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Forecasts and market analysis based on price assessments from Fastmarkets MB and Fastmarkets AMM

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December 2019 | Base Metals


Zinc: Finding support, but bearish risks remain


We still believe there is room for zinc prices to test higher in the short term due to persistent structural tightness and a potential double-bottom on the chart. But the greater catalyst is likely to be a positive development in US-China trade negotiations. An escalation in tariffs risks fuelling bearish sentiment, potentially pressuring prices to a fresh 2019 low, which would likely mean downwards revisions to our 2020 price forecast.

At risk of testing fresh lows
The LME three-month zinc price is attempting to form a base around $2,200 per tonne at the start of this week after falling to a three-month low of $2,201 per tonne last Tuesday. If it can hold at this level, it will form a potentially significant double-bottom with September’s $2,190 per tonne low.

SHFE stocks fall while bonded stocks climb amid negative arb

SHFE zinc stocks totalled 37,118 tonnes on December 6, a drop of 8,654 tonnes on the previous week’s two-year high. While Chinese smelters...

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