Operating Rates Continued to Rise This Week, but Order Demand Had Not Fully Recovered [SMM Zinc Oxide Weekly Review]

       This week, the operating rate of zinc oxide was 52.73%, up 8.51 percentage points MoM. Inventory side, some enterprises had yet to resume operations this week, and finished product inventories in plants were nearly depleted; coupled with the gradual resumption of production at downstream end-use factories, enterprises accelerated their shipment pace, driving finished product inventories lower, while raw material inventory was basically flat from last week. On orders, top-tier enterprises generally maintained stable orders, but overall industry demand had yet to fully recover. Affected by the relatively late Chinese New Year break, current end-use demand from rubber, desulfurization, and other sectors had yet to fully start, while the ceramics segment also remained weak, and any substantive demand improvement still needed time. This week’s rise in the operating rate was mainly driven by enterprises gradually starting operations and resuming production. Looking at next week, as some enterprises are expected to resume production at the end of this week, the operating rate is expected to continue rising and fluctuate around 55.67%.