Zinc Supply Remains Tight as Inventories Stay Low, SMM Reports

Market focus this week include: the annualised reading of new housing starts in the United States in August, the initial value of the manufacturing PMI in the Eurozone in September, and the initial value of the Markit manufacturing PMI in the United States in September; China's one-year loan market quotation interest rate as of September 22. In terms of events, FOMC will announced the interest rate resolutions this Thursday; the Fed Chairman Powell will hold a press conference; and the European Central Bank will announces an economic bulletin.

Shanghai base metals all cruised higher on Friday morning as European Central Bank kept interest rate unchanged and US dollar weakened. Meanwhile, their counterparts on LME traded mixed.

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.

Shanghai base metals trended higher on Wednesday morning after US Senate passed the $1 trillion infrastructure bill. Meanwhile, their counterparts on LME mostly fell.

Copper tightness should feed through quickly to prices if demand picks up

Zinc prices maintained upward momentum in 2017, thanks to the fundamental story. LME zinc refreshed a 10-year high, and SHFE zinc jumped above 27,000 yuan per tonne, up over 20% so far this year.

Total zinc inventories in Shanghai, Guangdong and Tianjin increased from last week, with small growth in Shanghai and Tianjin, SMM reported.

Many zinc traders contributed the surge in zinc market mainly to two factors, 21st Century Business Herald reported. 

Combined zinc inventories in Shanghai, Tianjin and Guangdong continued falling as of August 18 from a week earlier, SMM reports.

Prices for SMC imported zinc rose close to domestic #0 zinc prices at one point today due to supply tightness, SMM reports.