[SMM Morning Comment on Zinc: Social Inventory of Zinc Ingot Continues to Increase, SHFE Zinc Falls Slightly] Last Friday, the most-traded SHFE zinc 2508 contract opened lower at 22,340 yuan/mt, with bulls continuing to reduce their positions in the early session. SHFE zinc fell all the way to a low of 22,225 yuan/mt, eventually closing up at 22,240 yuan/mt, down 170 yuan/mt or 0.76%. Trading volume decreased to 57,395 lots, and open interest fell by 1,726 lots to 126,000 lots.

[SMM Zinc Morning Meeting Summary: Market Concerns Arise as Tariff Deadline Approaches, LME Zinc Prices Fall]: Last Friday, LME zinc opened at $2,739.5/mt. With mixed bullish and bearish sentiments in the early session, LME zinc fluctuated upward, reaching a high of $2,757/mt during European trading hours. Subsequently, as bulls reduced their positions, LME zinc prices fluctuated downward throughout the day, hitting a low of $2,722.5/mt during the night session. It eventually closed at $2,735.5/mt, down by $2.5/mt or 0.09%. Trading volume decreased to 4,385 lots, while open interest fell by 883 lots to 206,000 lots.

The SMM Imported Zinc Concentrate Index for this week is $66.25/dmt, with a 1.53% WoW increase. The SMM Imported Lead Concentrate average spot TC for this week is $-55/dmt, flat from the previous week's figure.

[SHFE Zinc Maintains High Levels, Awaiting Further Macro Guidance]: The most-traded SHFE zinc 2508 contract opened at 22,325 yuan/mt. After the opening, SHFE zinc began to fluctuate considerably. Near the midday session, SHFE zinc dipped to 22,285 yuan/mt, then fluctuated upward all the way. Near the end of the session, it reached a high of 22,445 yuan/mt, and finally closed up at 22,410 yuan/mt...

As of June 30, the most-traded SHFE zinc contract closed at 22,495 yuan/mt, rising by 270 yuan/mt month-on-month, with a decline of 1.21%. In June, zinc prices first fell and then rose, hitting a low of 21,660 yuan/mt in mid-month before rebounding to a high of 22,570 yuan/mt at the end of the month. As we enter July, how will zinc prices perform?

[Some enterprises still remain shut down, and downstream operating rates continue to decline this week] This week, the operating rate of zinc oxide producers was recorded at 56.14%, down 2.58% MoM. On the raw material side, zinc prices maintained a fluctuating trend this week. Meanwhile, due to the relatively sluggish demand recently, enterprises' enthusiasm for stockpiling raw materials was low, resulting in a slight MoM decline in raw material inventory. On the finished product inventories side, as enterprises' outflows from warehouses slowed down recently, finished product inventories increased MoM...

[Sluggish market transaction atmosphere; premiums and discounts in Guangdong continue to decline] This week, premiums and discounts in Guangdong continued to decline, dropping by approximately 100 yuan/mt WoW. As of Friday this week, the mainstream quotation for 0# zinc in the Guangdong market was at a premium of 10~30 yuan/mt against the market, and the Shanghai-Guangdong price spread remained...

[Some enterprises resumed production during the week, driving an overall increase in operating rates] This week, the operating rate of die-casting zinc alloy producers stood at 49.14%, up 2.6 percentage points WoW. On the raw material side, zinc prices maintained a fluctuating trend this week. With current downstream demand weakening and some enterprises in the market still holding a certain bearish outlook on subsequent zinc prices, procurement was mainly driven by immediate needs, resulting in a WoW decrease in raw material inventories. Finished product inventories of enterprises remained basically flat WoW this week. The increase in the operating rate of die-casting zinc alloy producers this week was mainly due to the resumption of production by some enterprises, driving an overall increase in production...

[US ADP employment data shows a surprise cold performance, SHFE and LME zinc prices maintain fluctuating trend] At the beginning of the week, LME zinc maintained the fluctuating trend of last week. Subsequently, due to the recent resurgence of disputes between the US and Canada over tariff issues, the market was filled with tension, and some investors chose to take profits and exit the market. LME zinc pulled back from its highs...

[Increased Arrivals + Weakened Demand = Increased Social Inventory This Week] According to SMM's communication and understanding, as of Thursday (July 3) this week, the total inventory of zinc ingots in seven locations tracked by SMM was 82,400 mt, an increase of 2,900 mt from June 26 and an increase of 1,800 mt from June 30. Domestic inventory recorded an increase...