Most Cities in China Resumed Work and Production, SHFE/LME Price Ratio Rising

SHANGHAI, Jun 13(SMM) - 

SHFE/LME price ratio surged and then fell last week, ranging between 6.73-6.99 and the import losses stood at 4,633-3,721 yuan/mt.

As Shanghai was lifted from the COVID lockdown, most cities in China resumed work and production. And market confidence was boosted by the frequent introduction of favourable policies.

On the other hand, the exported zinc ingot from China was delivered at LME, resulting in a slow reduction in LME inventory. However, SHFE/LME zinc price ratio was under pressure from two aspects.

First, consumption expectations were strong, but the actual consumption was still weak. The inventory hovered at a multi-year high.

Second, after the opening of the mine-end import window, smelters purchased forward imported ore with fixed prices, putting pressure on the futures market. It is expected that the upward space of the SHFE/LME price ratio is limited and the ratio will move rangebound.