Technically Zinc market is under short covering as market has witnessed drop in open interest by 19.46% to settled at 1775 while prices up 0.3 rupees.
Now MCX Zinc is getting support at 264.9 and below same could see a test of 260.4 levels, and resistance is now likely to be seen at 274, a move above could see prices testing 278.6.
Zinc yesterday settled up by 0.11% at 269.2 as overseas energy issue intensifies and the production of smelters reduces further.
The supply of global zinc concentrate has been tight in 2021. The output of domestic zinc concentrate has been rising since March, 2021, and the overall operating rates of concentrate plants have grown steadily as well.
However, the imports of zinc concentrate has been low due to the closed import window and sea transport disruptions. The social inventory of zinc ingots stood at 119,800 mt as of September 30, which has been falling after set a record high at March 15, 2021.
China released 150,000 tonnes of industrial metals from its state reserves in the fourth round of sales this year as it continues a campaign to ease supply tightness and tame high commodity prices.
The world’s top metals consumer offered processors and manufacturers the chance to bid for 30,000 tonnes of copper, 70,000 tonnes of aluminium and 50,000 tonnes of zinc reserves on online platforms operated by state-run China Minmetals Corp and Norinco.
Total zinc inventories across seven Chinese markets stood at 136,600 mt as of October 11, up 2,800 mt from October 8 and 16,800 mt from September 30. Goods in transit during the November holiday continued to arrive in Shanghai, and inventory increased.
–Zinc trading range for the day is 260.4-278.6.
–Zinc prices rose as overseas energy issue intensifies and the production of smelters reduces further.
–The supply of global zinc concentrate has been tight in 2021.
–Citi raises zinc Q1, 2022 average price forecast to $2,900/t from $2,800/t.
Courtesy: Kedia Commodities
Source: Comodity Online