Import Window for Zinc Concentrates Remains Open, Domestic TCs Temporarily Halt Decline [SMM Zinc Concentrate Weekly Review]

SMM January 9:

On a weekly basis, the average SMM Zn50 domestic zinc concentrate TC remained flat WoW at 1,500 yuan/mt in metal content, while the SMM Imported Zinc Concentrate Index dropped by $6.25/dmt WoW to $37.5/dmt.

Domestic ore market. As zinc concentrate TCs for January were gradually finalised, domestic smelters mostly executed earlier contracts this week, keeping overall zinc concentrate TCs stable. It is understood that with previously purchased imported zinc concentrates arriving at ports, raw material inventories at domestic smelters increased slightly. In addition, as the import window for zinc concentrates remained open in January, smelters' purchasing enthusiasm for domestic zinc concentrates waned. The decline in domestic zinc concentrate TCs paused recently, but with no significant improvement in the supply-demand pattern yet, a rebound in TCs will take time. SMM will continue to monitor subsequent TC trends.

Imported ore market. In the first week after the New Year's Day holiday, trader offers for imported ore were scarce this week. Meanwhile, smelters had largely completed winter stockpiling purchases, leading to sluggish spot transactions of imported ore during the week. It is understood that recent offers for Antamina zinc concentrates were reported at $0–10/dmt, and the decline in imported zinc concentrate TCs continued.

Australian media reported that due to monsoon rains, flooding in northwestern Queensland is expected to persist over the coming weeks, with several rivers still at peak flood levels and some inland towns and major transport routes cut off. Meteorological authorities indicated that although overall weather conditions have eased, substantial ground water means flood recession will be slow, and risks of further heavy rainfall and flash floods remain in local areas. There is no clear information yet indicating large-scale disruptions to nonferrous metal mine production from the flooding, but road and regional logistics constraints pose potential risks to subsequent ore and concentrate transportation, with related impacts requiring continued monitoring.

This week, SMM zinc concentrate inventories at main ports in China totaled 251,500 mt in physical content, down 77,500 mt WoW, with Fangchenggang and Nanjing ports contributing the main decreases.