Buyers in Shanghai spot zinc market hold back on high prices of futures

SHANGHAI, Aug 8 (SMM) – Spot zinc trades in the Shanghai market remained sluggish in the week to Wednesday August 8 as high prices of futures deterred downstream consumers that mostly purchased as needed.

The SHFE 1809 contract traded robustly in the morning and closed at 21,705 yuan/mt at the end of the morning trading session, about 155 yuan/mt higher from Tuesday.  

In Shanghai, the 0# common brand was offered at a premium of 190-220 yuan/mt over the 1809 contract, and the higher-grade Shuangyan brand was offered at 210-230 yuan/mt. Both stood 20-30 yuan/mt lower from offers on Tuesday. Less interest in higher-priced cargoes limited the traded price gaps between the 0# common brand and the Shuangyan brand. The #0 zinc mostly traded at 21,920-21,960 yuan/mt before noon. 

In Guangdong, downstream consumers also hesitated on high prices of futures after they restocked earlier this week. Premiums of 0# zinc dipped by 50 yuan/mt to 200-240 yuan/mt over the SHFE 1809 contract, from August 7. Some #1 Cishan brand and imported YP brand entered the market and traded at a premium of 160 yuan/mt and 190 yuan/mt over the 1809 contract, respectively.

Traded prices of #0 zinc stood at 21,900-21,940 yuan/mt in Guangdong this morning. The Guangdong-Shanghai price spread stood at a premium of 10 yuan/mt today, from a premium of 30 yuan/mt on August 7.