Tight Ore Supply Situation Remained Unchanged, Domestic and Imported Zinc Concentrate TCs Continued to Decline [SMM Zinc Concentrates Weekly Review]

SMM News, May 29:

Looking at weekly data, the SMM Zn50 domestic weekly average TC decreased 250 yuan/mt Zn WoW to 150 yuan/mt Zn, and the SMM Imported Zinc Concentrate Index fell $7.19/dmt WoW to -$63.44/dmt.

Domestic ore market. In the last week of the month, the domestic zinc concentrates market was at the peak of June TC negotiations. Overall TCs continued to decline, the tight supply of domestic ore remained unchanged, and smelters continued to actively purchase domestic zinc concentrates. It was learned that the tender results for zinc concentrates from a mine in southwest China were released this week, with the self pick-up tender price at around -100 yuan/mt Zn, down approximately 900 yuan/mt Zn WoW.

Imported ore market. Traders offered limited volumes this week. The overall willingness to lower TCs persisted, but recent losses on imported zinc concentrates exceeded 1,500 yuan/mt Zn, prompting smelters to prioritize purchasing domestic zinc concentrates, and overall market activity was moderate. It was learned that recently some traders and smelters concluded deals on break-bulk shipments of imported ore at around -$60 to -$65/dmt, with precious metals priced separately, for Q3 delivery. Additionally, some ore traders were heard to have lowered their offers for imported ore to around -$80/dmt, and imported zinc concentrate TCs continued to slide.

Recently, the Phase I flotation plant project of Hezhang Dingshengxin Mining Development Co., Ltd. achieved a major milestone, with the semi-autogenous grinding mill and ball mill systems successfully completing no-load joint trial runs. This marked that the Zhugongtang super-large lead-zinc mine's mining and beneficiation project had fully entered the equipment joint commissioning stage. It was reported that the Phase I flotation plant of the Zhugongtang lead-zinc mine is expected to be ready for clean water trial runs by the end of June this year, ready for feed trial runs in August, and aims to officially enter trial production by the end of September, at which point it will initially achieve a production capacity of processing 2,000 mt of raw ore per day.

This week, SMM zinc concentrates inventory at main ports in China totaled 268,000 mt in physical content, an increase of 8,000 mt in physical content WoW, with Qinzhou port inventories contributing the main increment.