Core Viewpoint - Reinsurance serves as a critical risk management tool for insurance companies, allowing them to transfer risk and manage capital requirements effectively, thereby enhancing their overall stability and capacity to pay claims [2][33]. Group 1: Overview of Reinsurance - Reinsurance is an agreement between insurance underwriters and reinsurance companies, allowing insurers to transfer part or all of their risk to reinsurance firms [2]. - The primary functions of reinsurance include increasing underwriting capacity, stabilizing loss experience, limiting liability from single events, and protecting both insurers and policyholders from catastrophic events [2][3]. - Modern technology has simplified risk assessment processes, making reinsurance more efficient [2]. Group 2: Risks Associated with Reinsurance - Key risks in reinsurance include reinsurance recoverables risk, which occurs when a reinsurer defaults, causing the risk to revert to the original insurer [6]. - Counterparty risk is another significant concern, as insurers face credit risk when selecting reinsurers [6]. - Strategies such as collateral accounts can be employed to mitigate these risks by ensuring funds are available to cover claims in case of reinsurer default [6]. Group 3: Cost-Benefit Analysis of Reinsurance - While reinsurance provides benefits such as capital relief and risk diversification, it also incurs high costs, often exceeding the actuarial value of the risks transferred [7]. - The strategic value of reinsurance remains significant, as it enhances insurers' risk tolerance and provides financial buffers during extreme events [7]. Group 4: Catastrophe Risk and Reinsurance - Catastrophe risks, including natural disasters and man-made events, significantly influence the demand for reinsurance [9]. - Following catastrophic losses, insurers often increase their reinsurance purchases to enhance risk resilience, although post-disaster reinsurance can be costly and difficult to obtain [9][10]. - The structure of reinsurance contracts, including proportional and non-proportional contracts, plays a crucial role in managing catastrophe risks [11]. Group 5: Life and Non-Life Insurance - Reinsurance plays a vital role in both life and non-life insurance sectors, helping insurers manage capital guarantees and reserves effectively [14][16]. - The use of reinsurance can prevent the decline of capital guarantees in life insurance products, thereby maintaining their value [15]. - In non-life insurance, reinsurance is used to provide overall protection for risk portfolios, with different factors influencing reserve formation [16]. Group 6: Compensation Mechanisms in Reinsurance - Compensation mechanisms in reinsurance contracts are essential for risk transfer and can be optimized using various approaches [18][20]. - Structured reinsurance contracts can be designed to provide higher compensation during financial distress, benefiting both insurers and reinsurers [20]. Group 7: Financial Performance Indicators and Reinsurance - Financial performance metrics such as liquidity creation and financial flexibility are critical in assessing the impact of reinsurance on insurance companies [22]. - There exists a structural bidirectional causality between liquidity and reinsurance demand, indicating that insurers with higher risk exposure are more likely to seek reinsurance [23]. - The relationship between reinsurance and debt capacity varies based on a company's financial flexibility, affecting how insurers manage their capital structures [24]. Group 8: Mathematical Modeling in Reinsurance - Mathematical models are increasingly used to analyze reinsurance processes, aiding in decision-making and risk assessment [30][31]. - These models help predict claims payments and optimize investment-reinsurance strategies, enhancing overall financial performance [30][31]. Conclusion - Reinsurance is a fundamental tool for insurance companies to manage risks and capital requirements, ensuring they can meet claims even in the face of significant losses [33]. - The collective research highlights the importance of understanding reinsurance's core concepts, its strategic value, and the associated risks, providing a comprehensive view of the reinsurance landscape [34].

Report Industry Investment Rating - Aluminum: Neutral [8] - Alumina: Cautiously Bearish [8] - Aluminum Alloy: Neutral [8] Core Views - The supply of domestic electrolytic aluminum remains stable, and the Middle East crisis has not disturbed production. Consumption shows marginal weakness, and social inventory has slightly increased, but the absolute inventory is at a historical low. If inventory does not accumulate during the off - season, delivery risks need long - term attention. Alumina is in a downward channel, and the smelting profit of electrolytic aluminum has expanded, but it's difficult to further expand the profit without unexpected fundamental benefits [4]. - For alumina, the spot market has transactions, costs are stable, and the production and inventory are rising significantly with existing smelting profits [5][6]. - Aluminum alloy is in the consumption off - season, the price is supported by the cost, and there are cross - variety arbitrage opportunities in the 11 - contract [7]. Key Points by Content Aluminum Spot and Futures - On June 23, 2025, the Yangtze River A00 aluminum price was 20,650 yuan/ton, down 70 yuan/ton from the previous trading day. The spot premium of Yangtze River A00 aluminum decreased by 30 yuan/ton to 150 yuan/ton. The Central Plains A00 aluminum price was 20,470 yuan/ton, and its spot premium decreased by 40 yuan/ton to - 20 yuan/ton. The Foshan A00 aluminum price was 20,530 yuan/ton, and its spot premium decreased by 5 yuan/ton to 45 yuan/ton [2]. - On June 23, 2025, the main contract of Shanghai aluminum opened at 20,425 yuan/ton, closed at 20,365 yuan/ton, down 50 yuan/ton or - 0.24% from the previous trading day. The trading volume was 181,056 lots, an increase of 87,843 lots, and the position was 253,597 lots, an increase of 89,586 lots [2]. Aluminum Inventory - As of June 23, 2025, the domestic electrolytic aluminum ingot social inventory was 464,000 tons, and the LME aluminum inventory was 340,975 tons, a decrease of 1,875 tons from the previous trading day [2]. Alumina Spot and Futures - On June 23, 2025, the SMM alumina price in Shanxi was 3,130 yuan/ton, in Shandong was 3,140 yuan/ton, in Guangxi was 3,205 yuan/ton, and the Australian alumina FOB price was 370 US dollars/ton [3]. - On June 23, 2025, the main contract of alumina opened at 2,886 yuan/ton, closed at 2,906 yuan/ton, up 11 yuan/ton or 0.38% from the previous trading day. The trading volume was 335,270 lots, an increase of 11,654 lots, and the position was 286,561 lots, a decrease of 4,189 lots [3]. Aluminum Alloy Price and Inventory - On June 23, 2025, the Baotai civil primary aluminum purchase price was 15,300 yuan/ton, and the mechanical primary aluminum purchase price was 15,400 yuan/ton, unchanged from the previous day. The Baotai quotation of ADC12 was 19,500 yuan/ton, unchanged from the previous day, and the ADC12 - A00 spread in East China was - 1,050 yuan/ton [3]. - The aluminum alloy social inventory was 23,800 tons, a weekly increase of 1,500 tons. The in - plant inventory was 82,900 tons, a weekly decrease of 2,100 tons. The total inventory was 106,700 tons, a weekly decrease of 600 tons [3]. Market Analysis - **Electrolytic Aluminum**: The supply is stable, the consumption is marginally weakening, the alumina price is falling, and the smelting profit is expanding, but it's difficult to further expand without unexpected benefits [4]. - **Alumina**: The spot market has transactions, the cost is stable, the bauxite freight has decreased, the alumina price has fallen, and the production and inventory are rising [5][6]. - **Aluminum Alloy**: It's in the off - season, the price is supported by the cost, and there are cross - variety arbitrage opportunities in the 11 - contract [7]. Strategy - **Alumina**: The spot price is loose, the long - term surplus pattern remains, and the 09 contract has a significant discount to the spot. Be vigilant against basis risk if the spot price falls slowly [8]. - **Arbitrage**: Long - short spread arbitrage in Shanghai aluminum and long AD11 short AL11 [8].

Core Viewpoint - The Zhengzhou Commodity Exchange (ZCE) has announced the addition of four designated delivery warehouses for rapeseed meal, aiming to optimize the delivery structure and enhance market service efficiency in a complex market environment [1][2]. Group 1: Market Impact - The adjustment of delivery warehouses provides more convenience for companies in the rapeseed meal sector to utilize futures tools [2]. - The expansion of delivery warehouses is expected to play a crucial role in repairing the market pricing mechanism, especially under the impact of U.S. tariff policies [2]. - The increase in delivery resources enhances the supply of deliverable rapeseed meal, covering major consumption areas in East and South China, thus providing a stable price anchor for the industry [2]. Group 2: Risk Management and Efficiency - The improved delivery warehouse system reconstructs the risk management model of the industry chain, enhancing hedging efficiency and allowing importers to convert volatile pricing risks into more stable basis risks [2]. - The addition of delivery warehouses significantly facilitates the delivery process in surrounding regions, leading to a notable increase in registered warehouse receipts for rapeseed meal [3]. - The expansion of delivery points helps companies effectively avoid operational risks arising from macroeconomic changes and reduces delivery costs, thereby improving overall delivery efficiency [3].