Key Data Spot Market: The LME zinc spot premium stood at -8.96 USD/ton. The SMM Shanghai zinc spot price increased by 220 yuan/ton to 24,340 yuan/ton, with a spot premium/discount of -5 yuan/ton. The SMM Guangdong zinc spot price rose by 230 yuan/ton to 24,320 yuan/ton, with a spot premium/discount of -25 yuan/ton. The Tianjin zinc spot price increased by 220 yuan/ton to 24,270 yuan/ton, with a spot premium/discount of -75 yuan/ton. Futures Market: On May 12, 2026, the main SHFE zinc contract opened at 24,255 yuan/ton and closed at 24,380 yuan/ton, representing an increase of 255 yuan/ton from the previous trading day. Daily trading volume reached 140,871 lots, with open interest at 88,173 lots. The intraday high was 24,550 yuan/ton, and the low was 24,200 yuan/ton. Inventory: As of May 12, 2026, the total zinc ingot inventory across seven SMM regions was 257,100 tons, a change of 3,600 tons from the previous period. LME zinc inventory was 111,425 tons as of May 12, 2026, a change of 1,125 tons from the previous trading day. Strategy Analysis Peru accounts for approximately 16% of overseas zinc mine production and about 20% of China's imported ore. Concerns persist regarding the impact of Peruvian regulations on zinc ore supply, potentially exacerbating the current tight supply situation. The downward trend in treatment charges (TC) continues. Domestic port inventories for imported ore are declining steadily, while domestic demand for ore remains inelastic. The falling TC provides favorable support for zinc prices. Expectations point to a sequential decline in both domestic and international smelting output, influenced by explosion incidents at overseas smelters and a drop in comprehensive domestic smelting profits. The recurring Middle East crisis has led to sentiment-driven trading favoring a de-escalation, yet actual fuel supply remains tight. On the consumption front, robust export orders and long-term optimism regarding overall demand and cost pressures from rising energy prices continue to support a positive outlook for zinc prices. Risks 1. Unexpected disruptions in overseas mine supply. 2. Domestic consumption falling short of expectations. 3. Liquidity changes exceeding expectations.