Demand continues to weaken, and galvanizing operation rates decline [SMM Weekly Galvanizing Review]

SMM June 27 News: This week, the operating rates of galvanising producers stood at 56.21%, down 2.39 percentage points WoW. In terms of raw material inventory, zinc prices have been rising this week, reaching a level unacceptable to downstream users. Coupled with weak downstream demand, restocking for immediate needs or long-term contracts dominated, leading to a decrease in zinc ingot inventory. The weekly operating rate pulled back, primarily due to the following reasons: This week, ferrous metals prices maintained a fluctuating trend without significant fluctuations. Traders restocked less, and orders for galvanized pipes were low. South China has entered the rainy season with high temperatures, affecting construction and resulting in weak downstream demand. Galvanized pipe factories reduced production to lower inventory, but sales were poor, leading to a slight inventory buildup of finished products. For galvanized structural components, demand weakened during the traditional off-season, and export orders also declined. Although there have been tenders for steel tower orders, the issuance of drawings for new tender orders has been slow, and end-users have requested fewer goods, leading to a decline in enterprise production. It is expected that the operating rate will continue to pull back to around 55.86% next week.

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