SHANGHAI, Mar. 7 (SMM) – SMM survey of 30 industry insiders finds that about 47% are bullish toward zinc price trends this week, expecting LME zinc to rise to USD 1,880/mt, and SHFE 1605 zinc to climb to RMB 15,000/mt. China is expected to eliminate overcapacity in the steel, coal and nonferrous metals sector. This boosted energy, chemical and ferrous metals. 

See SMM Price Forecast Please Click: LME Zinc Poised to Rise Further This Week

Some 33% are bearish, seeing LME zinc fall to USD 1,750/mt and SHFE 1605 zinc drop to RMB 14,000/mt. A large number of longs are expected to withdraw from the market after profit-taking, with selling pressure expected. Combined zinc inventories in Shanghai, Guangdong and Tianjin grew to above 450,000 mt, and warrants on the SHFE climbed to 139,000 mt, both hitting record highs.

The remaining 20% are neutral, expecting LME zinc to fluctuate between USD 1,780-1,850/mt and SHFE 1605 zinc to fluctuate between RMB 14,200-14,600/mt. Despite sluggish inflation rate and manufacturing PMIs in EU countries, it is still uncertain whether the European Central Bank will expand quantitative easing, leaving market cautious.