China's Tight Ore Supply Pattern Unchanged, LME Drives SHFE Zinc Rise [SMM Zinc Morning Comment]

Overnight, LME zinc opened at $3,545/mt, briefly dipped to a low of $3,535/mt in early trading, and then rose as bulls added positions, drifting higher throughout the session. It touched a high of $3,594/mt toward the end and finally closed up at $3,579/mt, gaining $31/mt, or 0.87%. Trading volume increased to 13,260 lots, while open interest fell by 1,268 lots to 269,000 lots. Overnight, LME zinc recorded a major bullish candlestick. With routine maintenance at South Korea’s YP and continuous destocking in LME zinc inventories, solid support formed at the bottom and the price center shifted higher. The market is expected to mainly consolidate at highs today.

Overnight, the most-traded SHFE zinc 2608 contract opened at 24,605 yuan/mt. As bulls added positions in early trading, SHFE zinc quickly rose to a high of 24,750 yuan/mt before consolidating and eventually closing up at 24,670 yuan/mt, gaining 155 yuan/mt, or 0.63%. Trading volume declined to 56,555 lots, and open interest increased by 1,941 lots to 90,819 lots. Overnight, SHFE zinc recorded a minor bullish candlestick. With China’s tight ore supply situation unchanged and TCs continuing to move lower, solid support formed at the bottom. However, persistently weak domestic consumption and a social inventory buildup capped the upside, even as the price center edged slightly higher. SHFE zinc is expected to consolidate at highs today.

Data source statement: Except for publicly available information, all other data is based on public information, market communication, and SMM’s internal database models, processed by SMM. It is for reference only and does not constitute investment advice.