SMM China July Refined Zinc Production and August Forecast

In July 2024, China's refined zinc production was 489,600 mt, down 56,270 mt or 10.3% MoM, down 11.15% YoY. The total production from January to July was 3.671 million mt, down 2.81% YoY, below the expected value. Among them, the domestic zinc alloy production in July was 92,200 mt, down 850 mt MoM.

In July, the production of domestic smelters declined more than expected. Heavy rainfall in Sichuan affected the production of local enterprises. Additionally, enterprises in Yunnan, Guangdong, and Guangxi experienced unexpected production cuts and controls, leading to a certain reduction. Furthermore, maintenance in July was mainly concentrated in Henan, Inner Mongolia, Shaanxi, Gansu, and Qinghai. Some smelters in Hunan and Yunnan resumed operations after maintenance. The overall production declined notably.

SMM expects domestic refined zinc production to slightly increase by 700 mt MoM to 490,300 mt in August, down 6.88% YoY. The total production from January to August is expected to be 4.162 million mt, down 3.31% YoY. Entering August, the overall production change will be minimal. The reduction will mainly be concentrated in Inner Mongolia, Shaanxi, Hunan, Yunnan, Sichuan, and Liaoning due to raw material shortages and declining profits. The increase will mainly come from the resumption of operations after maintenance in some smelters in Henan, Hunan, Guangdong, Gansu, Qinghai, and Guangxi.