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Prospects for Deficit of Zinc Bring Prices Higher

July 11, 2014 at 14:26 by Vladimir Vyun

Zinc rallied today on speculations that steady demand and falling inventories will lead to a deficit. China, the biggest user of the metal, plans to improve its infrastructure, including railroads. This promises to increase consumption of zinc. China is not the only Asian country with growing demand for zinc as specialists think that usage of the industrial metal in India may double over the next three years.

Meanwhile, zinc stockpiles monitored by the London Metal Exchange dropped for 14th straight week and are down 29 percent over this year. The LME-tracked inventories totaled 660,800 tons — the lowest level since December 2010. Experts believe that consumption may exceed output by almost 500,000 metric tons this year.

Contract for delivery of zinc in three months gained 0.5 percent to $2,282.75 per ton on LME today. Prices were heading to a 2.1 percent weekly gain.

If you have any questions and comments on the commodities today, use the form below to reply.

2 Responses to “Prospects for Deficit of Zinc Bring Prices Higher”

  1. karan

    I’m short in zinc in the Indian market since last week loosing lots,of money till now.. Still holding short.. Can you plz suggest wht to do further in zinc n whts the outlook in zinc.. Plz help.


    Vladimir Vyun Reply:

    While we do not provide trade recommendations, I can say it looks like the general consensus among analysts is that zinc is in a bullish trend both in short and long term. The price graph also points upwards. So, unless you are a contra-trend trader and have a really good reason to believe that something will drive prices down soon, it looks dangerous to be in a short position under the current circumstances.


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