Zinc price drops to three-month low after ‘shadow stocks’ hit market

The arrival of around a quarter of a billion dollars of zinc into London Metal Exchange warehouses this week has dented the metal’s price prospects, confirming analysts’ view of a well-supplied market.

A total of 105,800 tonnes of zinc was delivered onto the LME system on Tuesday and Wednesday this week, all in the United States and Southeast Asian port locations, bringing total inventories on the bourse to the highest since mid-2017.
Prices subsequently fell while the market digested the emergence of expected but nevertheless hidden additional stocks. The exchange’s three-month zinc contract dropped to a three-month low of $2,552 per tonne on Thursday January 28, down 5.7% from $2,705.50 per tonne at the start of the week.
The price recovered slightly on Friday to $2,573 per tonne as of the 9am open, but remains down by 4.9% from Monday.

“If we look at...

Published

Archie Hunter

Ana de Liz

January 29, 2021

10:02 GMT

London