






Zinc Morning Meeting Summary on May 7
Futures Market: Overnight, LME zinc opened at $2,626/mt. After a slight decline in the early session, LME zinc rebounded from the lows and reached a high of $2,664.5/mt. Subsequently, SHFE zinc fluctuated upward above the daily average line. Then, LME zinc declined again during the night session, hitting a low of $2,621/mt. Near the end of the session, LME zinc rebounded from the lows to near the daily average line and finally closed up at $2,626.5/mt, up $11.5/mt or 0.44%. Trading volume increased to 11,213 lots, while open interest decreased by 64 lots to 209,000 lots. Overnight, the most-traded SHFE zinc 2506 contract opened at 22,300 yuan/mt. In the early session, SHFE zinc hit a low of 22,300 yuan/mt, then continued to rise from the lows. After reaching a high of 22,470 yuan/mt, SHFE zinc fell again below the daily average line and began to fluctuate. It finally closed up at 22,360 yuan/mt, up 5 yuan/mt or 0.02%. Trading volume decreased to 553.44 million lots, while open interest increased by 1,970 lots to 114,000 lots.
Macro: Trump: A major announcement will be made before the Middle East trip, which may not necessarily involve trade matters; if negotiations fail, the EU will impose tariffs on $100 billion worth of US goods; Minneapolis Fed President Kashkari will replace Schmid in voting; the Indian Armed Forces launched "Operation Sindhur" to attack multiple locations in Pakistan; He Lifeng will hold talks with the US lead negotiator, US Treasury Secretary Bessent; the State Council Information Office will hold a press conference at 9 a.m. on May 7; Lan Fo'an: China will adopt more proactive macro policies; the Hong Kong Monetary Authority sold HK$12.788 billion in the market.
Spot Market:
Shanghai: During the Labour Day holiday, zinc ingot arrivals in the Shanghai area were relatively limited. With limited supply, market traders' sentiment to stand firm on quotes resurfaced. However, as the futures market maintained a fluctuating trend, it did not reach the psychological price expectations for downstream enterprises to purchase. Additionally, some downstream enterprises reported that they still had some raw material inventory, and overall purchases were mainly based on immediate needs, resulting in sluggish spot trading activity.
Guangdong: It was at a premium of 50 yuan/mt over Shanghai spot. Overall, there were a few arrivals in Guangdong during the holiday, but the current overall inventory remained at a relatively low level, and the reported spot premiums and discounts in the market were relatively high. Meanwhile, on the first trading day after the holiday, the sales of various traders improved compared to the previous trading day. Coupled with the expansion of the price spread between futures contracts yesterday, it drove spot premiums and discounts to rise somewhat.
Tianjin: It was reported at a premium of around 40 yuan/mt over SHFE zinc. The futures market continued to fluctuate mainly. Downstream enterprises had more holidays during the Labour Day, and on the first day after the holiday, they mainly adopted a wait-and-see attitude. Some enterprises restocked based on immediate needs or waited for the arrival of new long-term contracts. With the contract rollover quotes yesterday, traders' quotes remained relatively stable, and overall trading was average.
Ningbo: It was on par with Shanghai spot.On the first day after the Labour Day holiday, traders in the Ningbo market predominantly rolled over their contracts to offer quotes for the 2506 contract. In the morning, downstream enterprises restocked after the holiday, and the buying sentiment was moderate. However, as the price spread between nearby months gradually widened, spot premiums in Ningbo continued to rise, leading to a slight deterioration in spot transactions.
Social Inventory: On May 6, LME zinc inventory decreased by 875 mt to 172,925 mt, a decline of 0.5%. According to communication with SMM, as of May 6, the total zinc ingot inventory across seven locations tracked by SMM was 84,100 mt, a decrease of 1,800 mt from April 28 and an increase of 7,100 mt from April 30. Domestic inventory recorded an increase.
Zinc Price Outlook: Overnight, LME zinc recorded a bullish candlestick, with the 5-day moving average providing support below. The weakening of the US dollar index supported the rise in zinc prices, but persistent market concerns about demand prospects and macroeconomic pressures continued to weigh on zinc prices, limiting the gains in LME zinc during the night session. Overnight, SHFE zinc also recorded a bullish candlestick, with the upper band of the Bollinger Bands forming resistance. Domestic zinc ingot supply levels in May remained strong on a MoM basis, while market expectations for May consumption were weak amid tariff disruptions. Fundamentals provided insufficient support for zinc prices, and SHFE zinc maintained a fluctuating trend.
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