Zinc-Smelter Stockpiling Before Deficit Spurs Price, Sucden Says
Feb. 20 (Bloomberg) -- Zinc refiners are lining up supply before an expected shortfall next year, helping to support prices that have run up faster than justified by actual demand for the metal, said Jeremy Goldwyn of Sucden Financial Ltd.
“People are positioning themselves for things getting tighter,” Goldwyn, the head business development for Asia, said in an interview today at the International Zinc Conference in Rancho Mirage, California. “They don’t want to get caught without supply.”
Zinc has risen 7.4 percent this year to $1,982 a metric ton today on the London Metal Exchange. Concern that supplies will be tight next year may help erode zinc-treatment charges for smelters, Goldwyn said. The annual processing fee for turning ore into refined metal is being negotiated at the conference, and smelters are more likely to offer discounts to secure supply from miners, he said.
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