Zinc price “V” type operation in August
According to the Commodity Market Analysis System of the Business Society, as of August 31, the zinc price was 21208 yuan/ton, a slight increase of 0.25% compared to the zinc price of 21156 yuan/ton on August 1; The zinc price has increased by 6.33% compared to 19946 yuan/ton on August 17th. The macroeconomic performance in July was poor, with zinc prices dropping significantly in early August; The traditional consumption peak season of “nine gold and ten silver” is approaching, and terminal demand is expected to improve; Supported by macro bullish conditions and tight supply, zinc prices fell first and then rose in August. As the fundamentals of the zinc market improved, the focus of zinc prices shifted upwards.
Zinc prices in the LME market fell first and then rose in August
From the trend chart of zinc prices in the LME market, it can be seen that in August, zinc prices in the LME market first fell and then rose. Data released in early August showed that employment growth in the United States further slowed down in July, macroeconomic growth slowed down, and zinc prices fell significantly; In mid August, data showed a decrease in unemployment in the United States, and the resilience of the labor market supported the economy by driving retail sales and housing construction. Zinc prices stopped falling and rose in mid August. At the end of August, data showed that the number of new jobs created by American companies in August hit a new low in five months, further indicating signs of slowing labor demand. In addition, the PMI data for August in the United States showed poor performance, and the unexpected decline in the service industry had a huge impact on the economy. The manufacturing PMI decreased from 49.0 in July to 47.0, marking the fourth consecutive month of contraction and the economy approaching stagnation. Zinc prices may fluctuate and consolidate in the future.
China Manufacturing Purchasing Managers Index
According to data released by the National Bureau of Statistics, in August, the Purchasing Managers’ Index (PMI) of the manufacturing industry was 49.7%, an increase of 0.4 percentage points from the previous month, further improving the level of manufacturing prosperity. Production demand has rebounded synchronously, and the willingness of enterprises to purchase has increased. The non-ferrous metal market is positive, and zinc prices have stopped falling and rising.
Overview of zinc market situation
In terms of policies, the three departments have issued documents stating that they will reasonably increase consumer credit support for products such as automobiles, home appliances, and home furnishings, continuously optimize interest rates and fee levels, stimulate domestic consumption, and benefit the zinc market. On the supply side, with the increase in zinc concentrate processing costs and the stimulation of smelting profits, some smelters have completed or postponed maintenance. In early August, domestic zinc production was slightly higher than expected compared to the previous month. With the decline in zinc prices, zinc concentrate processing costs have stabilized, and domestic smelters have concentrated maintenance, resulting in a decline in zinc market output. In late August, markets such as Shanghai and Tianjin experienced significant shortages, and the rise in zinc prices has been positive. In terms of demand, downstream demand is basically maintained, but due to the tightening of spot supply, downstream willingness to “buy up” has increased. In addition, the continuous promotion of some consumer promotion measures has driven social inventory to go out of stock. Support for the rise of zinc prices in the future remains
Future Market Forecast
Data analysts from Business Society believe that the macroeconomic performance did not meet expectations, and zinc prices fell in August. However, with more positive news, zinc prices stopped falling and rose. In the future, with the arrival of the traditional peak season of “nine gold and ten silver”, the demand for zinc is expected to improve. However, national policies stimulate economic recovery, accumulate social inventory in the zinc market, and overall zinc supply weakens, demand recovers, and positive news increases. However, the performance of the US economic data is less than expected, which to some extent limits the room for zinc prices to rise. It is expected that zinc prices will fluctuate and consolidate at high levels in the future
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