China's Spot Zinc TCs Rise to $200 But Tipped to Fall

SHANGHAI, Sept. 7 -- China's spot zinc treatment charges (TCs) have risen by USD 30/mt from a week ago to USD 200/mt but are tipped to fall in coming weeks as supply tightens up, said market participants.

    "Spot TCs for imported zinc are about USD 190/mt while the highest offer was quoted at USD 200/mt," confirmed a physical trader in Yunnan.

    China's zinc TCs have been climbing for weeks, thanks to a rising domestic supply, as more local miners resumed operation with the rebound in prices and the global financial market.

    However, the supply of concentrates is tightening, said market sources.

    "Zinc TCs still gained this week, but to tell the truth, we have stopped selling zinc concentrates in the Chinese market," said an analyst at a top trading house in Shanghai.

    "Demand from overseas smelters is rising as well and we have to honor our contract with them," he said, "thus very little can be offered to Chinese smelters.

    "Meanwhile, local supply of concentrates is turning tighter again and with rainfalls in Yunnan, some miners have to suspend operation to a certain extent, which will hurt output as well," he added.

    "I am eyeing a fall in zinc TCs in the coming weeks," said another analyst in Shanghai. "Concentrates supply is not that ample."

    (Source: Metal Bulletin)