As of October 30th, the price of 0 # zinc was 25833 yuan/ton, an increase of 0.83% compared to the zinc price of 25618 yuan/ton on October 26th.
fundamentals
The zinc price shows a significant “V” – shaped reversal trend. The zinc price has risen from its low at the beginning of the week and successfully recovered from the 25800 yuan/ton mark. The comprehensive repair of technical indicators, coupled with cost support, has led to a strong rebound in zinc prices in the short term.
The pattern of scarce raw materials on the supply side has not changed. The progress of resuming production in overseas mines is relatively slow, coupled with the fact that some northern mines in China have entered a winter production reduction period, resulting in overall tight supply of zinc concentrate. The smelting end is constrained by the continuous low operation of processing fees (TC), resulting in a significant compression of profit margins. Some smelters have expectations of reduced production due to maintenance, which limits the incremental output of refined zinc. The rigid constraint on the supply side provides a solid underlying logic support for the rapid rise of zinc prices from the bottom this week (such as the low on October 25th).
The demand side has shown a clear resonance between “phased replenishment” and “buying up sentiment” this week. With a single day price increase of 0.84% on October 30th, breaking through the 25800 yuan/ton mark, the speculative demand in the market of “buying up, not buying down” has been stimulated, and trading sentiment has significantly rebounded. However, it should be noted that as zinc prices rise to a high level, downstream processing enterprises are becoming increasingly fearful of high priced raw materials, mainly focusing on essential purchases. The sustained increase in actual terminal consumption remains to be observed.
Comprehensive analysis:
The current zinc price is showing strong performance under the resonance of technical oversold rebound and fundamental low inventory and high cost. But we need to be wary of the marginal weakening of downstream willingness to receive goods and the disturbance of macro sentiment after the price quickly rises to a high level. It is expected that zinc prices will maintain strong fluctuations next week.
| http://www.sulfamic-acid.com |