Morning Bites (part 1)
🔗China’s crude steel output dropped 9% YoY in June vs. the -7% YoY in May, according to the NBS data. The recent production declines are likely related to Beijing’s plans to cut 'excessive' steel output in 2025 (up to 2-5% of China’s 2024 supply, per market estimates). Although local crude steel supply dropped 3% YoY in 1H25, per official data, Chinese net exports were up 11% YoY over the period, still weighing on global steel prices
🏢China's property sales slid 7% YoY in June, after the 5% YoY decline in May, and were down 53% vs. the 2021 levels. Meanwhile, floor space starts decreased a further 9% YoY in June (-73% vs. 2021). Personal mortgage loans decreased 23% YoY in May (-59% vs. 2021), while property completions inched down 2% YoY
#steel #property
🔗China’s crude steel output dropped 9% YoY in June vs. the -7% YoY in May, according to the NBS data. The recent production declines are likely related to Beijing’s plans to cut 'excessive' steel output in 2025 (up to 2-5% of China’s 2024 supply, per market estimates). Although local crude steel supply dropped 3% YoY in 1H25, per official data, Chinese net exports were up 11% YoY over the period, still weighing on global steel prices
🏢China's property sales slid 7% YoY in June, after the 5% YoY decline in May, and were down 53% vs. the 2021 levels. Meanwhile, floor space starts decreased a further 9% YoY in June (-73% vs. 2021). Personal mortgage loans decreased 23% YoY in May (-59% vs. 2021), while property completions inched down 2% YoY
#steel #property
Morning Bites (part 2)
⛏️Implats plans to close its Lac des Iles palladium mine in Canada by mid-2026, Bloomberg reports. According to a company representative, the decision was due to the prolonged period of low PGM prices
On our numbers, the mine accounted for ~3% of global Pd supply in 2024, so its planned closure might deepen the market deficit in 2026F to over 5% of demand — a favorable factor for palladium market sentiment. However, we believe that the decision might be actually postponed if the positive trend in PGM prices (seen since mid-May) persists
#PGMs
⛏️Implats plans to close its Lac des Iles palladium mine in Canada by mid-2026, Bloomberg reports. According to a company representative, the decision was due to the prolonged period of low PGM prices
On our numbers, the mine accounted for ~3% of global Pd supply in 2024, so its planned closure might deepen the market deficit in 2026F to over 5% of demand — a favorable factor for palladium market sentiment. However, we believe that the decision might be actually postponed if the positive trend in PGM prices (seen since mid-May) persists
#PGMs
Morning Bites
💎India’s rough diamond net imports grew 3% YoY in June, vs. the 11% YoY decline in May. Meanwhile, polished diamond net exports dropped 25% YoY. Synthetic rough diamond net imports rose 20% YoY. Lab-grown net rough imports accounted for 7% of total trading
We maintain our view that it might take longer than we had originally anticipated for the global diamond market to recover, given the still high midstream inventories in 2025. Meanwhile, further de-escalation of the US-China trade war (jointly, they account for ~65% of the world gem-set jewellery trade), would become a favorable factor for consumer confidence
India accounts for ~95% of the world's polished stone supply
#diamonds
💎India’s rough diamond net imports grew 3% YoY in June, vs. the 11% YoY decline in May. Meanwhile, polished diamond net exports dropped 25% YoY. Synthetic rough diamond net imports rose 20% YoY. Lab-grown net rough imports accounted for 7% of total trading
We maintain our view that it might take longer than we had originally anticipated for the global diamond market to recover, given the still high midstream inventories in 2025. Meanwhile, further de-escalation of the US-China trade war (jointly, they account for ~65% of the world gem-set jewellery trade), would become a favorable factor for consumer confidence
India accounts for ~95% of the world's polished stone supply
#diamonds
Morning Bites
🇿🇦South Africa’s PGM mining output was flat YoY in May, vs. the 24% YoY decline in April, per official data. Meanwhile, local gold production inched up 2% YoY, reversing from the -3% YoY in April
To recap, heavy rains disrupted domestic mining output in 1Q25, while the high cost of electricity (Eskom lifted its tariffs a further 13% in early-2025) also affected South African miners’ performance. Nevertheless, further PGM production recovery, if it persists, might lead to normalisation of abnormally high platinum prices, we believe
SA accounts for ~70% of global Pt, 38% of Pd supply and 3% of world gold production
#PGMs #gold
🇿🇦South Africa’s PGM mining output was flat YoY in May, vs. the 24% YoY decline in April, per official data. Meanwhile, local gold production inched up 2% YoY, reversing from the -3% YoY in April
To recap, heavy rains disrupted domestic mining output in 1Q25, while the high cost of electricity (Eskom lifted its tariffs a further 13% in early-2025) also affected South African miners’ performance. Nevertheless, further PGM production recovery, if it persists, might lead to normalisation of abnormally high platinum prices, we believe
SA accounts for ~70% of global Pt, 38% of Pd supply and 3% of world gold production
#PGMs #gold
Morning Bites
🔗CISA mills daily crude steel production in early-July was 2.10mnt, down 1.5% vs. the previous ten days, and 2.5% lower YoY. Local steel inventories also decreased 2.5% over the period, being down 2.2% YoY
According to CISA data, on a YTD basis (through 10th July), production dynamics remained slightly positive (+0.5% YoY). Meanwhile, per official NBS data, the country's steel output was down 3.3% YoY in 1H25, following Beijing’s plans to cut 'excessive' supply in 2025. To recap, these measures might affect 2-5% of China’s 2024 supply, per market participants’ estimates
China accounts for ~57% of global steel supply
#steel
🔗CISA mills daily crude steel production in early-July was 2.10mnt, down 1.5% vs. the previous ten days, and 2.5% lower YoY. Local steel inventories also decreased 2.5% over the period, being down 2.2% YoY
According to CISA data, on a YTD basis (through 10th July), production dynamics remained slightly positive (+0.5% YoY). Meanwhile, per official NBS data, the country's steel output was down 3.3% YoY in 1H25, following Beijing’s plans to cut 'excessive' supply in 2025. To recap, these measures might affect 2-5% of China’s 2024 supply, per market participants’ estimates
China accounts for ~57% of global steel supply
#steel
Week ahead data releases in M&M
As the reporting season gains momentum, many M&M names are scheduled to release their 2Q25 financials this week. Overall, our EBITDA estimates are more upbeat than the consensus on Newmont and major copper miners (Freeport, First Quantum and Teck), except Southern Copper
We also await EU car registrations data for June and world steel monthly production statistics this week
#reporting_season
As the reporting season gains momentum, many M&M names are scheduled to release their 2Q25 financials this week. Overall, our EBITDA estimates are more upbeat than the consensus on Newmont and major copper miners (Freeport, First Quantum and Teck), except Southern Copper
We also await EU car registrations data for June and world steel monthly production statistics this week
#reporting_season
Morning Bites
💎Zimbabwe’s biggest diamond miner is cutting 400 jobs, amid a global market downturn, Bloomberg reports, citing a company representative. The decision will affect 20% of the company’s workforce
State-owned Zimbabwe Consolidated Diamond Company (~5% of global rough diamond supply) had to choose between closing operations or maintaining them at a reduced rate whilst awaiting a price recovery, the representative added
We maintain our view that it might take longer than we had originally anticipated for the global diamond market to recover, given the still high midstream inventories in 2025. Meanwhile, further de-escalation of the US-China trade war (jointly, they account for ~65% of the world gem-set jewellery trade), would be a favourable factor for consumer confidence
#diamonds
💎Zimbabwe’s biggest diamond miner is cutting 400 jobs, amid a global market downturn, Bloomberg reports, citing a company representative. The decision will affect 20% of the company’s workforce
State-owned Zimbabwe Consolidated Diamond Company (~5% of global rough diamond supply) had to choose between closing operations or maintaining them at a reduced rate whilst awaiting a price recovery, the representative added
We maintain our view that it might take longer than we had originally anticipated for the global diamond market to recover, given the still high midstream inventories in 2025. Meanwhile, further de-escalation of the US-China trade war (jointly, they account for ~65% of the world gem-set jewellery trade), would be a favourable factor for consumer confidence
#diamonds
Morning Bites (part 1)
🇨🇳China has begun the construction of a massive, USD 170bn hydropower project in Tibet, Bloomberg reports, citing the country’s Premier Li Qiang. The Yarlung Zangbo River project will consist of five cascade dams, with a total annual output estimated at ~300TWh (~3% of China’s electricity generation supply in 2024)
Although no official details have yet been provided on the timing or scope of the project, some market participants expect the mega-dam to be finished in 2030s and add 0.1 p.p. to China’s GDP growth every year during its construction
In our view, the project might add some support to local demand for cement, steel and base metals over the next 10 years, especially if coupled with a potential recovery in the Chinese real estate sector, which started to gradually bottom out in 2H24
#steel
🇨🇳China has begun the construction of a massive, USD 170bn hydropower project in Tibet, Bloomberg reports, citing the country’s Premier Li Qiang. The Yarlung Zangbo River project will consist of five cascade dams, with a total annual output estimated at ~300TWh (~3% of China’s electricity generation supply in 2024)
Although no official details have yet been provided on the timing or scope of the project, some market participants expect the mega-dam to be finished in 2030s and add 0.1 p.p. to China’s GDP growth every year during its construction
In our view, the project might add some support to local demand for cement, steel and base metals over the next 10 years, especially if coupled with a potential recovery in the Chinese real estate sector, which started to gradually bottom out in 2H24
#steel
Morning Bites (part 2)
💍Luk Fook’s 2Q25 LFL sales decreased 17% YoY in the diamond jewellery segment, decelerating from the -36% YoY in 1Q25, according to a press release from the retailer. Specifically, the company’s sales on the Mainland market slid 13% YoY (vs. -25% YoY in 1Q25)
We maintain our view that it might take longer than we had originally anticipated for the global diamond market to recover, given the still high midstream inventories in 2025. Meanwhile, further de-escalation of the US-China trade war (jointly, they account for ~65% of the world gem-set jewellery trade), would be a favourable factor for consumer confidence
#diamonds
💍Luk Fook’s 2Q25 LFL sales decreased 17% YoY in the diamond jewellery segment, decelerating from the -36% YoY in 1Q25, according to a press release from the retailer. Specifically, the company’s sales on the Mainland market slid 13% YoY (vs. -25% YoY in 1Q25)
We maintain our view that it might take longer than we had originally anticipated for the global diamond market to recover, given the still high midstream inventories in 2025. Meanwhile, further de-escalation of the US-China trade war (jointly, they account for ~65% of the world gem-set jewellery trade), would be a favourable factor for consumer confidence
#diamonds
Morning Bites (part 1)
🏭Global primary aluminium output inched up 1.3% YoY in June, vs. the +2.0% YoY in May, per International Aluminium Institute (IAI) data. Chinese production (60% of global Al output) increased 1.7% YoY last month, while ex. China output was up only 0.6% YoY. Overall, strong consumption dynamics in Asia (including grid), the ongoing monetary easing cycle in the EU and China, as well as the expected additional US fed rate cuts in 2H25, are likely to add further support to Al, which we forecast to reach USD 2,700-2,900/t by late 2025 - early 2026
We also note that there is limited potential for additional supply growth in China, as local Al output is capped at 45mnt (China produced 43.4mnt in 2024, as well as 43.7mnt in 1H25 in annualised terms, per IAI data)
#aluminium
🏭Global primary aluminium output inched up 1.3% YoY in June, vs. the +2.0% YoY in May, per International Aluminium Institute (IAI) data. Chinese production (60% of global Al output) increased 1.7% YoY last month, while ex. China output was up only 0.6% YoY. Overall, strong consumption dynamics in Asia (including grid), the ongoing monetary easing cycle in the EU and China, as well as the expected additional US fed rate cuts in 2H25, are likely to add further support to Al, which we forecast to reach USD 2,700-2,900/t by late 2025 - early 2026
We also note that there is limited potential for additional supply growth in China, as local Al output is capped at 45mnt (China produced 43.4mnt in 2024, as well as 43.7mnt in 1H25 in annualised terms, per IAI data)
#aluminium
❤1
Morning Bites (part 2)
🇨🇱Chile’s copper output increased 9% YoY in May, after the 14% YoY gain in April, per INE data. According to market participants, this production increase has partly reflected investment decisions made in 2020-21, a demonstration of the industry's long lead times. We maintain our positive view on copper amid Chile’s long-term supply issues (its peak supply is now likely to be in 2027), growing demand for renewables globally, and surging investments in China’s grid infrastructure (which represents ~8% of global Cu demand, on our numbers)
🇵🇪 Peru’s copper output fell 5% YoY in May, reversing from the +8% YoY in April, per MINEM data. To recap, Peru's top mining association, SNMPE, expects the country's 2025 copper output to hit around 2.80mnt, which is broadly in-line with the 2.74mnt seen in 2024
The joint production of Chile and Peru (~24% and ~12% of global Cu supply, respectively) rose 5% YoY in May, due to the jump in Chile’s output
#copper
🇨🇱Chile’s copper output increased 9% YoY in May, after the 14% YoY gain in April, per INE data. According to market participants, this production increase has partly reflected investment decisions made in 2020-21, a demonstration of the industry's long lead times. We maintain our positive view on copper amid Chile’s long-term supply issues (its peak supply is now likely to be in 2027), growing demand for renewables globally, and surging investments in China’s grid infrastructure (which represents ~8% of global Cu demand, on our numbers)
🇵🇪 Peru’s copper output fell 5% YoY in May, reversing from the +8% YoY in April, per MINEM data. To recap, Peru's top mining association, SNMPE, expects the country's 2025 copper output to hit around 2.80mnt, which is broadly in-line with the 2.74mnt seen in 2024
The joint production of Chile and Peru (~24% and ~12% of global Cu supply, respectively) rose 5% YoY in May, due to the jump in Chile’s output
#copper
Morning Bites (part 1)
🥈Solar panel installations in China dropped 31% YoY in June, reversing from the sharp 5.6x YoY growth in May, per NEA data, as some key subsidies for local solar projects expired in early-June, and investment in grid infrastructure is failing to keep pace with the installation of renewable energy capacities. The figure was up 2.0x YoY in 1H25
Meanwhile, overall photovoltaic cell output in China grew 35% YoY in June, accelerating from the 7% YoY gain in May (and was up 29% YoY on 1H25 basis)
Given the solid demand for renewable energy in China, we maintain our positive view on silver, copper and aluminium, which are the key beneficiary metals of the proposed global transition to clean energy in 2024-30
#silver #copper #aluminium
🥈Solar panel installations in China dropped 31% YoY in June, reversing from the sharp 5.6x YoY growth in May, per NEA data, as some key subsidies for local solar projects expired in early-June, and investment in grid infrastructure is failing to keep pace with the installation of renewable energy capacities. The figure was up 2.0x YoY in 1H25
Meanwhile, overall photovoltaic cell output in China grew 35% YoY in June, accelerating from the 7% YoY gain in May (and was up 29% YoY on 1H25 basis)
Given the solid demand for renewable energy in China, we maintain our positive view on silver, copper and aluminium, which are the key beneficiary metals of the proposed global transition to clean energy in 2024-30
#silver #copper #aluminium
Morning Bites (part 2)
🇨🇳 The output of power generation equipment in China rose 22% YoY in June, vs. the 51% YoY jump in May, per NBS data. The figure was also up 61% YoY in 1H25. Meanwhile, investment in China’s grid infrastructure rose 4% YoY in June (vs. the +33% YoY in May) and increased 15% YoY on 1H25 basis
Although State Grid (which controls >80% of Chinese electricity transmission capacity) sees only a 10% YoY capex increase in 2025, the actual figure might be higher, in our view: historically, the company has often exceeded its investment guidance
On our numbers, the grid accounts for 10-15% of Al and Cu demand in China, so upbeat investments (due to the growing installations of renewable energy) are fundamentally supportive of demand for these base metals
#copper #aluminium
🇨🇳 The output of power generation equipment in China rose 22% YoY in June, vs. the 51% YoY jump in May, per NBS data. The figure was also up 61% YoY in 1H25. Meanwhile, investment in China’s grid infrastructure rose 4% YoY in June (vs. the +33% YoY in May) and increased 15% YoY on 1H25 basis
Although State Grid (which controls >80% of Chinese electricity transmission capacity) sees only a 10% YoY capex increase in 2025, the actual figure might be higher, in our view: historically, the company has often exceeded its investment guidance
On our numbers, the grid accounts for 10-15% of Al and Cu demand in China, so upbeat investments (due to the growing installations of renewable energy) are fundamentally supportive of demand for these base metals
#copper #aluminium
Morning Bites (part 3)
🔗Global crude steel output dropped 6% YoY, to 151mnt in June, accelerating from the -4% YoY seen in May, according to World Steel Association data. China’s production (55% of global crude steel supply in June) dropped 9% YoY (-3% YoY in 1H25), while world ex-China output slid 1% YoY, per WSA data. Meanwhile, Russia’s production dropped 7% YoY last month; EU output also shrank 8% YoY. US production rose 5% YoY, while Indian output (~9% of global steel supply) gained 13% YoY, also being up 9% YoY in 1H25
We remind readers that Beijing plans to cut 'excessive' steel output in 2025 (which might mean a decline 2-5% YoY, per market estimates), which is likely to cool surging Chinese steel exports and support global prices in late-2025 or 2026, we believe
#steel
🔗Global crude steel output dropped 6% YoY, to 151mnt in June, accelerating from the -4% YoY seen in May, according to World Steel Association data. China’s production (55% of global crude steel supply in June) dropped 9% YoY (-3% YoY in 1H25), while world ex-China output slid 1% YoY, per WSA data. Meanwhile, Russia’s production dropped 7% YoY last month; EU output also shrank 8% YoY. US production rose 5% YoY, while Indian output (~9% of global steel supply) gained 13% YoY, also being up 9% YoY in 1H25
We remind readers that Beijing plans to cut 'excessive' steel output in 2025 (which might mean a decline 2-5% YoY, per market estimates), which is likely to cool surging Chinese steel exports and support global prices in late-2025 or 2026, we believe
#steel
Morning Bites
🔗CISA mills daily crude steel production in mid-July was 2.14mnt, up 2.1% vs. the previous ten days, and 0.3% lower YoY. Local steel inventories rose 3.9% over the period, but were down 3.9% YoY
According to CISA data, on a YTD basis (through 20th July), production dynamics remained slightly positive (+0.5% YoY). Meanwhile, per official NBS data, the country's steel output was down 3.3% YoY in 1H25, following Beijing’s plans to cut 'excessive' supply in 2025. To recap, these measures might affect 2-5% of China’s 2024 supply, per market participant estimates
China accounts for ~57% of global steel supply
#steel
🔗CISA mills daily crude steel production in mid-July was 2.14mnt, up 2.1% vs. the previous ten days, and 0.3% lower YoY. Local steel inventories rose 3.9% over the period, but were down 3.9% YoY
According to CISA data, on a YTD basis (through 20th July), production dynamics remained slightly positive (+0.5% YoY). Meanwhile, per official NBS data, the country's steel output was down 3.3% YoY in 1H25, following Beijing’s plans to cut 'excessive' supply in 2025. To recap, these measures might affect 2-5% of China’s 2024 supply, per market participant estimates
China accounts for ~57% of global steel supply
#steel