Some enterprises are still in a state of shutdown, and downstream operations continued to decline this week [SMM Zinc Oxide Weekly Review]

SMM News on July 4:

     This week, the operating rate of zinc oxide was recorded at 56.14%, down 2.58% MoM. On the raw material side, zinc prices maintained a fluctuating trend this week. Meanwhile, influenced by the recent sluggish demand, enterprises currently have low enthusiasm for stockpiling, resulting in a slight MoM decline in raw material inventory. Regarding finished product inventories, due to the recent slowdown in outflows from warehouses of enterprises, finished product inventories increased MoM. In terms of terminal orders, the market has now entered the off-season for consumption. From the perspective of end-use demand for feed-grade zinc oxide, downstream demand has weakened recently. At the same time, the market has also entered the off-season for automobile consumption, with tyre factories currently having high inventory levels. Overall orders for rubber-grade zinc oxide have also weakened. The decline in zinc oxide operating rate this week was mainly due to some enterprises being in a state of shutdown during the week, while some enterprises slowed down their production pace due to the weakening demand, jointly driving the operating rate down. The currently shut-down enterprises are expected to resume production next week, and the operating rate of zinc oxide may slightly increase to 56.52% next week.

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