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Zinc Bear Market Seen Ending as China Absorbs Glut: Commodities

The 28 percent plunge in zinc that drove the metal into a bear market may be ending as record demand from steelmakers erodes stockpiles and the price slump spurs producers to curb output.

About 50 percent of zinc is used to rust-proof steel and production of the alloy reached an all-time high of 31.7 million metric tons in the second quarter, according to Macquarie Group Ltd. Global stockpiles monitored by exchanges in London and Shanghai are the lowest since April. Prices may climb as much as 27 percent to $2,450 a ton next year, according to the median in a Bloomberg survey of 10 producers, analysts and traders.