Only 40% Lead-Zinc Mines in Fujian in Production as Environmental Protection Overshadows, SMM Reports

Total zinc ingots inventories across seven major markets in China stood at 284,100 mt as of April 15, up 6,100 mt from April 8, down 3,700 mt from April 11.

Shanghai base metals mostly trended lower on Tuesday morning after US dollar rallied significantly. Meanwhile, their counterparts on LME performed similarly.

Shanghai nonferrous metals mostly closed in the positive territory as the market was cheered up by the macro front, as China released its December official manufacturing and non-manufacturing PMI readings, which topped market expectation.

SHFE and LME zinc prices once again hit new highs in two months, mainly owing to the continuously rising electricity and natural gas prices which rose by more than 20% amid intensifying energy shortages in the eurozone, according to SMM. Meanwhile, the costs of smelters also climbed due to low zinc concentrate TCs as a result of tight supply.

Market focus this week includes the readings of the manufacturing PMI in the Eurozone in November and the Markit manufacturing PMI in the United States in November; the one-year loan market interest rate as of November 22 in China. On the events front, the Federal Reserve FOMC will release the minutes of the monetary policy meeting this Thursday; Bank of England Governor Bailey will deliver a speech this Friday.

Shanghai base metals basically trended higher on Tuesday morning amid extended power rationing. Meanwhile, their counterparts on LME mostly fell.

The most-traded SHFE lead contract fell as a whole in September, with a decrease of 3.69% in the month. The contract closed at 14350 yuan/mt as of September 30, down 550 yuan/mt from the beginning of the month.

Three-month LME lead bottomed out during China’s National Day holiday. LME lead fell to $2,060/mt on September 30 and rebounded to $2,168/mt on October 1. Then the prices fluctuated between $2,130-2,170/mt during the holiday. LME lead closed at $2,136/mt yesterday, down $0.5 or 0.02%. The open interest stood at 109,000 lots.

China produced 276,900 mt of refined lead in August, down 0.75% from July and 2.69% from a year ago.

Shanghai base metals all went down on Friday night following the record low of the US weekly initial jobless claims. Meanwhile, their counterparts on LME basically went up.