SHANGHAI, Mar. 10 (SMM) – Last week, spot zinc market prices improved from two weeks ago, with spot discounts against SHFE 1405 zinc contract prices expanding from RMB 200/mt to RMB 300/mt after SHFE zinc prices surged, prompting traders to purchase actively. However, as SHFE zinc prices fell back, spot discounts narrowed to RMB 200/mt again, allowing some arbitrage traders to move goods. Spot discounts for Shuangyan branded #0 zinc were RMB 200/mt, but were over RMB 200/mt for Jiulong and Qinxin branded #0 zinc. Spot supply remained ample, but downstream enterprises purchased on an as-needed basis with prices around RMB 15,000/mt, leaving transactions mainly among traders.
Last week, demand in Guangdong market improved, with #0 zinc prices level with Shanghai prices, allowing some smelters in southwest China to increase supply to Guangdong. Spot demand in Tianjin remained sluggish, with downstream buyers mostly purchasing on an as-needed basis, but spot supply fell later in the week as some smelters reduced deliveries. #0 zinc prices rose from RMB 110/mt below Shanghai prices early in the week to RMB 80/mt below Shanghai prices. Prices of Huludao branded zinc produced on older production lines rose by RMB 50/mt, to RMB 15,510/mt.
SHFE 1405 zinc contract prices will test support at RMB 15,050/mt this week, with spot discounts narrowing to RMB 150/mt due to improving spot demand.