Refined Zinc Import Window Approaching: Will Import Volume Surge in July? [SMM Analysis]

According to the latest customs data, in June 2024, refined zinc imports were 34,900 mt, down 9,500 mt or down 21.35% MoM, down 22.94% YoY. From January to June, cumulative refined zinc imports were 222,000 mt, up 125.93% YoY. In June, refined zinc exports were 1,360 mt, resulting in net imports of 33,500 mt.

The top three countries for refined zinc imports in June were Kazakhstan (12,300 mt, 35.15%), Australia (9,900 mt, 28.47%), and Iran (6,000 mt, 17.31%). Overall, refined zinc imports in June decreased but slightly exceeded expectations, with Spain showing the largest decline, while Iran had a significant increase.

Over 10,000 mt of goods were still in special customs supervision areas in June, which technically do not count as market inflows. The main reason for the decline in June imports was the low ratio and the continued closure of the import window.

In July, with overseas macro sentiment fluctuating and domestic mining issues unresolved, processing fees continued to drop to a historical low of less than 2,000 yuan/mt in metal content. The reduction in mining output has been transmitted to smelters, and refined zinc production in July is expected to see a sharp drop MoM. Strong support on the supply side, with domestic strength and overseas weakness becoming apparent, is approaching the opening of the refined zinc import window. Attention should be paid to the window opening at the end of the month. The market in July is expected to be dominated by long-term imports, supplemented by spot imports, with little increase in refined zinc imports.