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[minutes of 5.18 Zinc Internal Morning meeting] the spot transaction turned good on Friday and intra-day shocks are expected.
May 18,2020 09:49CST
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The content below was translated by Tencent automatically for reference.

Summary of Zinc Morning meeting in SMM on May 18th

Spot fundamentals

Shanghai: Shanghai Zinc 2006 contract fluctuated within a narrow range, closing at 16505 yuan / ton in the morning market. Zinc prices fluctuated in a narrow range, traders shipped normally, and the quotations of zinc in Shanghai were basically the same as yesterday. Domestic quoted water rose about 140 yuan / ton, Shuangyan quoted about 150 yuan / ton, and the average price still contributed mainly to the transaction in the first trading period. in addition, downstream entered the market for inquiry and purchase, and market trading remained active during the second trading period. at the same time, the transaction of imported brands also increased, and a continuous decline had a significant effect on actual consumption. The overall turnover during the day was slightly higher than that of yesterday. Ningbo: the Shanghai market rose slightly today, but the Ningbo market is weak. In the first session of the morning, Xikuang and Hualian continued to quote yesterday that it was quoted around 140 yuan / ton for the June contract, 150 yuan / ton for the June contract, 160 yuan / ton for the June contract and 170 yuan / ton for the June contract. Trading was poor in the morning, entering the second trading session, the willingness to buy downstream turned worse, and traders slightly lowered the rising water. Kirin raised water around 160 yuan / ton for the June contract, while Tiefeng lowered to 150 yuan / ton for the June contract. Overall, trading today is weaker than yesterday, and buying interest in the market is not good. Guangdong: in the first trading session, the center of gravity of futures prices moved slightly upward, and the purchase of inquiry downstream was less than that of yesterday, while the arrival of the market was limited, the relative standing price of the holder, the market quotation was mostly on the net price, and the transaction was mainly between traders. Kirin and Mongolia quoted water 30 yuan / ton for the Shanghai zinc June contract and 20 yuan / ton for Tiefeng. In the second trading session, the downstream demand still did not improve, traders received goods at a low price, and the overall market quotation was 10 yuan lower than that of the first trading session. Kirin and Mongolia quoted a price of 20 yuan / ton for the six-month contract for zinc in Shanghai and 10 yuan / ton for Tiefeng. Tianjin: today, Shanghai zinc stopped falling and rebounded, the spot market maintained a rising discount price, and the quotation was more divergent. The ordinary brand lark quoted a rise of 190 yuan / ton for the 06 contract, Hong Kong quoted a rise of 210 yuan / ton for the 06 contract, Chi Hong quoted a premium of 170 Mel / ton for the 06 contract, imported KZ quoted a premium of 100 yuan / ton for the 06 contract, and the high-priced brand Zijin quoted a premium of 270,260 yuan / ton for the June contract. Zinc prices have stopped falling and rebounded today, traders have a strong willingness to raise prices, some brands have diverged quotations, and high-priced brands have lowered their prices after poor shipments; downstream, the spot price in Tianjin today is basically the same as yesterday, and the mood of receiving goods downstream is better. On the whole, today's deal was flat yesterday.

Inventory: according to SMM, as of May 15, the total inventory of SMM seven zinc ingots was 227300 tons, down 9700 tons from May 8 and 10300 tons from May 11. Inventories in seven places have not increased but declined this week, with the main decline concentrated in Shanghai and Guangdong. Enterprises in the lower reaches of the Shanghai area have a strong willingness to purchase and buy actively to drive to the warehouse during the price callback; there is less storage in Guangdong, and the proportion of some smelters straight downstream increases, leaving the warehouse to maintain normality, with a slight decline in the balance of entry and exit; and there is a slight decline in Tianjin, mainly because the arrival of goods is more concentrated, part of the imported Harbin zinc into the warehouse, the second half of the warehouse turnover is good. Overall, the original inventory in Shanghai, Guangdong and Tianjin fell by 7300 tons, while the inventory in seven places across the country dropped by 9700 tons.

Bonded area inventory: according to SMM, as of May 15, the inventory of zinc ingots in Shanghai Free Trade Zone was 58000 tons, down 7500 tons from last week. It is understood that this week, with the continuous repair of import prices, import losses have narrowed, and a large number of imported zinc ingots such as SMC,YP, Belgium, Spain and Kazakhstan are in circulation in the market. The inventory of zinc ingots in the bonded area decreased for four consecutive weeks, by a total of 18400 tons.

Today's forecast zinc price: last Friday, Lun Zinc recorded a long shadow line Xiaoyin line, the lower 10 / 60 day line to provide support, the upper Bollinger Road on the track to form resistance. Lme inventories fell 50 tons to 98975 tons on Friday, a drop of 0.05%. Pay attention to whether the recovery of overseas demand can lead to the continuation of inventory, to provide support for Lun Zinc, short-term overseas fluctuations, we need to be vigilant against the trend of US stocks. Last Friday, Shanghai zinc received a small cross-yang line, the lower 15 line to provide support, the upper 5 / 10 line into resistance. With the low-level finishing of zinc in Shanghai, the willingness of downstream enterprises to receive goods at low prices has warmed up compared with the previous period, driving the social treasury to go to the warehouse to support the price of zinc.

Today, it is estimated that the contract price of Shanghai Zinc 2007 is expected to operate in the range of 16200 Mel 16700 yuan / ton, and the price of Lun Zinc is expected to run in the range of US $1940 and 1990. Domestic zinc rose 80 yuan per ton.

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inventory
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