LME zinc opened at $2640/mt yesterday evening, and hit a high of $2644/mt before falling back to $2555/mt, and closed at $2574/mt, a decrease of $63.5/mt or 2.41%. The trading volume increased to 14572 lots, and open interest added 1353 lots to 204,000 lots. LME zinc inventory increased by 65075 mt or 95.5% to 133200 mt. The large delivery of LME zinc positions suppressed the optimism brought about by previous mine production cuts. Currently, the overseas zinc market supply is still ample, and LME zinc is under pressure.
The most active SHFE 2401 zinc contract prices opened at 21500 yuan/mt and fell 320 yuan/mt or 1.47% to close at 21425 yuan/mt trading with the high-end of 21530 yuan/mt and the low-end of 21395 yuan/mt. Trading volumes decreased to 59414 lots and open interest fell 1502 lots to 78596 lots. The market's early optimism has been digested. Although there are good consumption expectations for real estate, the recent actual consumption performance is poor. After the lifting of downstream environmental protection, the improvement in downstream demand is limited. Coupled with the expectation of high operating capacity of smelting plants in the fourth quarter, the fundamentals support are insufficient from zinc prices.
