Domestic Zinc Concentrate Shortage Persists, TCs Continue to Decline in Multiple Regions [SMM Zinc Concentrate Weekly Review]

SMM News on December 5:

Both domestic and imported zinc concentrate TCs continued to decrease this week. On a weekly basis, the SMM Zn50 domestic TC average fell 200 yuan/mt in metal content WoW to 1,850 yuan/mt in metal content, while the SMM imported zinc concentrate index dropped $3.5/dmt WoW to $57.75/dmt.

Domestic ore market. In the first week of the month, which coincided with the peak period for December zinc concentrate TC negotiations, TC pricing results were finalized in some regions. TCs in many domestic areas declined by 200-400 yuan/mt in metal content this week. Although domestic smelters continued to expand production cuts in December, leading to a WoW decrease in zinc concentrate demand, domestic zinc concentrate supply also weakened. As temperatures continued to drop, some zinc mines in northern regions began winter shutdowns starting in November, and the volume of domestically circulated zinc concentrate further decreased in December. Under the dual decline in supply and demand, the tight supply of domestic zinc concentrate remained unresolved, and the downward trend in zinc concentrate TCs persisted.

Imported ore market. Import losses for zinc concentrate widened further this week, prompting smelters to primarily purchase domestic zinc ore. Trading in the imported zinc concentrate market was relatively quiet during the week. It is understood that most offers for standard zinc concentrate were concentrated around $50-60/dmt. Although the decline in imported zinc concentrate TCs slowed down, the overall downward trend continued.

SMM zinc concentrate inventories at main ports in China totaled 300,000 mt in physical content this week, down 2,000 mt in physical content WoW, with Lianyungang contributing the main decrease.