Dual Factors Constrained Industry Operations, Die-Casting Zinc Alloy Operating Rates Declined This Week [SMM Die-Casting Zinc Alloy Weekly Review]

The die-casting zinc alloy operating rate came in at 49.89% this week, down 1.62 percentage points WoW. Recently, the center of zinc prices shifted upward, and combined with the successive arrival of earlier long-term contracts, enterprises' enthusiasm for raw material procurement pulled back somewhat, leading to a decline in raw material inventory; meanwhile, high prices suppressed downstream demand, resulting in passive accumulation of finished product inventories. The operating rate weakened WoW this week, partly due to some enterprises arranging holidays during the Qingming Festival, and partly because rising zinc prices dragged down downstream purchase willingness, with rising finished product inventories causing enterprises' production pace to slow down. In terms of order structure, demand for electronics orders remained relatively strong, auto parts and zipper orders performed steadily, but orders for crafts and medals were relatively weak. Overall, downstream demand is currently highly sensitive to prices, with procurement pace notably slowing down during the zinc price rise phase, and alloy plants' shipments were under pressure. Looking ahead to next week, as the impact of the Qingming Festival fades, enterprises are expected to gradually resume normal production pace, and the die-casting zinc alloy industry operating rate is expected to rebound to around 52.07% and fluctuate at that level.