Price Trend
According to the data monitoring of business associations, zinc prices rose sharply in March, rising by 5.40% in March, the biggest monthly increase in nearly a year. As of March 31, the price of zinc ingot was 23226.67 yuan/ton, which was 5.40% higher than that of 22036.67 yuan/ton at the beginning of March, and 6.49% lower than that of the same period last year. Overall, the market of zinc rose in March, and the market of zinc was good.
II. Market Trend Analysis
In terms of products:
As can be seen from the above chart, zinc prices rose sharply in March after changing the previous decline, and reached the biggest increase in one year. Zinc price rises, zinc trading activity increases, and the momentum for future market increases, which is good for future market.
Non-ferrous plate:
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As can be seen from the K-line chart of the non-ferrous plate index, the overall fluctuation of the non-ferrous plate rose in 2019, and the market of the non-ferrous plate rose significantly in March, with the advantages outweighing the disadvantages. The industry as a whole rose, which was good for the market of zinc, and the overall motive force for the rise of zinc price was sufficient.
Data statistics:
According to the data released by the Statistical Commission of Kazakhstan, the output of zinc in Kazakhstan decreased by 4.0% from January to February, the output of zinc in Kazakhstan decreased, and the supply of zinc in Kazakhstan decreased, which is good for the price of zinc.
According to data from Peru’s Ministry of Energy and Mining, the output of zinc minerals in Las Bambas mine of MMG company dropped 7.8% in January from a year earlier to 10,1604 tons. The data show that the supply of zinc minerals in Peru fell in January, which has a positive impact on the future zinc market.
Vinneth Bajaj, a senior mining analyst at Global Data, points out that global zinc production has increased to 13.2 million tons in 2017 and 13.4 million tons in 2018, respectively, following a sharp decline in 2016. In 2018, Australia’s zinc production grew by 9.9%, Peru’s by 8.5%, India’s by 7.9% and the United States by 5.9%. In China, zinc production has declined by 1% due to environmental protection measures. As China is the world’s largest producer of zinc, global zinc production is 1.1 million tons less than the global total demand of 14.5 million tons. Demand for zinc in Belgium, China, Germany and the United States has been growing.
Overseas enterprises:
Glencore said Friday it had suspended mining and development operations at the McArthur River zinc mine in northern Australia in preparation for the coming hurricane. The approaching hurricane will restrict the opening and transportation of mines in Australia, which will affect the supply of zinc ingots for a period of time in the future. The shortage of zinc supply in the near future will bring about significant benefits to zinc prices in the future.
Empire State Mine, which sent a possible layoff notice to 87 miners, said it would continue to invest in mine development and exploration after layoffs and match its staffing with planned mining activities. But layoffs will inevitably affect mining, zinc supply will be affected by the decline, the overall supply of zinc will have a favorable impact on the price of zinc.
Noranda Income Fund said that in March, international traders and miners Glencore had signed a zinc processing fee agreement with them for the next year, but did not disclose the specific costs. Meanwhile, Noranda said in a statement: “Processing fees have rebounded in the past few months, but the pricing environment may continue to fluctuate.” The trend of spot processing fees is the best example of the increase in zinc concentrate supply. Processing fees for zinc concentrates in the spot market have risen above $200, to $30 per ton at the beginning of last year. Increasing processing cost of zinc concentrate is beneficial to zinc price in the future market.
Laws and regulations:
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Yunnan Provincial Department of Ecology and Environment issued the “Yunnan Province Solid Waste Pollution Control Implementation Plan” clearly, by 2020, Yunnan Province will achieve the whole process of solid waste supervision. By 2020, the discharge of heavy metals from key industries in Yunnan Province will be 12% lower than that in 2013, and the comprehensive utilization rate of industrial solid waste will strive to reach more than 56%. The key areas of solid waste pollution control in Yunnan Province include 11 key areas of heavy metal pollution prevention and control in countries, and areas with prominent problems of heavy metal pollution in cultivated land. The key industries include: heavy non-ferrous metal ore (including associated ore) mining and processing industry (copper, lead-zinc, nickel-cobalt, tin, antimony, gold and mercury mining and processing industry), heavy non-ferrous metal smelting industry (copper, lead-zinc, nickel-cobalt, tin, antimony, gold and mercury smelting, etc.). The government has strengthened the governance of heavy metal industry, which is bound to restrict the supply of non-ferrous metals industry. The price of non-ferrous metals has risen, and the market of zinc is good.
3. Prospects for the Future Market
Bai Jiaxin, an analyst of business associations, believes that the recent good news of zinc market both at home and abroad continues, although it can not fundamentally change the relationship between supply and demand in zinc city, but it still increases the speed and momentum of future market growth in zinc city. In the international market, Australia’s suspension of zinc mining and transportation due to hurricanes, the reduction of zinc supply in Kazakhstan, the layoffs of Empire Mining Company of the United States, and the increase of zinc concentrate processing fees have all had a positive impact on the rise of zinc prices; Looking back at the domestic market, the state has intensified efforts to prevent and control heavy metal pollution, and environmental protection measures have affected the start-up of zinc mining enterprises, which has a greater impact on zinc production in the city Likon, China is the world’s largest zinc producer. The decline in China’s zinc production has led to insufficient international zinc supply, which has a significant positive impact on the rise of zinc prices. In 2019, the international economic environment warmed up and the demand for zinc increased. The supply of zinc in the city was still in short supply. The future zinc market had sufficient momentum to rise. The overall international and domestic positive news has a strong impact on zinc prices in the future, which is expected to be volatile in the future.
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