[Non-Farm Payrolls Data Exceed Expectations, SHFE and LME Zinc Prices Pull Back] At the beginning of the week, the gradual digestion of macro sentiment led to a decline in LME zinc; however, continued destocking of overseas LME zinc inventory provided bottom support for prices. Subsequently, as the market continued to await the delayed release of non-farm payrolls and CPI data, trading activity became more cautious, and LME zinc maintained a fluctuating trend.

[SMM Flash News]: SMM zinc social inventory has risen consecutively from a low level to 81,700 mt. Coupled with the impact of the off-season in the downstream sector, the market expects a continuous inventory buildup. Bears have increased their positions by over 40,000 lots. The price of the most-traded SHFE zinc contract has broken through and declined to around 21,850 yuan/mt. However, trading in the spot market has improved at this price level. It is expected that there is limited downside room for zinc prices. Attention should be paid to the price support brought by the buying power in the downstream sector.

[This week, the zinc price on both SHFE and LME maintained a fluctuating trend due to the resonance between fundamental and macro front factors] At the beginning of the week, influenced by the lingering market uncertainties, LME zinc continued its fluctuating trend from last week; subsequently, Moody's downgraded the US credit rating from Aaa to Aa, ending its highest rating for the US since 1917, which intensified market concerns. Meanwhile, Bostic reiterated his preference for one interest rate cut this year, and LME zinc declined amidst the sentiment-driven and low interest rate cut expectations...

This week, the SHFE/LME price ratio fluctuated around 8.3, and the zinc ingot import window closed. Overseas, zinc inventories continued to decrease at the beginning of the week, strengthening the bottom support for zinc prices, and LME zinc slightly rose. Later, due to the expected announcement of reciprocal tariffs by Trump, macro uncertainties increased, and LME zinc continued to decline.

【Copper】 SHFE copper rose again on Tuesday with increased open interest, as domestic buyers placed orders at low levels to support copper prices. Spot copper was at 81,565 yuan/mt today, with Shanghai spot discounts at 15 yuan/mt and Guangdong spot premiums at 190 yuan/mt. Overnight, the new US President softened his stance on comprehensive tariffs, without mentioning copper, but uncertainties remain high. With the wide spread between LME and US prices, the market is focusing on logistics changes. LME copper inventories continued to outflow, and based on the US annual refined copper imports of 800,000 mt, the expected increase in copper imports this year could be around 400,000 mt. On the indicator front, the US February manufacturing PMI fell to 49.8, while the composite PMI exceeded expectations. Eurozone manufacturing activity warmed up to 48.7, the highest in over two years, with Germany's changes boosting market confidence. Currently, domestic supply and demand support copper prices to continue fluctuating at high levels and test further upward. SHFE copper's adjustment time is short, and the pullback is likely to be limited under peak season buying demand. 【Aluminum & Alumina】 SHFE aluminum fluctuated downward today, first falling and then rising, with spot prices maintaining slight discounts. Over the past week, social inventories of aluminum ingots and billets decreased by 35,000 mt and 13,000 mt, respectively. Aluminum ingot destocking was slightly stronger than in the same lunar period in recent years. The market has expectations for peak season consumption, but spot feedback is moderate, and aluminum billet processing fees remain low. After a significant cost reduction, higher profits require larger deficit expectations. In the short term, SHFE aluminum faces resistance at 21,000 yuan/mt, with support at the low of the recent one-month range of 20,500 yuan/mt, waiting for a directional breakout. Alumina operating capacity fluctuates at historically high levels, with limited production cuts, and the supply-demand balance remains loose. Miners' sentiment to stand firm on quotes remains strong, with Guinea ore still above $90/mt. As some northern alumina companies face cash cost losses, alumina's decline may slow before ore prices loosen further. In the short term, it may hover around 3,000 yuan/mt, with attention on spot transaction changes. 【Zinc】 LME zinc inventories continued to pull back to 153,700 mt, with the 0-3 month discount narrowing to $14.5/mt. The overseas market's fundamental data improved, which is unfavorable for the import window to open. It is expected that the domestic and overseas markets will diverge slightly in the future. SHFE zinc fluctuated at high levels, with downstream buyers cautious about high prices and spot premiums weakening. Longs reduced positions at high levels, and SHFE zinc's weighted open interest fell by 3,155 lots to 232,900 lots, with capital outflows of 82.23 million yuan. In March, domestic smelters turned profitable, and refined zinc output is expected to increase by over 50,000 mt MoM. In Q2, mine-side increments are expected to be further realized, mainly tracking the resumption of production at Portugal's AI justrel. During the traditional peak season of "Golden March and Silver April," consumption performance is moderate, but the increment is insufficient. Under the dual increase in supply and demand, SHFE zinc is likely to maintain a rangebound movement between 23,200-24,200 yuan/mt. 【Lead】 The domestic and overseas markets diverged slightly, with lead spot import losses widening to around 720 yuan/mt. LME lead inventories are at a high of 232,200 mt, and the possibility of the lead ingot import window opening in the future cannot be ruled out. The futures market weakened, and the spread between futures and spot prices narrowed to 180 yuan/mt. The news of a large smelter in Henan planning a 25-30 day maintenance at the end of March supported prices. Secondary lead smelters previously purchased raw materials at high prices, resulting in high costs, and the price difference between primary metal and scrap remained unchanged at 75 yuan/mt. Domestic smelters are profitable, maintaining high operating rates, and the raw material shortage remains unchanged. Some secondary lead smelters reduced production due to insufficient raw materials, but the overall expectation for production increase remains unchanged, with regional differences in lead ingot supply. Consumption is still in the off-season, with weak demand for car battery replacements, providing insufficient support for high lead prices. Attention is still needed on the pullback pressure near 17,880 yuan/mt. 【Nickel & Stainless Steel】 SHFE nickel rebounded slightly, with active market trading. Jinchuan premiums rebounded to 2,000 yuan/mt, while Russian nickel discounts were at 25 yuan/mt and electrodeposited nickel discounts at 100 yuan/mt. High-grade NPI prices remained strong, with Indonesian ore still affecting raw material pricing, and the latest quote was at 1,027 yuan/mtu. In terms of inventories, NPI inventories fell sharply by 6,000 mt to 23,000 mt, refined nickel inventories dropped by 1,900 mt to 47,000 mt, and stainless steel inventories slightly decreased to 990,000 mt. After the price decline, NPI remains the main support on the cost side, with strong support estimated near 130,000 yuan/mt. Technically, SHFE nickel has not yet weakened, waiting for shorts to mature. 【Tin】 SHFE tin fluctuated with a bearish line, briefly recovering 275,000 yuan/mt, with SMM spot tin at 273,700 yuan/mt today. Overnight, LME tin inventories decreased to 3,555 mt, with LME 0-3 month spot discounts at $55/mt. Currently, it is recommended that mid- and downstream buyers place orders near 275,000 yuan/mt as needed. Wa State is advancing the resumption of tin mine production, but the realization path is medium-term; the situation in the DRC remains unclear. Downstream, the market is concerned about the risk of the US imposing tariffs on chips, which may affect demand. It is inclined that tin prices will mainly fluctuate between 275,000-280,000 yuan/mt this week.

[SMM Zinc Morning Comment] Overnight, the most-traded SHFE zinc 2504 contract opened at 23,750 yuan/mt. At the beginning of the session, shorts reduced their positions, and SHFE zinc fluctuated upward to a high of 23,860 yuan/mt. Subsequently, longs reduced their positions, and SHFE zinc fluctuated downward below the daily average line. Later, shorts took profits and exited, causing the center of SHFE zinc to move upward. It ultimately closed higher at 23,820 yuan/mt, up 90 yuan/mt or 0.38%. Trading volume decreased to 58,989 lots, and open interest fell by 2,227 lots to 85,458 lots. Overnight, SHFE zinc recorded a small bullish candlestick...

【Overseas Inventories Increase Along with Continuous Tariff News, Zinc Price Centers in Both Domestic and Overseas Markets Decline This Week】At the beginning of the week, LME zinc rose slightly, influenced by the lower-than-expected preliminary February S&P Global Services PMI and final February University of Michigan Consumer Sentiment Index in the US last Friday. However, uncertainties surrounding international developments and Trump's tariff policies led to a decline in LME zinc...

[SMM Morning Meeting Summary: Tariff Disturbances Combined with Inventory Reduction, LME Zinc Recorded a Long Upper Shadow Bullish Candle] Overnight, LME zinc opened at $2,808/mt. At the beginning of the session, LME zinc fluctuated around the daily moving average, briefly dipping to $2,801/mt. During European trading hours, bears reduced positions, and LME zinc quickly climbed to a high of $2,846/mt. Entering the night session, LME zinc gradually pulled back below the daily moving average. By the end of the session, the center fluctuated around $2,810/mt, closing with a gain at $2,809.5/mt, up $1.5/mt or 0.05%. Trading volume increased to 108,000 lots, while open interest decreased by 3,271 lots to 230,000 lots.

[LME Inventory Dynamics: Aluminum and Lead Inventories Decrease, Copper and Nickel Inventories Increase] On February 14, LME aluminum inventories decreased by 4,525 mt, copper inventories increased by 17,300 mt, nickel inventories increased by 2,952 mt, lead inventories decreased by 1,550 mt, tin inventories remained unchanged, and zinc inventories decreased by 775 mt.

Overnight, LME copper opened at $9,178/mt, initially dipping to $9,155/mt before climbing steadily. Near the session's end, it peaked at $9,292/mt and finally closed at $9,291/mt, up 0.27%.