SMM Zinc Market Daily Review (2014-7-17)

SHANGHAI, Jul. 18 (SMM) – SHFE 1409 zinc contract prices opened at RMB 16,650/mt on Wednesday evening, then dipped to RMB 16,545/mt since LME zinc prices dropped and due to the exodus of longs after profit-taking, and closing at RMB 16,560/mt, down RMB 80/mt or 0.48%. Trading volumes decreased by 49,616 lots, to 212,666 lots, and total positions decreased by 1,646 lots to 257,466 lots. SHFE 1409 zinc contract prices opened at RMB 16,565/mt on Thursday, dipping to RMB 16,790/mt in the morning, but rallying to RMB 16,600/mt due to the entry of bargain hunters, once touching RMB 16,705/mt. At the end of trading, SHFE 1409 zinc contract prices fell as LME zinc prices lost early gains and closed at RMB 16,615/mt, down RMB 25/mt or 0.15%. Trading volumes decreased by 206,628 lots, to 229,982 lots, and total positions of SHFE 1409 zinc contracts decreased by 9,660 lots to 247,806 lots.

#0 zinc prices were between RMB 16,500-16,540/mt, with spot discounts of RMB 60-40/mt against SHFE 1409 zinc contract prices. #1 zinc prices were between RMB 16,490-16,510/mt. SHFE 1409 zinc contract prices dipped to RMB 16,520/mt after opening, with #0 zinc prices as low as RMB 16,490-16,510/mt. As SHFE zinc prices leveled out between RMB 16,570-16,580/mt, spot discounts narrowed to RMB 60-40/mt. But cargo holders were unwilling to sell, with supply limited. Downstream buyers purchased on an as-needed basis, leaving transactions muted. Shuangyan branded #0 zinc prices were RMB 16,530/mt, Yuguang, Qilin and Hongda brand #0 zinc prices were between RMB 16,510-16,520/mt. Prices for domestic undeliverable brands including Baohui and Haolong were between RMB 16,480-16,500/mt. prices for imported AZ and SMC brand zinc were between RMB 16,500-16,510/mt, and RMB 16,490-16,500/mt for other imported zinc. SHFE zinc prices climbed to RMB 16,600/mt and touched RMB 16,705/mt in the afternoon, with spot discounts expanding to RMB 70-50/mt, and transactions improving. #0 zinc prices were between RMB 16,550-16,600/mt.