Macro Disturbances Coupled with Divergent Fundamental Performance, Zinc Prices Stable Overseas but Rising Domestically [SMM Market Review - Weekly Price Commentary]

LME Zinc: At the beginning of the week, LME zinc pulled back from fluctuating at highs as policy uncertainty intensified after the US Supreme Court overturned former President Trump's emergency tariff order, and Trump immediately announced a new comprehensive tariff policy. Subsequently, the resumption of domestic market trading boosted risk appetite, coupled with continued destocking in overseas inventories, supporting a rebound in LME zinc. However, the transition between the old and new US tariff policies triggered wild swings in the US dollar, leading to volatile market sentiment, and LME zinc pulled back again and entered a consolidation phase. Later, traders lowered expectations for US Fed interest rate cuts, the US dollar strengthened, and LME zinc came under pressure. Towards the end of the week, uncertainties surrounding tariffs and regional geopolitical risks persisted, and LME zinc maintained a narrow consolidation. As of 15:00 this Friday, LME zinc recorded $3,378.5/mt, up $0.5/mt, an increase of 0.01%.

SHFE Zinc: At the beginning of the week, SHFE zinc rose rapidly driven by gains in the LME. However, after the Chinese New Year holiday, domestic zinc ingot inventory continued to build up to over 200,000 mt, weighing on zinc prices due to high inventory levels, and SHFE zinc subsequently declined. Later, as uncertainties surrounding overseas tariffs and regional geopolitical issues persisted, SHFE zinc maintained a fluctuating trend. However, overall operating rates across downstream sectors remained low, the spot market was sluggish, and domestic inventory continued to rise. Affected by fundamentals, SHFE zinc moved lower. Nevertheless, despite weak fundamentals, there were still certain uncertainties on the macro front, and market wait-and-see sentiment was strong, leading SHFE zinc to maintain a fluctuating trend. As of 15:00 this Friday, SHFE zinc recorded 24,710 yuan/mt, up 460 yuan/mt, an increase of 1.90%.