Nov 20 The London zinc price touched a fresh six-year low of $1,497.50 per tonne on Thursday.
Last month’s flurry of excitement after Glencore’s announcement of 500,000 tonnes of mine cuts had, it seemed, completely dissipated.
But those cuts were carefully calibrated to get maximum impact out of the supply chain and the tremors are starting to be felt, judging by this morning’s announcement of major production cuts by Chinese zinc smelters.
And it’s caught the many bears in this market on the hop. The London Metal Exchange (LME) three-month price has surged to a current $1,602 per tonne.
Zinc, like copper, has been coming under sustained bear attack from China, where Shanghai Futures Exchange (SHFE) volumes and open interest have been surging even as the price has been sliding.
Investment money elsewhere has followed suit. LME broker Marex Spectron estimates the collective speculative short on LME zinc is around 38 percent of open interest. That’s the highest it’s been since June 2012 and funds are more bearish on zinc than on any other metal.
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