LONDON (Reuters) – Is that it for the zinc rally? After hitting a 10-year high of $3,595.50 per tonne in February, the London Metal Exchange (LME) price has been sliding ever since. The retreat has extended to $2,946.50 so far on Thursday morning, the lowest level since August last year.
Expectations for one last bull hurrah have faded as exchange stocks have rebuilt, apparently calling time on the supply chain tightness that underpinned zinc’s two-year charge from the January 2016 low of $1,444.50 per tonne.
As ever with this particular metal, though, appearances can be deceptive, as shorts have just found out to their cost. Time-spreads across the front part of the LME zinc curve have tightened sharply over the last couple of weeks, a seemingly anomalous outcome given rising inventory. Continue Reading →