Core Viewpoint - The article discusses the challenges in forming a consensus on market demand amidst concerns of weak long-term demand, particularly in the context of U.S. stagflation and deflationary pressures in the Asia-Pacific region [3]. Group 1: Market Dynamics - Short-term market consensus is difficult to establish due to prevailing pessimism regarding demand, influenced by external shocks that are hard to predict [3]. - The U.S. government's proposal to significantly increase biofuel blending requirements is expected to drive up domestic demand for soybean oil, leading to a notable price increase [4][5]. Group 2: Policy Impacts - The proposed increase in biofuel blending requirements aims to boost domestic biofuel production and reduce reliance on imported raw materials, which is expected to raise soybean oil prices significantly [4]. - If the proposal is implemented, domestic soybean oil demand could rise from approximately 6 million tons per year to between 7.4 and 7.6 million tons by 2025-2027, representing an increase of about 1.5 million tons [5][6]. Group 3: Historical Context and Future Projections - Historical demand surges, such as the price increase of soybean oil from $0.30 to $0.87 per pound between 2022 and 2023, suggest that current trends could push prices towards $0.60 per pound [7]. - The anticipated increase in soybean crushing demand could elevate U.S. soybean crushing levels to 2.7 billion bushels, improving the soybean balance sheet and supporting higher soybean prices [7]. Group 4: Geopolitical Considerations - The article highlights the potential for geopolitical conflicts to impact commodity prices, with historical examples showing significant price increases during crises [9][11]. - The ongoing geopolitical tensions, particularly in the Middle East, could lead to sustained high prices for commodities if supply chains are disrupted [10][15]. Group 5: Long-term Outlook - The long-term trajectory of commodity prices will depend on the evolution of geopolitical conflicts and their impact on supply chains, with a focus on whether these conflicts will lead to a permanent increase in prices [17]. - The interplay between geopolitical risks and overall demand will be crucial in determining the stability of commodity prices in the future [17].

Core Viewpoint - Despite an increase in port inventories and a continuous decline in rebar demand, iron ore prices remain relatively stable and do not show significant downward movement [1] Group 1: Market Conditions - Port inventories of iron ore have increased, indicating a potential oversupply in the market [1] - Demand for rebar, a key steel product, continues to decline, which typically would exert downward pressure on iron ore prices [1] Group 2: Price Stability - Iron ore prices are described as "not falling significantly," suggesting that market dynamics are preventing a sharp decline despite the unfavorable demand-supply conditions [1]

Supply and Demand - Construction activity shows a significant decline in cement usage, with construction site funding availability lower than the same period in 2024[2] - Industrial production remains at a seasonal high, but some sectors are declining, such as polyester chip production which has dropped to a low level[2][24] - Building demand is weak, with rebar and construction material demand below historical levels[3][31] Prices - International commodity prices for oil, copper, and aluminum are fluctuating, while gold prices have increased[4][39] - Domestic industrial products are experiencing weak fluctuations, with the South China comprehensive index nearing its September 2024 low[4][41] Real Estate - New housing transactions remain at historical lows, with a 7% week-on-week decline in transaction area across 30 major cities, down 41% compared to 2023[5][59] - Second-hand housing transaction volumes are weakening, with Beijing, Shanghai, and Shenzhen showing year-on-year declines of -1%, -15%, and +6% respectively[5][61] Exports - High-frequency export data for the first week of June indicates a potential year-on-year decline of around -8%[6][67] Liquidity - Recent weeks have seen a decline in funding rates, with R007 at 1.55% and DR007 at 1.53% as of June 6[5][80] - The central bank has implemented a net withdrawal of 358.6 billion yuan in recent weeks[5][82]

Supply and Demand - Construction starts show a structural positive change, with infrastructure cement usage exceeding the same period in 2024[2] - Industrial production remains at a seasonally high level, with the chemical chain operating at historical highs[2] - Demand in construction is weak, while automotive and home appliance demand is improving, with rolling sales of passenger cars showing a year-on-year increase[3] Price Trends - International commodity prices show a mixed trend, with oil and gold prices declining while base metals are rising[4] - Domestic industrial products are experiencing a slight rebound, with rebar prices recovering and some chemical and building material prices showing signs of rebound[4] - Food prices are trending downward, with agricultural product prices fluctuating downwards and pork prices remaining stable[4] Real Estate and Liquidity - New housing transactions remain at historical lows, although first-tier cities show improvement, with transaction area in major cities up 2% week-on-week[5] - Second-hand housing transactions in Beijing and Shenzhen show a marginal year-on-year decline, while Shanghai's second-hand housing transactions continue at historical highs[5] - Liquidity is tightening, with funding rates declining; as of May 16, R007 was at 1.63% and DR007 at 1.64%[5] Export Performance - High-frequency export data has not significantly rebounded, with May exports expected to be around 0% year-on-year as of May 17[6] - Port throughput data indicates a potential decline in exports, with daily export transport data showing some resilience but not a substantial recovery[6] Risk Factors - Risks include unexpected fluctuations in commodity prices and potential changes in policy strength[6]