Amidst the bleak look of the base metal sector, zinc and lead were the only metals showing a little bit of life during the past few months. However, the month of March was bad for both metals.
Zinc decreased by 10 percent on the LME while lead dropped 5 percent. This supports what we have been saying for the past few months – until the base metal sector turns up, it will be hard to see any of them skyrocketing.
3-month zinc price on the LME since 2013.
We remain rather neutral on zinc for the balance of 2014. In the short-term, prices might bounce back up following normal market fluctuations. In either case, we don’t expect zinc to trade above $2,200 per metric ton, as we commented previously.
What This Means For Metal Buyers
This might be a good opportunity to buy for meeting near-term requirements. However, we wouldn’t suggest zinc buyers begin taking long-term positions, as we don’t see prices trading well above today’s levels.
Until the sector turns up, we expect zinc prices to remain below $2,200 per metric ton.
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