The Resumption Wave Has Ended: What Is the Progress of Zinc Oxide Production Resumption? [SMM Analysis]

SMM February 14 News:

        Two weeks have passed since the holiday, and zinc oxide operating rates have continuously rebounded from the yearly low. Mid-week coincides with the post-Lantern Festival resumption wave. What is the current progress of zinc oxide production resumption? Let’s analyze by segment.

• Rubber segment: Large-scale rubber-grade zinc oxide producers mostly halted production around the Little New Year and resumed around the eighth day of the Chinese New Year. With tyre factories gradually resuming operations after the holiday, some new orders for zinc oxide have continued to emerge, and related rubber-grade zinc oxide orders are steadily recovering.
• Feed segment: The Chinese New Year coincides with the peak consumption season for the feed segment. Overall end-use consumption demand has been robust, continuously supporting related feed-grade zinc oxide orders. Recently, some producers are still fulfilling orders received before the holiday, and the overall production resumption progress is proceeding as scheduled.
• Ceramics segment: Winter is the typical shutdown season for ceramic factories. The cold weather has not significantly warmed up, leading to a slower resumption process for previously halted ceramic factories. End-use demand remains weak, and some zinc oxide producers have chosen to delay production resumption. Overall demand is expected to rebound significantly by late February or around March.
• Electronics and chemicals segments: After the holiday, zinc oxide orders in the electronics and chemicals segments have basically returned to pre-holiday levels, supporting related zinc oxide enterprises to resume production as planned.

        In summary, apart from some ceramic-grade zinc oxide enterprises delaying production resumption, other zinc oxide producers have largely resumed production as planned. With the gradual resumption of downstream end-user enterprises, related zinc oxide consumption continues to recover, driving a gradual rebound in zinc oxide operating rates.

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