It’s been a bearish year for zinc prices, but last month’s Glencore announcement that 500,000 metric tons of mining cuts saw a brief glimmer of price increases… only to drop back down to a new six-year low.
According to a report from Reuters, last week, the London Metal Exchange (LME) zinc price reached a new six-year low of $1,497.50 per metric ton last week, revealing that the short-lived price increase stemming from Glencore’s announcement had run its course.
“Zinc, like copper, has been coming under sustained bear attack from China, where Shanghai Futures Exchange (SHFE) volumes and open interest have been surging even as the price has been sliding,” Reuters reported.
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Bears coming for other industrial metals
It’s not just zinc, however, that’s feeling downward pressure on prices. According to a report this week from the Financial Times, nearly all industrial metals are hovering near their lowest levels in years, signaling miners across the globe to cut production.
In fact, a group of 10 Chinese zinc smelters announced they would reduce output in response to low prices. However, zinc, which is used to galvanize steel, dropped earlier this week to its lowest point in six years.
“The macro headwinds remain strong and, thus, the the impact of these latest cuts is likely to be fleeting, “Daniel Hynes, senior commodity strategist at ANZ, told the Financial Times.
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