Just a word of caution with regards to zinc stocks. We may temporarily see a bit of a build. I stress may.
There is 40,000t on a ship on the way to New Orleans. I am not sure if this is accounted for in LME stock levels. I have also seen backorders fall to a low level with about 10,000t worth of backorders dropping off in the past week.
It would be nice to start 2012 with a level under 700,000t but we might end up starting with about 750,000t.
At the moment it's 736,000 with 30,000t on backorder but activity has dropped off a bit and probably won't pick up until after the Chinese New Year on January 23.
So don't be too surprised or disheartened if you see some inflow in the next 6-8 weeks. It's normal for this time of year. Prices have improved a bit, so miners might also be cashing in a little but I would expect they are still stockpiling in the hope of fetching the $1-$1.10 price range from February. At this stage futures are indicating a move to 96c by late January.
Cheers, BB
KZL Price at posting:
35.0¢ Sentiment: Buy Disclosure: Held
