Twitter

Zinc, Lead and Tin

Zinc Prices Surge as Supplies Shrink – by Tatyana Shumsky (Wall Street Journal – June 22, 2014)

http://online.wsj.com/home-page

Zinc is trading at its highest price in more than a year amid diminishing supplies of the metal.

Zinc for delivery in three months rose $24, or 1.1%, to $2,177 a metric ton Friday on the London Metal Exchange, the highest level since Feb. 14, 2013. Zinc prices gained 4.3% for the week.

The metal is primarily used to galvanize steel to make rust-resistant products. Zinc supplies are dwindling as construction demand is ramping up globally while mines shut down.

The amount of zinc held in the LME’s global warehouse network fell to a 3½-year low of 674,375 metric tons on Thursday. While the stockpiles increased by 1,900 tons on Friday, the amount of zinc in LME storage is still down 28% this year.

“That decline in stocks is helping to drive zinc higher, no question about it,” said Michael Turek, senior director of metals with Newedge in New York. “In the meantime, demand is quite good in the U.S., and Europe isn’t the basket case we expected it to be.”

Global demand for zinc is likely to grow 5.7% this year to 13.85 million metric tons and expand a further 5.2% in 2015, according to Morgan Stanley analysts.

Read more

Teck Resources honoured for environmental stewardship – by Susan Down (Vancouver Sun – May 30, 2014)

http://www.vancouversun.com/index.html

Natural resource industries have always been a huge part of Canada’s economy, but in the past the resource developers were focused more on extract-and-exit operations than mitigating the long-term effects of activities such as mining and logging.

However, one Vancouver corporation is proving that miners can be good stewards, choosing to integrate social and environmental goals into business performance. In March, Teck Resources Ltd. received the award for corporate environmental excellence, one of six environmental awards handed out annually by the GLOBE Foundation, a Vancouver business consultancy. A diversified mining company with operations in Canada, the U.S., Chile and Peru, Vancouver-based Teck produces steelmaking coal, zinc and copper.

Teck was singled out from more than 20 applicants for the environmental award by a panel of judges who assessed companies on criteria such as industry leadership, measurable improvements in environmental practices, and transparency in communications. Runners-up this year were Bell and bathroom tissue manufacturer Kruger Products.

Rewarding mining companies for improving is not just “greenwashing” public relations, say organizers. “Everybody uses mining resources in consumer products, so (good practices) have a prolific impact,” said Nancy Wright, vice-president of marketing for the GLOBE Foundation.

Read more

COLUMN-Bulls lose patience with zinc’s slow-burn story – by Andy Home (Reuters U.S. – May 7, 2014)

http://www.reuters.com/

Andy Home is a Reuters columnist. The opinions expressed are his own.

May 7 (Reuters) – Markets are fickle things. A few months ago zinc was the only game in town among the base metals traded on the London Metal Exchange (LME). The market was chasing a bullish story of pending supply shortfall as some of the world’s largest mines reach the end of their natural lives.

Now, however, metal bulls are shunning the zinc market, turning their attentions to nickel with its equally compelling story-line of mine shortfall after the January imposition of a ban on nickel ore exports by Indonesia.

LME three-month nickel has gained 30 percent, while three-month zinc has fallen by 2 percent since the start of this year. So what has changed to explain zinc’s fall from bullish favour? Nothing, according to Canadian producer Teck Resources , which in its Q1 2014 results reiterated the bull argument for zinc.

“We believe the outlook for zinc is the most favourable of the base metals. With recent and expected closures of a number of zinc mines, we believe that approximately 1.5 million tonnes of current zinc mine production will be closed by the end of 2016 in a 13 million tonne per year market.”

Read more

Half-mln tonne zinc position sparks jitters about hidden stocks – by Eric Onstad (Reuters India – March 14, 2014)

http://in.reuters.com/

LONDON, March 14 (Reuters) – Metals markets are nervous that nearly half a million tonnes of hidden zinc may be delivered on the London Metal Exchange next week, shaking a market unsure about the extent of further concealed stocks.

Investors who had bought into a bullish story about zinc may be particularly concerned since the appearance of the unforeseen inventories could weigh on prices of zinc, the top LME performer last year.

LME zinc stocks MZNSTX-TOTAL have declined by a third over the past 12 months, encouraging bullish investors, but analysts are uncertain about how much more inventory is stashed away in off-exchange depots in financing deals.

“It’s a very real risk that we do see a very big physical delivery onto the LME at some point over the next week,” said analyst Gayle Berry at Barclays in London. “There has been, we think, a large accumulation of unreported zinc inventories, which could be mobilised to deliver against a large short futures position.”

Read more

COLUMN-Zinc and lead; beauties in the eye of the beholder? – by Andy Home (Reuters U.S. – February 19, 2014)

http://www.reuters.com/

Feb 19 (Reuters) – Not so long ago, zinc and lead were the “ugly sisters” of the London Metal Exchange (LME) base metals suite, both burdened by consecutive years of surplus and high inventories.

The peak of the commodities super-cycle has come and gone, and you’d be hard pressed to discern its passage through the prism of these two industrial metals. With no spectacular bull runs such as seen in copper and iron ore, they went through a long, long period of largely sideways grind.

Sentiment is now changing, particularly for zinc, which is currently the “belle of the ball” on the LME. Three-month zinc was the best relative performer last year, an act it is repeating in the early part of 2014.

This turnaround in fortunes appears to be borne out by the latest figures from the International Lead and Zinc Study Group (ILZSG), assessing both markets as shifting to production-usage deficits in 2013. It was the first year of lead deficit since 2009 and the first year of zinc deficit since 2006. The previous sentence should probably include the word “probably”.

Read more