Not only this but it appears that even when it did go to $1.60/lb this time around there was little,if any,slowing of the drawdown rate.Looks like the base metals market is getting a little concerned as to just how much they think will be left in the not too distant future.
Unless we start seeing some substantial long term contract dumps into the stockpile the scenario for zinc supplies is not looking great when taking into consideration current iron ore demand and steel production.
Question is just how far will the zinc stockpile have to go down by to start driving the base metals complex itself rather than copper,if this is attainable of course.Copper has always been seen as strategically more important but if one thinks about an extreme squeeze in zinc supplies just what do the car manufacturers and other bulk users of galvanising(predominantly large steel infrastructure users) go to in order to create their product?
China and India still have a long way to go before their growth rates even look like dropping to some kind of sane level and if this is the case we could just have little to no zinc left in the stockpile in the not too distant future.
d.
AIM Price at posting:
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