SHANGHAI, Sept. 27 (SMM)－Premium of ordinary domestic brands in Shanghai during dropped rapidly during the day. Premium of 0# ordinary delivery brand dropped rapidly from 320-340 yuan per tonne yesterday to 200-230 yuan per tonne.

SMM thinks the reason for rapid drop of Shanghai premium is that Zinc price keeps high and contract monthly difference of Shanghai futures Zinc are getting escalated. Besides, by the end of this month and begin of National Day Holiday, some traders are willing to transact for cash with little stock in hand. Also downstream have prepared most stock since last Friday so the latter part of this week will witness a weakened demand of stock-up.

SMM predicts that before Oct 1^st, the following two days will probably see a continuous drop of premium. The market should be alerted to the risk of weakening of spot premium.(SMM, Liu Mengyue)

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