SHANGHAI, Jun. 21 (SMM) - SHFE 1310 zinc contracts became the most actively traded contracts today, opening RMB 60/mt lower at RMB 14,480/mt as LME zinc prices opened low and moved lower. HSBC’s June PMI for China deteriorated, triggering concerns over China’s demand for zinc. SHFE 1310 zinc contract prices pulled down to RMB 14,450/mt. The Shanghai Composite Index dipped to 2,082.82, a new low since last December, with daily losses of 2.77%. LME zinc prices lost USD 1,850/mt, weighing down SHFE zinc prices. As large numbers of shorts rushed to the market, SHFE zinc prices once dipped to RMB 14,355/mt, hitting a record low from mid-April, and finally closing at RMB 14,380/mt, down RMB 160/mt, or 1.1%. Trading volumes of SHFE 1309 zinc contracts increased by 37,686 lots, to 68,656 lots, and positions increased by 17,384 lots to 124,756 lots.
#0 zinc prices were between RMB 14,530-14,570/mt, with spot premiums between RMB 110-130/mt against SHFE 1310 zinc contract prices. #1 zinc prices were between RMB 14,510-14,520/mt. SHFE zinc prices opened low and moved lower, and HSBC’s June PMI for China fell further, distressing market sentiment. Cargo holders were actively moving goods, while smelters and traders also sold goods aggressively to generate cash, causing spot supply to increase. But downstream buyers were cautious due to pessimism and the lack of orders, causing supply surplus to exacerbate, pushing down spot zinc prices. #0 zinc prices were between RMB 14,550-14,570/mt during the first trading session, but dropped to RMB 14,530-14,550/mt in the second trading session, with transactions muted.