss is expanding, with aluminum oxide ton gross profit calculated at -186 yuan/ton using domestic ore prices, and at -85 yuan/ton using prices of imported bauxite from Guinea, leading to ongoing losses. - Copper: Geopolitical tensions combined with production cuts at the mining end continue to drive copper prices upward - The processing fee for copper concentrates declined again, with the SMM imported copper concentrate index on January 16th (week) reported as -46.53 USD/ton, down 1.12 USD/ton from the previous period. The operating rate of major copper rod enterprises in China increased by 9.65% month-on-month to 57.47%, while that of copper wire and cable enterprises decreased by 0.59% to 55.99%. Global inventories continue to accumulate, with a total global inventory of 1.0874 million tons, an increase of 77,800 tons month-on-month and 602,700 tons year-on-year. - Zinc: Weak consumption leads to accumulation of visible stocks - The operating rate of primary zinc production is relatively weak year-on-year, with galvanizing operating rate recorded at 53.48%, down 0.91% month-on-month, and die-casting zinc operating rate at 49.52%, down 0.38% month-on-month. Domestic and LME inventories remain stable. This week, the total inventory of zinc ingots in China's seven regions was 118,400 tons, down 0.01 million tons from the previous week, while LME inventory was 106,500 tons, down 275 tons from the previous week, remaining relatively stable. Risk warning: Risks stemming from macroeconomic fluctuations, risks from policy changes, risks from unexpected industry policies, risks from lower-than-expected downstream consumption, risks from delays or outdated information in publicly available data used in research reports, etc.