Zinc prices will be at $ 2,500 per tonne within 12 months - Goldman Sachs

Zinc prices will average around $ 2,500 per tonne over the next 12 months, according to the latest analytical data released by investment banking expert Goldman Sachs (GS). However, in the immediate short term, prices are likely to remain under pressure. While generally positive, metal prices are likely to cool slightly after the recent 13% rally since late June 2014.

The zinc market remains bullish as the largest mines in Australia and Ireland will expire by mid-2015, GS analysts said. The closure of the mines is likely to cut supplies by 450 thousand and 160 thousand tons per year, respectively. This will further reduce the supply of zinc to the world market. Over the course of 12 months, zinc prices are expected to average around $ 2,500 per tonne, so any short-term drop in prices should be exploited for purchase, according to a GS research report.

Metal prices have skyrocketed since late July, so they will be down in the short term. The recent growth is due to the improvement in US and Chinese macroeconomic data. Looking ahead, we can say that Chinese imports are likely to decline in the short term and, in turn, could lead to lower prices for zinc. The spot price for zinc on the London Metal Exchange (LME) was $ 2355 per tonne this week.