Zinc prices soared to a four-year high: the war in the Middle East compounded the shutdown of mines, and a series of critical attacks on the supply side boosted the market

The Zhitong Finance App noticed that, driven by signs of tight supply, zinc prices rose to their highest level in more than four years, continuing the upward trend for several months.

The metal, which is used for galvanized steel, rose 2.5% on the London Metal Exchange (LME) to hit $3,980.50 per ton, then narrowed in part. Recently, from the Middle East war blocking Iran's ore supply to production interruptions in many mines, including China, a series of factors have combined to drive up prices.

Chaos Ternary Futures Co. (Chaos Ternary Futures Co.) wrote in a report: “There are frequent disruptions on the supply side.” The report added that the market's expectations that China will export more zinc metal to ease the tension in the global market are heating up.

In August, zinc prices recorded a fifth consecutive month of increase. Lunzinc futures rose 27% this year, far superior to copper and aluminum, which are also suffering from significant supply-side fluctuations. Despite a recent slight increase in zinc stocks in LME warehouses, it is still below 100,000 tons, which is still relatively low by historical standards.

The tense situation in the market is reflected in the sharp drop in smelting and processing fees (TC), which fell further last month to negative $117.50 per ton at the end of August. Lower processing fees suggest that ore shortages are forcing smelters to accept more stringent conditions from mining companies, although smelters can usually make up the difference by selling by-products.

Additionally, copper prices extended their gains on Tuesday. As of press time, LME copper prices rose 0.6% to $14,382 per ton. The metal continued to rise after hundreds of thousands of tons of copper were shipped to the US and squeezed global supply. On Monday, the LME market was closed due to the UK Bank Holiday.