Premiums and discounts in Guangdong rose about 5 yuan/mt WoW. As of Friday, mainstream 0# zinc quotations in Guangdong were at discounts of 50~15 yuan/mt against the market, and the Shanghai-Guangdong price spread narrowed. Zinc prices' center continued to move higher this week, while downstream fear of high prices intensified. Only limited rigid demand restocking occurred on the first day after the holiday, and overall transaction improvements were limited. Although spot inventory in Guangdong reached a three-year high, traders showed low willingness to sell at low prices. Coupled with the narrowing of the price spread between futures contracts after the holiday, spot premiums/discounts edged up. Overall, high zinc prices continued to suppress market sentiment. Downstream purchasing remained need-based and cautious, keeping the spot market under pressure. However, with traders recently reluctant to sell at low prices, spot premiums/discounts are expected to remain in the doldrums in the near term.
