SMM10, 8 March:
During the National Day holiday, more foreign macro data were released, of which the US ISM manufacturing PMI in September hit a new low of 47.8 in the past decade, the non-manufacturing PMI hit a new low of 52.6 in the past three years, and the non-farm employment data in September was slightly lower than expected at 136000. The unemployment rate was almost 3.5%, the lowest level since October 2012. The final value of manufacturing PMI in the euro area reached 45.7 in September, the lowest level since October 2012. German manufacturing PMI data for September recorded 41.7, the lowest level since June 2009; France in September manufacturing PMI final value of 50.1, below the previous and expected value of 50.3; British manufacturing PMI recorded 48.3 in September, some economists pointed out that the British manufacturing industry continued to decline in September, the possibility of sliding into recession.
Lun Zinc operated independently during the holiday period. During the holiday period, Lun Zinc fell by US $74.50 / ton, or 3.15%. Although the back structure of overseas markets narrowed slightly during the National Day holiday, the 0-3 liter discount was still deadlocked at US $30-40 / ton, but the back structure still did not attract market positions. On the contrary, LME zinc stocks dropped from 67300 tons on September 30 to 64325 tons on October 7, recording a decline of 2975 tons. Shows that the current spot supply in overseas markets is relatively tight, market rumors of hidden inventory may not be much, in terms of fundamentals, Lun Zinc although there is no strong ability to act, but there is still some support. However, the macro news for Lun Zinc is still significant, in the short term, this week still need to pay attention to the news brought about by the new round of trade negotiations between the United States and China.
As far as Shanghai zinc is concerned, on the first trading day after the festival, the Shanghai zinc main force 1911 contract opened low and walked high, receiving the Xiaoyang line, mainly due to the cumulative increase of 10200 tons of social inventory in the three places during the National Day holiday, mainly in Guangdong, and slower in Shanghai and Tianjin. Compared with the same period last year and the same period the year before last, the demand for downstream reserves in the week before National Day this year was significantly higher than that in the previous two years, and the accumulated inventory during the National Day holiday was also far less than that in the previous two years. On the whole, on the first trading day after National Day, the market paid more attention to inventory increment, while the increase of more than 10,000 tons of social inventory in the three places was basically lower than market expectations, and there was a slight boost to zinc prices.
In October, processing fees remain high, smelters are still active production, pre-maintenance smelters mostly resume, short-term maintenance manufacturers affect the volume of goods is relatively limited, but the smelter faces production bottlenecks, expected output growth or relatively limited, superimposed import zinc inflow continues to be less, so the overall supply side is still expected to have a small increment.
For consumers, downstream orders improved significantly after mid-September, reflected in the first two weeks of National Day downstream reserve, the volume of storage increased significantly compared with the previous two years, the social inventory of the three places recorded a decline of 13900 tons. Among them, most of them are galvanized enterprises in North China. Although the national day parade has limited production requirements for some small galvanized plants, on the whole, the impact of environmental protection on the start-up of galvanized enterprises is relatively limited. At the same time, the decline of inventory in Tianjin also proves that galvanized consumption has improved. In addition, in South China and East China, where there are more die casting zinc alloy enterprises, the improvement of orders in Guangdong is more obvious, among which the foreign trade orders of large and medium-sized zinc alloy enterprises in Guangdong are significantly improved, which are concentrated in the jewelry gift section. In addition, the hardware bathroom and door and window lock plates are also significantly better than in August, and the orders of some small enterprises are also transferred to large and medium-sized enterprises. For zinc oxide enterprises, with the narrowing of the decline in automobile production and sales, the terminal zinc oxide orders for tires have also improved, the chemical plate is basically stable, overall zinc oxide orders are in a stable and turning for the better.
As far as October is concerned, although the consumer side warming still supports the zinc price, however, under the condition of low inventory, the processing fee brings high profit stimulus to the smelter, the supply side volume is still expected, and it is difficult to change the market empty expectation for the time being. In the short term, if there is no influential macro news guide, it is expected that the Shanghai zinc main contract will run in the range of 18400-19000 yuan / ton.