SHANGHAI, Jul. 17 (SMM) – SHFE 1409 zinc contract prices opened at RMB 16,570/mt on Tuesday evening, then touched RMB 16,670/mt, a record high since February 23, 2012. At the end of trading, SHFE 1409 zinc contract prices fell slightly as some longs left the market after profit-taking, and closing at RMB 16,575/mt, up RMB 105/mt or 0.64%. Trading volumes increased by 140,726 lots, to 262,282 lots, and total positions decreased by 1,994 lots to 268,968 lots. SHFE 1409 zinc contract prices hovered between RMB 16,570-16,670/mt on Wednesday, touching a record high of RMB 16,790/mt since February 23, 2012, pointing toward RMB 16,800/mt. But as a large number of longs left the market, SHFE 1409 zinc contract prices fell back to RMB 16,600/mt, and closing at RMB 16,610/mt, up RMB 140/mt or 0.85%. Trading volumes increased by 254,000 lots, to 698,000 lots, and total positions of SHFE 1409 zinc contracts decreased by 11,850 lots to 259,000 lots. Trading volumes of SHFE zinc contracts were 940,000 lots, to 698,000 lots, and total positions increased by 12,500 lots to 500,000 lots.

#0 zinc prices were between RMB 16,500-16,600/mt, with spot discounts of RMB 110-80/mt against SHFE 1409 zinc contract prices. #1 zinc prices were between RMB 16,520-16,530/mt. SHFE 1409 zinc contract prices rose, pushing up spot zinc prices. A limited amount of #0 zinc was sold below RMB 16,500/mt in the morning. As SHFE zinc prices climbed, goods releases from arbitrage traders were limited. When combined with modest supply from smelters, goods availability was low. Downstream buying interest was weak, leaving transactions muted. Cargo holders took a wait-and-see posture in the morning. Shuangyan branded #0 zinc prices were RMB 16,500-16,600/mt, Yuguang and Qinxin brand #0 zinc prices were between RMB 16,480-16,570/mt. Imported zinc supply was limited, with RMB 16,520-16,550/mt for SMC brand zinc. Due to an exodus of investors after profit-taking, SHFE zinc prices fell in the afternoon, with spot discounts narrowing to RMB 50/mt, causing transactions to improve. #0 zinc prices were between RMB 16,520-16,590/mt.