Social inventory of zinc ingots continues to accumulate, SHFE zinc prices decline slightly [SMM Morning Comment on Zinc]

SMM July 7 News:

Last Friday, the LME zinc contract opened at $2,739.5/mt. In early trading, bulls and longs interwove, causing LME zinc to fluctuate upward, reaching a high of $2,757/mt during European trading hours. Subsequently, longs reduced positions, leading LME zinc to fluctuate downward throughout the session, hitting a low of $2,722.5/mt during the night session. It finally closed down at $2,735.5/mt, a decrease of $2.5/mt or 0.09%. Trading volume dropped to 4,385 lots, while open interest fell by 883 lots to 206,000. Last Friday, LME zinc formed a small bearish candlestick. Market focus shifted to the July 9 tariff deadline, after which the US will impose tariffs on countries not yet subject to them, sparking market concerns and causing LME zinc to close lower.

Last Friday, the most-traded SHFE zinc 2508 contract opened lower at 22,340 yuan/mt. In early trading, longs continued to reduce positions, driving SHFE zinc downward to probe a low of 22,225 yuan/mt. It ultimately closed up at 22,240 yuan/mt, down 170 yuan/mt or 0.76%. Trading volume decreased to 57,395 lots, while open interest dropped by 1,726 lots to 126,000. Last Friday, SHFE zinc formed a small bearish candlestick. Amid weak domestic consumption, social inventory showed some buildup, with repeated expectations of domestic inventory accumulation. However, relatively low zinc ingot social inventory continues to provide support. SHFE zinc is expected to consolidate today.