The SMM Imported Zinc Concentrate Index for this week is $93.75/dmt, with a 1.35% WoW increase. The SMM Imported Lead Concentrate average spot TC for this week is $-90/dmt, unchanged WoW.

Reviewing the overall die-casting zinc alloy market in H1, how did China's imports and exports perform amid tariff disputes and the export rush? What are the prospects for H2?

SMM Analysis：In the complex and ever-changing market environment, inventory, as a crucial indicator of supply-demand relationships, serves as a key reference for investors to judge price trends. Against the backdrop of SMM’s well-established tracking of visible lead-zinc inventories, the market has turned increasing attention to the existence of hidden inventories.....

[Daily Candlestick Center Continues to Decline, Focus on Tonight's PCE Data] The most-traded SHFE zinc 2510 contract opened at 22,130 yuan/mt. After opening, bears increased positions, causing SHFE zinc to fluctuate downward below the daily average line. Subsequently, bears reduced positions, and SHFE zinc continuously rose to a high of 22,180 yuan/mt. At the close, SHFE zinc pulled back slightly, ultimately settling at 22,140 yuan/mt, down 30 yuan/mt (0.14%). Trading volume dropped to 140,000 lots, while open interest increased by 1,964 lots to 117,000 lots.

[SHFE/LME price ratio pulled back to fluctuate around 7.9, zinc ingot import arbitrage window remained closed]: The SHFE/LME price ratio pulled back to fluctuate around 7.9 this week, while the zinc ingot import arbitrage window stayed closed. Overseas, the center of LME zinc prices declined initially due to recent US Fed turbulence, but then the initial jobless claims came in lower than expected, indicating the labour market remained robust. The positive market sentiment drove continuous rises in LME zinc prices.

[Domestic and Overseas Inventories Continue to Diverge, SHFE and LME Zinc Prices Fluctuate Considerably] At the beginning of the week, LME zinc was closed for one day due to the Summer Bank Holiday. Subsequently, the US dollar index rebounded, and LME zinc edged lower. However, affected by recent US Fed turmoil, the US dollar index kept pulling back, while LME zinc continued to rise...

[Die-casting zinc alloy operating rates rose this week, expected to continue climbing next week] The operating rate of die-casting zinc alloy producers recorded 50.78% this week, up 0.32 percentage points WoW. Raw material side, zinc prices fluctuated, with the pullback in the latter half of the week prompting some companies to stock up small amounts of raw materials.

[Some producers suspended production this week, zinc oxide operating rates declined WoW] The operating rate of zinc oxide stood at 51.69% this week, down 4.2 percentage points WoW. Raw material side, zinc prices maintained fluctuating trend, although prices saw a notable pullback at the week's end, zinc oxide producers mainly made just-in-time procurement, with inventory basically flat from last week...

[Overall transactions remained sluggish, spot premiums/discounts continued to decline] WoW, premiums/discounts in Guangdong dropped by around 10 yuan/mt. As of Friday, mainstream 0# zinc quotations in Guangdong were at discounts of 80~50 yuan/mt against the market, while the Shanghai-Guangdong price spread narrowed...

[Continuous arrivals across regions coupled with weak cargo pick-up by downstream sectors led to further domestic inventory increase] According to SMM surveys, as of Thursday (August 28), the total #1 zinc ingot inventory across seven major markets monitored by SMM reached 144,500 mt, up 11,600 mt from August 21 and 6,000 mt from August 25, indicating rising domestic inventory...