Zinc prices fluctuate and rise this week
| Chitosan oligosaccharide |
According to the Commodity Market Analysis System of the Business Society, as of November 3rd, the zinc price was 21520 yuan/ton, an increase of 1.88% compared to the zinc price of 21122 yuan/ton on October 27th last weekend. Nesta suspended the operations of two zinc mines in the United States, resulting in a decrease in zinc concentrate processing costs, continuous tightening of zinc mine production, reduced supply expectations in the zinc market, and fluctuating zinc prices.
Reduction in zinc concentrate processing costs
From the trend chart of zinc concentrate processing fees, it can be seen that in October, the zinc concentrate processing fees rapidly decreased, and the domestic zinc ore production is expected to decrease. On the domestic smelting end, smelters do not stop production all year except for maintenance. Currently, there is still profit space for smelters under processing fees. Smelters are actively storing in winter, and the production of zinc smelters is expected to increase. The domestic zinc market supply is expected to be stable.
Nesta to suspend operations at two zinc mines in the United States
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According to Nyrstar, due to weak prices and inflation, the company plans to temporarily close two zinc mines in Tennessee by the end of November, which is expected to affect production of 40000 to 50000 tons of zinc mines. As early as mid June 2023, Swedish mining company Boliden announced the suspension of production at Tara, the largest Irish zinc mine in Europe, which produces approximately 103200 metal tons of zinc concentrate annually; In mid February, an accident occurred at one of the world’s top ten zinc mines, the Dugard River mine in Queensland, Australia, and operations were suspended. In 2023, multiple zinc mine manufacturers have suspended their zinc mine business multiple times, leading to an expected decrease in zinc mine production and a decrease in zinc market supply.
Global Zinc Production
The global zinc production in 2022 is approximately 12.8 million tons, and it is expected to recover in 2023, an increase of 2.0% compared to 2022. Nyrstar has announced the suspension of its zinc mine production. Its 40000 to 50000 tons of zinc mine production accounts for a relatively small proportion of the global total zinc mine production, and it is expected to have little impact on the supply of zinc in the market. However, the suspension of zinc mine production has a certain impact on the sentiment of the zinc market, and zinc prices will support an increase in the short term.
Future Market Forecast
Data analysts from Business Society believe that the Federal Reserve has not raised interest rates as scheduled, and non-ferrous and precious metals have generally risen; Nyrstar Company closed two zinc mines in Tennessee, and due to the shutdown of zinc mines, bullish sentiment in the zinc market surged. London zinc rose sharply on the night trading, while Shanghai zinc rose 2.5%; The decrease in zinc concentrate processing fees has affected the supply of zinc in the market, but zinc smelters are actively storing in winter, and the production of zinc in the market is expected to steadily increase. Overall, the macro outlook is positive, with a general increase in non-ferrous metals, a halt in zinc mine production, and a decrease in zinc concentrate processing fees. The expected decrease in zinc smelting production is expected, but zinc smelters are actively storing in winter, with stable supply expectations in the zinc market. The short-term zinc market is bullish, and the medium to long-term zinc price expectations are expected to fluctuate and consolidate.
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