Dual Factors Disturb the Market, Zinc Oxide Operating Rates Decline [SMM Zinc Oxide Weekly Review]

This week, the zinc oxide operating rate recorded 52.48%, down 0.44 percentage points WoW. Inventory-wise, zinc prices consolidated during the week, and some zinc oxide enterprises bought the dip, driving raw material inventory to edge up. This week's operating rate pulled back, mainly due to two factors: on one hand, end-use demand weakened recently, and some enterprises proactively implemented production control measures; on the other hand, environmental protection checks were carried out in some regions recently, which had a certain impact on production at related enterprises, causing operating rates to contract. In terms of end-use orders, overall downstream demand for zinc oxide is currently weak, with orders for rubber-grade, ceramic-grade, and feed-grade zinc oxide all showing mediocre performance. Demand for electronic-grade zinc oxide is relatively firm, but market feedback is mixed, with some enterprises noting mediocre orders in the varistor and valve plate segments, while power grid-related orders have yet to form significant demand growth. Looking ahead to next week, given that end-use demand improvement remains limited and environmental protection checks in some regions still have a certain impact on production, the zinc oxide enterprise operating rate is expected to edge down, running near 52.40%.