Morning Insight: December 18, 2025

Morning Insight:December 18, 2025 LinlinGaoCertification：Z0002332gaolinlin@gtht.comYu Chen Wu (Contact)Certification：F03133175 wuyuchen@gtht.com Main Body Commodity MarketInsight： Lithium Carbonate:Fundamental changes remain limited, with marketsentiment driving lithium prices higher. On the one hand, the YichunMunicipal Bureau of Natural Resources plans to revoke 27 mining licenses.Although most of the affected mines had previously been suspended,implying limited impact on actual supply and demand, the market hasinterpreted this as a signal of tightening lithium resource regulation inthe Yichun region, and expects potential constraints on future supplygrowth of lepidolite-based lithium. On the other hand, marketexpectations for the resumption of production at major producers havebeen repeatedly pushed back. In the absence of restarts, weeklyinventories have continued to decline at a pace of more than 2,000 tons.Ongoing destocking on the spot side, together with expectations ofimproving future demand, has jointly supported bullish market sentiment.That said, it is worth noting that spot market transactions remainrelatively subdued, downstream buyers show limited acceptance of currenthigh prices, and a degree of divergence has emerged between the futuresand spot markets. Overall, market sentimentis currently biased to theupside. In the short term, lithium prices are expected to hold atelevated levels with increased volatility, and cautious positioning isadvised. Platinum & Palladium:On December 17, the most active platinum andpalladium futures contracts on the Guangzhou Futures Exchange surged to the daily limit, driven by a confluence of macro factors, acute spotmarket tightness, and capital flows. On the macro front, a weaker U.S. dollar supported the broader preciousmetals complex. As relatively undervalued metals within the sector,platinum and palladium benefited from catch-up buying. Meanwhile, spotmarket liquidity tightened further: the 1-month platinum lease ratespiked to 14%, while contango across the forward curve remained above 10%on an annualized basis. ETF holdings continued to rise, with particularlystrong momentum in palladium investment demand, reflected in both theabsolute levelof holdings and the accelerating pace of inflows. At the same time, elevated basis levels and wide domestic–overseas pricespreads encouraged arbitrage capital to accumulate physical inventory.Rising spot prices were subsequently transmitted to the futures market,with synchronized moves across onshore and offshore markets amplifyingprice elasticity. This multi-layered resonance ultimately pushed futuresprices to their upper limits. Given the rapid pace of the rally, volatility at elevated levels islikely to intensify, and downside correction risks warrant closeattention going forward. Open Interest Source：iFind, GUOTAIJUNAN FUTURESResearch Source：iFind, GUOTAIJUNAN FUTURESResearch Source：iFind, GUOTAIJUNAN FUTURESResearch Source：iFind, GUOTAIJUNAN FUTURESResearch News Highlights: 1. China on Thursday launched island-wide special customs operations inthe Hainan Free Trade Port (FTP), the world's largest FTP by area,allowing freer entry of overseas goods, expanded zero-tariff coverage andmore business-friendly measures. The move is widely seen as a landmark step in China's ongoing efforts topromote free trade and expand high-standard opening-up at a time ofrising protectionism worldwide. Under the new arrangements, the tropical island of more than 30,000 square km has been designated as a special customs supervision zone. Thismarks a new stage in the development of the Hainan FTP, which enablesfreer flows of goods, capital, personnel and data, supported by zerotariffs, low tax rates and a simplified taxsystem. (Source: Xinhua) 2. The United Nations Convention on Negotiable Cargo Documents, adoptedearlier this week, underscores China's commitment to true multilateralismand its efforts to provide global public goods and advance the reform andimprovement of global governance, the Ministry of Commerce said onWednesday. The convention was formally adopted by the 80th session of the UN GeneralAssembly on Dec. 15 in New York. China has served as both the proposer and a key driving force behind theconvention, having submitted a formal proposal on the issue as early asJuly 2019. According to a statement on the UN's website, the convention aims toextend the benefits of negotiable documents beyond maritime transport. Byestablishing clear rules on the issuance and use of negotiable cargodocuments (NCDs), as well as on the rights and liabilities of NCDholders, the convention seeks to facilitate trade finance, enable thesale of goods in transit, promote multimodal transport, and support thedigitalization of global trade. In addition, it allows for the use of a single NCD to cover the entiretransport journey, simplifying documentation, improving operationalefficiency, and easing customs clearance procedures. (Sou