Zinc Price Trend and Forecast

North America

The third quarter of 2022 for the North American Zinc powder market started out poorly, with CFR California values assembled at $3420/mt in August. Values later improved, though, and eventually settled at $3510/mt in September. During the first half of quarter three, the weak domestic demand from the end-user industries, such as the pharmaceutical, personal care, and cosmetics sectors, has mostly been responsible for maintaining this price trend in the US. The power shortage in China brought on by prolonged heatwaves in the southern provinces, as well as the heightened operational pressure and shutdown of industrial units, also disrupted the dynamics of the US market in H2. Substantial rate rises by the US Federal Reserve in the second half, which pushed the US currency to fresh 20-year highs, badly damaged business optimism globally. Gains in metal prices were constrained by a strong dollar, which was bolstered by predictions of a major interest rate increase following an unanticipated spike in US consumer prices in August that affected the value of the nation's zinc powder.

Asia Pacific

Zinc Powder Price in China deescalated during the first half of the third quarter, with EXW Shanghai discussions reaching a settlement at $2520/mt, but they later effectively increased and reached a settlement at $2660/mt in September. The first half of the quarter saw a decline in demand from the end-user sectors in the local Chinese market. According to analysts, despite the greater price of coal, Chinese producers were still not making a lot of money. This lower price trend in China has been supported by both increased operating pressure due to insufficient market demand and a power deficit brought on by prolonged heat waves in the southern regions. In order to address the spot supply crunch in the domestic market, some smelters exported their products during the second half of this quarter, which increased the number of arrivals in the Shanghai market. This has had a favorable impact on the price trend of the Chinese market for Zinc powder. The last several weeks saw significant reductions in China's zinc production due to power problems, along with brief interruptions brought on by rationing in Sichuan province this month.

Europe

In the European region, the price trajectory of Zinc Powder mimicked the market trend of North America, with values settling at $2940/mt in July. The prolonged energy crisis, rising inflation, and ensuing worries about the outlook for economic growth caused the most significant drops in Europe during the third quarter. The biggest driver of inflation was still the cost of energy. Germany's logistical issues as a result of ongoing transportation bottlenecks exacerbated the third quarter's economic downturn. The situation in Europe deteriorated because of the ongoing port closures in China and the unrest in Russia and Ukraine. Due to the sluggish demand from end users of pharmaceutical and nutraceutical products, domestic retailers lowered their prices in the second part of the quarter.

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