SMM, June 5 / PRNewswire-Asianet /-
In May, the domestic supply began to enter an accelerated recovery period, and the optimistic forecast given in the early period was that it would reach the peak of the year in June and swing near the peak. After the supply growth was in place, a reasonable transport transfer time was given. Will see the inventory stop falling back up to form a cumulative pool, the emergence of this inflection point, but also indicates that the early expectations all fall to the ground according to the plan, the downward pressure of zinc to synchronously in place.
The shift from loose supply to a decline in inventories indicates that supply easing in recent months is not as good as in recent months, in the traditional off-season of consumption from June to August. And for the ingot supply loose one-sided downward pressure has been close to the bottom position (Shanghai zinc main 1907 or about 20000 yuan / ton).
Timely SHFE warehouse receipts dropped significantly by more than 10,000 tons; In addition, the silver company's Chengzhou plant has stalled due to the accident, which means that the time point for short-term supply to be relaxed will be set back, the market will adjust its overly optimistic expectations in the early stage, and at the same time, it has further intensified the supply contradiction in the near and far months. The contract price difference of 1906-1907 widened from about 260-280 yuan / ton to 400-420 yuan / ton, while the contract price difference of 1906-1908 widened from 450 yuan / ton to 760-800 yuan / ton.
However, it should also be noted that during this period, the forward contract has been on hold, with the monthly difference between 1908 and 1909 expanding only slightly from about 180 to 200 yuan per ton to about 240 to 250 yuan per ton, and from 1909 to 1910 to about 180 to 200 yuan per ton. This reflects another level of expectation that infrastructure spending, which has been slow to make a big move in the first and second quarters, will be delayed to the third quarter, and that when the story of supply growth is over, zinc futures will be at a low level for the year.
The subsequent story relay of consumption, for zinc consumption in 2019, infrastructure is an absolute backing force. Although the expectation of infrastructure has been hit by successive failures, it is hoped that it will not be lost, supported by such expectations. Zinc will gain the momentum of a low return, or hopefully complete a beautiful V-turn, which, of course, will take time, and the story has not yet officially begun.