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Zinc Posted: Thu, 08 May 2008 [miningmx.com] -- ZINC prices, on a downward slope since hitting a record peak in November 2006, are expected to fall further this year as mine output growth accelerates and boosts production of the metal used to galvanise steel, Reuters reported. But lower prices, tight credit and high borrowing costs will eventually limit the number of new mines and hence supplies, which should boost prices towards the end of the decade and beyond, it said. "It still looks as though the market is going to be in surplus this year and next, but things will get more positive in 2011 to 2012, with very little growth in new mine supply," Adam Rowley, analyst at Macquarie Bank, was quoted as saying. Some key mines are also due to close or have lower output around then, further tightening supplies. Rowley said global zinc prices could easily scale new peaks during this period if demand grew at a decent pace. Benchmark zinc on the London Metal Exchange hit an all-time high of $4,580 a tonne in November 2006 and has since fallen to around $2,240, partly because speculators betting on higher prices have cut their holdings.
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