The Market Is Still Digesting Positive Sentiment, Zinc Prices Fluctuate at Highs [SMM Morning Meeting Summary]

Spot Market Fundamentals:

Shanghai: In the early session, the market quoted premiums of 260-280 yuan/mt over the average price, with almost no follow-up quotations. In the second trading session, ordinary domestic brands were quoted at premiums of 590-610 yuan/mt against the 2501 contract, while high-end brands like Shuangyan had no quotations against the 2501 contract. On the last day of annual long-term contracts, some traders offloaded inventory, leading to an increase in market quotations. However, with futures prices rising, downstream buyers were cautious about high prices and made just-in-time procurement. Attention is focused on the arrival of new long-term contracts.

Guangdong: In the first session, suppliers quoted premiums of 540-570 yuan/mt for Qilin, Mengzi, Danxia, and Lantian brands. The futures market hovered at highs today, with downstream just-in-time procurement. In the second session, Qilin and Danxia were quoted at premiums of 550-570 yuan/mt over the online price. Overall, the price spread between futures contracts rose yesterday, premiums slightly increased, and the futures market continued to hover at highs, higher than the previous day. Market transactions were relatively moderate.

Tianjin: By midday close, Xinzi was quoted at premiums of 450-540 yuan/mt against the 01 contract, Chihong had no quotations against the 01 contract, Xikeng was quoted at premiums of 450-480 yuan/mt against the 01 contract, and Bailin had no quotations against the 01 contract. High-end brands like Zijin were quoted at premiums of 580-600 yuan/mt against the 01 contract. The futures market continued to rise yesterday, and downstream buyers were cautious about high prices, leading to limited procurement. Spot availability in the Tianjin market remained low, and traders' quotations were relatively firm, resulting in poor overall market transactions.

Ningbo: In the first session, Yongchang was quoted at a premium of 430 yuan/mt against the 2501 contract. In the second session, traders' quotations remained unchanged from the previous session. Yesterday, no traders were seen quoting in the Ningbo market, and some downstream buyers procured spot cargo from Guangdong. Overall, buying sentiment in Ningbo remained low, and the market continued to be sluggish.

Zinc Price Forecast for Today: Overnight, LME zinc was closed for the Christmas holiday. SHFE zinc recorded a small bullish candlestick overnight, with resistance at the upper Bollinger Band and support from various moving averages below. As year-end approaches, downstream consumption is expected to gradually weaken. However, tight supply in the spot market continues to support zinc prices, which are expected to hover at highs in the short term.