SHFE/LME price ratio remains low, trading remains sluggish [SMM Zinc Concentrates Weekly Review]

SMM News on June 20:

This week, domestic zinc concentrate TCs remained stable, while imported zinc concentrate TCs increased on a WoW basis. Specifically, the average weekly SMM Zn50 domestic TC price remained unchanged at 3,600 yuan/mt (metal content) on a WoW basis, and the SMM Imported Zinc Concentrates Index rose by $2.27/dmt WoW to $55.27/dmt.

In the spot ore market, the SHFE/LME price ratio remained low this week, with the import window for zinc ore remaining closed. Smelters continued to prioritize domestic purchases, and their willingness to purchase imported zinc ore remained low, resulting in sluggish overall transactions during the week. According to SMM, the current TC offer for Antamina zinc ore from ore traders is around $45/dmt. Recently, the tender result for New Century zinc ore was heard to be around $40/dmt for a tender volume of 10,000 mt, with a Q3 shipment period. Additionally, the tender result for a zinc ore in North China was recently reported at 5,500 yuan/mt (including a 20:80 profit-sharing arrangement), a decrease of 200 yuan/mt WoW. SMM will continue to monitor subsequent changes in TCs.

On June 16, Australian miner Polymetals Resources Ltd announced that its Endeavor silver-zinc mine in the Cobar region of New South Wales had achieved commercial production. Currently, production of silver-lead concentrates and zinc concentrates has commenced, with the beneficiation plant operating steadily and the grinding and flotation systems undergoing continuous optimization. The company stated that the advance payment for zinc concentrates would be received in June, realizing the first cash flow, with the first shipment planned for early July. Deliveries of silver-lead concentrates will commence later. The upper high-grade silver ore body is expected to start being mined in August, and mine operations are set to ramp up in H2 2025, gradually increasing to the planned capacity of processing 1.2 million mt of ore annually. If production activities proceed smoothly, the mine is expected to produce approximately 20,000 mt (metal content) of zinc concentrates in 2025.

This week, the total inventory of SMM zinc concentrates at China's main ports was 325,000 mt, a decrease of 10,000 mt WoW, indicating a slight reduction in port zinc ore inventory.

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