Zinc Declines to Two-Week Low in London as China Imports Slideby
Investors winding back expectations on zinc: TD Securities
China imports slump 49 percent from month earlier, data show
Zinc fell to the lowest in almost two weeks as a slump in imports rekindled demand concerns on China, the world’s biggest user.
Shipments of refined zinc into the Asian nation shrank 49 percent in April from a month earlier and were down 24 percent from a year ago, customs data showed Monday. China’s Minxin Manufacturing PMI index fell 1.1 percentage points in May from the previous month, according to a statement Saturday on China Academy of New Supply-side Economics’ website.
“You had a little more detail on the trade data, and it wasn’t all that great,” Mike Dragosits, a senior commodity strategist at TD Securities in Toronto, said in a telephone interview. “People built up pretty positive expectations and now they’re going to have bring it back a little bit, and I think that’s why we’re seeing a little bit of a sell-off.”
Zinc for delivery in three months declined 1.3 percent to settle at $1,841 a metric ton at 5:51 p.m. on the London Metal Exchange, after touching $1,826.50, the lowest since May 10.
The price has surged about 14 percent this year, leading gains among the six main metals traded in London, amid expectations that global demand will outstrip production.
On May 19, Goldman forecast global mine supply will drop 3.2 percent, as consumption climbed 1.9 percent, triggering a deficit of 114,000 metric tons. The shortfall will increase to 360,000 tons in 2017, the bank forecast.
- Copper, lead, nickel and tin also declined on the LME, while aluminum rose.
- In New York, copper futures for July delivery slipped less than 0.1 percent to $2.055 a pound on Comex.