The three-month zinc price has also fallen by 6% since reaching a July 2018 high of $2,800 per tonne last week. Since then, open interest in zinc has dwindled by more than 11% from around 350,000 positions to just under 310,000 positions.
Total zinc stocks remain at a decade-low, with on-warrant material now below 60,000 tonnes, while one dominant warrant holding position has emerged at around 40-49% of LME stocks.
“We believe the trade war sentiment will continue to cap gains in the longer term despite a moderately favorable fundamental picture,” Sucden Financial said in its quarterly metals report.
“Infrastructure investment, in particular high-speed railways, would provide additional support to the market. [All things being equal], zinc looks overdone above $2,800 per tonne, but we would expect...