The three-month zinc price closed $34 per tonne higher, rising over 4% so far this week. Further cancellations today mean there is no on-warrant stock available in Antwerp and the cash/three-month LME spread is still in significant backwardation, most recently at $60.50 per tonne.
“The LME zinc strength seems to have been triggered by a resumption of tighter present fundamentals. Indeed, available stocks have slumped by 20,275 tonnes or 10% on the LME since Monday,” said Boris Mikanikrezai, Metal Bulletin analyst.
“But considering the fall in open interest since Monday, the driving force behind LME zinc is short-covering rather than fresh buying. This indicates that bullishness has not picked up of late,” he added.
Aluminium prices also closed higher but dipped back...