Demand dwindles in Shanghai spot zinc market

SHANGHAI, Aug 22 (SMM) – Trades thinned in the Shanghai spot zinc market on Wednesday August 22 as demand weakened after transactions from most long-term contracts ended. 

The SHFE 1809 contract traded around 20,800 yuan/mt in the morning and closed at 20,775 yuan/mt at the end of the morning trading session, about 210 yuan/mt higher from that time on Tuesday.  

In Shanghai, 0# common brand was offered at a premium of 450-480 yuan/mt over the 1809 contract, up 40 yuan/mt from August 21. However, weaker purchasing interest from downstream dragged premiums of the higher-grade Shuangyan brand to 380-410 yuan/mt over the 1809 contract, around 100 yuan/mt lower from August 21. The #0 zinc mostly traded at 21,180-21,300 yuan/mt, or at a premium of 390-410 yuan/mt before noon.  

In Guangdong, trades also cooled as downstream consumers hesitated on high premiums of 720-750 yuan/mt over the SHFE 1810 contract. Sellers demurred as inventories across Guangdong warehouses stood at a low of two and a half years. Traded prices of #0 zinc stood at 21,130-21,240 yuan/mt this morning. The Guangdong-Shanghai price spread stood at a discount of 10 yuan/mt today, from a premium of 20 yuan/mt on August 21.