Demand from Tyre Factories Slows Down, Operating Rate of Zinc Oxide Declines [SMM Zinc Oxide Weekly Review]

SMM April 25 News:

       This week, the operating rate of zinc oxide recorded 59.77%, down 1.01% MoM. Raw material side, the center of zinc prices rose this week, and the prices of various raw materials are currently high. Zinc oxide enterprises mainly made just-in-time procurement, and raw material inventories decreased MoM. Finished product inventories side, on one hand, downstream demand has weakened, and the pace of cargo pick-up has slowed down. On the other hand, some enterprises have holiday arrangements for May Day, so finished product inventories increased MoM. Order side, tyre factories currently have poor orders, and overcapacity has continuously compressed corporate profits. Tyre enterprises have seen significant inventory buildup, and the demand for rubber-grade zinc oxide has weakened. The demand for ceramic-grade zinc oxide in the market is relatively stable. For feed-grade zinc oxide, overall orders are also relatively normal, but the recent prevalence of epidemic diarrhea in the pig market may affect subsequent feed-grade zinc oxide orders. In terms of export orders, the "rush to export" in the end-use market is not obvious recently. On the contrary, tyre orders have weakened due to tariff issues. Next week, some zinc oxide enterprises plan to take holidays, and the overall operating rate may drop to around 57.33%.

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