RE: MAFL Zinc Tide will Turn25 Jan 2019 23:26
and with zinc in storage falling dramatically- read what happened to zinc prices last time around..
TV's CEO, Cormark, Wood: Zinc could climb to US$4,409/tonne
Dr. Mark Cruise, CEO of Trevali Mining (TV) recently said that his optimism for zinc is based on continued drawdowns of global refined zinc inventories:
“We are starting to approach inventory levels last seen in the 2006/2008 window when the zinc price propelled to over US$2 per pound [US$4,409 per tonne].”
As of December, LME zinc stockpiles stood at 122,000 tonnes, down from 250,000 tonnes in July 2018, see the chart with LME inventories.
Based on this pace of drawdown, we will run out of refined zinc inventories in April 2019.
You can imagine what this will mean for the zinc price in 2019.
See also what Cormark says about zinc:
Stefan Ioannou said that at Cormark, a price prediction of US$1.35 a pound (US$2,976.2 a tonne) is the average for the next year going forward, a price he said is “somewhat conservative.”
“We’re down into sort of a 120,000-tonne range on the LME right now. And quickly approaching 100,000 tonnes, and when you add up the visible supply that’s out there right now, we’re down to half a week of global consumption, which I think for argument’s sake is pretty critical already.”
“[The] last time we saw zinc inventories on the LME below 100,000 tonnes, the zinc price spiked to US$2 a pound [US$4,409.24 a tonne]. I think just based on that supply concern, I think if we see any waning in the Trump trade war narrative and people start to take a closer look at what the visible inventories are telling them. we could see prices spike significantly next year,” he said.
See also what Wood Mackenzie says. Wood Mackenzie’s Thomas was closer to Ioannou’s sentiments:
“We forecast double-digit growth in Chinese smelter production in 2019. It’s important to understand that even if this is achieved, the metal market is still forecast to experience further declines in stocks and remain in deficit. As a consequence the price is projected to revisit, and potentially exceed, the highs seen in February [2018].”
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