China SRB Buys 59,000 T Refined Zinc from 7 Smelters

China's State Reserves Bureau has agreed to buy a total of 59,000 tonnes of refined zinc from seven state-owned smelters at 11,800 yuan per tonne, smelter sources said on Wednesday.

The volume is lower than the expected 100,000-200,000 tonnes as the price is just 3.5 percent higher than spot values in Shanghai on Wednesday, a source at one of the smelters said.

"The price is too low. We do not want to sell much. We think the price will rise," the smelter source told Reuters.

Smelters also hold low stocks of refined zinc, limiting their selling to the SRB, a senior executive at another smelter said.

He added that Zhuzhou Smelter and Huludao Zinc, the top two zinc plants in China, were already offering zinc at 11,800 yuan to the spot market.

The SRB bought the zinc in a bidding round on Wednesday morning in Beijing, the smelter source said.

The seven smelters that sold zinc to the SRB are Huludao Zinc Industry Co Ltd, Zhuzhou Smelter Group Co Ltd, Henan Yuguang Gold & Lead Co Ltd, Baiyin Nonferrous, Yunnan Chihong Zinc & Germanium Co Ltd, Shenhzen Zhongjin Lingnan Nonfemet Co Ltd and Hanzhong Bayi Zinc.

The zinc will go into 13 SRB warehouses in China and the smelters will pay the transports costs, the source said.

SRB, which builds and manages China's state reserves, bought 290,000 tonnes of primary aluminium ingots and 30 tonnes of indium last month, part of a plan to help loss-making smelters and to boost consumption.