LME zinc recorded a five-day winning streak, with the center of the daily candlestick continuing to rise. [SMM Morning Meeting Minutes]

Zinc Morning Meeting Minutes for January 7
Futures: Overnight, LME zinc opened at $3,204.5/mt. Initially, it dipped to a low of $3,203/mt, then bulls increased their positions, pushing the price up continuously to a high of $3,268/mt. It held up well towards the close, finally settling at $3,245.5/mt, up $37.5/mt, a gain of 1.17%. Trading volume increased to 120,000 lots, and open interest rose by 4,650 lots to 236,000 lots. Overnight, the most-traded SHFE zinc 2602 contract opened at 24,300 yuan/mt. Initially, bears reduced positions, driving the price up to a high of 24,515 yuan/mt, then it pulled back slightly to a low of 24,240/mt, maintaining a relatively strong fluctuating trend. It finally settled at 24,385 yuan/mt, up 90 yuan/mt, a gain of 0.37%. Trading volume decreased to 87,210 lots, and open interest fell by 1,540 lots to 94,919 lots.

Macro: Venezuela and the US are negotiating oil exports to the US; Britain and France will deploy troops to Ukraine after a Russia-Ukraine peace agreement is reached; The US Supreme Court is scheduled to rule on tariff issues on the 9th; The Trump administration is discussing options for acquiring Greenland, including military options; Saudi Arabia will open its financial markets to all foreign investors; Sources: China is studying tightening the review of rare earth export licenses to Japan; The central bank set key tasks for 2026: Continue to implement a moderately loose monetary policy.

Spot:
Shanghai: Yesterday, the buying sentiment for refined zinc in the Shanghai area was 2.00, and the selling sentiment was 2.52. In the morning, zinc futures prices continued to rise, but spot availability in the Shanghai market was limited. Traders continued to hold prices firm when offering goods, keeping overall spot premiums high. However, downstream users remained cautious of high prices, resulting in low inquiry and purchasing sentiment yesterday. Overall spot trades were sluggish, with most transactions occurring between traders.
Guangdong: Yesterday, the buying sentiment for refined zinc was 1.99, and the selling sentiment was 2.66. Overall, as zinc prices continued to climb, downstream purchasing enthusiasm waned. Trading activity among traders also declined. However, recent gradual decreases in Guangdong inventory led traders to offer at higher prices, supporting a slight increase in premiums and discounts.
Tianjin: Yesterday, the buying sentiment for refined zinc in the Tianjin area was 1.79, and the selling sentiment was 2.05. Zinc prices continued to rise, causing downstream users to be cautious, purchase cautiously, and adopt a wait-and-see approach. Traders' offers were disorderly, premiums increased slightly, and overall market transactions were sluggish.
Ningbo: Overall spot availability in the Ningbo market was limited. Although zinc futures prices rose significantly, market traders continued to hold prices firm yesterday, pushing spot premiums higher. Some downstream enterprises with shortages made purchases as needed and fixed prices, resulting in generally mediocre spot transaction performance.

Inventory: On January 6, LME zinc inventory decreased by 75 mt to 105,850 mt, a drop of 0.07%. According to SMM communication and understanding, as of this Monday (January 5), domestic zinc ingot inventory increased.

Zinc Price Forecast: Overnight, LME zinc recorded a five-day winning streak, supported by the upper Bollinger Band. Current international regional disputes remain tense, and US Fed Governor Milan signaled the need for interest rate cuts exceeding 100 basis points in 2026, pushing the LME zinc price center higher. Overnight, SHFE zinc recorded a three-day winning streak, supported by various moving averages. Driven by strong performances in LME and other base metals, the center of the SHFE zinc daily candlestick continued to rise. However, constrained by expectations of a slight increase in domestic supply and mediocre demand fundamentals, further sharp rises in SHFE zinc are expected to face some resistance.

Data Source Statement: Except for public information, other data are processed by SMM based on public information, market communication, and relying on SMM's internal database model, for reference only and do not constitute decision-making advice.