SMM Zinc Market Daily Review (2014-10-29)

SHANGHAI, Oct. 30 (SMM) – SHFE 1501 zinc contract prices opened higher at RMB 16,530/mt on Tuesday evening, then climbed to RMB 16,565-16,595/mt, and closing at RMB 16,565/mt, up RMB 35/mt or 0.21%. Trading volumes were 61,360 lots, and total positions rose 7,900 to 136,796 lots. SHFE 1501 zinc contract prices opened at RMB 16,565/mt, plunging with LME zinc prices, dipping to as low as RMB 16,440/mt, but clawing back early gains in the afternoon, and closing at RMB 16,565/mt, up RMB 35/mt or 0.21%. Trading volumes were up 61,854 to 157,320 lots, and total positions increased 10,322 lots to 132,880 lots. SHFE 1412 zinc contract prices are expected to remain weak.

#0 zinc prices were between RMB 16,780-16,840/mt, with spot premiums of RMB 270-320/mt against SHFE 1412 zinc contract prices. #1 zinc prices were between RMB 16,720-16,750/mt. SHFE 1412 zinc contract prices plummeted to RMB 16,510/mt after opening, down nearly RMB 100/mt from the previous trading day, with spot premiums widening RMB 10/mt. Smelters sold normally, while cargo holders moved goods actively to generate cash, leaving supply sufficient. SHFE zinc prices fell, and traders believe spot premiums will fall but were unwilling to purchase on expanding spot premiums yesterday. Downstream buyers purchased as needed at RMB 16,800/mt, leaving overall trading muted. Shuangyan branded #0 zinc prices were RMB 16,830-16,840/mt, and prices for Yuguang zinc were RMB 16,810-16,820/mt. Jiulong, Qinxin, Qilin, Tiefeng and Baiyin zinc prices were RMB 16,780-16,810/mt, with RMB 16,760-16,790/mt for Belgian #0 zinc. SHFE 1412 zinc contract prices touched RMB 16,615/mt in the afternoon, causing spot premiums to fall RMB 20/mt, to RMB 250-300/mt. Overall transactions did not improve.