Report Summary 1. Report Industry Investment Rating - Not provided in the given content 2. Core Views - On August 12, the JM2601 contract of coking coal closed at 1313.0, up 6.97%. The macro - expectation is warming up with the upcoming news conference on the new version of the "Coal Mine Safety Regulations". Fundamentally, the overall inventory at the mine end is decreasing, and the clean coal inventory is shifting from upstream mines and coal washing plants to downstream coal - using enterprises. The cumulative import growth rate has been declining for 3 consecutive months, and the total inventory has increased for 4 consecutive weeks. Technically, the daily K - line is above the 20 - day and 60 - day moving averages. It should be treated as oscillating with a strong bias [2]. - On August 12, the J2601 contract of coke closed at 1812.0, up 4.50%. The fifth round of price increase has been implemented on the spot side. The suspension of the 24% tariff between China and the US for 90 days since August 12, 2025 has greatly improved market sentiment. Fundamentally, the raw material inventory has rebounded. The current pig iron output is 242.23 million tons, a decrease of 0.39 million tons. The inventory at the coal mine end is no longer under pressure, and the inventory is shifting downstream. The total coking coal inventory has increased for 4 consecutive weeks. The average loss per ton of coke for 30 independent coking plants nationwide is 16 yuan/ton this period. Technically, the daily K - line is above the 20 - day and 60 - day moving averages. It should be treated as oscillating with a strong bias [2]. 3. Summary by Relevant Catalogs Futures Market - JM main contract closing price: 1313.00 yuan/ton, up 57.00 yuan; J main contract closing price: 1812.00 yuan/ton, up 131.00 yuan [2]. - JM futures contract holding volume: 977539.00 lots, up 35457.00 lots; J futures contract holding volume: 54421.00 lots, up 1344.00 lots [2]. - Net holding volume of the top 20 JM contracts: - 82976.00 lots, unchanged; net holding volume of the top 20 J contracts: - 6504.00 lots, unchanged [2]. - JM 1 - 9 month contract spread: 150.50 yuan/ton, up 1.00 yuan; J 1 - 9 month contract spread: 82.00 yuan/ton, up 3.50 yuan [2]. - Coking coal warehouse receipts: 800.00 sheets, up 700.00 sheets; coke warehouse receipts: 800.00 sheets, unchanged [2]. Spot Market - Ganqimao Mongolian No.5 raw coal: 986.00 yuan/ton, up 13.00 yuan; Tangshan Grade - 1 metallurgical coke: 1665.00 yuan/ton, unchanged [2]. - Russian prime coking coal forward spot (CFR): 145.00 US dollars/wet ton, unchanged; Rizhao Port quasi - Grade - 1 metallurgical coke: 1470.00 yuan/ton, unchanged [2]. - Jingtang Port Australian imported prime coking coal: 1610.00 yuan/ton, up 60.00 yuan; Tianjin Port Grade - 1 metallurgical coke: 1570.00 yuan/ton, unchanged [2]. - Jingtang Port Shanxi - produced prime coking coal: 1610.00 yuan/ton, unchanged; Tianjin Port quasi - Grade - 1 metallurgical coke: 1470.00 yuan/ton, unchanged [2]. - Shanxi Jinzhong Lingshi medium - sulfur prime coking coal: 1320.00 yuan/ton, unchanged; J main contract basis: - 147.00 yuan/ton, down 131.00 yuan [2]. - Inner Mongolia Wuhai - produced coking coal ex - factory price: 1100.00 yuan/ton, unchanged; JM main contract basis: 7.00 yuan/ton, down 57.00 yuan [2]. Upstream Situation - Raw coal inventory of 110 coal washing plants (weekly): 277.10 million tons, down 15.43 million tons; clean coal inventory of 110 coal washing plants (weekly): 166.39 million tons, down 9.23 million tons [2]. - Operating rate of 110 coal washing plants (weekly): 61.51%, down 0.80%; raw coal output (monthly): 42107.40 million tons, up 1779.00 million tons [2]. - Coal and lignite import volume (monthly): 3560.90 million tons, up 256.90 million tons; daily average output of raw coal from 523 coking coal mines: 188.30 million tons, down 5.30 million tons [2]. - Imported coking coal inventory at 16 ports (weekly): 463.05 million tons, down 30.89 million tons; coke inventory at 18 ports (weekly): 273.55 million tons, up 2.65 million tons [2]. - Total coking coal inventory of independent coking enterprises (weekly): 987.92 million tons, down 4.81 million tons; coke inventory of independent coking enterprises (weekly): 69.73 million tons, down 3.89 million tons [2]. - Coking coal inventory of 247 national steel mills (weekly): 808.66 million tons, up 4.87 million tons; coke inventory of 247 national sample steel mills (weekly): 619.28 million tons, down 7.41 million tons [2]. - Available days of coking coal for independent coking enterprises (weekly): 12.99 days, up 0.12 days; available days of coke for 247 sample steel mills (weekly): 10.91 days, down 0.26 days [2]. Industry Situation - Coking coal import volume (monthly): 910.84 million tons, up 172.10 million tons; coke and semi - coke export volume (monthly): 51.00 million tons, down 17.00 million tons [2]. - Coking coal output (monthly): 4064.38 million tons, down 5.89 million tons; capacity utilization rate of independent coking enterprises (weekly): 74.03%, up 0.34% [2]. - Profit per ton of coke for independent coking plants (weekly): - 16.00 yuan/ton, up 29.00 yuan; coke output (monthly): 4170.30 million tons, down 67.30 million tons [2]. Downstream Situation - Blast furnace operating rate of 247 national steel mills (weekly): 83.77%, up 0.29%; blast furnace iron - making capacity utilization rate of 247 steel mills (weekly): 90.07%, down 0.15% [2]. - Crude steel output (monthly): 8318.40 million tons, down 336.10 million tons [2]. Industry News - The National Mine Safety Supervision Bureau will hold a special press conference on the new version of the "Coal Mine Safety Regulations" at 10:00 am on August 13 [2]. - As of now, 10 national intelligent demonstration coal mines have been built in Shanxi Province, and a total of 289 intelligent coal mines have been built [2]. - Recently, the "Several Policy Measures for Henan Province to Support Enterprises in Reducing Costs and Increasing Efficiency" was issued, which mentioned accelerating the ultra - low emission transformation of the steel industry [2]. - Goldman Sachs: As of June, US enterprises bear 64% of the tariff cost, consumers bear 22%, and foreign exporters bear 14%. By October, consumers are expected to bear 67% of the cost [2].

Group 1 - The U.S. has implemented a 50% import tariff on copper products, while exempting refined copper and copper raw materials, leading to significant fluctuations in COMEX copper prices [2][3][9] - The unexpected exemption of refined copper from tariffs has resulted in a narrowing of the COMEX-LME price spread, with COMEX copper prices experiencing a notable decline [3][4] - The anticipated "siphon effect" in the U.S. market may have already been realized, and concerns about inventory returning to the U.S. are premature, suggesting that copper prices may stabilize and rise due to tight supply and improving global economic conditions [2][5][9] Group 2 - The 232 tariff is expected to benefit Chinese copper processing companies by creating higher product premiums in the U.S. market, stimulating demand for domestically produced copper products [7][9] - U.S. refined copper imports have surged, with a 130% year-on-year increase in the first five months of 2023, indicating a high dependency on imports [4][5] - The copper processing market in the U.S. shows a significant import dependency, with nearly 30% of copper semi-finished products being imported, which could lead to price premiums for domestic products if tariffs are applied [4][5]

Core Viewpoint - The recent announcement of a 50% tariff on imported semi-finished copper products by the U.S. government has led to a significant drop in copper prices, with COMEX copper futures plummeting by 21% to a low of $4.33 per pound, triggering a mass exit of bullish investors from the market [1][2][3]. Tariff Impact - The U.S. will impose a 50% tariff on semi-finished copper products starting August 1, while refined copper and scrap copper are exempt from this tariff, leading to a sharp decline in copper prices as market expectations shifted [2][3]. - The new tariff structure contrasts sharply with previous expectations of a blanket tariff on all copper products, resulting in a rapid liquidation of accumulated copper inventories in the U.S. [3][4]. Market Dynamics - Following the tariff announcement, the COMEX copper inventory surged to 250,000 tons, up from less than 100,000 tons in February, indicating a significant shift in supply dynamics [7]. - The London Metal Exchange (LME) copper inventory has decreased by over 64% since mid-February, highlighting contrasting trends in global copper supply [7]. Price Fluctuations - The price of COMEX copper futures saw a year-to-date increase of over 40% before the tariff announcement, which has since narrowed to 8.87% as of July 31 [8]. - The volatility in copper prices is expected to continue, with potential downward pressure due to excess inventory and changing market conditions [12]. Supply Chain Disruption - The U.S. tariff policy is anticipated to disrupt global copper supply chains, with potential shifts in sourcing strategies for industries reliant on copper, such as automotive and renewable energy sectors [9]. - Major copper-exporting countries like Chile may redirect their supplies towards Asian and European markets, further affecting global copper supply and demand balance [9]. Future Outlook - Analysts predict that the U.S. copper import volume could reach 1.36 million tons this year, significantly higher than last year's 900,000 tons, which may lead to an oversupply situation in the market [8]. - The long-term implications of the tariff on U.S. domestic copper demand and pricing strategies remain uncertain, as companies may seek to adjust their supply chains in response to the new tariff structure [10].

Core Viewpoint - The copper market is experiencing significant volatility due to the U.S. government's unexpected tariff policy, leading to a sharp decline in copper prices and a mass exit of long positions from the market [1][2][4]. Tariff Policy Impact - The U.S. announced a 50% tariff on imported semi-finished copper products starting August 1, while exempting refined copper and scrap copper, which contrasts sharply with previous expectations of a blanket tariff on all copper products [2][3][4]. - This targeted approach has led to a rapid liquidation of previously accumulated copper inventories in the U.S., as the market adjusts to the new tariff structure [4][10]. Market Reactions - Following the announcement, COMEX copper futures plummeted to $4.33 per pound, a 21% drop from the previous close, while London and Shanghai copper prices also fell by 0.8% and 1.3%, respectively [1][2]. - The market had previously anticipated a broader tariff application, leading to a surge in copper imports into the U.S. to capitalize on expected price increases [10][12]. Inventory Dynamics - As of July 30, COMEX copper inventories reached 250,000 tons, a significant increase from less than 100,000 tons in February, indicating a major shift in supply dynamics due to tariff expectations [9][10]. - In contrast, LME copper inventories have decreased sharply, highlighting a divergence in inventory trends between the two markets [9]. Future Outlook - Analysts predict that the U.S. copper market will face downward pressure on prices due to the potential for excess inventory to be re-exported to international markets [10][12]. - The tariff policy is expected to disrupt global copper supply chains, with major copper-exporting countries potentially redirecting their shipments to Asia and Europe [12][13]. Industry Implications - The tariff's impact on copper prices may increase costs in sectors such as automotive and renewable energy, prompting companies to consider domestic alternatives or adjust their supply chains [12]. - The long-term effects of the tariff policy on the copper market will depend on how well downstream industries can adapt to the new pricing environment and whether they can mitigate the impact of increased costs [12][13].

Investment Rating - The investment rating for the non-ferrous metals industry is "Positive" (maintained) [4][106]. Core Views - The report highlights that copper prices are under pressure due to the implementation of a 50% tariff on copper by the U.S., which is expected to take effect in late July or early August. This has led to a significant increase in U.S. copper prices while London and Shanghai copper prices have declined [5][9]. - The report anticipates that global copper inventory transfers will conclude, providing some support for copper prices despite the short-term pressure from tariffs. It is expected that Shanghai copper will fluctuate between 77,000 and 79,000 CNY per ton in the near term [5]. - The aluminum market is characterized by low inventory levels, with aluminum prices experiencing high volatility. The report notes a slight increase in alumina prices and a decrease in aluminum production margins [5][26]. - Lithium prices are rebounding from the bottom, driven by a "reverse involution" trend, with expectations for supply-side reductions and seasonal demand support [5][78]. - Cobalt prices may rebound due to an extended export ban from the Democratic Republic of Congo, which is expected to tighten supply in the fourth quarter [5][88]. Summary by Sections 1. Industry Overview - The report discusses macroeconomic indicators, including U.S. unemployment claims, and the announcement of copper tariffs by the U.S. government [9]. - The overall performance of the non-ferrous metals sector is analyzed, with the sector underperforming compared to the Shanghai Composite Index [11]. 2. Industrial Metals 2.1 Copper - London copper prices fell by 2.43%, while Shanghai copper prices decreased by 1.63%. U.S. copper prices increased by 10.30%. Inventory levels showed a mixed trend, with London copper inventory rising by 14.12% and Shanghai copper inventory declining by 3.70% [26]. 2.2 Aluminum - London aluminum prices increased by 0.08%, and Shanghai aluminum prices rose by 0.36%. Inventory levels for both London and Shanghai aluminum increased, while production margins decreased [26][36]. 2.3 Lead and Zinc - Lead prices decreased, while zinc prices saw a slight increase. Inventory levels for lead and zinc showed mixed trends, with lead inventory declining and zinc inventory increasing [49]. 2.4 Tin and Nickel - Tin prices fell, and nickel prices also experienced a decline. Inventory levels for both metals showed a downward trend [62]. 3. Energy Metals 3.1 Lithium - Lithium prices, including lithium carbonate and lithium spodumene, saw increases, while hydroxide prices slightly decreased. The report notes ongoing challenges in production margins for lithium [78]. 3.2 Cobalt - Cobalt prices are under pressure, but the extended export ban from the DRC may create opportunities for price rebounds in the future [88].