Zinc prices have already risen 20% year-over-year to $4,451.00 per ton, the highest level since 2006. Since the start of the pandemic, zinc prices have risen a whopping 115%. But now, the price of zinc could skyrocket.
Zinc Price Chart
As Reuters reports, zinc stocks on the London Metal Exchange (LME) have fallen to a two-year low. This immediately brings to mind nickel, which had recently risen to a price above $100,000 per ton. The LME then suspended trading in nickel and introduced price limits. Reuters reported that nearly 60,000 tons of LME zinc prepared for physical loading were canceled this month. In Singapore, 40,000 tons were reportedly canceled.
The LME explained to Reuters, “We note the current tightness in the zinc market and are monitoring all metals closely to ensure market activity remains orderly.”
Should the situation develop similarly to nickel, a price explosion can be expected soon. However, the LME will do everything not to fall into the same trap and keeps its monitoring of the zinc market on alert. The development looks very bullish, however, which should make investors and traders wide-awake.
Those interested in the zinc market can do so with shares of zinc producers, for example:
Vedanta Limited (NYSE: VEDL).
Hudbay Minerals Inc. (NYSE: HBM)
Vale S.A. (NYSE: VALE)
Hecla Mining Company (NYSE: HL)
Teck Resources Limited (NYSE: TECK)
Trevali Mining (TSX: TV)
Nevsun Resources (TSX: NSU)