According to the monitoring of the commodity market analysis system of Shengyi Society, as of August 29th, the price of 0 # zinc was 22002 yuan/ton, a decrease of 1.35% from the zinc price of 22302 yuan/ton on August 25th.
This week’s market analysis
At the beginning of the week, the Shanghai zinc market continued the volatile operation trend of last week. Due to relatively loose domestic supply, the price of zinc in Shanghai is under pressure to decline. Subsequently, although domestic social inventory continued to increase, overseas zinc inventory continued to decrease. At the same time, consumption in some downstream sectors in China has shown some signs of recovery recently. Under the combined effect of these factors, Shanghai Zinc continued to maintain a volatile operation. Afterwards, influenced by the external market, Shanghai Zinc jumped short and opened high. However, in the situation of domestic and foreign inventory “going against each other” (increasing domestically and decreasing overseas), Shanghai Zinc has once again entered a period of volatile operation. Subsequently, due to the unexpected performance of the August Consumer Confidence Index by the US Chamber of Commerce and the continued downward trend caused by factors such as tariff interference, Shanghai Zinc jumped short and opened low.
Although domestic inventory continued to increase afterwards, the trading situation in the spot market improved, and coupled with the gradual decline in overseas inventory, Shanghai Zinc ultimately maintained a volatile trend.
Supply and demand side
At the beginning of the week, the price of zinc futures was at a high level and showed a fluctuating trend. At this time, the market’s enthusiasm for receiving goods is not high when prices rise, and the atmosphere is relatively cold. In terms of warehouses, the amount of goods received continues to increase, but most of them are warehouse receipts. In the spot market, the circulation of delivery brands remains stable, and quotes mostly fluctuate around cost prices. Merchants’ willingness to continue lowering prices and shipping is not strong. Downstream enterprises take advantage of lower prices to gradually enter the market to receive goods, resulting in a random slight improvement in the transaction atmosphere. However, due to the overall weak performance of downstream orders, even with a significant drop in zinc prices towards the weekend, the market situation has not improved significantly.
Inventory end
Compared to last week, social inventory has shown a continuous upward trend. Specifically, the inventory growth in Guangdong region is relatively significant, and there has also been a certain degree of increase in Shanghai and Tianjin regions. In the Guangdong region, the atmosphere of trade activities is relatively quiet, and most of the incoming goods choose to continue to be used for delivery, so the inventory growth remains relatively stable. Due to downstream production restrictions during the week, consumer demand in Tianjin has been sluggish, resulting in an overall accumulation of inventory. In the Shanghai area, due to normal deliveries within the week and poor downstream demand, there was a slight accumulation of inventory. Considering the current resumption of production in smelters, it is expected that the cargo volume in Guangdong region will continue to maintain a slight increase next week.
comprehensive analysis
It is expected that zinc prices will continue to face downward pressure and fluctuate.