Spot Zinc Consumption Weakens, Zinc Prices Drop Back Slightly [SMM Zinc Futures Review]

SMM Sept. 26:

The most-traded SHFE zinc 2511 contract opened at 22,055 yuan/mt. After opening, SHFE zinc fluctuated rangebound around the daily average line, touching a high of 22,065 yuan/mt during the session. Approaching the close, SHFE zinc fell all the way, hitting a low of 21,980 yuan/mt, and finally closed down at 21,980 yuan/mt, down 70 yuan/mt or 0.32%. Trading volume increased to 64,102 lots, while open interest decreased by 2,878 lots to 126,000 lots. SHFE zinc recorded a bearish candlestick, with the 20-day moving average forming resistance overhead. Recently, pre-holiday stockpiling by downstream users has been largely completed, leading to a subsequent weakening in spot consumption. Coupled with smelter production remaining at high levels, the fundamental picture of strong supply and weak demand has led to a pullback in zinc prices.