According to the latest quotes from the Changjiang Nonferrous Metals Network, the average price for 0# zinc was 24,300 yuan per tonne, down 90 yuan from the previous day. The average price for 1# zinc was 24,200 yuan per tonne, also down 90 yuan. The price for die-cast zinc alloy ingots fell 100 yuan to 25,000 yuan per tonne, and zinc alloy zamak-3 similarly dropped 100 yuan to 25,000 yuan per tonne.

On the futures front, the main Shanghai zinc contract ZN2608 opened at 24,400 yuan, reached an intraday high of 24,535 yuan, and closed at 24,130 yuan per tonne. This represents a decline of 360 yuan, or 1.47%, from the previous day, with a settlement price of 24,315 yuan per tonne. The intraday price fluctuation was 465 yuan, with a trading volume of 136,322 lots and open interest of 93,670 lots, resulting in a decrease of 1,815 lots in open interest.

In overseas markets, the latest LME zinc price was $3,441.5 per tonne, down $50.5, a decline of 1.45%.

Analysis of Key Drivers

On the cost side, a survey shows that import zinc concentrate TC (treatment charges) remain at a low level of $25-30 per dry tonne. Domestic zinc concentrate TC stands at 2,800-3,200 yuan per tonne, approaching the breakeven point for smelters, leading some high-cost operations to schedule maintenance and reduce output.

Regarding supply, some smelters in Shaanxi and Yunnan have arranged maintenance due to tight raw materials and negative profit margins, leading to a marginal tightening in domestic zinc ingot supply. Imported zinc arrivals at ports remain stable, with the Yangshan port premium staying elevated.

On the demand front, survey data indicates an operating rate of 68% for galvanizing enterprises and 62% for die-cast zinc alloy enterprises, both at mid-year levels. Infrastructure-related orders saw a slight sequential improvement in July, while orders from the real estate sector remain weak.

For inventories, the latest LME zinc stock data shows 119,200 tonnes, with a single-day drawdown of 625 tonnes. The proportion of stocks in Asian warehouses has declined, indicating that fundamental factors still provide some support.

Market Summary and Outlook

Shanghai zinc has fallen below the 24,500 yuan level, with the primary pressures stemming from weaker macro sentiment and expectations of a seasonal demand lull. In the short term, prices are expected to fluctuate within the 24,000 to 24,500 yuan range. Data suggests that while zinc fundamentals are showing marginal improvement, macro pressures are significant. Analysts hold the view that Shanghai zinc is likely to experience weak, range-bound trading in the near term, with support expected around the 24,000 yuan level.

Key factors to monitor in the coming days include changes in zinc concentrate TC, the operating rates of galvanizing plants, and LME zinc inventory data.