SMM December 19:
This week, the zinc oxide operating rate recorded 55.88%, up 0.21 percentage points WoW. On the raw material side, driven by the pullback in zinc prices, enterprises' purchase willingness strengthened, and raw material inventories accumulated. However, on the production side, affected by environmental protection inspections halting production at some enterprises, finished product inventories were gradually consumed. Demand side showed divergence: orders from large plants were generally stable, but orders from small and medium-sized enterprises were weak. Meanwhile, ceramic-grade zinc oxide entered the seasonal consumption off-season, and demand gradually slowed down. Although environmental protection inspections constrained production at some enterprises, some enterprises resumed production after inspections ended during the same period. Coupled with the release of some new capacity, these factors jointly supported the slight rise in this week's operating rate. Overall, although orders from large plants were stable and there were increments from production resumptions, considering that some enterprises still halted production due to environmental protection issues, the zinc oxide operating rate is expected to remain around 56.07% next week, with limited overall fluctuations.
