SHFE zinc prices moved rangebound without improvement in consumption [SMM zinc morning comment]

LME zinc prices opened at $2532/mt last Friday and closed down $49.5/mt or 1.95% at $2482.5/mt, with the high-end of $2535.5/mt and the low-end of $2481.5/mt. Trading volume decreased to 9945 lots, and open interest grew by 6370 lots to 230,000 lots. The market began to expect that the Federal Reserve would cut interest rates later, the U.S. dollar index strengthened again, and the early optimism was digested.

Last Friday, the SHFE 2405 zinc contract opened at 21180 yuan/ton with a low of 21165 yuan/ton and a high of 21305 yuan/ton. It finally closed down at 21230 yuan/ton, down 80 yuan/ton, or 0.38%. The trading volume dropped to 43143 lots, and the open interest decreased by 104 lots to 102,000 lots. Recently, TCs have been running at low levels. The shortage of supply at the mines may still support zinc prices. However, there has been no major improvement in consumption, and SHFE zinc may have insufficient upward momentum.