Year-end trader account closing and settlement, strong shipping sentiment during the week [SMM Shanghai Spot Cargo Weekly Review] | SMM
Shanghai zinc spot premiums decreased this week due to trader settlements and limited downstream demand, but supply constraints may prevent further significant declines.Summary
The Shanghai zinc spot market experienced a pullback in premiums this week, with prices remaining largely flat week-over-week. As of Friday, common domestic brands were offered at a premium of 140 yuan/mt against the 2601 contract, while the high-priced brand Shuangyan was quoted at 380 yuan/mt. This decline was driven by year-end account closures among Shanghai traders, leading to increased inventory sales. However, downstream consumption remained weak due to the off-season, resulting in sluggish transactions. Despite the premium decline, limited spot supply is anticipated next week as new annual long-term contracts have not yet begun, suggesting a substantial further decrease in premiums is unlikely. SMM notes that all data is based on publicly available information and internal models and should not be considered investment advice.
(Source：Shanghai Metals Market)