Zinc hits highest in nearly a month on supply fears
LONDON: Zinc prices climbed for a fourth session to hit their strongest level in nearly a month on Wednesday, amid worries about mine supply and shortages outside China. Benchmark three-month zinc on the London Metal Exchange gained 0.7% to $3,868 a metric ton in official open-outcry trading, its highest since September 30. Declining mine output has spurred record-low treatment charges for…
Zinc prices surged for the fourth consecutive day on Wednesday, reaching their strongest level in nearly a month, according to the London Metal Exchange. The benchmark three-month zinc climbed 0.7% to $3,868 per metric ton, its highest since September 30. The surge was driven by concerns over mine supply and shortages outside China.
Record-low treatment costs for smelters and production cuts by refiners have contributed to the price increase. Analyst Viktoria Kuszak at Sucden Financial warned that unless concentrate availability improves, Chinese refined output may not be able to quickly alleviate the tightness in international markets. While Chinese exports of zinc, primarily used for galvanizing steel, have helped relieve shortages elsewhere, it remains uncertain if this trend will continue.
LME cash zinc prices have risen sharply to $106 per ton, from $45 last week, and the amount of available LME stocks has fallen by 14% since last week. The involvement of trade houses in the zinc market may add to volatility, as they appear to be controlling the situation.
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