Where is Zinc Contango Going? SMM Analysis

SHANGHAI, Jun. 23 (SMM) - LME zinc has outshined other nonferrous metals recently due to well-behaved fundamentals. Falling visible and invisible zinc inventories have given a boost to LME zinc prices.

LME zinc inventories decreased 124,000 tonnes from the beginning of 2017 as of June 22, SMM understands.

WBMS: World Zinc Market in Severe Deficit in January-April despite More Output

In this scenario, zinc contango on the LME will narrow or convert to backwardation in the near term, SMM predicts. LME zinc contango has shrank from $25 in early April to $10 per tonne.

LME Zinc Outshines Other Nonferrous Metals - Here’s Why, SMM Reports

As to China market, SHFE zinc prices should stay firm in the near term, helped by supply tightness and low inventories. 

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