The Deepening Deficit That Makes Zinc One of 2016’s Top Bets
- Global mine supply seen set for ‘record shortage’ this year
- China’s refined zinc output to drop for first time since ‘12
Zinc ingots sit stacked at the Public Procurement Service (PPS) warehouse in Gunsan, South Korea, on Wednesday, June 25, 2014. South Korea is scheduled to release industrial production numbers on June 27.
Photographer: SeongJoon Cho/BloombergThe Chinese smelters that churn out more than 40 percent of the world’s zinc may cut production for the first time in four years because they can’t get enough raw material, further lifting prices of one of this year’s strongest-performing commodities.
Zinc, used for rustproofing steel in everything from auto bodies to suspension bridges, has surged as much as 25 percent in 2016 to the highest since July as miners supply less of the ore concentrate that’s refined to produce the metal, just as demand rebounds in China, the biggest user. Banks from Goldman Sachs Group Inc. to Macquarie Group Ltd. see further gains, while Glencore Plc, the biggest miner of the metal, says structural deficits are back.