Also...Scotia Capital outlook...ZINC, MOLY OUTLOOK
In their analysis, Scotia also updated its zinc outlook, increasing its 2007 price forecast from $1.48/lb to $2.06/lb. The higher price forecast accounts for expectation that zinc inventories will hit critically low levels equal to two days of consumption in the second quarter of 2007, as well as a shift in market attitudes since zinc has exceeded the $4,000/tonner price barrier.
Scotia also launched its formal coverage on the global molybdenum market with a price forecast of $25.25/lb for 2007 and $19.25/lb in 2008. "We believe that continued strong growth rates in stainless and non-stainless applications will continue to keep the molybdenum supply chain, both at the mine level and at the roaster level, relatively tight," according to the analysts. They added that annual moly production growth will be limited to 5-6% annually until at least 2008, with potential significant growth emerging in 2009 and 2010.