Resumption Progress of Secondary Zinc Enterprises Post CNY Holiday

SHANGHAI, Feb 16 (SMM) - Zinc ingots are widely used in galvanising, alloy and other related fields, which involving real estate, infrastructure, home appliances, automobiles and other industries. With the declining ore grades and the continuous green development, secondary zinc gradually received attention. According to the data from the Ministry of Commerce, the domestic secondary zinc output reached 1.37 million mt in 2021 and continued to increase in recent years. After the Chinese New Year (CNY) holiday, the zinc prices fell sharply and once declined below 23,000 yuan/mt while the secondary zinc oxide coefficient remained high. Under this background, how about the resumption progress of secondary zinc enterprises post the holiday? 

 According to SMM research, some zinc smelters did not suspend work during the CNY holiday and most factories that took holidays have resumed work, while some enterprises have not resumed production due to maintenance.

The orders were average as the downstream zinc alloy enterprises and galvanising enterprises in south China have just resumed production recently. Although the galvanising enterprises resumed earlier, galvanising plants mainly digested their stocks under the poor terminal demand. Coupled with falling zinc prices, enterprises were wait-and-see.

In terms of raw materials, the survey indicated that the sufficient pre-holiday stockpile, the current fluctuating zinc prices and the overall low operating rates weighed on the demand for raw material.

The current situation of enterprises was relatively stable while workers of some enterprises resumed work slowly. The high prices of raw materials and falling zinc prices curbed the profits of enterprises.

On the whole, the resumption of secondary zinc enterprises diverged, and SMM will continue to investigate the recovery of orders in the follow-up stage.