Shanghai zinc once fell close to 2%: tired bank, light consumption, enterprises have early holiday expectations [SMM analysis]

SMM, January 17: since the opening of trading this morning, the main force of Shanghai zinc has fluctuated all the way down, falling as much as 1.9% at one point in intraday trading. There was a slight correction near the close, and finally the main force of Shanghai zinc fell by 1.47% to 24545 yuan / ton.

Today's spot trend also coincides with the futures market. According to the spot quotation of SMM, the average spot price of SMM zinc ingots is 24650 yuan / ton, down 330yuan / ton in a single day, or 1.32%.

"Click to view the spot historical price of SMM zinc.

In terms of fundamentals, on the supply side, in addition to the enterprises that have stopped production due to environmental protection factors, the current smelters still have production control due to mine pressure. at the same time, some smelters in Hunan have been overhauled beyond the usual time in the past. SMM expects an output of 513400 tons in January, which is significantly lower than the previous forecast.

In terms of inventory, according to the latest inventory data from SMM, as of January 17, the total inventory of SMM zinc ingots in Seven places was 126200 tons, an increase of 3100 tons compared with last Friday. This is mainly due to the arrival of goods on the way in Shanghai, which leads to a rebound in inventory. The accumulation of inventory brings some pressure to the rise of zinc price. And the situation of this tired library also confirms the previous prediction of SMM. In the next two weeks, SMM expects the stock of zinc ingots to be about 17, 000 to 30, 000 tons.

Data source: SMM database

On the consumption side, according to SMM research, due to the epidemic and the early holiday of some enterprises, the start of zinc downstream is weak as a whole. Take the galvanizing plate as an example, according to SMM research, the fermentation of the recent epidemic in Tianjin has made the already light galvanizing consumption even worse. The Spring Festival this year is earlier than in previous years, superimposed production restrictions on environmental protection in the north, and overall consumption is poor, enterprises have the expectation of a holiday ahead of schedule, the overall transportation and production of the epidemic is limited, and some small and medium-sized enterprises have had a holiday one after another last week. Most enterprises have basically completed their holidays this week, and large enterprises will enter their holidays around Little year (1.25) at the latest. "View details

In addition, die-casting and zinc oxide plate most enterprises have also entered the holiday cycle this week, the overall zinc consumption in the lower reaches of the year gradually weakened.

Generally speaking, the weakening of zinc prices today is mainly due to the accumulation of storage and light consumption downstream, and the follow-up will still be expected. SMM believes that in the short term, the domestic zinc market faces the pressure of accumulation in January, but in the long run, SMM is still optimistic about zinc prices and is expected to run in shock in Shanghai.