First, the price trend

According to business data monitoring, this week, the zinc price fluctuated and the overall zinc price remained balanced. As of August 3, the zinc price was 2,1835.00 yuan / ton, compared with the last weekend (July 27) zinc price of 21,812.50 yuan / ton, the price rose 0.10%, compared with the beginning of this week (July 30) zinc price 21,892.50 yuan / ton The price fell by 0.26%, down 8.40% year-on-year.

Second, the market trend analysis

Product aspects:

On August 3, the London LME market zinc futures closing price was 2,631 US dollars / ton, compared with the beginning of the week (July 30) zinc closing price of 2,557 US dollars / ton, the price rose 74 US dollars / ton, August 3, London LME market spot price 2650.00-2651.00 US dollars / ton, compared with the beginning of the week 2589.50-2590.00 US dollars / ton price rose 61 US dollars / ton. On August 3, Shanghai futures market futures zinc closing price was 21,735 yuan / ton, compared with the opening price of 21,450 yuan / ton at the beginning of the week, the price rose 285 yuan / ton. The futures zinc price rose, driving the spot zinc price to rise, the zinc price market temporarily stabilized, and the zinc market rebounded strongly.

Policies and regulations

The Customs Tariff Commission of the State Council issued an announcement on August 3rd to impose tariffs of 25%, 20%, 10%, and 5% on 5,207 tax items originating in the United States. The Ministry of Commerce also issued a response on the evening of the 3rd, saying that the implementation date of the taxation measures will be determined according to the actions of the US, and China reserves the right to continue to introduce other countermeasures. Among the commodities subject to tariffs, including zinc ore and concentrates, the increase in tariffs has led to an increase in the cost of domestically imported zinc concentrates, or a slight increase in domestic zinc prices. However, considering that China’s imports of zinc ore from the United States account for a relatively small amount, it cannot fundamentally affect the domestic zinc market, but the increase in tariffs is still a driving force for the rise in zinc prices.

Third, the outlook

Business analysts believe that this week’s Sino-US trade war continues to heat up. Following the US announcement of tariffs on Chinese goods, China introduced counter-measures and introduced tariffs on US$60 billion in US goods. This time, the zinc industry was implicated. Zinc mines and zinc concentrates were added to the tariff list. The increase of tariffs caused domestic enterprises to increase the cost of importing zinc mines from the United States, and the domestic zinc market increased pressure. The exchange rate of the renminbi against the US dollar has risen, the purchasing power of the renminbi has declined, and the import cost of zinc ingots has increased, which has increased the pressure on zinc prices. The increase in cost will prompt an increase in zinc prices in the market. However, as the overall zinc market is still in an oversupply situation, zinc prices are unlikely to rise sharply. It is expected that the zinc price in the market will fluctuate and adjust slightly, but the average price of zinc will remain in August. Difficult to exceed 23,000 yuan / ton.