Zinc stockpiles monitored by the London Metal Exchange had the biggest weekly decline in three after reaching a 17-year high last month amid increasing mine production and softening demand.
Inventories of the metal used to protect steel from corrosion slid 1.3 percent for the week to 992,300 metric tons, figures from the exchange showed. They’re still up 21 percent this year, second-most after nickel among the six main industrial metals traded on the LME.
Production of refined zinc exceeded demand by 149,000 tons in this year’s first five months and jumped 34 percent in China, the International Lead & Zinc Study Group said in a report July 18. Zinc stocks tracked by the LME rose above 1 million tons for the first time since 1995 on July 18.
“So far this year, demand for zinc stayed weak in most parts of the world,” Amsterdam-based Casper Burgering, an ABN Amro Bank NV analyst, wrote in a report July 26. This stemmed from a “slowdown in activity in the manufacturing and construction sectors in the EU, the U.S. and China,” according to the report.
Zinc for three-month delivery fell 2 percent this week to $1,821 a ton by 11:48 a.m. on the LME. Prices are down 1.3 percent this year, the best performance among the exchange’s six main metals.
Copper stockpiles, down 3.2 percent in July, declined 2.2 percent this week to 244,725 tons. The drop was the second in a row and reduced inventories to the lowest level since June 13.
Lead stocks retreated 0.6 percent this week to 327,100 tons. They reached 326,775 tons, the lowest level since September, on Aug. 1.
Nickel inventories rose 2.3 percent to 115,314 tons for the week as aluminum stocks gained 0.5 percent to 4.86 million tons. Tin inventories fell 1 percent to 11,650 tons.
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