The most-traded zinc contract on the Shanghai Futures Exchange closed up 1 percent at 26,080 yuan ($4,019.73) a tonne on Friday. It earlier marked its strongest since November 1 at 26,140 yuan a tonne. Zinc stocks held in London Metal Exchange warehouses fell 250 tonnes to their lowest since late 2008, data showed on Thursday, down by a third from their October peak.
Commodities traders and analysts say under-investment in new zinc mines as older ones close and Chinese efforts to reduce industry-generated pollution are stoking expectations for continued supply deficits in the months ahead. The global zinc market deficit widened to 36,900 tonnes in October from a revised deficit of 35,900 tonnes in September, the latest figures from the International Lead and Zinc Study Group show.
China will continue to "unswervingly" cut existing steel capacity and "strictly" ban the launch of any new steelmaking facilities in 2018, its government said this week.