Zinc oxide exports in March were weak and may not improve in April [SMM Analysis]

SHANGHAI, Apr 24 (SMM) - According to the latest customs data, zinc oxide exports in March 2024 were 905.16 tons, a month-on-month increase of 35.58% and a year-on-year decrease of 52.76%; the cumulative zinc oxide exports from January to March 2024 were 2,576.5 tons, a year-on-year decrease of 39.08 percentage points.

In March 2024, Vietnam imported 252.7 tons of Chinese zinc oxide, accounting for 27.92% of China’s total zinc oxide exports in March, ranking first; Thailand imported 193.3 tons of Chinese zinc oxide, accounting for 21.35% of the total zinc alloy exports in March, ranking second. Japan imported 102 tons of zinc oxide from China, accounting for 11.27% of the total zinc alloy exports in March, ranking third. Comparing the cumulative zinc oxide exports from January to February 2024, the zinc oxide exports to Vietnam were relatively stable, and the increase in exports to Thailand was significant. Overall zinc oxide exports were low.

SMM attributes the weak zinc oxide exports in March to the following factors.

1. Some domestic enterprises gradually moved overseas or opened branches in overseas markets, thereby directly delivering cargoes to overseas markets to enhancing their advantages; that eroded into export share of some domestic companies.

2. In March, the SHFE/LME price ratio fluctuated at a high level, and the domestic zinc oxide price advantage narrowed.

3. The tax issues on zinc oxide import and export are relatively complicated, and there are many taxation procedures. Some enterprises calculate costs and reduce the export ratio.

In April, the market situation remains grim, and zinc oxide exports may not improve and will fluctuate at a low level.