SMM Daily Review - 2010/1/12 Zinc Market

SHANGHAI, Jan. 13 (SMM) -- SHFE zinc prices opened low, and fluctuated lower, but bottomed out at noon and moved higher, narrowing the declines when closing. Positions of SHFE 1004 zinc contract increased by 11,452 lots, and the turnover rate was 304%, with trading value reaching nearly RMB 48 billion. SHFE 1004 zinc contract dipped to RMB 21,125/mt, and closed at RMB 21,490/mt. SHFE spot-month contract zinc prices fluctuated in the RMB 20,600-20,900/mt range, stronger than other contracts.

In the spot zinc market, SMM offers for #0 zinc were RMB 20,600-20,700/mt, and market offers were RMB 20,700/mt positively affected by rising SHFE zinc prices. However, SHFE zinc prices faced growing short selling pressure, and downstream consumers adopted a wait-and-see attitude, with no interest in purchases currently, despite that they still had buying demand. Meanwhile, both traders and smelters kept offers firm, resulting in neutral trading sentiment.

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