SHANGHAI, Apr 27 (SMM) – Industrial Climate Index in April, Economic Prosperity Index in April, CPI monthly rate in April in eurozone, and US monthly rate of durable goods order in March; official manufacturing PMI in April in China. On events, US President Joe Biden will deliver a speech at a joint meeting of the two houses of Congress on April 28, and the Federal Reserve FOMC will announce interest rate resolutions and policy statements on April 29.
The Covid-19 vaccine problem has not been effectively resolved last week, and the number of daily vaccination in the United States has further declined. In addition, the number of new infection cases in a single week hit a new high for the year, and the pandemic in India was completely out of control. The worsening Covid-19 pandemic situations have caused market concerns about the recovery of consumption. Whether the overseas injection volume will continue to decrease due to vaccine problems remains as the market focus. If the injection volume rises again, we can continue to expect recovery, and metals market will also strengthen. Vaccine injections in Peru, Bolivia, and other countries are low, which is likely to cause difficulties in the release of production in local mines. The downward room for LME zinc was limited. LME zinc prices are expected to stand at $2,780-2,890/mt.
Zinc concentrate imports in March exceeded expectations. Imported zinc concentrate will arrived at smelters in April and May. Imports are expected to remain high levels. Zinc concentrate is expected to remain a tight balance in Q2 amid the seasonal recovery of domestic mines. Maintenance at smelters will increase in May and output is expected to increase only 8,000 mt on the month, which is far less than expected. Thus, demand for zinc concentrate rose slightly. TCs in some regions is likely to rise in May as the tight zinc concentrate supply is eased. The national average price of zinc concentrate TCs is expected to increase by about 50 yuan/mt month-on-month in May, and the cost support for smelters will be slightly lowered. Though orders weakened amid high raw material prices, social inventories declined amid rigid demand. Zinc prices are expected to fluctuate further supported by costs at smelters. The most-traded SHFE contracts prices are expected to stand at 21,000-22,000 yuan/mt this week, spot premiums of Shanghai zinc stood at -30-10 yuan/mt over the May contract.
