Zinc prices fluctuated and fell in July

According to the Commodity Market Analysis System of the Business Society, as of July 10th, the zinc price was 20104 yuan/ton, a decrease of 0.50% compared to the fluctuating zinc price of 20206 yuan/ton on July 1st at the beginning of the month. Zinc market demand is weak and supply expectations are increasing, with zinc prices fluctuating and falling this week.

Overview of zinc market situation

Macroscopic monetary tightening, downstream consumption off-season, expected decrease in zinc market demand, enhanced economic recession expectations, and fluctuating decline in zinc prices; The processing cost of zinc concentrate has increased, the profits of zinc smelting enterprises have increased, the expectation of zinc smelting enterprises starting operations has increased, and the supply of zinc in the market is expected to increase.

Future Market Forecast

According to data analysts from Business Society, macroeconomic weakness has led to a decrease in demand for zinc, an increase in processing fees for zinc concentrate, and an increase in supply expectations for zinc. In the future, with an increase in supply and weak demand, zinc prices are expected to fluctuate and fall.

According to the monitoring of the Commodity Market Analysis System of the Business Society, the domestic price of LLDPE (7042) was 8042 yuan/ton on July 3, and the average price on July 7 was 8064 yuan/ton. During this period, the quotation increased by 0.27%.

According to the monitoring of the Commodity Market Analysis System of the Business Society, the average ex factory price of LDPE (2426H) on July 3 was 8637 yuan/ton, and the average price on July 7 was 8687 yuan/ton, with an increase of 0.58% during the period.

According to the monitoring of the Commodity Market Analysis System of the Business Society, the average ex factory price of HDPE (5000S) was 9112 yuan/ton on July 3rd, and the average price on July 7th was 9137 yuan/ton. During this period, the quotation increased by 0.27%.

The price of polyethylene has mainly increased this week. In terms of cost, the rise in international oil prices has supported the rise in polyethylene prices. In terms of supply, there are many parking, maintenance, and decoration projects, and some varieties have a short-term supply shortage. Production enterprises and traders have raised their prices. In terms of demand, agricultural film is in the off-season of demand, and order follow-up is limited; In terms of pipes, orders are relatively stable; The current market demand for wire drawing is average. In terms of futures, polyethylene futures have experienced strong volatility, boosting the spot market.

There is still room for crude oil to rise next week, and demand is gradually improving in the second half of the year. It is expected that polyethylene may fluctuate more strongly.

According to the monitoring of the commodity market analysis system of the business agency, the prices of industrial and battery grade Lithium carbonate still showed a downward trend this week. On July 6, the average domestic mixed price of industrial Lithium carbonate was 291000 yuan/ton, down 2.35% from the average price of 298000 yuan/ton on July 2. On July 6, the domestic mixed average price of battery grade Lithium carbonate was 308600 yuan/ton, down 1.22% from the average price of 312400 yuan/ton on July 2.

According to the observation of market changes, the price of Lithium carbonate this week is stable and declining. At present, the production of Lithium carbonate market is running smoothly, but the upstream and downstream of the market are playing a heavy game. The upstream holders have obvious willingness to support prices, and the downstream procurement is rational. At present, the market transactions are dominated by small orders. Due to the end of financial reporting pressure, the market price cut has eased, but some enterprises still slightly reduced the price of Lithium carbonate.

In terms of demand, there is currently a demand for downstream restocking, and some material factories are experiencing urgent purchases due to low inventory levels, which has led to a strong market sentiment towards high prices. In addition, some terminals also have the trend of synchronously lowering prices for material factories, so material factories are facing dual pressure from upstream and downstream, and their purchasing intentions are more cautious.

Downstream Lithium hydroxide prices showed a downward trend. Because Lithium carbonate prices showed a fluctuating decline, the market support for Lithium hydroxide was weak, the market supply was relatively abundant, the downstream purchasing mentality was cautious, the enthusiasm for receiving goods was not high, the market trading atmosphere was light, and the price focus of Lithium hydroxide fell.

The price of Lithium iron phosphate in the downstream is stable, while the price of Lithium carbonate in the upstream is weak, which makes the support of Lithium iron phosphate at the cost end weak. In addition, the manufacturer supplies only old customers, and does not take orders from new customers. However, the market is squeezed by both upstream and downstream pressures, and the purchasing intention is relatively cautious.

Lithium carbonate analysts from the business agency believe that the current upstream and downstream game state of the Lithium carbonate market continues. Although the recent purchase demand is good, the market activity is low. Therefore, some enterprises are still exploring the price of Lithium carbonate to increase shipment. It is expected that the price of Lithium carbonate may continue to fluctuate in the short term.

1、 Price trend

According to commodity data monitoring, the market price of yellow phosphorus rose first and then fell in June, with the overall increase being the main trend. At the beginning of the month, the average price of yellow phosphorus was 21900 yuan/ton, and at the end of the month, the average price was 22900 yuan/ton. During the month, the price increased by 4.57%.

2、 Market analysis

In June, the market price of yellow phosphorus first rose and then fell, with the overall increase being the main trend. In the early part of this month, the manufacturer mainly placed preliminary orders, but there was not much inventory on the market and they were reluctant to sell at low prices, resulting in an overall market increase. In the middle of the month, the overall market trading situation of yellow phosphorus was light, and the start of construction in the yellow phosphorus market was still at a low level. Some enterprises postponed driving, and market transactions were limited, with prices slightly falling. At present, most of the yellow phosphorus production enterprises are reducing their production load in the latter half of the year, with stable prices as the main focus. Downstream procurement is based on demand and can be taken as needed. As of now, the quotation in Sichuan region is around 22800-23000 yuan/ton, and the actual transaction is subject to negotiation.

In terms of phosphate rock, according to data monitoring by Business Society, as of June 26, 2023, the reference average price of 30% grade phosphate rock in China was around 942 yuan/ton. Compared with June 1, 2023 (the reference price of phosphate rock was 1010 yuan/ton), the price was reduced by 68 yuan/ton, a decrease of 6.73%. At present, the trading atmosphere in the phosphate ore field is average, with downstream purchases being the main demand, and new orders being relatively cautious. The phosphate ore data analyst at the Business Society believes that in the short term, the domestic phosphate ore market will mostly be weak and organized, and the specific trend still needs to pay more attention to changes in supply and demand news.

In terms of coke, according to the Commodity Market Analysis System of Business Society, in June 2023, the coke market experienced a round of increase and decrease. As of the time of publication, the price of quasi first-class metallurgical coke in Shanxi region was 1754 yuan/ton, a decrease of 50 yuan/ton, and a monthly decrease of 2.34%. In June, the coke market experienced a round of decline, with a cumulative decrease of 100 yuan/ton. Towards the end of the month, the market started its first round of increase with the positive boost of steel prices. However, the mentality of the coke steel game was heavy, and the first round of increase had not yet been implemented. Overall, the difficulty of landing the first round of rising prices has increased, and the overall market atmosphere has weakened. The steel market is in the off-season, and actual demand is weak. The coke steel game mentality is strong, and it is expected that the coke market will temporarily operate stably in the short term. The first round of rising prices will be difficult to land in the near future.

In terms of phosphoric acid, according to the monitoring of the commodity market analysis system of the Business Society, the reference price of phosphoric acid at the beginning of the month is 6220.00 yuan/ton, and the average price at the end of the month is 6280 yuan/ton. The price has increased by 0.96% during the month. The phosphoric acid market price fluctuated this month, and overall, the price has increased. The price of thermal phosphoric acid has slightly increased this month, and the support of raw material yellow phosphorus is still acceptable. However, downstream demand is average, and the phosphoric acid market is mainly cautious and wait-and-see. It is expected that in the short term, the market price of phosphoric acid will be adjusted and operated in a narrow range.

3、 Future Market Forecast

Yellow phosphorus analysts from the Chemical Branch of the Business Society believe that in June, the market price of yellow phosphorus first rose and then fell, with the overall increase being the main trend. At present, the market trading situation is average, with enterprises focusing on stabilizing prices and downstream purchasing on demand. Both supply and demand sides are more wait-and-see. It is expected that the market price of yellow phosphorus will temporarily stabilize and operate in the short term, and actual transactions will be negotiated separately.

According to the commodity market analysis system of the business community, as of June 29, the average price of domestic industrial Lithium hydroxide enterprises was 332500.00 yuan/ton, up 1.92% from June 1.

In June, the industrial Lithium hydroxide market rose to a high level. In the first half of the month, the upstream Spodumene price was running at a high level, the upstream Lithium carbonate price was stable and rising, and the cost support was stable, which boosted the price mentality of the industry. The enterprise quotation rose. The manufacturer was dominated by long-term orders. The downstream needs to follow up, and the enthusiasm for inquiry increased. However, the new orders in the market were generally closed, and the wait-and-see atmosphere was strong. In the second half of the month, the cost support continued, the operating rate of downstream material plants increased, and the enthusiasm for market inquiry was fair, but the actual transaction was limited, the capacity utilization rate of production enterprises was limited, and the focus of Lithium hydroxide market negotiation was stability.

The upstream Lithium carbonate, according to the data monitoring of the business community: on June 28, the reference price of Lithium carbonate battery grade was 312400.00, up 0.77% from June 1 (310000.00). On June 28, the reference price of Lithium carbonate industrial grade was 298000.00, up 2.76% from June 1 (290000.00).

Analysts from Lithium hydroxide business agency believe that the current cost support still exists, the Spot market transaction atmosphere is light, and the market has a strong wait-and-see atmosphere. It is expected that in the short term, the domestic Lithium hydroxide market will either wait and see to sort out and operate, and more attention should be paid to the upstream Lithium carbonate price changes.