[SMM analysis] the decline in zinc price boosts the demand for replenishment. The start-up of some alloy plants has slightly improved.

SMM5 March 24: this week, some die-casting zinc alloy factories started to improve slightly, mainly driven by the decline in the price of raw material zinc ingots, this week Shanghai zinc first rose and then suppressed the inverted V trend. The domestic two sessions will be held soon, the market is full of expectations for the launch of more economic stimulus measures in China, and the market risk appetite has increased. Shanghai zinc rose rapidly at the beginning of the week. After the main contract broke through 16500 yuan / ton, it continued to increase positions upstream, rising to a maximum of 16965 yuan / ton. However, the pressure at the integer level of 17000 yuan above the price was greater, and the high price was actively closed out by many positions, and the price gave up some of the increase. The high price and narrow range shock consolidation on Wednesday, but the inventory of lun zinc increased sharply after the close, which led to a sharp drop in the opening price of night trading, which was supported after approaching 16500 yuan / ton. The price recorded a V reversal, the high price was suppressed by short positions, and the price began to dive. The price was supported by the 20-day moving average, and the price was temporarily breathed and waited for an opportunity to break 16500 yuan / ton, but it was suppressed again on the way up, and the price fell rapidly, falling below 16300 yuan / ton. The price fluctuates in a narrow range. On Friday, the domestic government work report did not put forward the GDP growth target, and the new investment in traditional infrastructure was limited, which fell short of market expectations. At the same time, affected by the decline in crude oil and surrounding metals, the center of gravity of zinc prices in Shanghai again moved down to 16165 yuan / ton. Later, with some short sellers leaving, prices rebounded into a narrow volatility trend.

When the terminal price falls, the order increases slightly, driving the production of die-casting zinc alloy factories, but most alloy factories say that the current temporary increase in demand is mainly caused by the fall in prices. it does not mean that terminal orders have significantly improved, it is difficult for orders to change greatly in May, and whether they improve in June or not still need to wait for overseas orders to recover. The current overseas orders are still not significantly improved, still rely on domestic orders to support the overall demand. Domestic automobile production and sales rebounded, driving a certain amount of die-casting zinc alloy consumption, other plate increment is not obvious. Smelter alloy output decline, and the current alloy plant operating rate is low, some plants even temporarily stop production, die-casting zinc alloy sales pressure has been alleviated, but the overall sales pressure is still large. This week's terminal replenishment to some extent overdrawn the future purchase demand, coupled with the die-casting zinc alloy plant also has additional raw material zinc ingot inventory, alloy plant demand for zinc ingots is expected to decline next week.

Scan the QR code in the picture to sign up for the lead-zinc summit and fill in the personal information on the last page. The meeting staff will contact you later!