SunSirs: China's Zinc Prices Rose for 3 Consecutive Days, is the Market Welcoming the Dawn Again?

1. Zinc price trend

According to SunSirs data monitoring: China's zinc prices have risen sharply in the last three trading days. The average zinc price on July 13 was RMB 18,150.00/ton, which was an increase of 6.58% from July 17, which was RMB 17,030.00/ton. Zinc prices have risen sharply in a row. Will the zinc market return to the dawn and return to the bull market?

2. Market trends of galvanized steel

The price of galvanized steel sheets rose slowly in July. Recently, the price of galvanized steel sheets has increased significantly. The overall benefit to the zinc market is obvious, but the support for the increase is insufficient.

3. Car sales trends

According to data released by the Passenger Car Market Information Joint Conference, in June, the domestic narrow-sense passenger car market reached 1.654 million units, an increase of 2.9% from the previous month, and June’s retail sales decreased by 6.2% year-on-year. Trend. In June, the domestic passenger car market broke the law of the off-season of the same period in previous years, and it still resumes growth. The strong performance of the car market is favorable to the domestic zinc market, and the zinc market has strong support.

According to the June production and sales data released by the China Association of Automobile Manufacturers, in June 2020, the production and sales of automobiles were 2.325 million and 2.30 million, respectively, a month-on-month increase of 6.3% and 4.8%, and a year-on-year increase of 22.5% and 11.6%, respectively. The production and sales volume of automobiles in June all set a new monthly high in the production and sales volume of June in the past years. The outstanding performance of the auto market has provided sufficient support for the rebound of the zinc market, and the demand for zinc in the auto market has risen.

4. LME International Zinc Price

July zinc futures prices fluctuated and rose. The rise in zinc prices in the last three trading days has stimulated a rebound in the zinc price in the spot market, and the spot zinc market is in a favorable state.

5. Future market

SunSirs analysts believe that since July, the zinc market has witnessed favorable conditions, the galvanized steel market has continued to rise, the demand for zinc in the automotive market has increased, and the zinc market has strengthened. The rise in international futures zinc prices has provided the most rebound for spot zinc prices. The direct upward pushes support, and the zinc market has sufficient momentum to rise. However, the performance of the automobile market in June was the result of a combination of policies and market multiple factors. It is expected that the second half of the year will return to the normal trend. It is difficult for the automobile market to bring sustained support to the zinc market. The price of galvanized steel plates increased in July, but the increase Smaller, limited benefit for spot zinc prices. In general, the zinc market in the future market has insufficient support, and the zinc price continues to rise. The zinc price in the future market is expected to fluctuate slightly.

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

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