SHANGHAI, Oct 23 (SMM) – Transactions of spot zinc improved in Shanghai on the morning of October 23 as downstream consumers stockpiled after prices of futures extended their declines.
This morning in Shanghai, #0 zinc traded at 18,880-18,920 yuan/mt, and #1 zinc at 18,810-18,850 yuan/mt.
In early trades this morning, quotes were mostly heard for products with November’s invoices, which stood at a premium of 110-120 yuan/mt against the SHFE November zinc contract, as the issuance of October’s invoices will be halted on system upgrading on October 25.
Premiums for cargoes with October’s invoices came in at 120-130 yuan/mt.
As most traders have finished the delivery for long-term contracts, spot sellers cut premiums by some 10 yuan/mt near noon to boost purchases. This, together with lower Shanghai zinc prices, resulted in brisk procurement by downstream buyers even as seaborne cargoes of KZ and AZ zinc reportedly flew in Ningbo.
In the northern Chinese market of Tianjin, however, lower prices failed to improve spot trades as downstream producers in Hebei province were cautious about procuring amid environmental production curbs.
The Tianjin-Shanghai price spread widened to a premium of 20 yuan/mt, from a premium of 10 yuan/mt on October 22.
At noon of October 23, trades of #0 zinc occurred at 18,840-20,260 yuan/mt, and deals for #1 zinc at 18,790-18,890 yuan/mt in Tianjin.
The SHFE November zinc contract extended decline from the previous two sessions and closed the morning of October 23 at 18,780 yuan/mt, down 0.61% from that time on October 22.