SHANGHAI, Jun. 30 (SMM) - The SMM/LME zinc price ratio hit 9.3 in early and mid-June, the highest from April 17, 2009, and fell sharply to 8.33 recently. This closed the import profit window for zinc, turning import profit from 1,000 yuan per tonne to losses, which expanded to 800 yuan per tonne at one point, SMM data showed.
What closed the import profit window?
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Import profit during April and May attracted influx of imported zinc in China. Imported resources thus increased in Shanghai, Guangdong and Tianjin. Consequently, spot premiums of domestic zinc shrank fast from 1,000 yuan per tonne, and inverted to discounts of 20 yuan per tonne on June 29. In contrast, zinc supplies overseas tightened further because of outflows to China and zinc ingot shortages. LME zinc inventories continued falling, and canceled warrants on LME zinc increased. Backwardation of forward-month zinc on the LME expanded to above $200 per tonne. Spot supply tightness bolstered LME zinc, SMM explained.
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In the meantime, the central parity of the Chinese yuan increased. Both onshore and offshore yuan posted a 3-day winning streak. Higher forex exchange expanded import losses on zinc, SMM added.
The import profit window will unlikely reopen in the near term, SMM predicts. Arriving shipments of imported zinc will decrease in the near term. Imports from bonded zone inventories will be limited. And arriving shipments of future spot will also decrease.
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![Les fondamentaux présentent à la fois des facteurs haussiers et baissiers, le zinc du SHFE consolide à des niveaux élevés [Bref sur les contrats à terme du zinc de SMM]](https://imgqn.smm.cn/usercenter/TeRBO20251217171754.jpg)
