Demand Continued to Recover, Zinc Oxide Operating Rates Kept Rising [SMM Zinc Oxide Weekly Review]

This week, the zinc oxide industry operating rate was recorded at 59.26%, up 1.48 percentage points WoW. Inventory side, affected by high prices, enterprises showed weak enthusiasm for raw material procurement, and raw material inventory pulled back somewhat; meanwhile, high prices suppressed downstream order-taking, with finished product inventories of some enterprises continuing to accumulate and inventory pressure increasing. The WoW rise in operating rate was mainly attributable to the gradual recovery of orders across downstream sectors, driving up overall production loads of enterprises. By product category, rubber-grade and electronic-grade zinc oxide orders performed relatively well compared to other segments, ceramic-grade zinc oxide orders remained normal, and demand for feed-grade zinc oxide was relatively mediocre. Currently, major producers' capacity is gradually being released, supporting a continued rise in operating rates; however, affected by recent price fluctuations, rising auxiliary material costs, and intense market competition, profit margins of some zinc oxide enterprises remained narrow. Looking ahead to next week, as downstream demand continues to be released, the zinc oxide industry operating rate is expected to continue to rebound, fluctuating around 59.64%.