Industry Investment Rating - Pure Benzene: Sideways [2] - Styrene: Sideways [2] Core Viewpoints - In the fourth quarter, the pure benzene and styrene industry chain may need time to recover. Pure benzene faces dual supply pressures of increased import volume and new capacity ramping up, with downstream profit issues posing potential risks of reduced production. Styrene has a higher potential supply growth rate, and potential stockpiling problems may become a core contradiction. The industry needs to maintain low - profit states for a longer time to reduce supply and achieve a balance [4]. Summary by Directory 1. The biggest change in the industry chain in the third quarter was the rapid decline in styrene profits - In the third quarter, styrene prices weakened, dropping from around 7,600 yuan/ton at the end of June to about 6,900 yuan/ton recently. Pure benzene prices fluctuated less, remaining in the range of 5,800 - 6,000 yuan/ton. The trading focus shifted from compressing pure benzene valuation in the first half of the year to styrene profit decline in the third quarter [13]. - The root cause is the phased strength - weakness transformation of the pure benzene and styrene pattern. High styrene production profits in the first half of the year led to increased supply, resulting in inventory accumulation and a narrowing of the styrene - pure benzene spread [14]. 2. Pure benzene: New capacity launches are not over, and the expected import volume is rising again - From January to August, the total supply of pure benzene was 21.05 million tons, a year - on - year increase of 10.9%. Domestic production was 17.37 million tons (a 6.0% increase), and imports were 3.68 million tons (a 43.7% increase). High supply growth led to the failure of seasonal destocking in the first half of the year [18]. - In the fourth quarter, the import volume of pure benzene may rise again. South Korea's maintenance losses will decrease, and European pure benzene may flow to East Asia. New capacity, such as from Henan Fengli and Hunan Petrochemical, will be released, and planned maintenance may decrease. The monthly average output of petroleum benzene is expected to be around 2.01 million tons [19][22][23]. - Downstream industries are restricted by profit issues, and potential production cuts are a concern. New downstream capacity may not be smoothly implemented due to low profits. For example, caprolactam profits are at a five - year low, and styrene non - integrated device cash - flow profits are negative [26]. 3. Styrene: Pay attention to potential stockpiling contradictions 3.1. Demand resilience cannot match the supply increase, and the recent styrene profit center has significantly declined - The styrene - pure benzene spread has dropped from 2,000 yuan/ton in the middle of the year to around 1,000 yuan/ton, and non - integrated styrene profits have reached the lowest level this year [32]. - Styrene demand is better than expected, with 1 - 8 month production of PS, ABS, and EPS increasing by 10.3%, 24.3%, and 6.1% respectively year - on - year. However, high production profits in the first half of the year led to increased supply, with the average monthly output from July to August reaching 1.6 million tons, and the total output from January to August increasing by 16.6% year - on - year [33]. 3.2. There are concerns about weakening demand in the fourth quarter. Pay attention to whether the divergence between 3S and end - users will converge - In the third quarter, there was a divergence between the 3S开工率 and end - user demand growth. 3S production increased, but white - goods production decreased. In September, the total production of air conditioners, refrigerators, and washing machines decreased by 7.2% year - on - year [41]. - In the fourth quarter, the end - user demand for household appliances is expected to continue to decline, with the total production of three major white - goods in October decreasing by 9.9% year - on - year. Factors such as tariffs and the marginal decline of national subsidy policies affect demand. If end - user demand is weak, 3S enterprises may cut production, weakening styrene demand [45]. 3.3. The core issue for styrene in the future is how to solve potential stockpiling problems - If the 1.2 million tons/year capacity of Jilin Petrochemical and Guangxi Petrochemical is put into production in the fourth quarter, styrene stockpiling may exceed 250,000 tons, potentially leading to stockpiling at the East China main port [57]. - To solve this problem, styrene non - integrated profits need to stay below the break - even point for a long time to force more supply cuts. The industry's operating center may drop to around 70%. Next year, with less new capacity and stable 3S demand growth, the industry may return to a balanced state [57]. 4. Investment suggestions - In the fourth quarter, the pure benzene and styrene industry chain may not improve significantly. Pure benzene will face supply pressures, and styrene may have more prominent potential contradictions. The industry needs to maintain low - profit states to reduce supply, and the industry operating center may drop to around 70% [64]. - The strategy is to short the EB - BZ spread on rallies. The price range of pure benzene is expected to be 5,600 - 6,250 yuan/ton, and that of styrene is 6,500 - 7,350 yuan/ton [65].

Report Overview - The report is titled "Supply Abundant, Limited Imagination Space for Peak-season Demand - Outlook for LPG in the Fourth Quarter" and is published by Orient Securities Derivatives Research Institute on September 30, 2025 [1] Report Industry Investment Rating - Not provided in the report Report's Core View - In the fourth quarter, although it is the traditional combustion peak season, the supply and demand of domestic LPG and overseas propane are expected to remain relatively loose. With limited contradictions, there is little chance of a trending market. It is recommended to pay attention to the opportunity of shorting on the domestic market when prices are high and to be bearish on the overseas FEI [86] Q3 Market Review External Market - In Q3, the external market price was weak first and then strong. The change in trade flow and cargo flow bottlenecks pushed the relative valuation of the Far East Inbound Price (FEI) to strengthen significantly in August. The trading opportunities in Q3 were mostly short - term band trading opportunities caused by valuation deviations and short - term contradictions on the spot side [2][8] - In July, the external market was weak due to weak fundamentals and poor spot sentiment. Propane demand was dragged down by the year - on - year weakness in the cracking end, and the international supply surplus continued. In August, the relative valuation of FEI strengthened, mainly supported by the increase in transportation costs due to trade flow changes and cargo flow bottlenecks. In September, the contradiction weakened [8] Domestic Market - In Q3, the domestic market contradictions were stronger than those in the external market. Under the weak spot expectation, the number of warehouse receipts reached a record high. In July, the domestic market fell smoothly under the pressure of weak fundamentals in the off - season. The spot price was mainly lowered, and the number of PG registered warehouse receipts reached a record high, putting obvious pressure on the market [9][15] LPG Fundamental Outlook for the Fourth Quarter Supply Side United States - The net production of C3 in the United States has remained at a stable high level in Q3, and the commissioning of the Frac XVI fractionation unit in Q4 is expected to further increase the regional production. The current C3 inventory is slightly higher than that of the same period last year, at a seasonally neutral to high level [19] - The export volume of the United States has been basically stable at about 5.8 million tons per month this year. Although the export capacity of the docks has increased, the export volume is affected by multiple factors such as the actual change in Northeast Asian demand, the progress of China - US tariff games, and the passage of the Panama Canal [25] - The factors affecting the passage of the Panama Canal include drought, passage rules, and economy. In Q4, the focus is on the potential impact of USTR and possible hurricanes in the US Gulf on capacity allocation and loading [26][38] - The congestion of the Panama Canal in August temporarily pushed up the FEI - MB spread. The impact of USTR on the LPG market is expected to be limited, as the proportion of Chinese - operated ships is relatively low, and the market hype about USTR is gradually subsiding [31][42] Middle East - The CP price was weak in Q3. In Q4, the export increment in the Middle East is expected to be limited. The potential increment comes from OPEC+ production increase, but the export volume usually decreases seasonally in Q4 due to strong local demand in winter and seasonal maintenance of production facilities [50] Demand Side Combustion Demand - India's LPG import volume increased by 7.4% year - on - year to 17 million tons from January to September this year. The strong demand is supported by factors such as the growth of domestic terminal consumption, the commissioning of infrastructure projects, and the commissioning of new PDH devices. The annual import growth rate is expected to be about 6% [51][58] Chemical Demand - The LPG import volume of domestic flexible cracking terminals has decreased significantly this year due to China - US tariffs. In Q3, LPG had certain feedstock economic advantages over naphtha, but the overall LPG consumption in Far East cracking was weaker than last year. In Q4, it is difficult for FEI - MOPJ to provide strong economic incentives for LPG cracking feedstock demand [66] - The PDH demand may have reached a phased peak in Q3. In Q4, the operating rate is expected to be difficult to increase, and the feedstock demand is unlikely to have an optimistic performance, especially considering the expiration of the current China - US tariff plan in November [72] China - The domestic refinery gas commodity volume is abundant. In Q4, the external release volume is expected to further increase. Considering the high inventory in East China, the spot price in East China is expected to continue to be under pressure, and the lowest deliverable product of domestic civil LPG in October is still likely to be anchored in the East China region [85]

1. Report Industry Investment Rating No relevant content provided in the report. 2. Core Views of the Report - The main focus in the fourth quarter remains on the US biofuel policy and China-US/China-Canada relations, with policy impacts far outweighing fundamentals. After policies are gradually implemented, long opportunities mainly in palm oil are favored [5]. - The US is the biggest variable in the international oil market in the fourth quarter. The biofuel policy, especially the blending targets for 2026 - 27, as well as the redistribution plan for small refineries and the RINs coefficient for imported raw materials, will directly affect US soybean oil demand and the international oil price center [101]. - Palm oil will be influenced by US soybean oil in the fourth quarter, and it has its own drivers. The supply side may face early - onset production cuts and potential extreme rainfall due to La Nina, while the demand side focuses on Indonesia's B40 plan and potential B50 policies [102]. 3. Summary According to the Table of Contents 3.1 Third - Quarter Market Review - Internationally, Malaysian palm oil (MPO) outperformed US soybean oil in the third quarter. US soybean oil prices fluctuated around policy expectations and market rumors, and dropped below 50 cents/pound at the end of September. MPO remained at a high level supported by supply - demand patterns and US soybean oil prices [11]. - Domestically, the three major oils showed an upward trend with significant differences in strength. Palm oil followed the international market, while soybean and rapeseed oils were more affected by policies. Palm oil had a supply - demand weak situation, soybean oil had a strong de - stocking expectation but was still accumulating inventory, and rapeseed oil had a slow de - stocking speed due to high inventory and weak consumption [14]. 3.2 International Market Outlook 3.2.1 North and South America - **US**: - The planting and harvested areas of US soybeans in the 2025/26 season decreased significantly. Although the current yield per acre is ideal, there is still a possibility of a decline due to insufficient rainfall [19]. - The biofuel policy is beneficial to US soybean crushing demand, but the room for further significant increases in crushing is limited. The proportion of soybean oil in biofuel raw materials has rebounded, and the 45Z subsidy and increased RVO obligations from 2026 will further boost soybean oil demand [22][25]. - There is a large divergence in the market regarding the re - allocation of small refinery exemptions. EPA's proposed re - allocation has caused dissatisfaction among refineries [38]. - After the signing of the Big and Beautiful Act, the 45Z clean fuel tax credit has become law, which will lead to a substitution of a large part of UCO and tallow demand by North - American sourced soybean oil, rapeseed oil, and corn oil [42]. - If the EPA's proposed blending targets are met, there will be a supply gap in US soybean oil in 2026, which can only be filled by increasing imports. However, due to policy uncertainties, significant growth in soybean oil consumption in the fourth quarter is unlikely [44]. - **Canada**: - The final production forecast of Canadian rapeseed in the 2025/26 season is 20.1 million tons. China's anti - dumping tax on Canadian rapeseed is negative for its price, but the impact will be mitigated by expanded domestic crushing capacity and alternative export markets. Domestic crushing is expected to increase slightly, while exports will decline to 7 million tons [47]. - The price difference between European and Canadian rapeseed makes the EU have an incentive to import Canadian rapeseed. The improvement in domestic rapeseed crushing margins and the support for biofuel development offset the impact of reduced Chinese purchases [51]. 3.2.2 Asia - **Malaysian Palm Oil (MPO)**: - As of the third quarter, MPO had sufficient inventory, but production cuts may start earlier in September due to weather conditions. In the fourth quarter, the probability of La Nina increases, and there is a risk of floods and over - expected production cuts [53][70]. - MPO's domestic demand is expected to remain high in the fourth quarter, mainly due to potential CPO exports as POME to the EU and the support of biodiesel consumption [59]. - In terms of demand, MPO exports may recover slightly in the fourth quarter, with a peak in October. If US soybean oil can support the global soybean oil price center, palm oil may still be the preferred choice for countries like India [73]. - The pressure on MPO to accumulate inventory has passed, and it is expected to start de - stocking in September - October and accelerate the process in the fourth quarter [76]. - **Indonesian Palm Oil (IPO)**: - IPO production has recovered well this year, but the potential impact of the government's crackdown on illegal plantations remains. The transfer of plantation management may lead to supply uncertainties [79]. - It is difficult to achieve both high exports and high inventory in Indonesia. Domestic demand is more rigid, and the B40 plan needs to catch up in the fourth quarter. The inventory is expected to remain at around 2 million tons [83]. - The biodiesel industry in Indonesia is suffering serious losses, but it has little impact on actual blending. As of July 16, 2025, the B40 plan completion rate was about 47.51%. To complete the plan, there is still a large amount of remaining allocation and palm oil consumption required [90][91]. - **India**: - Before the Diwali festival, India's vegetable oil inventory is still low. In August, palm oil imports increased significantly, while soybean oil imports decreased. The total edible oil imports reached a 13 - month high [94]. - After replenishing inventory from June - August, India still has a need to continue purchasing and accumulating inventory. In the fourth quarter, India is expected to mainly purchase palm oil and South American soybean oil, with palm oil imports showing a trend of high in the early part and low in the late part [97][100]. 3.3 Domestic Market Outlook - **Palm Oil**: - In the fourth quarter, domestic palm oil is expected to maintain a supply - demand weak situation, following the international market. The narrowing import profit margin has led to an increase in purchases, and the inventory has reached a relatively high level, which is expected to continue to accumulate slowly [104][106]. - **Soybean Oil**: - In the third quarter, domestic soybean oil inventory accumulated rapidly due to a large amount of soybean arrivals and weak consumption. In the fourth quarter, it is expected to gradually de - stock, but inventory may still accumulate until the middle and late fourth quarter and then turn to de - stocking. Although exports have increased significantly, the possibility of large - scale exports continuing is low after India's备货 ends [111][134]. - If there is no reconciliation between China and the US and no purchase of US soybeans, there may be a shortage of soybean oil in the first quarter of next year [117]. - **Rapeseed Oil**: - Currently, domestic rapeseed oil inventory is extremely high, especially after the anti - dumping preliminary ruling on Canadian rapeseed. The import of rapeseed has decreased significantly, and the oil mill's rapeseed intake has shrunk year - on - year. The开机 rate is expected to continue to decline in the fourth quarter [120][125]. - The high price of rapeseed oil has led to low consumption, and it has been mostly replaced by soybean oil. Near the Double Festival, demand is expected to improve slightly [128]. - Russia has become the main source of China's rapeseed oil imports. Although imports can supplement the short - term supply, they cannot fully make up for the long - term gap caused by the lack of Canadian rapeseed [131]. 3.4 Strategies and Summary - The core is the US biofuel policy, which affects the global oil price center. Before the policy is determined, the market is expected to fluctuate within the range of 50 - 60 cents/pound [137]. - **Palm Oil**: - In the fourth quarter, palm oil is driven by supply and biodiesel. It is expected that Indonesia's B40 plan can be successfully completed, and domestic demand will increase. After the US biofuel policy is settled, palm oil prices are expected to rise. The recommended strategies are to go long on the palm oil 01 contract, conduct 1 - 5 positive spreads, and shrink the soybean - palm oil 01 contract price difference [137]. - **Soybean Oil**: - The current situation of the soybean oil market is weak, and it is difficult to see de - stocking in the short term. The inventory pressure may ease in the second half of the fourth quarter, but supply shortages are unlikely to occur. The recommended strategy is to shrink the soybean - palm oil 01 contract price difference [137]. - **Rapeseed Oil**: - The spot supply of rapeseed oil is relatively sufficient, but the supply gap of Canadian rapeseed in the fourth quarter is highly certain, and the market sentiment for going long is better than that of soybean oil. The recommended strategies are to go long on the rapeseed oil 01 contract and conduct 1 - 5 positive spreads [137].

1. Report Industry Investment Rating - Manganese silicon/silicon iron: Volatile [1] 2. Core Viewpoints of the Report - In the fourth quarter, the ferroalloy market will face a game between fundamentals and macro - factors. The cost center will move up due to the rebound of coking coal prices, while the supply pressure remains with the continuous release of new manganese silicon production capacity and high - level silicon iron supply. With lackluster demand, the prices of ferrous commodities may be more affected by the macro - environment and policy expectations, deviating from fundamentals. It is expected that ferroalloy prices will seek a balance between weak fundamentals and macro - sentiment, showing a range - bound trend with limited upside and downside space [4] 3. Summary by Relevant Catalogs 3.1 Third - Quarter Review of the Manganese Silicon and Silicon Iron Markets - In the first quarter, manganese ore prices rose steadily due to factors such as decreasing port inventories and reduced Gabonese shipments, driving up manganese silicon prices. Then, as the cost - driving force weakened, manganese silicon prices declined until a rebound in the third quarter. Silicon iron prices were under pressure in the first half of the year due to weak demand. Although it followed the upward trend of manganese silicon passively, it continued to decline. In the third quarter, both manganese silicon and silicon iron prices rebounded with the recovery of coking coal prices [11] 3.2 Manganese Silicon: Rising Costs and High - Level Supply 3.2.1 Cost Increase - Manganese ore prices reached a high in the first quarter, driven by factors like slow overseas shipments, low port inventories, and concentrated ownership of oxidized ore. After that, prices declined as supply increased. In the third quarter, the price increase was limited. In the fourth quarter, port inventories are expected to be replenished, but the decline in prices may be limited. Chemical coke prices fell in the first half of the year and rebounded in the third quarter. In the fourth quarter, they are expected to fluctuate within a range, providing some support to alloy prices [22][40] 3.2.2 High - Level Supply - Manganese silicon manufacturers' operating rates declined this year due to shrinking profits, but increased slightly in the second quarter as costs eased. In the third quarter, the operating rate remained high. In the fourth quarter, new production capacity is expected to be put into operation, maintaining high - level supply [42] 3.3 Silicon Iron: Rising Operating Rates and Increasing Inventories 3.3.1 Supply Release Driven by Rising Futures Profits - Silicon iron production was high from January to April. In the second quarter, production decreased due to losses. In the third quarter, with the recovery of prices and profits, supply increased. In different regions, Inner Mongolia had a high and rising operating rate, Ningxia was stable, and Shaanxi had a relatively low operating rate. In the fourth quarter, the over - capacity situation remains, and the operating rate will be profit - driven, with high supply elasticity [50][51] 3.3.2 Pressured Steel Demand at Home and Abroad - In the fourth quarter, steel demand is expected to weaken due to seasonal factors and weak real - estate investment. Silicon iron exports have been under pressure this year and are expected to remain weak in the fourth quarter. The demand from the magnesium market has limited impact on silicon iron. The balance of the silicon iron market in the fourth quarter will depend on supply - side adjustments [68] 3.4 Summary of Manganese Silicon and Silicon Iron in the Second Half of the Year - In the fourth quarter, the ferroalloy market will face a game between fundamentals and macro - factors. Cost centers will move up, while supply pressure remains. With lackluster demand, prices are expected to be range - bound, and the market's volatility will depend on the game between cost support, supply pressure, and macro - factors [70][71]

Group 1: Macro Strategy (Gold) - The amount of gold held in ETFs has increased by 0.60%, or 6.01 tons, reaching a total of 1011.73 tons as of September 29 [11] - Gold prices continue to rise, driven by market risk aversion due to the potential government shutdown in the U.S. and ongoing political disagreements [12][14] - The fundamental reason for long-term bullish sentiment on gold is the deteriorating fiscal situation and high government debt burden [12][14] Group 2: Macro Strategy (Government Bonds) - The National Development and Reform Commission announced a new policy financial tool with a total scale of 500 billion yuan aimed at stabilizing economic growth and promoting effective investment [15] - The bond market is expected to experience short-term fluctuations, but the probability of sustained adjustments is low, with recommendations to build long positions on dips [15] Group 3: Agricultural Products (Soybean Meal) - Brazil's new crop planting rate has reached 3.2%, higher than the same period last year [20] - The U.S. soybean harvest rate is at 19%, in line with market expectations, with a good quality rating of 62% [21] - Domestic demand for soybean meal remains strong, with a decrease in inventory at oil mills [22] Group 4: Black Metals (Rebar/Hot Rolled Coil) - The Ministry of Water Resources expects investment in water conservancy construction during the 14th Five-Year Plan to exceed 5.4 trillion yuan, which is 1.6 times that of the previous plan [25] - Steel prices are expected to remain under pressure due to high iron water production and inventory accumulation, with recommendations for light positions ahead of the holiday [26][27] Group 5: Nonferrous Metals (Zinc) - The nonferrous metals industry has released a stable growth work plan, emphasizing orderly project construction and resource development [40][44] - Domestic zinc ingot inventory has decreased to 141,400 tons, indicating a tightening supply situation [45] - The market sentiment for zinc is cautiously optimistic, with potential for short-term price stabilization [46] Group 6: Energy Chemicals (Soda Ash) - The liquid alkali market in Shandong has seen a slight decline, with general market demand being weak ahead of the holiday [47] - The price of liquid alkali has decreased due to insufficient downstream purchasing activity [48] Group 7: Energy Chemicals (PVC) - The domestic PVC powder market has shown a slight decline, with prices fluctuating between 0-10 yuan/ton [51] - The overall market remains weak, but low valuations may limit further price declines [52] Group 8: Energy Chemicals (Urea) - The utilization rate of compound fertilizer production capacity has decreased to 35.27%, indicating a reduction in production activity [53] - Urea prices are expected to remain under pressure due to high inventory levels and weak demand [54]

1. Report Industry Investment Rating - Not provided in the given content 2. Core Viewpoints of the Report - By 2035, new energy vehicles will become the mainstream of newly sold vehicles in China, with the net greenhouse gas emissions in the entire economic scope decreasing by 7%-10% from the peak, non-fossil energy consumption accounting for over 30% of the total energy consumption, and other goals to be achieved [1][109][118]. - The penetration rate of the Chinese new energy vehicle market exceeded 30% in 2023 and 50% in 2024. In 2025, high - competitiveness new car products are continuously launched, and price wars are gradually stopped. Overseas markets face trade protectionism in Europe and the United States, so attention should be paid to new growth points such as countries along the Belt and Road and the Middle East. The market share of independent brands continues to expand [3][120]. 3. Summary According to Relevant Catalogs 3.1 Financial Market Tracking - The one - week price changes of related sectors and listed companies are presented in charts. For example, BYD's one - week price decline was 1.65%, while Seres' was 9.48% [12][15]. 3.2产业链数据跟踪 3.2.1 China New Energy Vehicle Market Tracking - **Sales and Exports**: Data on China's new energy vehicle sales, penetration rate, domestic sales, exports, and sales of EV and PHV are presented in charts [16][21][23]. - **Inventory Changes**: Charts show the monthly new additions to new energy passenger vehicle channel inventory and manufacturer inventory [24][25]. - **Delivery Volumes of Chinese New Energy Vehicle Enterprises**: Monthly delivery volumes of enterprises such as Leapmotor, Li Auto, XPeng, NIO, etc., are presented in charts [27][28][32]. 3.2.2 Global and Overseas New Energy Vehicle Market Tracking - **Global Market**: From January to July, global new energy vehicle sales reached 9.233 million, a year - on - year increase of 25.9%. Except for China, Europe and other regions also had significant growth, with year - on - year increases of 29.5% and 53.4% respectively [2]. - **European Market**: Data on European new energy vehicle sales, penetration rate, and sales of EV and PHV in countries like the UK, Germany, and France are presented in charts [44][50][55]. - **North American Market**: In August, US new energy vehicle sales and penetration rate reached record highs. Due to the expiration of the federal electric vehicle tax credit on September 30, high market enthusiasm is expected to continue in September, followed by a sharp decline. Data on North American new energy vehicle sales, penetration rate, and sales of EV and PHV are presented in charts [2][119]. - **Other Regions**: Data on new energy vehicle sales, penetration rate, and sales of EV and PHV in regions such as Japan, South Korea, and Thailand are presented in charts [62][70][72]. 3.2.3 Power Battery Industry Chain - Data on power battery installation volume, export volume, weekly average price of battery cells, material costs, and the operating rates and prices of various battery materials are presented in charts [79][81][85]. 3.2.4 Other Upstream Raw Materials - Data on the daily prices of rubber, glass, steel, and aluminum are presented in charts [102][103][104]. 3.3 Hot News Summaries 3.3.1 China: Policy Dynamics - By 2035, new energy vehicles will become the mainstream of newly sold vehicles in China. From 2026, export license management will be implemented for pure - electric passenger vehicles [109]. 3.3.2 China: Industry Dynamics - From September 1 - 21, new energy vehicle retail sales increased by 10% year - on - year, and cumulative retail sales since the beginning of the year increased by 24%. In the 38th week (September 15 - 21), new energy passenger vehicle retail sales were 299,000, a year - on - year increase of 5.9%, and cumulative retail sales since the beginning of the year were 8.214 million, a year - on - year increase of 23.0% [111][112][113]. 3.3.3 China: Enterprise Dynamics - Chery Automobile was listed on the Hong Kong Stock Exchange, raising HK$9.14 billion. Li Auto and Sunwoda Power jointly established a battery company [114]. 3.3.4 Overseas: Policy Dynamics - Australia announced a 2035 emission reduction target, aiming to reduce emissions by 62 - 70% compared to 2005. The US lowered the import tariff on EU cars to 15%, and Turkey imposed new tariffs on imported passenger cars [114][116][119]. 3.3.5 Overseas: Enterprise Dynamics - BYD's Brazilian factory obtained an international green certificate. Porsche adjusted its product strategy, slowing down electrification and lowering its 2025 performance expectations [117][118]. 3.4 Investment Advice - Pay attention to new growth points such as countries along the Belt and Road and the Middle East. Focus on enterprises with strong product capabilities, smooth overseas expansion, and stable supply [3][120].

1. Report Industry Investment Rating - The investment rating for cotton is "Bearish" [2] 2. Core Viewpoints of the Report - The industry has a strong consensus on a bearish outlook for the future. In the fourth quarter, with the large - scale listing of new cotton, supply pressure and market sentiment will be concentratedly released. The futures price may fall below 13,000 yuan/ton, with the low point possibly occurring in November. After the release of negative factors, downstream restocking will help stabilize the market. In the long - term, the fourth quarter may be the period with the greatest domestic pressure, and the market in the next year is generally cautiously optimistic [5][30][36] 3. Summary According to the Directory 3.1 Research Purpose - To understand the production, cost, acquisition, consumption, inventory, and industry sentiment of cotton in Xinjiang, the researcher participated in the "2025 Autumn Xinjiang Cotton 'Full - industry Chain + Full - domain' In - depth Research" from September 7th to 19th. The research objects included cotton farmers, ginning factories, textile enterprises, and warehousing and logistics enterprises, mainly through enterprise discussions and on - site field inspections [14] 3.2 Research Summary - **New cotton production increase**: The expectation of new cotton production increase is strong, and the production forecast has been raised. The estimated production of Xinjiang cotton this year is between 730 - 780 tons, with a high probability of reaching 750 tons. The planting area has increased by 300 - 400 million mu (7% - 10%), and the average yield per mu has increased by 30 - 50 kg (5% - 10%) [17][18] - **New cotton quality**: The new cotton quality is expected to improve year - on - year. Although the lint percentage in some southern Xinjiang areas may decline, the overall quality of cotton in both southern and northern Xinjiang is better than last year [19] - **Opening time**: The opening time of cotton acquisition in southern and northern Xinjiang is close, expected to be concentrated around September 25th to the end of September, later than the previous market expectation but earlier than last year [20] - **Planting cost and income**: The planting cost has increased slightly year - on - year. The cost of leased land is about 3,000 yuan/mu, and the cost of self - owned land is about 1,500 - 1,700 yuan/ton. The break - even yield per mu for leased land is 400 - 410 kg [21] - **Cottonseed price**: The cottonseed price has increased year - on - year. The pre - sale price in southern Xinjiang is 2.3 - 2.35 yuan/kg, and in northern Xinjiang is about 2.2 yuan/kg. During the peak acquisition period, the price may drop to 2.1 - 2.2 yuan/kg, still higher than last year [22] - **Ginning factory**: Ginning factories are cautious in acquisition. In northern Xinjiang, due to years of losses, they have lost the ability and impulse to rush for cotton, and the over - capacity situation has been reversed [23][24] - **Cotton farmers**: Cotton farmers have low expectations for the cotton price, with a psychological expectation of 6.3 - 6.5 yuan/kg, and their reluctance to sell has weakened [25] - **Warehousing inventory**: The inventory of old cotton in Xinjiang's warehousing enterprises is extremely low, while the industrial inventory of cotton spinning enterprises is relatively high, which can be connected to the large - scale listing of new cotton. However, some inland textile enterprises have tight inventories, and the shortage of high - quality cotton is prominent [26] - **New cotton pre - sale**: The pre - sale volume of Xinjiang cotton is large, about 150 tons. The pre - sale basis is high, but the actual execution rate is uncertain [27] - **Cotton spinning enterprises**: Xinjiang's cotton spinning enterprises have sufficient orders but shrinking profit margins. The growth of cotton spinning capacity in Xinjiang will enter a bottleneck period [28] 3.3 Market Outlook and Investment Strategy - **Short - term**: In the fourth quarter, due to the large - scale listing of new cotton, the supply pressure and market sentiment will be concentratedly released. The futures price may fall below 13,000 yuan/ton, with the low point possibly in November. It is not recommended to short after the price falls below 13,000 yuan/ton due to the poor risk - return ratio [5][35][36] - **Long - term**: After the release of negative factors, downstream restocking will help stabilize the market. The overall market in the next year is cautiously optimistic [5][36] 3.4 Research Content 3.4.1 September 8th - Kashgar Region, Shache County - **Kashgar Youmian Experimental Base**: It promotes the modernization of the cotton industry. The expected yield per mu of the "Kashgar Youmian" demonstration field in 2025 is 630 kg, a year - on - year increase of more than 50% [41] - **Color Cotton Planting and Research Base**: It uses intelligent agriculture to increase yield. The current yield per mu is about 480 kg, and the lint percentage is 35% - 36% [41] - **Shache County Cotton Industry Company**: The planting area has increased from 800,000 mu last year to 1.1 million mu this year, and the yield per mu is expected to be higher than last year. The pre - sale price of cottonseed is 2.3 yuan/kg, and the expected acquisition price of hand - picked cotton for spinning is below 7 yuan/kg [40][43] - **DW Group Xinjiang Shache Industrial Park Enterprise**: It has a total planned capacity of 4 - 5 million spindles. It only produces one variety, 32s, with high production efficiency. It uses cotton with double 29 indicators, mainly from southern Xinjiang, and has a good profit [45][46][48] 3.4.2 September 9th - Bachu → Tumushuke - **Bachu County Industrial Park Cotton - related Enterprise Symposium**: Bachu's cotton - spinning industry has developed rapidly. The planting area in 2025 is 1.66 million mu, and the yield per mu is expected to increase to 410 - 420 kg. The total inventory of three warehouses is only 160,000 tons. The current cottonseed price is about 2.4 yuan/kg, and the expected acquisition price is 6.1 - 6.3 yuan/kg [52][61] - **Bachu County Delivery Warehouse**: Some factories in Kashgar are purchasing hand - picked cotton for wadding. The expected production in Kashgar this year is 200,000 tons more than last year, but the lint percentage may be one point lower. The current inventory is 38,000 tons, much lower than last year [62][63] - **A Division's Enterprise Group Symposium**: The cotton planting area this year is 1.08 million mu, slightly increasing. The expected yield per mu has a small increase. The lint percentage may be 1 - 2 points lower, but the quality indicators are better than last year. The expected acquisition price of hand - picked cotton for wadding is 16,200 - 16,500 yuan/ton [67][68] 3.4.3 September 10th - Tumushuke → Alar - **A State - owned Textile Enterprise under a Division**: It has a current spinning capacity of 400,000 spindles, producing 24S and high - end yarns. The inventory of cotton yarn is about 1,000 tons, mainly sold in Xinjiang. The processing cost of 60s yarn is about 7,200 yuan, and the production profit is negative after including depreciation and financial costs [72][74][76] - **A Division's Enterprise Group**: The cotton planting area in the division is stable at 2 million mu, and the expected yield per mu is 460 - 470 kg. The expected acquisition price of seed cotton is about 6 yuan/kg. The enterprise is conservative in acquisition and uses hedging strategies. It is optimistic about the market next year [78][82][85] 3.4.4 September 11th - Alar → Shaya → Xinhe - **Alar Economic Development Zone Symposium**: The surrounding textile mills in Alar are operating well, but the "Golden September and Silver October" peak season is not obvious. The current textile capacity in Xinjiang is about 34 million spindles. The "Bing 9 Articles" policy provides subsidies for building factories and equipment in southern Xinjiang's four divisions [86][89] - **Shaya Cotton Industry Company**: The planting area in Shaya is 1.85 million mu, and the yield per mu is expected to be over 500 kg. The current price of cottonseed is 2.4 yuan/kg, and the pre - sale price is 2.3 yuan/kg. The enterprise is cautious in acquisition and follows large factories [95][96][98] - **Xinhe Cotton Industry Group Symposium**: The enterprise is a leading enterprise in Aksu. It believes that the acquisition price of seed cotton above 6.5 yuan/kg is risky, and it may fall below 6 yuan/kg in November [100][103] 3.4.5 September 12th - Tiemenguan → Korla - **Tiemenguan Textile Enterprise**: It will form a complete industrial chain from cotton to clothing. The current order volume is about 2,100 tons, and the inventory is about 560 tons. The enterprise uses more southern Xinjiang cotton, and the acquisition price may be slightly higher this year. The yarn market has limited downward space but lacks upward momentum [112][114][122]

Report Industry Investment Rating - The short - fiber industry is rated as "oscillating" [6] Core Viewpoints - The terminal textile and clothing market lacks highlights, but the downstream polyester yarn segment has increased its overall inventory level due to peak - season expectations. The high growth rate of exports has compensated for the lack of domestic demand. On the supply side, with the industry operating at a high capacity, there is limited room for further supply growth. Overall, the supply - demand contradiction of short - fiber is limited. The absolute price is expected to mainly follow the fluctuations of polyester raw materials, and the processing fee may continue to fluctuate within a range. When the short - fiber inventory is at a low level and the spot circulation is temporarily tight, opportunities to expand short - fiber processing fees on dips or engage in positive spreads between contract months can be considered [4][65][66] Summary by Directory 1. Third - quarter Short - fiber Market Review - Short - fiber prices continued to be cost - driven, following polyester raw materials to rise and fall twice. The futures price of the main contract closed slightly lower than at the end of the second quarter. The spot processing margin briefly increased after operations such as joint production cuts and contract reductions by factories, then quickly gave back the gains, and later rebounded slightly with limited overall fluctuations [12] 2. Supply: The Industry Maintains High - level Operation but Lacks Elasticity for Further Growth - In the third quarter, the short - fiber operating rate first decreased and then steadily increased. From July to August 2025, the total short - fiber output was 1.442 million tons, with the average monthly output increasing by 3.5% compared to the second quarter. In mid - June, facing uncertainties such as geopolitical risks and the dilemma of high costs and low processing margins, short - fiber factories reached a resolution to jointly cut production by 15% in July and reduce contract volumes by 20%. In July, the short - fiber operating rate dropped from around 95% to below 90%, but since August, with the improvement of demand and inventory reduction, the operating rate gradually increased. By mid - September, it returned to around 95% [14] - Looking forward to the fourth quarter, short - fiber supply is expected to remain at a high level but lack incremental elasticity. New production capacity in the fourth quarter is unlikely to achieve effective output within the year. As of now, there is only an annual capacity increase of 340,000 tons in 2025, a 3.6% increase from last year. Although there is a probability of a 300,000 - ton/year device of Suqian Yida being put into operation, it is difficult to release significant incremental output within the year. The operating rate of existing production capacity has limited room for further increase. In 2025, the short - fiber industry's operating rate has been maintained at a relatively high level of 85% - 95%, about 5 - 10 percentage points higher than the same period in 2024. Currently, the industry's operating rate is around 95%, and the operating rate of cotton - type short - fiber has soared to around 98%, leaving little room for further improvement [17][20] 3. Domestic Demand: The Peak Season Starts Slowly and Shows a Disappointing Outlook 3.1 Terminal Textile and Clothing Domestic Demand Remains Stable, and Export Growth Turns Negative - From January to August, the cumulative retail sales of domestic clothing, footwear, and textile products were 940 billion yuan, with a cumulative year - on - year increase of 2.9%. The consumer's consumption willingness continued to recover slowly, and the terminal consumer market maintained stable growth, but the overall growth rate was moderate, and the demand potential still needed to be further released. In terms of exports, from January to August 2025, the cumulative textile and clothing exports were 197.27 billion US dollars, a year - on - year decrease of 0.3%. Among them, textile exports were 94.51 billion US dollars, a year - on - year increase of 1.6%, and clothing exports were 102.76 billion US dollars, a year - on - year decrease of 1.7%. Affected by factors such as the increase in US tariffs, the growth rate of textile and clothing exports to the US turned negative, and the cumulative year - on - year decline showed an expanding trend. In addition, the export growth rate to some countries such as Europe and ASEAN also slowed down in the third quarter [28][34][36] 3.2 The Peak Season in the Weaving Segment Starts Slowly - This year, textile enterprises' orders have been weak, inventory has accumulated, competition has intensified, profit margins have declined significantly, and production enthusiasm has been suppressed. Although the "Golden September" has arrived, the improvement in the operating rate of the weaving segment is far less than that in the same period of 2023 and 2024, and it is also in the low - level range of the same period in the past five years. The transition from the off - season to the peak season in the terminal market has been significantly delayed, and the lackluster peak - season performance is emerging [44][45] 3.3 Downstream Yarn Mills Still Face Finished - Product Inventory Pressure, but Raw - Material Inventory Has Increased Quarter - on - Quarter - Terminal demand has not fully started, and yarn mills have faced slow inventory reduction due to weak downstream procurement. The low processing fee of pure polyester yarn has also restricted the operating enthusiasm of yarn mills. However, since the third quarter, the profit and inventory pressure in the downstream yarn segment have improved quarter - on - quarter. With peak - season expectations, the overall inventory level has increased, and short - fiber inventory has been smoothly reduced [50][52] 4. Exports: The Upward Shift of the Industrial Chain's Exports and the Continued Strong Growth of Short - fiber Exports - From January to August 2025, the cumulative export volume of uncombed polyester short - fiber (HS code 55032000) was 1.0965 million tons, a year - on - year increase of 29.5%. The reasons for the high - growth rate of exports are the obvious cost advantage of raw materials and the upward shift of the industrial chain's exports. It is estimated that the export increment in the first eight months has digested about 63.6% of the new short - fiber production. The export market has shared a significant sales pressure in the context of lackluster domestic demand [58] 5. Investment Suggestions - Given the fundamentals, as the terminal textile and clothing market lacks highlights, the downstream polyester yarn segment still faces finished - product inventory pressure, but the overall inventory level has increased due to peak - season expectations. The high growth rate of exports has compensated for the lack of domestic demand. On the supply side, with the industry operating at a high capacity, there is limited room for further supply growth. Overall, the supply - demand contradiction of short - fiber is limited. The absolute price is expected to mainly follow the fluctuations of polyester raw materials, and the processing fee may continue to fluctuate within a range. When the short - fiber inventory is at a low level and the spot circulation is temporarily tight, opportunities to expand short - fiber processing fees on dips or engage in positive spreads between contract months can be considered [4][65][66]

Report Industry Investment Rating - The rating for Shanghai Lead is "Volatility", with a price range of [16,500, 17,800], featuring narrow - range fluctuations and occasional small - to medium - scale market movements [3]. Core Viewpoints of the Report - In Q4 2025, the shortage of lead concentrates and waste batteries will intensify. Domestic demand is expected to improve periodically under the background of policy - boosted consumption, while export demand may continue to be under pressure. The oscillation center of Shanghai Lead may move up, and there may be small - to medium - scale upward trends as consumption improves. The volatility may increase compared to Q3, and it is safer to take long positions at low prices. Attention should be paid to the production strategies of large enterprises [3]. Summary by Relevant Catalogs 1. Q3 2025 Lead Price Review - In July, lead prices rose first and then fell. Shanghai Lead increased significantly due to anti - cut - throat competition sentiment and pre - trading of improved demand, but domestic demand was later disproven, and anti - cut - throat competition had limited impact on basic non - ferrous commodities. LME Lead was pressured by a stronger US dollar, and both domestic and overseas lead prices dropped back to pre - increase levels [6]. - In August, the 0 - 3 cash of the outer market remained deeply in contango. The domestic lead market had weak supply and demand. Falling lead prices and tight raw materials intensified the pressure on the operating rate of secondary smelters, and demand was even weaker. With low capital attention, both domestic and overseas lead prices fluctuated at low levels [6]. - In September, the bottom - building of lead prices ended. As the traditional peak season approached, the raw material and finished - product inventories of downstream battery factories continued to decline, and lead prices rose slightly in advance. With the approaching of the double - festival holiday, downstream enterprises stocked up in advance, and market transactions improved as lead prices rose. The fundamental support pushed the operating center of lead prices up from 16,800 yuan/ton to 17,000 yuan/ton [6]. 2. Lead Concentrate Supply Overseas - In Q3 2025, overseas lead concentrate production was lower than expected. Although project profits were sufficient, factors such as lower - than - expected output from sample mining enterprises, irreversible decline in mine grades, long - term impact of geological factors, time required for equipment renewal, and increased probability of La Nina led to the annual overseas lead concentrate increment dropping from 700,000 to 0 tons. There is no obvious expectation of improvement in Q4 [7][11]. Domestic - From January to August, the cumulative domestic lead concentrate output was 1.098 million tons, a year - on - year increase of 11.7%, mainly due to the output release of new projects such as Yinzhushan and Kangjiawan. The main reasons for the decline in TC were the high operating rate of primary smelters, the reflection of the supply - demand relationship of high - grade concentrates in TC, and the weak bargaining power in spot transactions due to fewer long - term contracts signed by smelters. In Q4, Huoshaoyun may release marginal increments, and the domestic mine increment in 2025 is expected to reach +1.2 million tons. The import of Red Dog lead concentrate will share tariff costs equally between domestic and foreign parties, and the import of lead concentrates may decline seasonally in Q4. With primary smelters maintaining a relatively high operating rate, TC may continue to be under pressure [20]. 3. Primary Lead Production Overseas - From January to August, the cumulative overseas primary lead output was 864,000 tons (YoY - 1.4%). Due to tight raw materials, the reduction in overseas primary lead production increased. There was a significant reduction in Kazzinc 3rd Party under Glencore, and the incremental production from restarted and ramping - up projects was not obvious [24]. Domestic - From January to August, the cumulative domestic primary lead output was 2.542 million tons (YoY + 8.2%), mainly due to the restoration of raw material supply, the widening of the price difference between refined and secondary lead, and the increase in production profits (including by - products such as small metals). The operating rate of primary lead in Q3 was generally at a high level. Overall, the domestic surplus (+193,000 tons) can still cover the overseas reduction (-13,000 tons). However, smelting profits are approaching the break - even point and declining, and with the downward pressure on TC in the future, smelting profits may be under pressure. The production of primary lead in Q4 may decline quarter - on - quarter [24]. 4. Secondary Lead Production - From January to August, the cumulative secondary refined lead output was 2.08 million tons (YoY - 3%), and the operating rate of secondary lead remained at a low level of 30%, which may drop below 25% in September. The production cuts of secondary lead smelters mostly follow the raw material consumption rhythm rather than profit changes. The scrap battery scrap volume in Q3 did not improve significantly. Although recyclers sold off stocks multiple times during the lead price decline, it had limited effect on replenishing smelters' raw material inventories. As lead prices rebounded, the profits of secondary lead smelters in October were restored, and the operating rate may increase [44]. - The operating rate of secondary lead smelters in Q4 may increase quarter - on - quarter but will still be highly volatile. The replacement demand may be stimulated by trade - in subsidies, new national standards, and consumer festivals after October, but the annual output is expected to be lower than expected, and the year - on - year growth rate is revised down to - 2%. After years of continuous losses, the cash flow of many secondary lead plants has been under pressure for two and a half years, and attention should be paid to the possible exit of secondary lead production capacity [44]. 5. Initial Demand - In Q3, lead demand was generally weak. In the battery field, the demand for new automotive batteries was neutral to weak, and the replacement demand was significantly lower than expected. The traditional peak seasons for electric two - wheelers and tricycles did not materialize. The export demand for batteries was also weakened by tariffs and anti - dumping measures, while the demand in the energy storage field continued to perform well [46]. - The participation of large enterprises in the futures market has decreased, and there is a phenomenon of buying on rising prices. The finished - product inventory of large enterprises has been transferred to dealers, and the finished - product inventory has undergone a round of destocking. The production orders of lead - carbon battery manufacturers in the energy storage field are abundant [48]. 6. Terminal Demand Electric Two - Wheelers - From January to August, the cumulative production of electric bicycles in Jiangsu and Tianjin increased by 101.5% and 14.7% year - on - year respectively, and the growth rate expanded compared to the first half of the year. The cumulative production of two - wheeled and three - wheeled motorcycles increased by 10.6% and 4.4% year - on - year respectively, and the growth rate narrowed compared to the first half of the year. The replacement demand in Q3 was weak. In Q4, the replacement demand is expected to strengthen periodically due to factors such as trade - in policies, upcoming Double Eleven promotions, and the implementation of new national standards [54]. Automobiles - From January to August, the domestic automobile production was 21.027 million vehicles (YoY + 12.6%), with new energy vehicles increasing by 37.1% and fuel vehicles decreasing by 2%. The export increased by 13.8% year - on - year, but the export growth rate may slow down in Q4. Considering the impact of lithium substitution for lead, the annual lead consumption growth rate in the automotive field is revised down to - 1.8% [59]. Energy Storage - Lead - carbon batteries are still irreplaceable in the data center energy storage field. As of the end of September, the production schedules of some energy storage manufacturers have reached March next year, and the demand for lead - carbon batteries continues to grow strongly. The lead consumption growth rate in this sector is revised up from 8% to 10% [59]. 7. Export Demand - From 2020 - 2023, the average annual compound growth rate of lead battery exports was 10%. From January to August, the export of starting - type batteries increased by 0.2% year - on - year, while the export of other types decreased by 11.5% year - on - year, and the decline further expanded. The main reasons are price ratio suppression, anti - dumping measures, and weak non - automotive demand (destocking) [64]. - There is no obvious driver for the recovery of overseas lead consumption, and the domestic secondary production cost support is still strong. The internal - external price ratio is difficult to repair significantly. With the influence of trade protectionism and battery manufacturers going global, exports may still be under pressure, and the annual export demand growth rate is revised down from flat to - 1% [64]. 8. Inventory - The LME lead inventory is still at a seasonal high even after destocking, and the 0 - 3 spot has been in deep contango for a long time [69]. - In Q3, the lead elements concentrated in the initial downstream and terminal consumption fields were slowly consumed, and the lead elements in the intermediate links of the industrial chain have decreased. However, the medium - to - long - term trend still depends on future demand. Before the double - festivals, downstream enterprises stocked up normally, and potential delivery risks should be警惕 under low inventory levels [69]. - The import window for lead ingots may open intermittently in Q4. Based on this expectation, it is recommended to pay attention to the range - trading opportunities of the internal - external price ratio [69]. 9. Supply - Demand Balance - The revised balance sheet shows that the annual shortage level has decreased. The supply of primary lead may face a marginal tightening of imported ores in Q4, and TC has downward pressure, with a possibility of limited production cuts by smelters. The replacement demand in the secondary lead sector may improve periodically in Q4, but waste batteries will still be in short supply. The operating rate of secondary lead smelters may improve quarter - on - quarter but will remain highly volatile [71]. - The annual terminal demand growth rate is expected to turn negative, mainly due to the possible over - expected lithium substitution for lead, the pressure on both domestic sales and exports of automobiles, the dependence of electric vehicle replacement demand on policy stimuli, the strong consumption in the energy storage field, and the continued pressure on exports. The demand in Q4 may improve periodically [72].

Report Overview - Report Title: How Will the Balance Evolve under High Supply and Demand Elasticity after the Supply Shock? - Research Institute: Orient Futures Derivatives Research Institute - Date: September 2025 - Analyst: Chen Yixuan 1. Report Industry Investment Rating - Not provided in the report 2. Report's Core View - In the short term, the lithium market presents a combination of strong reality and weak expectations, with limited de - stocking and a surplus pattern. It is recommended to look for short - selling opportunities on price rallies and reverse spread opportunities for LC2511 - 2512. In the long term, although the static balance remains in surplus, the high - growth demand will ease the apparent inventory build - up pressure in 2026, and the trading strategy can gradually shift from shorting on rallies to buying on dips [61]. 3. Summary by Relevant Directory Q3 Market Review - Since the end of June, lithium prices have rebounded rapidly from the bottom to 90,000 yuan, then fluctuated after a spike. From late June to mid - July, demand expectation correction drove the price to stabilize and rebound; from mid - July to mid - August, supply - side risks led to a rapid price increase; since mid - August, after the market priced in the shutdown of Jianxiaowo, the price corrected to account for the increased supply stimulated by high prices [2][5]. Supply - Side Uncertainty - Since mid - July, mining license risks in Jiangxi and Qinghai have intensified. The shutdown of some projects raised concerns about domestic supply risks, and the expiration of Jianxiaowo's mining license in August triggered market sentiment. However, since late August, the resumption of previously shut - down projects has cooled market enthusiasm [6][8]. Supply Pressure and Inventory - High prices have accelerated the manifestation of supply pressure. After the price rebound, the output of spodumene processing increased rapidly, offsetting the reduction in mica supply. Since late August, the generation of warehouse receipts has accelerated. Currently, domestic ore inventory is still at a moderately high level, and imported ore flows in stably, with new projects expanding production capacity, so there is no significant constraint on lithium salt supply [9][11][12]. Lithium Salt Trade and Resource Output - In terms of lithium salt shipments, South American shipments are in line with capacity ramp - up expectations, and Indonesia has brought marginal increments. The regional premium has changed the trade flow of lithium salts. The revised global lithium resource supply in 2025 is expected to increase by 270,000 tons LCE year - on - year, and the impact of mining license disruptions is limited. In 2026, the project reserve is still sufficient, with an expected year - on - year increase of 300,000 tons LCE, but some mica capacity may face supply uncertainty [16][19][22]. Terminal Demand - In the power market, new - energy passenger vehicle sales in China, Europe, and the US from January to August increased by 36%, 28%, and 4% year - on - year respectively. The new - energy commercial vehicle market is a highlight, with sales in China from January to August increasing by 66% year - on - year. The domestic and overseas energy - storage markets have continuously exceeded expectations, with high growth in domestic large - scale energy - storage project bids and a significant increase in overseas exports [30][36][41]. Market Balance - In the short term, the market is in a de - stocking phase, but the de - stocking amplitude is limited. The fundamental situation supports prices in the short term but cannot drive prices up independently. In the long term, from 2025 to 2026, the global lithium resource market remains in surplus, but the apparent inventory build - up in 2026 may narrow, and the inventory - to - consumption ratio will decrease [48][51][55]. Strategy Recommendation - Short - term: Given the strong reality and weak expectations, limited de - stocking, and the expectation of project resumption, it is recommended to look for short - selling opportunities on price rallies and reverse spread opportunities for LC2511 - 2512. Long - term: As the demand growth will ease the inventory build - up pressure in 2026, the trading strategy can gradually shift from shorting on rallies to buying on dips [61].