SMM5 March 15:

SMM zinc ore inventory:

The recovery of domestic mines in April is still relatively limited, and SMM knows as follows: 1) some mines are still firmly unwilling to sell, waiting for better prices and processing fees, some of them are only mining and not selecting, only hoarding raw ore, dragging down the recovery of production; 2) A large mining enterprise in Hunan began technical transformation in April, only a small amount of feeding debugging in April, and half of the input in May, which will contribute to the increase. 3) the spot price of zinc rose to above Wan Qi in April, but it still does not constitute the attractiveness of resumption for high-cost and low-grade private mines. At the same time, the recovery of mines in some small and high-cold areas is delayed. If the price can not be significantly increased, it is expected that this part of the output will continue to be missing. 4) some mines reflect the decline in the taste of raw zinc mines, which has existed in recent years and constitutes a certain degree of reduction. 5) there is also some good news. Due to the current reduction in processing fees and the recovery of superimposed zinc prices, some mining enterprises have plans to seize the opportunity to increase production and lock in profits, resulting in certain increments, while the seasonal recovery of some high-latitude medium-sized mines has also brought certain increments. Overall, zinc mines are expected to continue to pick up month-on-month in May, but there is still a gap compared with the same period last year.

Looking abroad, import replenishment is expected to be relatively limited in May. The current epidemic in the Americas is still in a phase of rapid growth, with Peru extending its blockade again until 24 May, although Peru issued a decree on 2 May saying that mining production could be resumed as appropriate, but only Nexa has so far announced a recovery. Mexico has also been extended to May 30, and some mine announcements show that some mines that meet the conditions can be restored around May 18. According to the SMM follow-up mine announcement, the recovery of mines shut down in the early stage due to the epidemic is still limited. On the other hand, the epidemic situation in Russia has not been effectively controlled, so it is necessary to guard against a new reduction in the disturbance of its domestic mine production. Up to now, most of the overseas mines have stopped production for one month, and many new expansion projects have been delayed, so it is difficult to make up for this part of the reduction. As overseas countries begin to relax blockade measures to restore their economies, it is expected that overseas zinc mine production is expected to resume partially in May, but given that priority will be given to completing the contract volume of the previous delay after the resumption of production, the global surplus of zinc mine is expected to be limited. the level of domestic supply will not be too high in the coming quarter.

In the end, the SMM believes that short-term domestic mine supply is still under pressure.

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