Prices for exchange-traded nonferrous metals have strengthened over the last quarter despite questionable underlying fundamentals.

Government spending in the U.S. and policy support in China have tipped the scale somewhat and kept prices from declining as demand tapers off. While additional fiscal and monetary support is likely to be announced to help stabilize the mainland Chinese economy as downside risks mount, we believe that the overall policy stance will be accommodative but not aggressive given mainland China’s debt concerns.

We expect the prices for copper and nickel will continue to decline as a growing supply surplus will provide downward pressure into the third quarter, while aluminum and zinc prices will rise over the second half of the year. For the second quarter of 2023, Lumber price has a significant decrease of -30.4% year-of-year change as compared with its price level one year ago.