Zinc prices rose first and then fell in the first half of this month
According to the Commodity Market Analysis System of Business Society, as of July 10th, the zinc price was 24110 yuan/ton, a decrease of 0.52% from the fluctuation of zinc price of 24236 yuan/ton on July 1st.
Macro dynamics
Many regions continue to optimize their real estate policies, in addition to lowering down payments and interest rates, they have also continuously increased the amount of provident fund loans, reversing pessimistic expectations in the real estate industry. The National Development and Reform Commission has promoted the construction of all additional treasury bond issuance projects to start before the end of June this year, and the domestic policy side continues to make efforts. The expectation of three rate cuts within the year at the Federal Reserve’s interest rate meeting has been lowered to one, and the May PMI of China and the United States has fallen, slowing down the expansion of the manufacturing industry.
The London LME futures market’s zinc ingot inventory decreased by 5475 tons compared to the beginning of the month
According to data released by the London Metal Exchange (LME), as of July 9th, London’s zinc inventory continued to decline slightly, with the latest inventory level of 256375 tons. This week, London’s zinc ingot inventory continued to decline slightly, a decrease of 5475 tons compared to the beginning of the month.
The resumption of production of the century old Kiposh zinc mine
Ivanhoe Mines announced that its Kipushi mine in the Democratic Republic of Congo has been rebuilt and production has resumed. The mine produces lead, zinc, copper, and germanium. It has been 100 years since the first production of the mine and 31 years since the shutdown for maintenance. On May 31st, the first batch of ore was delivered to the Kiposh concentrate plant, and the first batch of concentrate was produced on June 14th. The production target for zinc concentrate at Kiposh Mine in 2024 is 100000 to 140000 tons.
WBMS: Global zinc market oversupply of 184000 tons in April 2024
The latest report released by the World Bureau of Metals Statistics (WBMS) shows that in April 2024, global zinc sheet production was 1.1391 million tons, consumption was 955100 tons, and there was an oversupply of 184000 tons. From January to April 2024, the global production of zinc sheets was 4.5547 million tons, with a consumption of 4.3611 million tons and an oversupply of 193600 tons.
Zinc concentrate processing fees have decreased by more than half
Since the beginning of the year, the processing fee for zinc concentrate has been continuously decreasing, with a decrease of more than half, resulting in losses for the refinery. In addition, the domestic supply of zinc concentrate is tight, and the profit level of zinc refineries is at a historical low. In July, the maintenance of the smelter exceeded expectations, and zinc production was expected to decrease by nearly 10%,
The enthusiasm has decreased, and the expected supply of zinc in the market has decreased, with some upward support for zinc prices.
Future Market Forecast
According to data analysts from Business Society, global zinc mines are in short supply, and domestic mines are resuming production, but the pressure for foreign mines to reduce production remains. The maintenance and production reduction of domestic refineries exceeded expectations, and the market supply was tight and balanced. Zinc prices were supported by the supply side and rose. Downstream consumption is still constrained by the weak reality of real estate and infrastructure, and the automotive industry has entered a traditional off-season, with demand slowing down and prices falling from high levels. Expected zinc prices to fluctuate and consolidate in the future.
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