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Zinc Price Forecast, December 2016: Total Inventories Decline

iconDec 23, 2016 11:41
Source:MetalMiner
The International Lead and Zinc Study Group recently released preliminary data for zinc in 2016, which revealed the global market for the refined metal in deficit from January to October of this year.

by Kyle Fitzsimmons on DECEMBER 22, 2016

The International Lead and Zinc Study Group recently released preliminary data for zinc in 2016, which revealed the global market for the refined metal in deficit from January to October  of this year.

Total reported inventories also fell over the same period.

Global zinc mine production dropped by 1.8% compared to the same 10 months in 2015 with the overall reduction attributed to drop-offs in Australia, Ireland, Peru and India. Of note were Bolivia, China and the Russian Federation which posted increases this year.

China and the Republic of Korea (South Korea) posted increases in refined zinc metal output, but the global output declined slightly due to activity in Mexico, India, Australia and the United States.

The report stated: “A rise in global usage of refined zinc metal of 3.7% was primarily influenced by an increase in Chinese apparent demand of 9.3% that more than offset a 14% reduction in the United States. Usage in Europe rose by 0.9%.”

ILZSG concluded that Chinese imports of zinc fell by nearly half, 44.5% to be exact, but the country’s net imports of the metal grew 26%.

Buying Zinc at the Right Time

Our own Raul de Frutos wrote of the ILZSG report, and added some insightful analysis on what buyers of the metal should consider this time of year:

“During this year’s rally, zinc buyers had several opportunities to buy forward. Buyers now need to pay close attention to the recent price pull back. If you see a rebound in prices near that support level, that would be a good time to buy some volume.”

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