Zinc prices to lack upward momentum

The price of LME zinc has fallen to the level which had driven mines to implement production cuts due to poor profits, and the domestic prices also stand close to smelters’ cost level. As such, there is not much room for further price decline. Under the suppression of macroeconomic and high supply, there is insufficient room for price increase. Prices are expected to remain range-bound. The SHFE 2401 zinc contract prices are expected to move between 20,300-21,300 yuan/mt this week. LME zinc is expected to trade between $2,400- 2,550/mt.