Stockpiling erodes zinc social inventories

SHANGHAI, Nov 5 (SMM) – Social inventories of refined zinc across Shanghai, Guangdong and Tianjin came in at 135,900 mt as of Monday November 5, down some 14,800 mt from Monday October 29 and down 3,700 mt from Friday November 2, SMM data showed.

Downstream buyers stockpiled ahead of road traffic controls for the first-ever China International Import Expo (CIIE) held in Shanghai on November 5-10. This significantly lowered zinc stocks in Shanghai, and accounted for majority of the overall decline.   

In Guangdong and Tianjin, stable downstream purchases also lowered zinc social inventories, SMM learned. We do not expect the stocks to decline significantly in the short run as consumption will cool in the low season.