The world’s largest producer and consumer of zinc, China, released positive trade data that sent zinc prices surging by 0.97% to settle at 261.3. China’s higher imports and exports in April gave the market confidence by indicating a rebound in both domestic and foreign demand.

The decision by the massive Swedish mining company Boliden to restart operations at its largest zinc mine in Europe, Tara, also contributed to the positive mood.

The mine’s reopening, which is slate for the final quarter of this year and is anticipat to reach full capacity by January 2025, highlights the expectation that supply will rise to keep up with demand.

Zinc prices received additional support from the improved outlook for the world economy and the United States labour market. Which raised anticipates for September interest rate cuts from the Fed.

The rising metal prices used in steel galvanization also fueled the restart of zinc output at Nyrstar’s Budel smelting process in Netherlands, which added to the market’s upward momentum.

Zinc Prices Supported by Strong Global Economy Outlook and Fed Rate Cut Expectations

However, data from the International Lead and Zinc Study Group (ILZSG) showed that the world’s zinc surplus was expanding, rising from 12,300 tonnes in January to 40,100 metric tonnes in February.

In spite of this excess, the first 2 months of this year saw a 53,000-ton surplus as opposed to an 8,000-ton deficit during the same time previous year, underscoring the dynamic shift in the supply and demand of the zinc market.

Technically speaking, there is new buying in the zinc market as evidenced by a 3.92% rise in open interest and a 2.5 rupee price increase.

Zinc has been found to have key support levels at 259.1, with potential downside testing at 256.9 levels. On the other hand, resistance is expect at 263.1. And a break through there could result in additional price testing at 264.9.

SHREE METAL PRICES