SHANGHAI, Nov 27 (SMM) – While prices of zinc futures continued to dip, traders lowered premiums further to destock, and this attached some downstream purchases in the Shanghai spot zinc market this morning.
The 0# common brand was mostly offered at a premium of 160-200 yuan/mt over the SHFE December contract in Shanghai. A higher quality of product kept offers of the Shuangyan brand at a premium of 550-600 yuan/mt. These compared with the highest level of 240 yuan/mt and 550 yuan/mt, respectively, on Monday November 26.
The #0 zinc mostly traded at 20,770-21,300 yuan/mt before noon. Prices settled in long-term contracts mostly fell to a discount of 20-10 yuan/mt over the average SMM prices.
However, in Guangdong, relative tight supplies and downstream purchases buoyed spot premiums, by some 90 yuan/mt from Monday to 850-1,000 yuan/mt over the SHFE 1901 contract. Traded prices mostly occurred at 20,920-21,260 yuan/mt. The Guangdong-Shanghai price spread expanded to a premium of 230 yuan/mt at noon, from 160 yuan/mt on November 26.
This morning, the SHFE 1901 extended decline and closed at 20,080 yuan/mt at the end of the morning trading session, down 460 yuan/mt from that time on Monday.