SHANGHAI, Oct. 25 (SMM) - Zinc prices will consolidate at highs before the year’s end due to ore shortfalls, pointing toward 20,000 yuan per tonne, SMM predicted.
Zinc concentrate supply tightness deteriorated in China, SMM said. Imports declined sharply and will fall 50% in 2016 with closures at overseas mines during 2015-2016. China’s zinc concentrate imports were 1.60 million tonnes (zinc content) in 2015.
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Domestic zinc ore output was still low. Supply shortages will expand to 600,000-700,000 tonnes this year, SMM expects.
Meanwhile, domestic downstream buyers will snap up goods in Q4 for winter production. These factors will all drive up zinc for the remainder of the year.
SMM understands canceled warrants on LME zinc surged 30,000 tonnes October 24. Some traders shipped goods to Asia.
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