Zinc goalposts for when the market moves into deficit keep moving forward.
When Glencore do something I take note...
Glencore International (LSE:GLEN), the largest zinc trader on the planet, recently decided to purchase zinc concentrate from Volcan, a Peruvian miner. They did so without even charging a zinc-processing fee. It was a telling move, because falling processing fees are a strong indication of weakening supply. In striking the deal Glencore had probably anticipated higher zinc prices in the near future, high enough to offset any losses gained by waiving such fees.
The forthcoming shortage will create a supplier’s market, one that is bound to shoot zinc prices through the roof. In that case, zinc makes for a highly rewarding long-term investment.
