THE OUTLOOK FOR ZINC

摘要

LME cash zinc prices averaged 0.475 dollars/lb in 2004, up 27 percent from the 2003 average of 0.375 dollars/lb, and LME zinc stockpiles fell by 15 percent to 629,000 mt. After a rapid buildup through most of 2002, LME zinc stocks stabilized during 2003, and in 2004 the market went into deficit and stocks were drawn down by 110,000 mt. As illustrated in the graph below, prices were volatile, climbing in the first three months, falling in the next six, then rising again in the last quarter to close the year at 0.535 dollars/lb, a four-year high. In January 2005, LME zine prices briefly soared to 0.573 dollars/lb on news that China's 100,000-mt/y Zhuzhou Smelter Group had temporarily shut down. The intraday price was zinc's highest level since the last quarter of 1997, when it reached 0.74 dollas/lb. Stocks ended January lower for the fourth consecutive month, and prices averaged 0.565 dollars/lb. In February, fundamentals remained strong, but the market was quiet early in the month before renewed fund interest firmed up prices. LME zinc stocks slipped 2 percent to 605, 200 mt, and prices averaged 0.601 dollars/lb.