Shanghai zinc prices jumped as much as 4.5% on Friday to their highest level in more than one month, after miner Nyrstar said it would shutter its plant in France due to high power prices, stoking concerns over tightness in supply.
The most-traded January zinc contract on the Shanghai Futures Exchange was up 3.8% at 24,030 yuan ($3,773.02) a tonne, as of 0240 GMT. Earlier in the session, the contract climbed to a peak since Nov. 2 at 24,160 yuan.
Three-month zinc on the London Metal Exchange gained 0.5% to $3,438 a tonne. In the previous session, prices touched a high since Oct. 25 at $3,482.
Belgium-based Nyrstar will shutter its zinc plant in Auby from the first week of January 2022. The plant, which also produces lead, is the latest to fall victim to higher gas prices, including Glencore's Portovesme plant and some of Nyrstar's other European operations.
The premium of LME cash zinc over the three-month contract rose to $43 a tonne, its highest since Dec. 7, indicating tightening nearby supplies.
Fundamentals
LME copper was flat at $9,504.5 a tonne, aluminium rose 1.1% to $2,695 a tonne, nickel was 0.5% higher at $19,715 a tonne, lead was up 0.3% at $2,315 a tonne and tin rose 0.5% to $38,885 a tonne.
ShFE copper climbed 2% to 69,320 yuan a tonne, aluminium gained 2.5% to 19,535 yuan a tonne, nickel rose 2.6% to 145,330 yuan a tonne, lead was up 2.3% at 15,705 yuan a tonne and tin was 2.4% higher at 286,020 yuan a tonne.
The world's third-largest tin producer, Malaysia Smelting Corp (MSC), has told customers it has delayed a plan to lift a force majeure during which its operations were suspended, until Dec. 20, according to a letter seen by Reuters.
Miner Nexa Resources, controlled by Brazilian holding company Votorantim SA, said on Thursday it had resumed production at its Cerro Lindo zinc mine in Peru after suspending it earlier this week due to a road blockade protests.
Lead demand may get a boost in 2022 as battery makers opt for cheaper alternatives to lithium, Chinese research house Antaike said on Thursday.
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