SHFE Zinc Bottomed Out and Rallied while LME Zinc Consolidated at $3,000/mt

SHANGHAI, Feb 20 (SMM) - Last Friday, the United States planned to impose new export controls on critical industries in Russia, with sanctions targeting Russia's national defence department, energy department, financial institutions and some individuals. The 59th Munich Security Conference concluded without reaching a broad consensus on issues such as the Russia-Ukraine conflict. Russia said it would urge the United Nations to investigate the explosion of the "Nord Stream" pipeline.

China's one-year and five-year LPRs will be released today.

LME zinc opened at $3,025/mt last Friday and closed up $43.5/mt or 1.43% at $3,081/mt. The trading volume was 4,875 lots, and open interest lost 470 lots to 199,000 lots. Generally, LME zinc rose and consolidated around $3,000/mt. LME zinc inventory was flat at a low level of 29,850 mt.

During last Friday’s night session, the most-traded SHFE 2303 zinc contract opened at 22,860 yuan/mt and moved sideways around 23,000 yuan/mt before closing at 23,105 yuan/mt, up 245 yuan/mt or 1.07%. Trading volume stood at 39,000 lots, and open interest shed by 3,909 lots to 70,700 lots. Generally, SHFE zinc bottomed out and recorded an increase. The domestic production post the Chinese New Year holiday was smooth enough to secure the supply of zinc ingots, but it is worth noting that the consumption of galvanised zinc products was rather robust with the launch of housing and infrastructure construction projects, which still bolstered the zinc prices. Therefore, zinc prices may continue to fluctuate in the short term.