National Day and Mid-Autumn Festival Double Holiday Approaches! How Are Die-Casting Zinc Alloy and Zinc Oxide Enterprises Arranging Their Holidays?

SMM, September 29:

With the National Day and Mid-Autumn Festival double holiday approaching, holiday arrangements for die-casting zinc alloy and zinc oxide enterprises have been successively released. The specific details are as follows:

In terms of die-casting zinc alloy:

SMM's sample of die-casting zinc alloy enterprises has a total annual capacity of 1.6365 million mt. For the holiday situation of these enterprises, SMM surveyed 18 companies with a total capacity of 657,000 mt, affecting zinc consumption by 6,184 mt. According to SMM, the holiday duration for enterprises during the National Day and Mid-Autumn Festival holidays ranged from 0 to 8 days, with an average of 4.4 days. A small number of enterprises are expected to have holidays exceeding 10 days. Overall, the holiday duration for die-casting zinc alloy enterprises this year increased by 1.6 days YoY compared to 2.8 days last year. The core reasons for the increase in holiday days are, on one hand, the extended holiday window resulting from the overlapping of the two festivals, and on the other hand, the need for some enterprises to adjust their production pace due to high inventory levels. Meanwhile, some enterprises indicated that the current holiday arrangements are preliminary plans, and the actual holiday schedule will be flexibly adjusted based on order volumes during the holiday period, with a certain degree of uncertainty. From the perspective of end-user orders, the current period falls within the September-October peak season, yet "September did not see a peak." Some enterprises noted that this year's end-user stockpiling efforts have been weaker compared to previous years.Meanwhile, zinc alloy enterprises have been impacted by weak end-use demand and competition from low-priced alloys, leading to an overall decline in production. It is expected that this predicament will be difficult to overcome in the short term. On the inventory side, driven by the recent decline in zinc prices, die-casting zinc alloy enterprises have engaged in stockpiling at low prices. In addition to fulfilling routine long-term contracts, some enterprises have also recently conducted spot order pricing for procurement.

Regarding Zinc Oxide:
The total annual capacity of the SMM zinc oxide enterprise sample is 1.092 million mt. This time, SMM communicated with 15 zinc oxide enterprises regarding their holiday arrangements, involving a total capacity of 405,600 mt, which affected zinc consumption by 634 mt. Due to the production process of zinc oxide, except for a few enterprises that had holiday arrangements, the rest maintained normal production. Some enterprises had extended holiday periods due to insufficient profit margins for their products. In terms of end-use orders, feed-grade zinc oxide orders are currently in peak season, with strong end-use demand, high order backlogs at enterprises, and fast shipment rates. However, demand for rubber-grade and ceramic-grade zinc oxide, which account for a larger market share, remains relatively subdued. The ceramic-grade zinc oxide segment, in particular, has been noticeably impacted by the downturn in the real estate sector. On the inventory side, due to the recent pullback in zinc prices and concerns among enterprises about holiday-related disruptions to transportation and procurement, raw material inventories at zinc oxide producers have increased.