Guangdong Zinc: Few Downstream Operating Enterprises, Sluggish Market Transactions [SMM Midday Review]

SMM, February 5: Mainstream transactions of Guangdong 0# zinc were around 23,180-23,760 yuan/mt. Mainstream brands quoted a premium of about 10 yuan/mt against the 2503 contract and a spot discount of 50 yuan/mt against Shanghai, with the Shanghai-Guangdong price spread widening. In the first session, suppliers quoted premiums of 0-50 yuan/mt for Qilin, Mengzi, and Lan zinc. In the second session, Mengzi quoted a premium of 10 yuan/mt against the online price. Overall, downstream enterprises are currently operating at low levels, with most actual production expected to resume around the Lantern Festival. Procurement demand remained weak. In the early session, the market quoted higher premiums due to concerns over Guangdong's inventory buildup falling short of expectations. Subsequently, premiums declined due to sluggish transactions. Market transactions were sluggish today, the price spread between futures contracts slightly expanded, and premiums slightly increased.