Core Viewpoint - The article discusses the recent trading limit requirements imposed on two popular futures products, coking coal and lithium carbonate, which have led to a significant decrease in trading volumes for both commodities [1][2][3]. Trading Limits - On July 25, the Dalian Commodity Exchange announced that the daily opening position limit for the main coking coal futures contract (2509) would be capped at 500 lots, while other contracts would be limited to 2000 lots. Similarly, the daily opening position limit for lithium carbonate futures (LC2509) was set at 3000 lots [2][5]. Decrease in Trading Volume - Following the implementation of these trading limits, the trading volumes for both coking coal and lithium carbonate saw a decline of over 20%. Specifically, the total trading volume for coking coal futures dropped by 912,000 lots to 3,169,000 lots, while lithium carbonate futures fell by 690,000 lots to 1,705,000 lots, resulting in a total decrease of over 1.7 million lots across both products [3][7]. Market Reaction - The coking coal and coke markets experienced a decline, with prices dropping approximately 4% in night trading on July 25. The main coking coal contract closed at 1259 yuan/ton, reflecting a rebound of 77.57% from a low of 709 yuan/ton on June 3 [4][6]. Policy Impact and Market Sentiment - Despite the trading limits, market sentiment remained bullish, driven by the "anti-involution" policies that have been increasingly emphasized since late June. This has led to a rotation of funds into the ferrosilicon market, with significant price increases observed [8][7]. Future Expectations - The market anticipates further policy implementations to stabilize the industry. Discussions among major manganese alloy producers in Inner Mongolia, Ningxia, and Shanxi are expected to focus on achieving consensus on energy conservation and emissions reduction [8]. Additionally, the execution of production limits in coal mines remains uncertain, with many regions facing low production rates due to environmental and safety regulations [8][9]. Analyst Insights - Analysts suggest that the current supply-side policies are not as urgent or effective as those from previous years, and without corresponding demand-side measures, the sustainability of price increases may be challenged. The long-term outlook for coal prices remains under pressure due to difficulties in passing costs onto end consumers [9].

Report Information - Report Name: Iron Alloy Industry Risk Management Daily Report - Date: July 3, 2025 - Analysts: Zhou Fuhan (Z0020173), Chen Mintao (F03118345) - Investment Consulting Business Qualification: CSRC License [2011] No. 1290 [1] 1. Report Industry Investment Rating - Not provided in the content 2. Report's Core View - The market has strong expectations for supply - side reform policies after the Sixth Meeting of the Central Financial and Economic Commission, which has boosted the prices of iron alloys. However, the current market shows a situation of strong expectations but weak reality. Although there is a certain rebound sentiment due to technical buying, the spot market is dragged down by steel mill price - pressure and weakening costs. In the long - term, with the steel consumption entering the off - season, the iron alloy market remains relatively weak. The previous high - inventory and high - supply negative factors are weakening, and the supply side maintains low - level supply with a low pressure. The iron alloy will continue the de - stocking trend, but the speed has slowed down. There are expectations of electricity price cuts and a decline in manganese ore prices in July. The iron alloy is expected to run weakly, but due to the decline in positions and low valuations, it may be disturbed by news in the short - term. It is recommended to short on rebounds [3]. 3. Summary by Relevant Catalogs 3.1 Iron Alloy Price Range Forecast - **Silicon Iron**: The monthly price range is predicted to be 5300 - 6000 yuan/ton, with a current 20 - day rolling volatility of 16.65% and a 3 - year historical percentile of 40.4% [2] - **Silicon Manganese**: The monthly price range is predicted to be 5300 - 6000 yuan/ton, with a current 20 - day rolling volatility of 14.41% and a 3 - year historical percentile of 22.7% [2] 3.2 Iron Alloy Hedging - **Inventory Management**: For enterprises with high finished - product inventory worried about price drops, they can short SF2509 and SM2509 futures according to their inventory to lock in profits and cover production costs. The recommended short - selling ratio is 15%, and the recommended entry range is SF: 6200 - 6250 yuan/ton, SM: 6400 - 6500 yuan/ton [2] - **Procurement Management**: For enterprises with low procurement inventory and planning to purchase according to orders, they can buy SF2509 and SM2509 futures at present to lock in procurement costs in advance. The recommended buying ratio is 25%, and the recommended entry range is SF: 5100 - 5200 yuan/ton, SM: 5300 - 5400 yuan/ton [2] 3.3 Core Contradiction - Policy expectations from the Central Financial and Economic Commission's meeting have boosted iron alloy prices, but the market faces a situation of strong expectations and weak reality. The long - term trend is weak due to factors such as steel mill price - pressure, cost weakening, and the off - season of steel consumption. However, de - stocking continues, and there are expectations of cost reduction. In the short - term, rebounds may occur, and it is recommended to short on rebounds [3] 3.4利多解读 (Positive Analysis) Silicon Iron - High steel mill profitability will maintain high hot - metal production, which supports the demand for silicon iron. Also, due to the continuous price decline, there is a possibility of a rebound due to low valuation [6] Silicon Manganese - The government's strict control over high - energy - consuming industries may lead to industrial structure adjustment and upgrading of the silicon - manganese industry. Similar to silicon iron, there is a possibility of a rebound due to low valuation [7] 3.5利空解读 (Negative Analysis) Silicon Iron - There is a possibility of increased production due to profit repair. The electricity cost of iron alloys is expected to decline further. The inventory of iron enterprises is 69,400 tons, a 1.47% increase from the previous period, and the silicon - iron warehouse receipt inventory is higher than the historical average after re - registration [11] Silicon Manganese - In the long - term, the real - estate market slump and the decline of the black sector have raised doubts about the growth of steel terminal demand, resulting in relatively weak demand for silicon manganese. The weekly production start - up rate of silicon - manganese production enterprises is 39.21%, a 2.82% increase from the previous period, and the weekly output is 179,200 tons, a 1.47% increase from the previous period [12] 3.6 Daily Data Silicon Iron - Data on July 2, 2025, shows changes in various indicators such as basis, futures spreads, spot prices, raw material prices, and warehouse receipt inventory compared to previous days and weeks [8] Silicon Manganese - Data on July 2, 2025, shows changes in various indicators such as basis, futures spreads, spot prices, raw material prices, and warehouse receipt inventory compared to previous days and weeks [9]