SMM October 8 news:
Futures: Overnight LME zinc opened at $3,777/mt, briefly rose to touch a high of $3,780/mt in early trading, then bulls reduced positions and LME zinc fell rapidly, hitting a low of $3,734.5/mt during European trading hours, before its center rebounded and it ultimately closed down at $3,766/mt, down $6.5/mt, a decline of 0.17%. Trading volume increased to 11,573 lots, while open interest fell by 1,292 lots to 261,000 lots. Overnight SHFE zinc was closed due to the National Day holiday.
Macro: Iran's Foreign Ministry said consultations with Oman on the strait shipping lanes are progressing smoothly; an advisor to Iran's Revolutionary Guard said the "illegal" shipping lanes in the Strait of Hormuz will soon be blocked; the September meeting minutes showed US Fed officials were divided over the reasons for rate hikes, with most officials expecting one more rate hike before year-end; the IEA supported accelerating the release of previously committed oil reserves, with priority given to releasing diesel; the World Gold Council said global gold ETFs attracted a record $31 billion in Q3; the PBOC increased its gold holdings for the 23rd consecutive month, up 740,000 ounces MoM.
Spot market:
Shanghai: Refined zinc purchasing sentiment in Shanghai was 1.66, while selling sentiment was 2.12. On the last trading day before the National Day holiday, few traders were selling in the market, overall quotes were relatively laid-back, overall spot premiums changed little, downstream enterprises were about to go on holiday, raw material stockpiling was basically completed, and the market atmosphere was sluggish.
Guangdong: Refined zinc purchasing sentiment in Guangdong was 1.70, while selling sentiment was 2.40. On the last day before the holiday, spot market activity deteriorated, fewer traders were selling in the market, and most downstream enterprises in Guangdong were about to enter the National Day holiday, so purchasing enthusiasm declined and spot market premiums remained stable.
Tianjin: On the last day before the holiday, refined zinc purchasing sentiment in Tianjin was 1.85, while selling sentiment was 2.21. Futures consolidated, and as the holiday approached, downstream point-price stockpiling increased. Traders were not active in selling near the holiday, and with fewer market shipments, premiums edged up, while overall market trading improved.
Ningbo: On the last trading day before the National Day holiday, most traders in the market were on holiday, overall shipments were scarce, and downstream enterprises were also about to shut down for the holiday, with almost no inquiries or purchases. The overall market was in a strong holiday mood.
Inventory: On October 7, LME zinc inventory increased by 475 mt to 127,750 mt, up 0.37%. According to SMM communication and understanding, as of September 30, total zinc ingot inventory across SMM's seven major locations was 193,100 mt, down 11,700 mt from September 24 and down 9,700 mt from September 28, with domestic inventory decreasing.
Zinc price forecast: Overnight LME zinc recorded a small bearish candlestick. The market is still pricing in a December rate hike, with market sentiment dominated by delaying and waiting for December. The US dollar index remains high, and under macro pressure, nonferrous metals broadly fell. Meanwhile, LME inventory accumulation combined with a narrowing backwardation structure means overseas spot tightness is marginally easing. The resonance of macro and fundamental factors drove LME zinc lower. LME zinc is expected to mainly consolidate today. Overnight SHFE zinc was closed due to the National Day holiday.
Data source statement: Except for public 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, not constituting decision-making advice.
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