Price Trend

According to the data monitoring of business associations, zinc prices rose first and then fell in September, and zinc price shocks were adjusted. Overall, zinc market shocks remained stable in September, the pressure of good news and bad news was offset, and zinc price shocks remained stable. As of September 30, the price of 0 × zinc ingot was 19040.00 yuan / ton, up 0.46% compared with 19026.67 yuan / ton at the beginning of the month, and down 16.05% compared with the same period last year.

II. Market Trend Analysis
In September, the processing cost of domestic zinc concentrate remained high at about 6500-6750 yuan/metal ton, while that of imported zinc concentrate remained around 280 dollars/dry ton. Compared with zinc price, zinc processing cost accounted for more than 30%, zinc ingot processing cost remained high and zinc ingot cost was high. High processing cost limited the falling space of zinc price, and zinc price had limited falling space.

Domestic Zinc Production

From the figure, we can see that zinc production rose sharply in August, domestic zinc production increased significantly in 2019, and zinc production increased by 18.9% in August compared with the same period last year; from January to August, domestic zinc production increased by 8.2%, zinc production increased, zinc supply increased, supply shortage alleviated, excess supply increased, and pressure on zinc price to fall increased.

Downstream demand

As can be seen from the figure above, the data of the National Bureau of Statistics show that the construction area of real estate increased steadily in 2019, and the construction area of real estate increased by 8.8% in January-August. The growth of real estate construction area shows that the fixed demand of the real estate market is still in existence and the demand of zinc city is declining with limited strength. At the same time, we can see from the chart below that in 2019, the new construction area of real estate decreased year-on-year, the real estate market declined compared with 2018, the demand of zinc market was insufficient, and the demand of real estate for zinc market was rising, but the benefits were limited.

According to the data released by the China Association of automobile manufacturers, in August 2019, there were 1 million 991 thousand vehicles and 1 million 958 thousand vehicles, with an increase of 10.3% and 8% compared with the same period, down 0.5% and 6.9% from the same period last year. From January to August, automobile production and sales fell by 12.1% and 11.0% compared with the same period last year, with 15.939 million vehicles and 16.104 million vehicles. The decline in production and sales continued to narrow compared with January to July. Automobile production and sales increased annually, but still declined year-on-year, and the total number of vehicles in August still did not reach 2 million. Although the overall decline of the industry has changed, the pressure faced by the industry has not been effectively alleviated. With the sharp decline of automobile production and sales and the decrease of demand for zinc ingots, the zinc market does not have enough power to rise.

3. Prospects for the Future Market

Business analyst Bai Jiaxin believes that: cost: zinc concentrate processing fees remain high, zinc ingot costs are high, zinc market has limited downward space, zinc market has upward pressure. In terms of supply and demand, the domestic zinc ingot production rose sharply in 2019, the supply of zinc increased, and the construction area of real estate increased overall. However, the newly added construction area declined to a certain extent. The growth of demand for zinc was limited. The production and sales of automobile industry continued to decline sharply. The demand for zinc was negative, and the overall zinc supply increased sharply and the demand was limited. In summary, the high cost of zinc ingot and the pressure of zinc price increase are great, but due to the imbalance between supply and demand, supply increases substantially, demand decreases, zinc price has pressure to fall. In a word, zinc market can not rise or fall, and it is expected that the fluctuation of zinc price will remain stable in the future.