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Zinc backwardation eases in official LME trading, prices steady

December 20, 2011 - 14:09 GMT Location: London

KEYWORDS: LME , zinc prices , backwardation , warehouse deliveries , aluminium , copper

Tightness in the tom-next zinc spread eased in the official session of the London Metal Exchange on Tuesday after shorts settled outstanding positions with physical deliveries on to the exchange.

Three-month zinc prices were steady at $1,853/54 per tonne on Tuesday, down $4/3 from Monday’s official price, but as official trading got underway the tom/next spread was trading at a $0.25 backwardation, compared to a $2 back earlier in the day. The cash-January spread was also easing after some 43,700 tonnes of zinc was delivered into LME stores overnight. LME inventories stood at 809,325 tonnes after the inflows into Johor and New Orleans. “The deliveries explain why the backwardation has eased off. The New Orleans...

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