Short-term zinc prices still face resistance upward

SMM, Oct 12: After the holiday, as macro optimism calmed down, zinc prices jumped initially and then pulled back. Overall, considering the US Fed's interest rate cut and domestic liquidity release, along with the economic growth target, the macro sentiment remained warm. Fundamentals side, there is an expectation of production cuts at overseas smelters, but no actual news has materialized yet. The high enthusiasm of funds has driven zinc prices stronger. Domestically, although domestic mine production did not increase beyond expectations, the increase in port zinc concentrate inventory was significant. Smelter raw material inventory slightly eased, increasing the market's available ore circulation. The expectation of a TC rebound has risen, but in the fourth quarter, there is also the expectation of seasonal production cuts in the north and stockpiling for winter, limiting the TC rebound space. Domestic smelter production in September was 499,300 mt, significantly higher than previously expected, while social inventory decreased by about 30,000 mt in September, indicating overall consumption was better than expected. Smelter production in October is expected to continue rising, and a large amount of imported zinc ingots entered after the holiday. If consumption cannot be maintained, inventory may continue to increase, and short-term zinc prices still face resistance upward. Attention should be paid to changes in macro sentiment.