Report Industry Investment Rating - No information provided in the report Core Viewpoints - The short - term market of Shanghai Zinc ZN2510 is expected to fluctuate and consolidate. The previous trading day saw a decline in Shanghai Zinc with shrinking trading volume. Long - positions slightly increased while short - positions slightly decreased. Technically, the price is above the 60 - day moving average with weak support, short - term indicators are in a weak zone, and the trend shows a stalemate between long and short forces [2][20]. Summary by Related Catalogs 1. Fundamentals - In April 2025, global zinc plate production was 1153000 tons, consumption was 1130200 tons, with a surplus of 22700 tons. From January to April, production was 4451400 tons, consumption was 4507900 tons, with a shortage of 56500 tons. The global zinc ore production from January to April was 4040600 tons [2]. 2. Basis - The spot price of zinc is 22260, with a basis of + 20, showing a neutral situation [2]. 3. Inventory - On August 21, LME zinc inventory decreased by 1875 tons to 69375 tons compared to the previous day, and the SHFE zinc inventory warrants remained unchanged at 32288 tons [2]. - From August 11 to August 21, the total social inventory of zinc ingots in major Chinese markets increased from 99000 tons to 117400 tons [5]. 4. Futures Market Quotes - On August 21, the trading volume of zinc futures contracts was 138079 lots, with a total turnover of 1538613560 yuan, and the total open interest was 214223 lots, a decrease of 1927 lots [3]. 5. Spot Market Quotes - On August 21, the price of zinc concentrate was 16950 yuan/ton (+ 30), zinc ingot was 22260 yuan/ton (+ 40), galvanized sheet was 4090 yuan/ton (- 4), galvanized pipe was 4490 yuan/ton (- 5), zinc alloy was 22780 yuan/ton (+ 60), zinc powder was 27340 yuan/ton (+ 60), zinc oxide was 20850 yuan/ton (unchanged), and secondary zinc oxide was 7726 yuan/ton (- 12) [4]. 6. Zinc Ingot Production - In June 2025, the production of refined zinc was 471800 tons, a month - on - month increase of 11.67% and a year - on - year decrease of 2.36%. The planned production for July is 470300 tons [16]. 7. Zinc Concentrate Processing Fees - On August 21, the average processing fee for 50% grade zinc concentrate in different regions ranged from 3500 to 4000 yuan/metal ton, with some regions having no change [18]. 8. Futures Company Transaction and Position Ranking - For the zinc contract zn2510 on August 21, the total trading volume of 20 futures companies was 134383 lots, a decrease of 35721 lots compared to the previous day. The total long - position was 70832 lots, an increase of 272 lots, and the total short - position was 76267 lots, a decrease of 483 lots [19].

Report Summary 1. Investment Rating - There is no specific industry investment rating provided in the report. 2. Core View - Zinc prices have declined, and the demand in the spot market has not improved significantly, with mainly rigid - demand procurement. The cost of imported ore TC is rising, and the smelting profit is increasing, leading to an expected increase in supply. Although the downstream consumption shows some resilience, it cannot offset the high growth on the supply side, resulting in a continuous increase in social inventories. After the market sentiment fades, zinc prices are expected to return to the fundamental logic, and due to the consumption off - season and supply pressure, zinc prices face significant pressure [4]. 3. Summary by Related Contents 3.1 Important Data - **Spot**: The LME zinc spot premium is - 1.96 dollars/ton. The SMM Shanghai zinc spot price dropped 120 yuan/ton to 22650 yuan/ton, and its premium rose 35 yuan/ton to - 45 yuan/ton. The SMM Guangdong zinc spot price fell 160 yuan/ton to 22600 yuan/ton, and its premium decreased 5 yuan/ton to - 95 yuan/ton. The SMM Tianjin zinc spot price declined 120 yuan/ton to 22600 yuan/ton, and its premium increased 35 yuan/ton to - 95 yuan/ton [2]. - **Futures**: On July 28, 2025, the SHFE zinc main contract opened at 22905 yuan/ton, closed at 22645 yuan/ton, down 200 yuan/ton from the previous trading day. The trading volume was 193107 lots, an increase of 41021 lots, and the position was 124461 lots, a decrease of 4767 lots. The highest price reached 22965 yuan/ton, and the lowest was 22575 yuan/ton [2]. - **Inventory**: As of July 28, 2025, the total SMM seven - region zinc ingot inventory was 103700 tons, an increase of 11000 tons from last week. The LME zinc inventory was 115500 tons, a decrease of 275 tons from the previous trading day [3]. 3.2 Market Analysis - **Cost**: The new - month tender price of domestic ore has not been determined, while the imported ore TC is still rising, with the highest offer reaching 85 dollars/ton, and the smelting profit is increasing. The smelting plants have sufficient raw material reserves and low enthusiasm for ore procurement, so the TC is expected to continue rising [4]. - **Supply and Demand**: The downstream consumption shows some resilience, but the high growth on the supply side leads to an increase in social inventories, and this trend is expected to continue in the second half of the year. Considering the consumption off - season and supply pressure, zinc prices face significant pressure [4]. 3.3 Strategy - **Unilateral**: Cautiously bearish [5]. - **Arbitrage**: Neutral [5].

Core Viewpoint - Zinc prices have continued to rise, with the Shanghai zinc index increasing by 0.62% to 22,676 yuan/ton, while the London zinc price rose by 18.5 to 2,684.5 USD/ton, indicating a bullish trend in the market [1] Price and Inventory Summary - The average price of SMM 0 zinc ingots is 23,180 yuan/ton, with various regional basis prices reported: Shanghai at 175 yuan/ton, Tianjin at 255 yuan/ton, and Guangdong at 430 yuan/ton [1] - The Shanghai Futures Exchange recorded zinc ingot inventory at 0.32 thousand tons, while domestic social inventory slightly decreased to 85.8 thousand tons [1] - LME zinc ingot inventory stands at 182.3 thousand tons, with 31.7 thousand tons in canceled warrants [1] Market Dynamics - The domestic zinc concentrate treatment charge (TC) is 3,450 yuan/metal ton, while the import TC is 40 USD/dry ton [1] - Zinc concentrate port inventory is at 287 thousand physical tons, and factory inventory is at 596 thousand physical tons [1] - The operating rate for galvanized structural components is 62.44%, with raw material inventory at 16 thousand tons and finished product inventory at 388 thousand tons [1] Future Outlook - Zinc mine inventory is increasing, and treatment charges are on the rise, maintaining expectations of oversupply in the zinc concentrate market [1] - Zinc ingot inventory is decreasing, with monthly differentials remaining high, indicating relative strength in the near term [1] - However, it is anticipated that downstream purchasing will gradually weaken after the peak seasons, coupled with pressure from imported zinc ingots, leading to potential accumulation of social inventory and downward risks for zinc prices [1]