SHANGHAI, Mar. 3 (SMM) – Spot zinc markets were sluggish due to soft demand. Spot discounts of #0 zinc against SHFE 1405 zinc contract prices expanded from RMB 140-170/mt to RMB 190-240/mt, with discounts of nearly RMB 200/mt for Shuangyan branded #0 zinc, and discounts over RMB 200/mt for Jiulong and Qinxin branded zinc. Spot supply was ample, but some traders suspended moving goods due to high spot discounts. Downstream buyers purchased on an as-needed basis, leaving trading quiet.
Guangdong market was more optimistic than Shanghai market, with #0 zinc prices level with Shanghai prices. The Tianjin zinc market remained quiet, with zinc demand sluggish since downstream orders did not return to normal levels during the ongoing environmental protection inspections conducted in the Beijing, Tianjin and Hebei regions. #0 zinc prices were RMB 120/mt below Shanghai prices early in the week, but then fell as low as RMB 150/mt below Shanghai prices. Prices for Huludao branded zinc produced on older production lines were cut by RMB 100/mt, to RMB 15,500/mt.
As enterprises restart production in March, spot demand will improve slightly, but spot discounts remain high given sufficient supply, but may narrow to RMB 180/mt.