Zinc Morning Meeting Minutes, August 17
Futures: Last Friday, LME zinc opened at $3,745/mt. In early trading, LME zinc consolidated and drifted lower around the daily moving average, hitting $3,720/mt near the start of the European session. After the European session began, bulls entered on dips and LME zinc gradually stabilized and rebounded. During the night session, bulls continued to push, driving LME zinc to drift higher and touch $3,784/mt. Near the close, capped by the upper Bollinger Band, LME zinc pulled back slightly and ultimately closed up at $3,762/mt, up $17/mt, a gain of 0.45%. Trading volume decreased to 9,829 lots, while open interest increased by 306 lots to 255,000 lots. Last Friday, the SHFE zinc 2609 contract opened at 25,750 yuan/mt. In early trading, bulls added positions and pushed SHFE zinc to rise quickly, touching 25,925 yuan/mt. It then consolidated and pulled back, capped by the upper Bollinger Band and amid profit-taking. Near the close, after dipping to 25,690 yuan/mt, it rebounded slightly and closed at 25,740 yuan/mt, up 85 yuan/mt, a gain of 0.33%. Trading volume decreased by 34,646 lots to 51,270 lots, while open interest decreased by 1,626 lots to 97,541 lots.
Macro: Trump called for a “significant reduction” in US–South Korea joint military drills; a senior US lawmaker asked Bessent to explain the basis for intervening in the Japanese yen; Kushner reportedly met with senior Hamas officials in Egypt last Sunday and pressured them; US retail sales MoM unexpectedly turned negative, and the consumer confidence index fell for the first time in three months; PBOC: cumulative growth in aggregate financing to the real economy totaled 22.25 trillion yuan in the first seven months.
Spot market:
Shanghai: In Shanghai, refined zinc procurement sentiment was 1.84, and shipments sentiment was 2.48. Last Friday, SHFE zinc futures maintained a fluctuating trend and did not reach downstream enterprises’ psychological price level for pricing; downstream players continued to wait and see, and overall spot trades showed no improvement. Traders quoted offers with a laid-back approach, and overall spot premiums changed relatively little.
Guangdong: In Guangdong, refined zinc procurement sentiment was 1.93, and selling sentiment was 2.55. Zinc prices are still consolidating at highs; enterprises with procurement needs downstream continued to make just-in-time procurement, while enterprises with relatively ample inventory mainly stayed on the sidelines. Overall, high prices continued to cap market transactions, and Guangdong spot premiums were flat versus last Thursday.
Tianjin: In Tianjin, refined zinc procurement sentiment was 1.77, and shipments sentiment was 2.53. Zinc prices remained relatively high, with almost no inquiries from downstream. Exports drove destocking, while actual consumption showed little improvement. Traders were the main participants in trading; traders’ shipment premiums stayed stable, and overall market transactions were average last Friday.
Ningbo: In Ningbo, there were relatively many traders offering shipments. Spot premium quotes changed relatively little MoM, but SHFE zinc futures stayed high and downstream enterprises continued to wait and see; overall spot transactions remained sluggish last Friday.
Social inventory: On August 14, LME zinc inventory fell by 4,550 mt to 88,000 mt, a decline of 4.92%; according to SMM market communication, as of August 13, inventory in China decreased by 3,100 mt to 264,300 mt.
Zinc price outlook: Last Friday, LME zinc posted a small bullish candlestick, with support provided by various moving averages below, while the upper band of the Bollinger Bands above formed resistance. A weaker US dollar and an expanding backwardation structure in LME zinc, after the US monthly retail sales rate unexpectedly turned negative, kept LME zinc drifting higher within a consolidating range. Last Friday, SHFE zinc posted a small bearish candlestick with a long upper shadow, but the center of the daily candlestick moved higher, with support provided by various moving averages below. Social inventory continued destocking, but weak consumption capped upside room; zinc prices were mainly range-bound, with attention on inventory performance in China and overseas.
Data source statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and SMM’s internal database models, for reference only and not constituting decision-making advice.
![Weak Consumption Limited Zinc’s Upside Room; Focus on Inventory Performance [SMM Zinc Morning Comment]](https://imgqn.smm.cn/usercenter/kdRPs20251217171754.jpg)
