Despite looking over the last couple of days I have not seen...

Despite looking over the last couple of days I have not seen anything about any direct cause of this current surge in some commodities, particularly zinc.

What material I have seen has focused on the medium term outlook for copper. All of the commentary back about 2-3 months is universally positive about the 2 year price outlook for copper. Supply side issues seem to be responsible, and as evidence even this week we saw the explosion at the EQN Lumwana project that will delay its production ramp-up. Other factors include lack of water for hydro power in Chile, new mines not meeting grade expectations etc. It's worth taking a look at the RIO presentation in May on Kennecott Copper.

The supply side issues and the continuing growth in demand from BRIC economies is leading some analysts to say we are going to USD5.50 lb Cu during 2009. Short term I was expecting Cu to pull back in the lead up to the Olympics, but that does not appear to be happening.

regards
DF