1. Report Industry Investment Rating - No information regarding the report industry investment rating is provided in the content. 2. Core Viewpoints of the Report - The zinc market is currently in a state of complex supply - demand dynamics. The overseas short - squeeze in the zinc market has ended, and the domestic destocking pace will slow down. In the short term, prices may enter a period of consolidation. In the long run, supply - side contradictions will continue to dominate zinc prices, and the expansion of consumption space will determine the upside potential of prices. With the end of the zinc mine expansion cycle, a tight balance in the zinc mine market may become the norm next year, and zinc prices have the potential to rise. Investors are advised to pay attention to the upper price pressure in the short term and mid - term opportunities to buy on dips [3][5]. 3. Summary by Relevant Catalogs 3.1 Market Review - **Price**: The closing price of SHFE Zinc's main contract last week was 23,275, with a weekly increase of 0.19%. The closing price of the night session yesterday was also 23,275, with a night - session increase of 0.00%. The price of LmeS - Zinc 3 was 3,127, with an increase of 1.31% [6][7]. - **Trading Volume and Open Interest**: The trading volume of SHFE Zinc's main contract last Friday was 154,943 lots, a decrease of 16,575 lots compared to the previous week. The open interest was 86,579 lots, a decrease of 8,618 lots. The trading volume of LmeS - Zinc 3 was 13,418 lots, an increase of 7,474 lots, and the open interest was 228,130 lots, an increase of 1,079 lots [6]. 3.2 Industry Chain Vertical and Horizontal Comparison - **Inventory**: Zinc ore and smelter finished product inventories have declined from high levels, and the visible inventory of zinc ingots has decreased. The inventory of zinc ore, smelter finished products, and zinc ingots has shown a downward trend, while the total global visible zinc inventory has significantly increased [9][36]. - **Profit**: Zinc mine profits are at the forefront of the industry chain, and smelting profits are at a historical median level. Zinc mine enterprise profits have rebounded to a medium - high historical level, smelting profits have rebounded to a historical median level, and galvanized pipe enterprise profits have remained stable at a medium - low level compared to the same period [11][12]. - **Capacity Utilization**: Smelting capacity utilization has declined, and downstream capacity utilization is at a medium - low historical level. Zinc concentrate and refined zinc capacity utilization have declined to a medium level compared to the same period in history. Downstream galvanizing capacity utilization has increased, while die - casting zinc and zinc oxide capacity utilization have shown mixed trends, generally at a medium - low historical level [13][14]. 3.3 Trading Aspects - **Spot**: The spot premiums in Guangdong and Tianjin have fluctuated. Overseas premiums have shown differentiation, with the Singapore premium remaining stable, and the LME CASH - 3M has declined from a high level and changed to a Contango structure [17][18]. - **Spread**: The Contango structure of SHFE Zinc has flattened [20]. - **Inventory**: There has been a slight reduction in inventory this week, and the open interest - to - inventory ratio has decreased. LME inventory is mainly concentrated in the Singapore region, with a significant increase in total LME inventory. The proportion of cancelled warrants has dropped significantly to a historical low level. The bonded - area inventory has remained unchanged this week, and the total global visible zinc inventory has significantly increased [28][34][36]. - **Open Interest and Trading Volume**: The domestic open interest is at a medium level compared to the same period in history [37]. 3.4 Supply - **Zinc Concentrate**: Zinc concentrate imports have rebounded significantly, domestic zinc ore production has decreased, the processing fee for imported ore has decreased this week, and the processing fee for domestic ore has decreased significantly. The arrival volume of zinc ore at ports is at a low level, and smelter raw material inventories have increased [40][41]. - **Refined Zinc**: Smelting output has declined and is at a medium level compared to the same period in history. Smelter finished product inventories have increased and are at a high level compared to the same period in history, and zinc alloy production is at a high level [47][48]. - **Recycled Zinc Raw Materials**: Information on recycled zinc raw materials mainly includes the operating rate of 87 independent electric arc furnace steel mills, the average price of galvanized pipe slag in Tianjin, and the daily consumption of scrap steel by 147 steel mills [51][52][53]. 3.5 Demand - **Downstream Processing Materials**: The consumption growth rate of refined zinc is positive. The monthly capacity utilization of downstream industries has slightly increased, mostly at a medium - low level compared to the same period in history. The raw material and finished product inventories of downstream industries show different trends [59][62]. - **End - Users**: The real estate market remains at a low level, and the power grid shows structural growth [76]. 3.6 Overseas Factors - The prices of European natural gas, carbon emissions, and electricity, as well as the profitability of zinc smelters in European countries, are presented, but no specific trends or conclusions are drawn in the summary [77][78][79].

Report Information - Report Title: Zinc Industry Chain Weekly Report [1] - Report Date: December 28, 2025 [1] - Research Institute: Guotai Junan Futures Research Institute [1] - Research Group: Non-ferrous and Precious Metals Group [1] - Chief Analyst: Ji Xianfei [1] - Contact Person: Wang Zongyuan [1] 1. Report Industry Investment Rating - Not provided in the report. 2. Report's Core View - Zinc prices are in a short - term tangled consolidation phase with a neutral strength - weakness analysis [2]. - Domestic supply is gradually resuming production, while demand is seasonally declining. The overseas short - squeeze has ended, and the domestic inventory reduction pace may slow down. In the long - term, supply - side contradictions will dominate prices, and there is potential for zinc prices to rise. Consider buying on dips [4]. 3. Summary by Relevant Catalogs 3.1 Market Performance - **Price**: The closing price of SHFE Zinc Main Contract last week was 23,170, with a weekly increase of 0.46%, and the night - session closing price was 23,215, with a night - session increase of 0.19%. The closing price of LmeS - Zinc 3 last week was 3086.5, with a weekly increase of 0.28% [5]. - **Trading Volume and Open Interest**: The trading volume of SHFE Zinc Main Contract last Friday was 145,708, an increase of 82,086 from the previous week, and the open interest was 97,425, an increase of 50,616. The trading volume of LmeS - Zinc 3 was 7,997, a decrease of 497, and the open interest was 229,088, an increase of 1,627 [5]. - **Inventory**: SHFE zinc warrant inventory decreased by 3,103 to 42,075; SHFE total inventory decreased by 3,054 to 72,963; social inventory decreased by 7,500 to 114,700; LME zinc inventory increased by 6,975 to 106,875; bonded - area inventory remained unchanged at 3,300 [5]. 3.2 Industry Chain Vertical and Horizontal Comparison - **Inventory**: Zinc ore, smelter finished product inventories are falling from high levels, and zinc ingot visible inventories are decreasing [8]. - **Profit**: Zinc ore profits are at the forefront of the industry chain, and smelting profits are at a historical median level. Mining enterprise profits are rising and are at a medium - to - high historical level; smelting profits are rising and at a historical median; galvanized pipe enterprise profits are stable and at a medium - to - low level compared to the same period [10][11]. - **Capacity Utilization**: Smelting capacity utilization has declined, and downstream capacity utilization is at a medium - to - low historical level. Zinc concentrate and refined zinc capacity utilization rates have declined and are at a medium level compared to the same period; downstream galvanizing, zinc die - casting, and zinc oxide capacity utilization rates have increased but are at a medium - to - low historical level [12][13]. 3.3 Trading Aspects - **Spot**: Spot premiums in Guangdong and Tianjin are oscillating. Overseas premiums are differentiated this week, with the Singapore premium stable, and the LME CASH - 3M has fallen from a high level and changed to a C structure [16][17]. - **Spread**: The SHFE zinc C structure has flattened [19]. - **Inventory**: There was a slight inventory reduction this week, and the open - interest - to - inventory ratio has decreased. LME inventory is mainly concentrated in Singapore, with a significant increase in total inventory. The CASH - 3M is related to LME off - warrant inventory, and the cancelled - warrant ratio has dropped significantly to a historical low. Bonded - area inventory remained unchanged this week, and the total global visible zinc inventory has increased significantly [27][32][34]. - **Open Interest and Trading Volume**: The domestic open interest is at a medium level compared to the same period in history [35]. 3.4 Supply - **Zinc Concentrate**: Zinc concentrate imports have increased significantly, domestic zinc ore production has decreased, import ore processing fees have decreased this week, and domestic ore processing fees have decreased significantly. Ore arrivals at ports are at a low level, and smelter raw - material inventories have decreased [38][39]. - **Refined Zinc**: Smelting output has declined and is at a high level compared to the same period in history. Smelter finished - product inventories have decreased and are at a high level compared to the same period. Zinc alloy production is at a high level [45][46]. - **Imports and Exports**: The consumption growth rate of refined zinc is positive. The downstream monthly capacity utilization rate has increased slightly, mostly at a medium - to - low level compared to the same period in history [51][54]. 3.5 Demand - **Refined Zinc**: The consumption growth rate of refined zinc is positive. The downstream monthly capacity utilization rate has increased slightly, mostly at a medium - to - low level compared to the same period in history [51][54]. - **Downstream Industries**: The real estate market remains at a low level, and the power grid shows structural growth [70]. 3.6 Overseas Factors - Natural gas, carbon, and electricity prices in Europe are presented, and the profitability of zinc smelters in different European countries is also shown [72][75].