SHANGHAI, Feb 27 (SMM) – While not all downstream customers have resumed operations post-Chinese New Year, SMM believes zinc prices would stay firm due to the huge decline in LME inventory.
Sources at Chinese miners and smelters were mostly bullish about zinc prices as they believe the domestic zinc concentrate output addition would be limited due to still strict environmental protection policy. Supply tightness remains as some miners have yet to come back from the Chinese New Year holiday and treatment charges (TCs) were low.
Traders also expect zinc to stay firm as LME inventory continues to decline and as downstream consumption recovers gradually and leads to destocking in China.
SMM learned that operations have resumed for some galvanising and zinc oxide plants and this is set to give support to zinc prices. However, many die-casting plants have been off since early February.
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