The Investing News Network caught up with Ryan Cochrane, lead, zinc and precious metals research manager at CRU Group, at this year’s Prospectors & Developers Association of Canada (PDAC) convention, to get more insight on the zinc and lead markets.
Speaking about what factors will impact zinc this year, he mentioned new mine supply as well as idle capacity expected to hit the market.
“There’s a lot of supply coming, [but] I think the interesting thing is the timing of it,” he said, explaining that CRU Group sees most supply coming online in the second half of the year.
Another supply-side factor investors should keep an eye on is stockpile levels, which remained low in 2017. Cochrane expects that trend to continue this year. “I guess the key question in the zinc market is how much unreported material there is and how it’s spread across the world,” he noted.
In terms of demand, Cochrane said China will still lead demand in the market. “[If] you look over a five-year basis, we think about 800,000 tons of incremental growth will still come out of China,” he said.
Cochrane forecasts that zinc prices will peak by mid-2018, averaging U$3,750 per tonne in Q2 and U$3,340 for the year.
Watch the video above to learn more about his thoughts on zinc prices, demand and supply and what’s ahead for the lead market. The transcript for this interview will be added shortly. Click here to view our PDAC 2018 playlist.
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Securities Disclosure: I, Priscila Barrera, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.