SMM Zinc Market Daily Review (2014-10-20)

SHANGHAI, Oct. 21 (SMM) – SHFE 1412 zinc contract prices opened at RMB 16,250/mt last Friday evening, then touched RMB 16,375/mt, and closed at RMB 16,345/mt, up RMB 165/mt or 1.02%. Trading volumes decreased 144,576 to 279,428 lots, and total positions increased 1,120 to 158,638 lots. SHFE 1412 zinc contract prices opened at RMB 16,350/mt October 20, then touched RMB 16,395/mt before losing early gains, meeting resistance at RMB 16,300/mt, and closed at RMB 16,265/mt, up RMB 85/mt or 0.53%. Trading volumes decreased 175,126, to 411,716 lots, and total positions were down 8,872 lots to 148,646 lots. SHFE 1412 zinc contract prices should meet resistance at the 5-day moving average.

#0 zinc prices were between RMB 16,590-16,640/mt, with spot premiums of RMB 300-340/mt against SHFE 1412 zinc contract prices. #1 zinc prices were between RMB 16,510-16,540/mt. SHFE 1412 zinc contract prices fell to RMB 16,290/mt after opening, but up RMB 100/mt from the previous trading day. Smelters increased supply, while traders held back goods due to limited arbitrage opportunities. Downstream buyers that had built stocks last week were also unwilling to purchase, leaving transactions muted. Shuangyan branded #0 zinc prices were RMB 16,620-16,640/mt, and prices for Yuguang and Hongda zinc were RMB 16,610-16,620/mt. Baiyin, Qilin, Tiefeng and Jiulong zinc prices were RMB 16,590-16,610/mt. Kazakhstan’s #1 zinc prices were RMB 16,500/mt. SHFE 1412 zinc contract prices consolidated in the afternoon.