Huatai Futures: the overseas situation is not yet clear. Zinc and aluminum continue to fluctuate.

Zinc:

On the spot side, LME zinc spot water rose 12.50 U.S. dollars / ton, the previous trading day rose 0.50 U.S. dollars / ton. According to SMM, the mainstream transaction of zinc in Shanghai is 25050,25090 yuan / ton, Shuangyan is 25060,25110 yuan / ton, ordinary zinc is 30,000,40 yuan / ton in 2203 contract, 50 yuan / ton in 2203 contract, and zinc mainstream transaction is 24980,25020 yuan / ton. The price of zinc continued to be low yesterday. In the morning, the holder quoted a slight rise in the rising water, to 300.40 yuan / ton for the 2203 contract and 50.10 yuan / ton to the average price. The price of zinc was still weak yesterday, and the holder continued to quote a price for rising water, and the transaction was mediocre. Entering the second period of time, the rising water remained unchanged, and the 2203 contract for ordinary zinc ingots was quoted at around 300.40 yuan / ton. On the whole, after the zinc price fell for four consecutive days, the wait-and-see mood in the downstream market was relatively strong, and the overall transaction was relatively general.

On the inventory side, LME stocks stood at 148475 tons on February 17, down 875 tons from the previous day. According to SMM, the inventory of zinc ingots in seven places in China was 254300 tons, an increase of 1.16 tons over last Friday.

Viewpoint: yesterday, Shanghai zinc was weak and volatile during the day, and the night market opened up slightly. Overseas, the situation in Russia and Ukraine has further deteriorated, friction has occurred between the two sides in the border area, and panic in the financial markets has risen sharply. Glencore's recent expansion of zinc mines has met with strong opposition from indigenous people. At present, the problem of gas supply in Europe has not been completely solved, the European Union is seeking more natural gas supply, and the United States will continue to pressure the "Nord Stream-2" project. Electricity prices in some European countries have stabilized, but they are still high, and the power costs of smelters remain high. The overall supply pressure of zinc still exists, and the follow-up effect still needs to be paid attention to.

On the domestic side, the production of mines in Inner Mongolia has been affected recently, resulting in a decline in the output of zinc concentrate. Some smelters in Inner Mongolia said that due to the relative difficulties in purchasing raw materials, the output of zinc ingots may be lower than expected. On the consumer side, domestic downstream enterprises have not yet fully resumed production, the finished product inventory of galvanizing, die-casting and zinc oxide enterprises has not been fully released, and the operating rate of the three industries has rebounded slightly but has not yet reached a high point. At present, the hype of demand shows the characteristics of strong expectation and poor reality, so we still need to wait for the stage of inventory to go to the warehouse. In terms of inventory, inventory data show that domestic inventory has increased, which has a certain pressure on prices. In terms of price, the high cost of domestic smelting has a certain support for the price of zinc, but it still needs to wait and see for the demand to pick up.

Strategy: unilateral: neutral. Arbitrage: internal and external arbitrage.

Risk points: 1, the impact of the epidemic situation of variants. 2. Consumption is lower than expected. 3. Domestic energy consumption double control policy.

Aluminum:

On the spot side, LME aluminum spot water rose 34 U.S. dollars / ton, the previous trading day rose 26.50 U.S. dollars / ton. According to SMM, yesterday Shanghai Aluminum's main 2203 contract opened in early trading at 22745 yuan / ton, the lowest price was 22565 yuan / ton, the highest price was 22780 yuan / ton, and finally closed at 22585 yuan / ton, up 65 yuan / ton from the previous trading day, an increase of 0.29%. The position decreased by 9495 lots from the previous day to 160000 lots, compared with the trading volume of 190000 lots yesterday. Yesterday, Shanghai Aluminum maintained a volatile trend in early trading. In early trading, the 03 contract fluctuated around the daily average line, the annual leave ended, downstream enterprises resumed work one after another, procurement improved, aluminum ingots in the South China market turned better, and the price of the consignor rose higher. Yesterday, SMM Foshan quoted a price of 100 yuan / ton for contract 03, up 10 yuan / ton over the previous trading day, and the spot price closed at 22760 yuan / ton, up 60 yuan / ton over the previous trading day. The actual transaction price in the market is 10 yuan discount to the net price-10 yuan / ton, and the concentrated transaction price is 22750-22770 yuan / ton.

Inventory, according to SMM, February 17, domestic aluminum ingot inventory of 1.039 million tons, compared with last Thursday accumulated inventory of 90, 000 tons. LME aluminum inventories fell 1700 tons to 855000 tons from the previous day on February 17.

Viewpoint: aluminum prices were strong and fluctuating yesterday, and downstream aluminum rods went to the warehouse slightly. Macroscopically, China's CPI and PPI fell back in January. The NDRC said the benchmark level of energy efficiency in industries such as copper, aluminum and zinc will be further improved by 2025. The overseas European energy crisis is still simmering, with production cut or expanded again due to greater uncertainty in overseas natural gas supplies before the start of spring in March. In terms of domestic fundamentals, Yunnan, Inner Mongolia and other places have begun to resume production, and the process of resuming production is different. In terms of consumption, the downstream resumes work one after another, so we need to pay attention to the impact of the epidemic situation and environmental protection control in the north on the downstream resumption of work. In terms of inventory, the latest treasury data show that inventory has accumulated, with major increases in the contribution of Nanhai, Wuxi and Gongyi. In terms of prices, the threat of the energy crisis to overseas electrolytic aluminum production capacity may continue until the beginning of spring, and with the resumption of construction in various places after the festival, consumption can be expected to pick up, driven by real estate stock construction, completion and infrastructure projects. however, we need to guard against the fluctuations of the market expectations of raising interest rates in the late first quarter, and it is suggested that we should treat them unilaterally with the idea of doing more than bargain.

Strategy: unilateral: be cautious and bullish. Arbitrage: neutral.

Risk points: 1. Liquidity tightens faster than expected. 2. Consumption is far below expectations. 3. Domestic energy consumption double control policy.