Zinc continues to grind rises and the growing consumer confusion

The prices of the LME zinc rose by 23,6% in the lasts 12 months and the trend does not seem to come loose.
Zinc is the metal that had the best performance since 2016 today reaching $ 3,600/Tons; the highest level since 2007.

Prices are under tension and show no signs of reversal because the stocks have fallen to the lowest since 2008: 151.000 Tons, 1% of world consumption, mainly concentrated in warehouses in New Orleans (far from the major centers of consumption). LME stocks now have returned to the levels of 2.1.2009.

The reasons are: on the one hand, the global consumption continues to grow, against loss of production of minerals and metal in China (° The producer and consumer in the world) due to shortage of minerals to the closure of thousands of small mines as a result of stringent environmental measures imposed by the government that have reduced the mining and metallurgical production.

China will be forced to import to cover domestic consumption and with what repercussions the LME where prices continue to show a Backwardation (forward prices lower than those in cash) reflecting a shortage of physical metal.

Given this substantial shortage of physical, Glencore (world leader in zinc production) He decided at the beginning of 2018 to resume mining at the Lady Loretta mine, entering the market 100.000 Tons of Zinc (nothing when you consider that in recent years had cut production 500.000 Tons).

The above, together with the difficulties in China, leads experts to believe that the 2018 be a year of firmness with the overcoming of the primacy likely recorded so far.

Other experts predict that prices may come down from 2021- 2022 when you feel the effect of the re-opening of new mines, exploiting to the maximum the capacity of existing smelters and the entry into new activities foundries.