High Prices Suppressed Downstream Procurement Enthusiasm, Zinc Oxide Operating Rates Declined This Week [SMM Zinc Oxide Weekly Review]

       This week, the operating rate for zinc oxide recorded 57.25%, down 1.26 percentage points WoW. Raw material side, zinc prices rose significantly during the week, prompting zinc oxide enterprises to purchase cautiously due to high prices, mostly consuming existing inventories or making just-in-time procurement in small quantities. Finished product inventories side, affected by high prices, the shipment pace of zinc oxide enterprises slowed down this week, and finished product inventories increased. End-use demand side, downstream enterprises were constrained by price pressure, resulting in insufficient procurement enthusiasm, with overall procurement mainly just-in-time. Among them, the stockpiling demand of downstream customers of small and medium-sized zinc oxide plants was particularly sluggish this week. The decline in this week's zinc oxide operating rate was mainly due to some zinc oxide enterprises experiencing poor shipments affected by high prices during the week, leading to a slight decrease in operating rates. However, enterprise performance diverged, with leading large plants maintaining relatively stable order demand and operating rates basically at normal levels. Looking ahead to next week, affected by high prices, market demand is mostly actual just-in-time needs, while demand for ceramic-grade zinc oxide gradually weakens. Additionally, considering that enterprises face dual pressures of high costs and inventory pressure, the zinc oxide operating rate is expected to slightly decrease, fluctuating around 57.10%.