zinc chart.offtake, page-2

re: zinc chart.next leg up. Up 3 cents atm.

$1.63.6

Moment of truth for zinc.

Will the fundamental of a dwindling stockpile be enough to push zinc higher AND maintain the current drawdown rate.

I dont know that zinc will ever be considered strategically important as copper in the overall scheme of base metals but as the stockpile continues to dissappear at an alarmingly fast rate,with only the odd fund dump to stay this drawdown rate,it may well just be headed for that illusive $4,000/t barrier.And if it hits $4,000/t at a stockpile of arond 120-150,000t whos to say it wont push on to $5,000/t.

IF the poZn continues to push higher it SHOULD make MF's job that much easier as the NPV of Perkoa that they last mentioned MAY be a lot closer to reality than first thought.All depends on the offtake/s.One wonders if a final signing is being put off in preference to better possible offers considering what the poZn is doing atm.If this is the case its a very ballsy play,although Ive got to say the stockpile fundamentals seem to be supporting MF's comments re a POSSIBLE price of $5,000/t for zinc in the not so distant future,as unrealistic as I think this may be.We all laughed at $7,000/t for Cu I seem to remember.

The main downside to this will be a continuing tightening of Chinese monetary policy and just whether or not the Chinese steel industry is indeed well over capacity as some are suggesting.Funny thing is BHP/RIO still got their respective 19% contract increases from China.Yet another comment made from an industry observer re China was that currently there are 25% of the population residing in cities and it is one of the aims of the Cinese to increase this number to 50%.IF this is indeed the case one cannot see the rate of growth in China pulling back much from its current 10% which only has very positive ramifications for the poZn and the continued stockpile drawdown rate.This seems to be supported by comments made by the Deputy Major of Chinas largest city(32M people)that they are currently spending $1Billion PER MONTH on city infrastrucutre to reduce bottlenecks and increase city efficiency.

Aim at 11c?

Either the one of the buys or the duds of the decade!

d.