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[SMM Weekly selection] 10 the contract position is too high to help the structure strengthen next week, zinc prices may be able to set a new high for the year.
Sep 19,2020 10:39CST
translation
Source:SMM
[zinc concentrate TC] domestic smelters, out of concern about forward ore supply, smelters take the initiative to reduce processing fees to receive goods, but the actual situation is not smooth, according to the balance of domestic and foreign mineral supply in the fourth quarter, if the domestic smelter maintains full production, the overall mineral supply tends to be in shortage, overseas, the current zinc ore supply is still in short supply, overseas mines forward October shipment tender price concentrated at 120,150USD / dry ton.
The content below was translated by Tencent automatically for reference.

"SMM Zinc Industry chain Weekly report" released, the weekly report SMM will select the hot topics, prices, market or major changes in the industry chain information released into a document for your reference.

The following is an excerpt from the weekly report of the zinc industry chain:

Zinc market forecast next week: in terms of Shanghai zinc, due to the continuous decline in the quoted price of imported mines, the logic of tightening of mineral supply boosting the price logic is strengthening, and the early release of winter storage demand is also exacerbating this tense atmosphere. Pessimistic expectations of zinc supply in the fourth quarter are gradually replacing consumption as the new price anchor, and this medium-term logic has not changed. In the short term, on the one hand, the Shanghai Zinc 2010 contract far exceeds the excess position in the same period in previous years, with warehouse receipts falling to about 19000 tons as of Friday, which is too low. At the same time, the price difference between far and near Synchronize expands the risk of corroboration. At the same time, the import window has successively reached the margin of profit and loss, and imported zinc may inflow and replenish. Coupled with the fact that the violent fall in zinc prices last week has already formed a certain overdraft on consumption, the release of reserve demand before the National Day may be restricted by the fact that the price is lower than expected, that is, the high point of going to the warehouse within the month has already appeared. Short-term fundamentals are multi-empty intertwined, the main zinc in the next cycle is expected to run around 19400-20500 yuan / ton, Shanghai zinc spot is expected to report a rise of 120,280 yuan / ton in October. Lun Zinc is expected to rise but not fall next week, running around 2430-2600 US dollars / ton.

Processing fees: this week, domestic smelters continue to reduce zinc concentrate processing fees, domestic ore supply is tight. It is understood that at present, the mainstream imported miners in the domestic market are quoted at US $100,130 / dry tonne. It is understood that some imported miners have quoted prices of about US $80 / dry ton. At present, there is no transaction. This week, the inventory of zinc concentrate in Lianyungang port rebounded to 130000 tons. However, it is understood that domestic traders generally have less spot volume. In terms of domestic smelters, out of concern about the long-term supply of ore, Smelters take the initiative to reduce processing fees to receive goods, but the actual situation is not smooth. According to the balance of domestic and foreign mine supply in the fourth quarter, if domestic smelters remain at full production, the overall mine supply tends to be in short supply, overseas, zinc ore supply is still in short supply, and the bidding price for long-term shipment of overseas mines in October is concentrated at 120-150 US dollars / dry ton.

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Catalogue of "SMM Zinc Industry chain Weekly report" in this issue

Main points of this weekly report: processing fees, import profit and loss inventory

Zinc industry hot spot: 10 contract positions are historically high-value structural opportunities or there may still be room for them.

Zinc concentrate market: domestic smelters continue to reduce zinc concentrate processing fees this week. Domestic ore supply is tight.

Refinery dynamics

Import Zinc Market: expected Zinc performance strong Import loss narrowed to the margin of Safety

Zinc market predicts next week: 10 contract positions are too high to boost the structure. Zinc prices may hit a new high this year next week.

Review of Zinc City: market sentiment has recovered and Zinc prices in the two cities fluctuated upward

Galvanizing: more than half of the enterprises in Daqiuzhuang, Tianjin have basically resumed production and will resume further next week.

Die-casting zinc alloy: high zinc price suppresses downstream demand for lower stock of raw materials

Zinc oxide: consumption in key sectors is still stable. Enterprise procurement will rise and wait and see.

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