Zinc Morning Meeting Minutes for September 22
Futures: Overnight, LME zinc opened at $3,944.0/mt. In early trading, LME zinc drifted lower, and the decline widened after entering the European trading session, accelerating to a low of $3,906.5/mt. During the night session, prices rebounded slightly from the low, but were capped by the daily moving average and pulled back again near the close, ultimately settling down at $3,925.5/mt, down $15.0/mt, or 0.38%. Trading volume decreased to 12,208 lots, while open interest increased by 1,337 lots to 263,000 lots. Overnight, the most-traded SHFE zinc 2611 contract opened at 26,715 yuan/mt. In early trading, increased long positions pushed SHFE zinc sharply higher, touching a high of 26,790 yuan/mt. Subsequently, increased short positions weighed on prices, and the contract pulled back under pressure, drifting lower near the close to a low of 26,625 yuan/mt, ultimately settling down at 26,675 yuan/mt, down 35 yuan/mt, or 0.13%. Trading volume decreased to 47,882 lots, while open interest increased by 708 lots to 136,000 lots.
Macro: Trump: This absurd Russia-Ukraine conflict must end. US Fed's Musalem: Further rate hikes may still be needed to curb inflation. The Russian government has decided to exempt grain export duties until the end of the year. The EU plans to extend sanctions against Russia. Xi Jinping will pay a state visit to the US from September 23 to 25. The central bank held a symposium for foreign-funded financial institutions: steadily expand two-way opening of the financial market.
Spot market:
Shanghai: Refined zinc purchasing sentiment in Shanghai was 2.02, while selling sentiment was 2.58. In the morning session, zinc prices edged up, and downstream enterprises again showed fear of high prices. Purchasing enthusiasm weakened yesterday, and overall spot transactions were mediocre. However, traders in the Shanghai market continued to quote firm prices, and overall spot premiums showed no significant pullback.
Guangdong: Refined zinc purchasing sentiment in Guangdong was 1.79, while selling sentiment was 2.64. Yesterday, trader quotes remained firm. A small number of large end-user plants in the market still had some pre-holiday stockpiling demand, but downstream purchasing was cautious at high prices, and spot trading activity in the market pulled back somewhat.
Tianjin: Refined zinc purchasing sentiment in Tianjin was 1.84, while selling sentiment was 2.41. Futures continued to rally, and downstream players mostly stayed on the sidelines with weak purchasing sentiment and few inquiries. Trader activity was brisk, with a tendency to hold prices firm and premiums remaining stable. Overall market transactions were poor.
Ningbo: In the morning session, zinc prices edged up. Downstream enterprises were wary of high prices and made few inquiries. Yesterday's spot transactions were largely need-based, mostly with post-pricing, and overall market activity was mediocre, with spot premiums remaining weak.
Social inventory: On September 18, LME zinc inventory increased by 1,550 mt to 116,850 mt, up 1.34%. According to SMM communication, as of September 21, domestic inventory increased by 2,100 mt to 215,600 mt.
Zinc price forecast: Overnight LME zinc recorded a small bearish candlestick, with support from moving averages below, and the MACD bearish candlestick narrowed. Overnight the US dollar index strengthened, and with the US Fed further signaling rate hikes, bears increased positions to pressure prices, sending LME zinc lower throughout the session. However, the LME Cash-3M backwardation structure persisted, keeping the LME zinc price center at elevated levels. Overnight SHFE zinc stopped rising and started to fall, with support from the middle Bollinger Band below. Overnight social inventory increased by another 2,100 mt, spot market transactions were weak at high zinc prices, and zinc prices encountered resistance above.
Data source statement: Except for publicly available information, all other data are processed by SMM based on public information, market communication, and SMM's internal database models, and are for reference only and do not constitute decision-making advice.
![SHFE zinc stopped rising and started to fall overnight, but the center remained at a high level [SMM Zinc Morning Comment]](https://imgqn.smm.cn/usercenter/nGzXc20251217171754.jpg)
![[Zinc ingot inventory increased on Monday, SHFE zinc consolidated at highs [SMM Zinc Futures Briefing]]](https://imgqn.smm.cn/usercenter/TeRBO20251217171754.jpg)
