Technically Zinc market is under fresh buying as market has witnessed gain in open interest by 37.37% to settled at 1283 while prices up 4.45 rupees.
Now MCX Zinc is getting support at 251.8 and below same could see a test of 247.8 levels, and resistance is now likely to be seen at 258.1, a move above could see prices testing 260.4.
Zinc yesterday settled up by 1.77% at 255.9 as support seen due to production restrictions in southwest China.
In China, power rationing sustained, and many zinc smelters have received notices to reduce their power consumption by 20 – 50%, which is expected to last until the end of September.
The output of zinc ingot affected by power rationing in Hunan is estimated at 350 – 400 mt/day based on rough calculation. Global zinc market remained in a marginal surplus of 11kt between January and July 2021, much smaller than the 420kt surplus seen during the same period last year.
Total refined zinc production rose by 4.4% YoY to 8.15mt, while total consumption jumped 10.2% YoY to 8.14mt in the first seven months of the year. Canadian miner Teck Resources Ltd cut its forecast for annual refined zinc production, citing an impact on its operations from wildfires in British Columbia.
The company projected refined zinc production for 2021 to be in the range of 285,000 tonnes to 290,000 tonnes, down from a previous estimate of 290,000 tonnes to 300,000 tonnes. Production in Guangxi and Jiangsu has cut output due to power rationing.
Trading Ideas:
–Zinc trading range for the day is 247.8-260.4.
–Zinc prices rose as support seen due to production restrictions in southwest China.
–In China, power rationing sustained, and many zinc smelters have received notices to reduce their power consumption by 20 – 50%.
–Global zinc market remained in a marginal surplus of 11kt between January and July 2021.
Courtesy: Kedia Commodities
Source: Comodity Online
