- Prices may drop 10 percent to $1,832 a ton this year or .83c a lb.
- JPMorgan Chase & Co. is warning that some prices rallied too fast and Goldman Sachs Group Inc. withdrew a recommendation to buy zinc on Jan. 26 after prices exceeded its 12-month forecast. (very important)
- Traders may still be adding to bets on higher prices. Open interest, or contracts outstanding, in LME zinc futures climbed 7.3 percent this year, bourse data show. Rising open interest at a time when prices are rallying suggests new so-called long positions
- Investors may already be anticipating an end to the glut, which Barclays says may come in 2014. Morgan Stanley is predicting a 110,000-ton shortage next year in 2013, snapping six consecutive annual surpluses.
- Prices will probably get a bit of support later in the year because 2013 does look as though the market will begin to start tightening up - “People will try to position themselves ahead of that.”
- Stockpiles in LME-monitored warehouses rose 20 percent in the past 12 months and at 848,050 tons are about 75 percent higher than the average over the past decade. Canceled warrants, or orders to withdraw metal from inventories, declined in 14 of the past 15 weeks
KZL Price at posting:
33.0¢ Sentiment: Buy Disclosure: Held
