Overseas Supply Disruptions Combined With US CPI Below Expectations, Zinc Price Center Slightly Rose in Both Domestic and Overseas Markets This Week [SMM Market Review - Weekly Price Commentary]

SMM March 14 News:

LME Zinc: At the beginning of the week, LME zinc continued last week's downward trend and declined further. Subsequently, the US February New York Fed's 1-year inflation expectations rose to 3.13%, higher than the market expectation of 3.1% and the previous value of 3%, raising doubts about the US Fed's future policy adjustments and negatively impacting overall sentiment, causing LME zinc to continue its downward trend. Then, with Trump escalating tariff threats against Canada, the US dollar index fluctuated downward, market risk aversion strengthened, and combined with the US February NFIB Small Business Optimism Index falling below expectations, multiple factors jointly pushed LME zinc upward. Later, US February CPI data came in entirely below expectations, the US fiscal year budget deficit reached $1.1 trillion, a record high for the same period, and Nyrstar announced that its Hobart zinc smelter would reduce production by about 25% starting in April 2025. Under the expectation of reduced supply, LME zinc continued to rise. Subsequently, LME zinc dropped back slightly, but due to the uncertainty of tariff policies and the reduction in overseas inventories, LME zinc maintained a fluctuating trend. As of 15:00 this Thursday, LME zinc recorded $2,933.5/mt, up $51.5/mt, an increase of 1.79%.

SHFE Zinc: At the beginning of the week, according to SMM data, as of this Monday (March 10), the total zinc ingot inventory across SMM's seven regions was 135,800 mt. Meanwhile, under the influence of the overseas market, SHFE zinc declined slightly. Subsequently, with Trump escalating tariff threats against Canada, market uncertainty over tariffs continued to increase, the US dollar index kept rising, and risk aversion also strengthened. SHFE zinc opened higher with a gap under the influence of the overseas market. Then, as domestic downstream consumption had not yet shown "peak season" performance, price support was weak, and SHFE zinc declined. Later, US February CPI data came in entirely below expectations, the US fiscal year budget deficit reached $1.1 trillion, and combined with Australia's Nyrstar announcing that its Hobart zinc smelter would cut production in April this year, SHFE zinc continued to open higher with a gap. However, as downstream consumption had not shown significant "peak season" performance and domestic social inventories, though slightly increased, remained at historically low levels in recent years, SHFE zinc maintained fluctuating operations. As of 15:00 this Thursday, SHFE zinc recorded 24,050 yuan/mt, up 90 yuan/mt, an increase of 0.38%.

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