Zinc prices continue to rise in July
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According to the Commodity Market Analysis System of the Business Society, as of July 31, the zinc price was 20898 yuan/ton, an increase of 3.42% compared to the fluctuating zinc price of 20206 yuan/ton on July 1. The macroeconomic recovery in July was positive for the non-ferrous metal market, and zinc prices fluctuated and rose in July.
Zinc prices have risen for two consecutive months
According to the Commodity Market Analysis System of the Business Society, zinc prices rose slightly in July, an increase of 3.42%, with zinc prices rising for two consecutive months. Since the trend of continuous decline in zinc prices in the first half of the year was reversed in June and rebounded, zinc prices have maintained an upward trend in July, with a slight increase. The economy has rebounded, the non-ferrous sector has rebounded, and zinc prices have followed suit.
China Manufacturing Purchasing Managers’Index
According to the data released by the National Bureau of Statistics, in July, the Purchasing Managers’Index (PMI) of the manufacturing industry was 49.3%, up 0.3 percentage points from the previous month. PMI rose for two consecutive months, and the prosperity level of the manufacturing industry continued to improve. Although the PMI was still below 50% in July, it has slightly rebounded for two consecutive months, and the overall level of domestic manufacturing prosperity continues to improve. The domestic macro economy has rebounded, and the zinc market is favorable.
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Long Short Game in Zinc Market
The June US CPI announced in July only increased by 3% year-on-year, lower than the market estimate of 3.1%. The CPI data has fallen beyond expectations, and Wall Street generally expects the Federal Reserve to restart the pace of rate hikes. However, it is also expected that the Federal Reserve’s rate hike in July may be the last rate hike of the year. The non-ferrous metal market is relatively strong, China’s strong policies are gradually implemented, the expectation of macroeconomic recovery is strengthened, and the zinc market is bullish.
7. In August, some smelters on the supply side will enter the maintenance period, which may lead to a significant reduction in supply. Zinc smelting processing costs will increase, and the decrease in zinc smelting production will be limited. At the same time, imported zinc will also provide a certain supplement to the supply side. The supply side of the zinc market may remain relatively loose, and the LME market’s zinc ingot inventory will skyrocket in July. The zinc market has sufficient supply, and the overall supply of zinc in the market exceeds demand. The bearish pressure of the zinc market still exists.
Future Market Forecast
Data analysts from Business Society believe that in the international market, the US interest rate hike may come to an end, while in the domestic market, strong support policies have been implemented, macroeconomic sentiment has improved, and non-ferrous metals have generally risen in July. The macroeconomic recovery is beneficial for the zinc market; However, zinc processing fees have increased, LME zinc ingot inventory has surged, and the zinc market is oversupplied. The downward pressure on the zinc market still exists. In the future, strong supply still exists, weak demand improves, and there are risks of rising and falling in the zinc market. It is expected that the zinc price will fluctuate and consolidate strongly in the future.
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