Zinc prices fluctuate and rise this week
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According to the Commodity Market Analysis System of the Business Society, as of September 11th, the zinc price was 21654 yuan/ton, an increase of 1.36% compared to the fluctuating zinc price of 21364 yuan/ton on September 1st. With the arrival of the traditional peak season of gold, silver, and ten, the demand for zinc has rebounded, and the popularity of the zinc market has rebounded. Market confidence has improved and rebounded, and the positive situation of the zinc market has increased. This week, zinc prices have fluctuated and risen.
The import volume of zinc market has surged
According to data from the General Administration of Customs, China’s refined zinc imports in July were 76796.69 tons, a significant increase of 3774.19% year-on-year and 69.42% month on month, marking the highest monthly record since April 2019. In the past 10 years, China has been a net importer of refined zinc, but this situation has changed in 2022. In 2022, the import volume plummeted from 434000 tons in 2021 to 79000 tons, while the export volume increased from 5000 tons to 81000 tons. The structural transformation of the trade model in 2022 is due to weak domestic demand and high spot premiums in Western markets. These factors are mainly affected by the impact of the epidemic and the closure of European smelters, and investors have insufficient confidence in the Chinese market in 2022. In 2023, the import and export of refined zinc experienced another reversal, with a total of only 5000 tons in the first seven months of 2023. In July alone, the import volume reached as high as 76800 tons, and the import volume of refined zinc surged, indicating an improvement in the Chinese market sentiment. Chinese market confidence has regained optimism, and the overall zinc market is positive.
Increase in imports of electrolytic zinc
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China is a major producer and consumer of electrolytic zinc, with zinc production capacity and output ranking first in the world for more than 20 consecutive years. For a long time, China’s electrolytic zinc has been mainly exported, while imports have been relatively small. However, in the first half of 2023, the import volume of electrolytic zinc significantly increased, while the export volume actually decreased. According to data from the General Administration of Customs, the total import volume of electrolytic zinc in the first half of 2023 was 98.27 thousand tons, an increase of 100.43% compared to the first half of 2022; The total export volume of electrolytic zinc in the first half of 2023 was 7.58 thousand tons, a decrease of 87.46% compared to the first half of 2022. There has been a significant change in import and export volume in the first half of 2023, mainly due to: on the one hand, the domestic zinc market is expected to rebound, the zinc ingot market in the Shanghai futures market is expected to rebound, the Shanghai London zinc ratio is up, and the import window is open, which is beneficial for imports but not conducive to exports; On the other hand, the demand at home and abroad is poor, and overseas zinc inventory has increased significantly, limiting the export of electrolytic zinc.
Future Market Forecast
According to data analysts from Business Society, the arrival of the traditional peak season of gold, silver, and ten has stimulated demand in the domestic zinc market, and the domestic zinc market is expected to rebound; The international market demand is weak, and China’s zinc market exports are weakening, while imports are increasing. Overall, with the arrival of the traditional peak season, both supply and demand in the zinc market have increased, imports have increased and exports have weakened. The supply of zinc in the market is sufficient, and the social inventory of zinc ingots has shifted from a decline to an increase. There is limited room for zinc prices to rise, and it is expected that zinc prices will consolidate strongly in the future.
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