LME, SHFE, and MCX Zinc Prices Rise as Supply Tightens
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LME, SHFE, and MCX zinc prices surged amid tightening global supply. The ILZSG revised forecasts, predicting a 164,000-ton deficit in 2024 due to production cuts, especially in Europe and China, driving continued market bullishness.
Zinc Price
- LME: As of last Friday, LME zinc opened at $3,096.5/ton, hitting a high of $3,160/ton and a low of $3,081/ton, closing up at $3,156/ton, an increase of $57/ton or 1.84%. Today, LME zinc trading commenced at $3,125/ton.
- SHFE: As of last Friday, the most-traded SHFE zinc 2411 contract opened at 25,450 yuan/ton, hitting a high of 25,780 yuan/ton, a low of 25,400 yuan/ton, and closing up at 25,760 yuan/ton, an increase of 410 yuan/ton or 1.62%. Today, SHFE zinc trading commenced at 25,330 yuan/ton.
- MCX: As of last Friday, MCX zinc prices opened at Rs. 284.35/kg, reached a high of Rs. 288.50/kg, a low of Rs. 282.80/kg, and finally closed down at Rs. 288.30/kg, an increase of 5.55 or 1.96%. Today, MCX zinc trading commenced at Rs. 288.55/kg.
Zinc Supply & Demand
- LME Opening Stock: 242,000 tons | Live Warrants: 212,600 tons | Cancelled Warrants: 29,400 tons.
- LME: Trading volume decreased to 10,637 lots, and open interest increased by 1,473 lots to 262,000 lots. Last Friday, LME zinc recorded a bullish candlestick, with the 20-day moving average providing support below. LME zinc inventory decreased by 450 tons to 24,200 tons, a decline of 0.19%. The US Fed's September PPI data reinforced market expectations for an interest rate cut, and the US dollar index fell back from highs, boosting zinc prices.
- SHFE: Trading volume decreased to 76,617 lots, and open interest increased by 2,690 lots to 122,000 lots. Last Friday, SHFE zinc recorded a bullish candlestick, with the 5-day moving average providing support below. Driven by overseas market trends and improved domestic downstream zinc demand, SHFE zinc also rose.
- MCX: Zinc prices surged by 1.96%, settling at Rs. 288.30/kg, amid concerns over a significant supply deficit expected in 2024. The International Lead and Zinc Study Group (ILZSG) revised its zinc market forecast, shifting from an anticipated 56,000-ton surplus to a 164,000-ton deficit. This supply shortage is driven by reduced production due to a raw materials squeeze, forcing smelters to cut output in regions like Europe and China. However, production increases in Australia, Mexico, and Congo may offset some declines.
Zinc News
- MCX zinc rallied as the global zinc market faces a sizeable supply deficit in 2024.
- The tender offer subscriptions for Korea Zinc and Young Poong Precision made by MBK Partners and Young Poong concluded on the afternoon of Oct. 14. The tender offer price was set at 830,000 won, with a maximum purchase target of 14.6% of the total issued shares. Results are anticipated on the settlement date, Oct. 17.
Expert Opinion
- According to participants, zinc is experiencing fresh buying as open interest increased by 18.83% to 3,263 contracts, alongside a price rise of Rs 5.55. Support is now seen at Rs. 284.5, with the potential to test Rs. 280.8 if breached.
- Resistance is expected at Rs. 290.2, and a move above this level could see prices testing Rs. 292.2 in the near term.
Daily Market Report
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