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SunSirs: London Zinc Inventory Surge Drags down Zinc Prices
January 28 2021 08:38:40SunSirs(Linda)

1. Zinc price

According to SunSirs data monitoring, the zinc price dropped sharply on the 27th, and the zinc market fell. On January 27, the average zinc price was 20136.67 yuan/ton, and the single-day zinc price dropped by 550 yuan/ton, or 2.63%.

2. Zinc inventory in London LME market

According to the zinc inventory data of the London LME market, on January 26, the London LME market zinc ingot inventory was 235,025 tons, and the inventory increased by 45,250 tons, accounting for an increase of 23.84%. Among them, registered warehouse receipts were 214750 tons, registered warehouse receipts increased by 27.03%, cancelled warehouse receipts were 20,275 tons, and cancelled warehouse receipts decreased by 2.17%. LME zinc market warehouse receipts soared, the global zinc market was adequately supplied, and the downward pressure on the zinc market increased, dragging down zinc prices.

3. Analysis

SunSirs analysts believe that with the easing of the epidemic and the continuous promotion of vaccines, global mining plants have resumed operations one after another, the supply of zinc has increased, the zinc inventory in the LME market has skyrocketed, the supply of the global zinc market is sufficient, and the oversupply of the zinc market has intensified. Correspondingly, the domestic Spring Festival is approaching, and many downstream zinc manufacturers have announced plans to stop production and repair, which dragged down the recovery of domestic zinc prices, and domestic zinc prices plummeted. In the long run, the zinc market is still supported by rising momentum, but the domestic zinc market demand is weak before the Spring Festival, and the zinc price has insufficient momentum to adjust. The zinc market after the holiday may usher in a short-term rising period.

Related listed companies: Zhongjin Lingnan (000060), Chihong Zinc Germanium (600497).

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