Zinc social inventories extend gains as smelters step up shipments

SHANGHAI, Jan 4 (SMM) – Social inventories of refined zinc across Shanghai, Guangdong and Tianjin stood at 97,500 mt as of Friday January 4, up 3,500 mt from Wednesday January 2 and 10,500 mt from Friday December 28, SMM data showed.

As the Chinese New Year approaches, domestic smelters are keen to deplete stocks and recover cash flows. This prompted them to pour their cargoes to the physical markets and this grew arrivals at social warehouses.

For the same week, social warehouses saw limited arrivals of seaborne materials. Inflows of imported zinc might grow as import losses have narrowed to nearly zero.

The upcoming CNY break is set to drive downstream consumers to stockpile, which would grow deliveries leaving social warehouses.