SHANGHAI, Jan 2 (SMM)－ Zinc prices are set to remain firm at the start of this year but they are forecast to slide in the second half of 2018 with better balance seen between supply and demand, SMM believed.
We forecast the LME three-month zinc price to trade at $2,450-3,500/mt in 2018, and the SHFE zinc at 20,500-29,700 yuan/mt.
In 2017, zinc prices surged over 20% and hit 10-year high due to low social inventory and tight supply of the raw materials. However, such situation may reverse in 2018 as Glencore may look to step up the pace of production resumption.
SMM sees zinc ore supply as the driving force for zinc prices in 2018 and the biggest risk at the same time.
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