Continued Arrival of Imports, Zinc Concentrate TCs May Continue to Rise in April [SMM Zinc Concentrate Weekly Review]

SMM March 28 News:

The domestic zinc concentrate TCs continued to rise in April. The monthly average TC for SMM Zn50 domestic zinc concentrate increased by 350 yuan/mt (metal content) MoM to 3,450 yuan/mt (metal content). The monthly average TC for SMM Zn50 imported zinc concentrate increased by $5/dmt MoM to $40/dmt. On a weekly basis, the average TC for SMM Zn50 domestic zinc concentrate rose by 150 yuan/mt (metal content) WoW to 3,400 yuan/mt (metal content), while the average TC for SMM Zn50 imported zinc concentrate remained flat WoW at $35/dmt.

In the spot market for ore, smelters began negotiations this week for April zinc concentrate TCs. Currently, the TCs in various domestic regions have hardly been finalized, but the expectation of an increase persists. For imported ore, the SHFE/LME price ratio remains unfavorable, and market traders are still unwilling to sell at low prices, resulting in no improvement in the transaction of imported zinc ore, with TC prices holding steady. Previously ordered imported zinc ore by smelters is gradually arriving, replenishing raw material inventories, while domestic mines are also gradually resuming production. The market expects subsequent supply to increase, and with no shortage of goods, domestic smelters continue to raise the pricing for April zinc concentrate TCs. Additionally, a mine in south China recently set the tender price for April zinc concentrate at 3,600 yuan/mt (metal content), continuing the rise from March. SMM will continue to monitor the subsequent adjustments in domestic TCs.

On March 21, a newly commissioned zinc smelter in Henan started production. It is reported that the new smelter has a capacity of 150,000 mt. As the production start-up process takes about a month, the actual output of zinc ingots is expected to be available by May at the earliest. SMM will continue to track the progress.

This week, the total inventory of zinc concentrates at major ports in China amounted to 310,300 mt, down 31,100 mt WoW, indicating a slight decline in port zinc ore inventories.

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