Zinc price likely to extend gains on global shortCommodities: Zinc price likely to extend gains on global shortage
Simon Casey Bloomberg News
MONDAY, JANUARY 30, 2006
LONDON Zinc prices have risen so fast that Robin Bhar, a metals industry analyst for 22 years, is about to raise his forecast for the second time in two months.
"We've all been left behind," said Bhar, who works in London with UBS. "It's just phenomenal. No one in their wildest imagination thought it would get to these levels."
Zinc has almost doubled since July 15 to $2,250 a metric ton on the London Metal Exchange, where it traded at record levels for 11 straight days this month. Prices may stay high as China increases imports and mining companies struggle to expand production.
"There is a global shortage," said Greig Gailey, chief executive of Zinifex, a zinc supplier based in Melbourne. "New mine development is a lengthy process, and it's difficult to see new mines coming on stream in the short to medium term."
Zinifex has no new mines planned until 2008 at the earliest.