On Tuesday, the most-traded SHFE zinc ZN2506 contract fluctuated rangebound during the day and traded sideways at night, while LME zinc prices fluctuated. Spot market: The mainstream transaction prices for 0# zinc in Shanghai were concentrated in the range of 22,780-22,975 yuan/mt, with a premium of 210-220 yuan/mt against the 2505 contract. During the holiday, arrivals in Shanghai were limited, and traders were reluctant to sell. However, downstream companies still had raw material inventories and mainly engaged in just-in-time procurement, resulting in sluggish spot transactions. SMM: As of May 6, the total zinc ingot inventory was 84,100 mt, a decrease of 1,800 mt from April 28 and an increase of 7,100 mt from April 30, indicating a buildup in domestic inventory. Glencore's owned zinc production in Q1 2025 was 213,600 mt, 4% higher than in Q1 2024. The company's owned zinc production guidance for 2025 is 930,000-990,000 mt. Volcan: In Q1 2025, the total metal production of zinc concentrates was 57,400 mt, down 10% QoQ and up 14% YoY. The company's zinc concentrate production guidance for 2025 is 250,000-255,000 mt. Overall, China and the US are set to hold high-level economic and trade talks, while the People's Bank of China, the China Securities Regulatory Commission, and other authorities will introduce the "package of financial policies to support market stability and expectations". The macro sentiment is expected to further improve, which is likely to boost zinc prices. From a fundamental perspective, social inventory is expected to increase slightly after the holiday as anticipated, but absolute inventory remains at a low level, providing underlying support. It is expected that zinc futures prices will fluctuate upward during the day. Additionally, as the delivery date approaches, the open interest ratio of the front-month contract remains relatively high, and attention should be paid to liquidity pressure.

On Wednesday, the most-traded SHFE zinc ZN2506 contract opened higher, fluctuated and pulled back during the day, and opened higher and fluctuated at night, while LME zinc rose first and then fell. Spot market: The mainstream transaction prices of Shanghai 0# zinc were concentrated at 22,815-23,040 yuan/mt, with a premium of 220-230 yuan/mt against the 2505 contract. At the end of the long-term contract, the market volume was limited, traders continued to stand firm on quotes, the premium continued to rise, futures prices moved higher, downstream purchase willingness was weak, and transactions were moderate. The US April Markit composite PMI unexpectedly fell to a 16-month low, the Eurozone April composite PMI was almost flat, and both Germany and France fell into contraction. Overall, the April PMI data in Europe and the US were poor, the impact of tariffs gradually emerged, and the US Fed's Beige Book showed concerns about the deteriorating economic outlook in many regions. However, Trump and Bessent recently released optimistic signals on trade negotiations, and market sentiment improved. Currently, zinc ore supply is relatively ample, and the safety accident at the Antamina mine has limited short-term impact. If the shutdown period is long, it will affect the recovery pace of overseas zinc mines. Domestic smelters increased maintenance in May, supply pressure marginally eased, and demand is still in the peak season, supporting supply and demand improvement. However, macro uncertainties remain, and funds maintained cautious trading. The weighted open interest of SHFE zinc fluctuated around 235,000 lots, with no significant changes. The view of a weak rebound in zinc prices with limited upside in the short term is maintained, and inventory data will be watched today.

On Monday, the most-traded SHFE zinc ZN2506 contract rebounded during the day but was in the doldrums at night, while LME zinc was closed. Spot market: The mainstream transaction prices of 0# zinc in Shanghai were concentrated at 22,500-22,620 yuan/mt, with a premium of 150 yuan/mt against the 2505 contract. As the long-term contract approached its end, there were few traders in the market, and downstream users had certain inventories, purchasing only for rigid demand. Spot transactions did not improve, and the premium continued to decline. SMM: As of Monday, social inventory was 93,000 mt, down 7,000 mt WoW from last Thursday. Customs data: Zinc concentrate imports in March were 35.95 mt, down 22.09% MoM but up 47.16% YoY. Refined zinc imports in March were 27,500 mt, down 18.12% MoM and 40.5% YoY. Overall, tariff negotiations made no substantial progress, and the new US president pressured Powell, increasing market concerns and putting pressure on zinc prices. March zinc ore imports met expectations, while zinc ingot imports slightly exceeded expectations. Refineries had ample raw materials, and supply increases were steadily realized. The peak consumption season supported downstream buying the dip, and inventory dropped to 93,000 mt, with low inventory supporting a weak rebound in zinc prices in the short term. As the rush for export orders was digested and the peak season approached its end, later consumption support was expected to weaken, and the sustainability of the zinc price rebound was insufficient.

On Monday, the most-traded SHFE zinc ZN2506 contract fluctuated rangebound during the day and bottomed out at night, while LME zinc rose first and then fell. Spot market: The mainstream transaction prices of Shanghai 0# zinc were concentrated at 22,900-23,110 yuan/mt, with a premium of 280-300 yuan/mt against the 2505 contract. As the delivery date approached, the price spread between futures contracts narrowed, and spot premiums declined MoM. Downstream sentiment was cautious, and spot inquiries and transactions were moderate. SMM: As of Monday, social inventory stood at 105,600 mt, up 3,500 mt WoW from Thursday. Overall, the tariff impact has temporarily eased but remains volatile, and market sentiment is weak. The weighted open interest of SHFE zinc fluctuated around 216,000 lots. The stabilization and rebound of zinc prices have suppressed downstream purchases, and inventory increased slightly. The zinc ingot import window briefly opened, with a small amount of imports flowing in, leading to a decline in spot premiums and a convergence of the price spread between near-month contracts. Short-term fundamental imbalances are not prominent, and zinc prices follow the fluctuations of the non-ferrous sector, expected to remain in a low-range consolidation.