Bullish commentary on zinc - Tongling has deep pocketsMacquarie Bank put this out recently :
Zinc supply cutting fast. Feature article•As base metals prices test lows and governments curtail activity, a growing number of production assets are going offline, temporarily or indefinitely. Amongst the industrial data we have collectedto date, zinc has seen some of the biggest cuts, and it is also the metal that has seen keynon-temporary shutdownsto date. •On top of the global pandemic impact, for zinc this is a result of an extended period of high TCs, a soft concentrates market, and a price that has been trending downwards for twoyears. With around one third of the cost curve now underwater (compared to about 15% for copper), capitulation came more quickly in this market.Demand declines are even more extreme at this time,stil lthe cutbacks will act to temper oversupply nearby -and past the nadir of this global health crisis may well leave zinc looking the most attractive amongst the base metals
Interesting to read this in the ZNX news release -- Tongling has very deep pockets and will pay up for an overseas project when they are read to (!):
Tongling has other mining interests outside China; including the Mirador copper project in Ecuador which was acquired in 2010 by the CAN$678 million buyout of TSX listed Corriente Resources. The Tonglingled Chinese consortium put the US$1.4 billion Mirador copper mine into production in 2019.
Zinc supply cutting fastFeature article•As base metals prices test lows and governments curtail activity, a growing number of production assets are going offline, temporarily or indefinitely. Amongst the industrial data we have collectedto date, zinc has seen some of the biggest cuts, and it isalsothe metal that has seen keynon-temporary shutdownsto date. •On top of the global pandemic impact, for zinc thisis a result of an extended period of high TCs, a soft concentrates market, and a price that has been trending downwards for twoyears. With around one third of the cost curve now underwater (compared to about 15% for copper), capitulation came more quickly in this market.Demand declinesare even more extreme at this time,stillthe cutbacks will act to temper oversupplynearby -and past the nadir of this global health crisis may well leave zinc looking the most attractive amongst the base metalsCommodities CommentZinc supply cutting fastFesature article•As base metals prices test lows and governments curtail activity, a growing number of production assets are going offline, temporarily or indefinitely. Amongst the industrial data we have collectedto date, zinc has seen some of the biggest cuts, and it isalsothe metal that has seen keynon-temporary shutdownsto date. •On top of the global pandemic impact, for zinc thisis a result of an extended period of high TCs, a soft concentrates market, and a price that has been trending downwards for twoyears. With around one third of the cost curve now underwater (compared to about 15% for copper), capitulation came more quickly in this market.Demand declinesare even more extreme at this time,stillthe cutbacks will act to temper oversupplynearby -and past the nadir of this global health crisis may well leave zinc looking the most attractive amongst the base metals