SHANGHAI, Jun 19 (SMM) – Transactions of spot zinc slowed in Shanghai and Tianjin on the morning of Wednesday June 19 as expectations of greater supplies deterred downstream purchases, even as the spot premiums dropped.
Downstream procurement also fell as buyers already stockpiled on lower futures prices of zinc on Tuesday June 18.
Keen to destock, traders lowered premiums to 160-180 yuan/mt at noon of June 19 against the SHFE July contract, from a premium of 200 yuan/mt in early trades, but this failed to bolster trades.
This morning in Shanghai, #0 zinc traded at 20,420-20,500 yuan/mt, and #1 zinc at 20,340-20,420 yuan/mt.
Premiums of higher quality Chihong and Shuangyan brands stood at 200-220 yuan/mt over the SHFE July contract this morning, compared with 160-200 yuan/mt for #0 common brands.
In Tianjin, consumption weakened considerably after buyers restocked on Monday and Tuesday. This, coupled with sufficient supplies, drove sellers to cut premiums, to 150-320 yuan/mt against the SHFE 1907 contract at noon of Wednesday June 19, from a premium of 260-320 yuan/mt in early trades.
Trades of #0 zinc mostly occurred at 20,360-21,580 yuan/mt this morning. The Tianjin-Shanghai price spread deepened to a discount of 120 yuan/mt, from a premium of 60 yuan/mt on Tuesday.
The SHFE 1907 contract retreated from overnight gains, and settled at 20,245 yuan/mt at the end of the morning trading session on Wednesday June 19, up 55 yuan/mt from that time on Tuesday.