Zinc Rises Near 13-Month High as Supply Concern Fuels Buyingby
Metal is up 36% this year following closure of two large mines
Stockpiles fall for a sixth day, longest stretch in six weeks
Zinc traded near a 13-month high as supply concerns mount on the outlook for mine closures.
The metal is up 36 percent this year, heading for the biggest annual gain since 2009, following the closure of two of the world’s largest mines, MMG Ltd.’s Century and Vedanta Resources Plc’s Lisheen. Prices may rise to $2,500 a metric ton over the next six months, or 14 percent above today’s price, as production trails demand, according to Goldman Sachs Group Inc.
“Zinc remains the favored child, with a view that the metal is in or will shortly be in deficit,” Tai Wong, the director of commodity products trading at BMO Capital Markets Corp. in New York, said in a telephone interview. “The price action has done nothing to suggest anything other than people are long and comfortable.”
Zinc for delivery in three months rose 0.5 percent to settle at $2,189 a ton at 5:50 p.m. on the London Metal Exchange. Prices touched $2,210.50 on Wednesday, the highest since May 2015.
Stockpiles of zinc monitored by the bourse fell for a sixth day, the longest stretch in six weeks, to 439,075 tons.
In other metals news:
- On the LME, aluminum, copper, lead, tin and nickel also advanced.
- Copper futures for September delivery gained 0.1 percent to $2.243 a pound on the Comex in New York.