Consumption Gradually Entering Off-Season, SHFE Zinc Expected to Fluctuate in the Short Term [SMM Zinc Morning Comment]

Published: May 20, 2026 08:39

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[SMM Zinc Morning Comment: Consumption Gradually Entering Off-Season, SHFE Zinc Expected to Fluctuate in the Short Term] Overnight, the most-traded SHFE zinc 2607 contract opened at 24,750 yuan/mt. At the beginning of the session, SHFE zinc touched a high of 24,750 yuan/mt. After the opening, SHFE zinc pulled back in a volatile manner throughout the session, hitting a low of 24,445 yuan/mt. It then gradually recovered from the low to near the daily average line, ultimately closing down at 24,555 yuan/mt, down 150 yuan/mt, a decline of 0.61%.

SMM News, May 20:

Overnight, LME zinc opened at $3,517.5/mt. After the open, LME zinc fluctuated along the daily moving average, touching a high of $3,541.5/mt during the session before pulling back quickly from the high. Near the end of the session, LME zinc dipped to a low of $3,488/mt, then rebounded to near the daily moving average, ultimately closing down at $3,511/mt, down $4.5/mt or 0.13%. Trading volume decreased to 9,434 lots, and open interest decreased by 5,126 lots to 239,000 lots. Overnight, LME zinc posted a bearish candlestick, with the 5-day moving average forming resistance above. Expectations for US Fed interest rate hikes persisted, and the US dollar index strengthened from low levels, suppressing zinc price movements. LME zinc maintained a fluctuating trend, with the center edging down MoM.

Overnight, the most-traded SHFE zinc 2607 contract opened at 24,750 yuan/mt. At the start of the session, SHFE zinc touched a high of 24,750 yuan/mt. After the open, SHFE zinc pulled back in a fluctuating manner throughout the session, dipping to a low of 24,445 yuan/mt, then gradually rebounded from the low to near the daily moving average, ultimately closing down at 24,555 yuan/mt, down 150 yuan/mt or 0.61%. Trading volume decreased to 31,882 lots, and open interest increased by 3,867 lots to 85,524 lots. Overnight, SHFE zinc posted a bearish candlestick, with the 10-day moving average forming resistance above. On the fundamentals, declining zinc concentrate TCs provided some support for zinc prices, but as China gradually enters the traditional consumption off-season, zinc ingot consumption continues to weigh on price movements. Upward momentum for zinc prices remains insufficient, and prices are expected to maintain a fluctuating trend in the short term.

Data source disclaimer: Data other than publicly available information is derived from publicly available information, market communication, and SMM's internal database models, processed by SMM for reference only and does not constitute decision-making advice.

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM‘s internal database model. They are for reference only and do not constitute decision-making recommendations.

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