Look how much it changed to their current forecast. Any fool can...

Look how much it changed to their current forecast. Any fool can do that-No crediability whatsoever!! especially last paragraph



Goldman Sachs raises nickel, zinc price forecasts for 2008
05.21.07, 8:21 AM ET


LONDON (Thomson Financial) - A likely tight supply of metal has forced Goldman Sachs to review price forecasts for some of the base metals complex.

The investment bank has raised its nickel forecast to 35,000 usd for 2008 from a previous forecast of 30,000 usd (made in April), while zinc is seen at 3,250 usd from 3,000 usd respectively.

'Prices will remain above historical levels as a continuing recovery in production growth keeps the emerging surplus relatively small for most of the base metals,' said the bank's latest report.

Nickel prices are currently hovering around 50,000 usd, about 3 pct lower than the all time high of around 52,000 usd struck last month. Prices are at a hefty premium as global inventories of the metal, used mostly for stainless steel production, would only satisfy a day's worth of global consumption.

Commenting on nickel, Goldman's analysts said that while prices could climb on a dangerously tight market, stainless steel producers are introducing grades which don't use nickel, and which could depress prices.

'Our baseline forecast is now that the market will return to balance by the end of the year, and as a result we believe the market is vulnerable to a sharp reversal of the demand rationing premium currently embedded in the price,' said the report.

On zinc, the researchers said 'we do not believe that inventories will build sufficiently to bring zinc stocks back to historical norms, and as a result, we expect prices to trade in a wide band around 3,250 usd per tonne (in 2008).'