Purchases for long-term contracts improve Shanghai spot zinc trades

SHANGHAI, May 29 (SMM) – Transactions of spot zinc improved in Shanghai on the morning of Wednesday May 29 as traders purchased for the deliveries of long-term contracts. Downstream consumers remained cautious with a pessimistic outlook on prices. 

This morning in Shanghai, #0 zinc traded at 20,920-20,990 yuan/mt, and #1 zinc at 20,880-20,940 yuan/mt.

Consumption from traders picked up in the second session for the morning, after sellers lowered offers to flat against the SHFE front-month June contract, compared with a premium of 20-30 yuan/mt in early trades. At noon, trades mostly occurred at a discount of 10 yuan/mt to a premium of 10 yuan/mt. 

In Guangdong, transactions remained tepid as downstream consumers held sufficient stocks and smelters kept from selling on lower prices of futures. Speculative demand from traders improved after spot discounts expanded, but this failed to improve overall trades this morning. 

Traded prices of #0 zinc mostly occurred at 20,870-20,940 yuan/mt this morning. The Guangdong-Shanghai price spread widened to a discount of 40 yuan/mt, from a discount of 10 yuan/mt on Tuesday May 28.

The SHFE June contract declined and closed the morning at 20,945 yuan/mt, down 120 yuan/mt from that time on Tuesday.