According to the monitoring of the commodity market analysis system of Shengyi Society, as of January 17th, the price of 0 # zinc was 24204 yuan/ton, a slight decrease of 2.43% compared to the zinc price of 24806 yuan/ton on January 13th.
This week’s market analysis
This week, zinc prices continued to decline initially, with signs of recovery over the weekend, showing an overall trend of initially suppressing and then rising. At the macro level, China’s GDP performance exceeded market expectations, and at the same time, the expectation of favorable policies has once again risen. The expectation of overseas interest rate cuts has been partially repaired, which are the main reasons for the rebound of the zinc market in the late trading session. However, given that Trump is about to take office, the potential risks involved cannot be ignored and need to be carefully monitored.
Supply and demand side
This week, the smelting profit of refined zinc manufacturers showed a further expansion of losses compared to the beginning of the week. The supply of zinc ore both domestically and internationally is gradually recovering, with domestic processing fees remaining stable while import processing fees have increased. The expansion of this loss is mainly due to the downward shift of the center of gravity of zinc prices.
Demand side
As the Spring Festival approaches, some small enterprises in Guangxi and Hunan regions have gradually formulated holiday arrangements, and the expected duration of work stoppage will range from one week to half a month. On the demand side, downstream industries have not received satisfactory orders this month, resulting in a rapid decline in the operating rates of various downstream enterprises.
comprehensive analysis
The improvement of macro level emotions is the main driving force behind the bottoming out and rebound of zinc prices. However, the expectation of fundamental inventory accumulation still holds, coupled with uncertain factors in the overseas macro environment, which may cause disturbances to zinc prices. Therefore, it is expected that the space for further increase in zinc prices in the short term may be limited.
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