zinc and lead pirce equilibrium

There were plenty of punters willing to part with their money on PEM when zinc was almost $2/lb, who assumed that that price would last forever.

Enter the cyclic response of increased production, and a reduction in demand due to that higher price, and lo, the price drops.

Now the zinc price in particular has plummeted, and marginal producers are putting their mines on care and maintenance, and new mines will not begin unless their grades and tonnage are exceptional...

This is the other end of the commodity cycle. If current zinc prices are below the price equilibrium, and I suspect they are, inventories will drop and we will see a rebound in prices.

When that happens, PEM will bounce and bounce hard. The market is pricing PEM barely above is cash position, which is very myopic in my opinion.

I have recently bought back in to PEM, after having bought into the zinc/lead uptick some time back.

Contrarians, who can see beyond the current commodity pricing, will be doing the same.

but DYOR