Economic deposit will see it do that imo Zinc prices still hot...

Economic deposit will see it do that imo

Zinc prices still hot

Zinc prices climbed to a fresh decade high on Monday (January 15), supported by a weaker US dollar and declining inventories.
LME zinc closed up 1.2 percent, at $3,423 a tonne, having touched a peak of $3,440 earlier in the day — its highest level since August 2007.
Overall it’s been a strong start of the year for the base metal, with prices increasing 1.4 percent year-to-date and more than 20 percent year-on-year.
Some analysts believe zinc prices might jump even further in 2018, as solid Chinese data, a weaker dollar and falling inventories continue to lend support.
“The bullish view has become the consensus in the market, and it’s very hard to see a deep correction in prices from here,” Richard Fu, head of Asia Pacific sales at Amalgamated Metal Trading, told Bloomberg.
On Monday, a falling US dollar supported a surge in all base metals, as a softer greenback makes commodities priced in dollars cheaper for investors using other currencies.
“It is a dollar story … which is behind this move,” said ING analyst Warren Patterson. “If you look at the speculative position in the metals, there is potential for further upside, if we continue to get positive economic data and strong manufacturing data.”
For Patterson, the zinc market is going to be “fairly tight” at least for the first half of the year, as investor fears over shrinking supply and a lack of new mine production continue to increase.
Supply-side concerns have also been fuled by declining warehouse inventories. Last week, LME zinc stocks fell for a 13th week, reaching their lowest level since October 2008. On Monday, on-warrant zinc inventories fell by another 10,000 tonnes to reach 116,675 tonnes.
“Prices will stay elevated because we have a market deficit that requires inventory drawdown,” Societe Generale (EPA:GLE) analyst Robin Bhar said last week.
Firms recently polled by FocusEconomics estimate that zinc prices will average $3,009 in 2018. The most bullish forecast for the year comes from TD Economics, which is calling for a price of $3,362; Danske Bank (CPH:DANSKE) is the most bearish with a forecast of $2,650.