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    Zinc at two-week high aided by hopes of deeper output cuts in Europe

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    Zinc at two-week high aided by hopes of deeper output cuts in Europe

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    Zinc prices are at a two-week high as hopes of deeper output cuts in Europe and a decline in production in China is aiding bullish sentiment in the base metal. CNBC-TV18's Manisha Gupta explains trends and price outlook

    Among base metals, Zinc is an outperformer, trading at a two-week high amid the Street expectations of deeper cuts in output in much of Europe as the region grapples with an energy crisis in the wake of supply constraints owing to the Russia-Ukraine war. There are shortages and the inventories have continued to decline as well.
    On output cuts, Nyrstar has shut the zinc smelter in the Netherlands and that has been shut since the first of September. Trafigura has also cut up to nearly 50 percent of capacity in at least three European smelters there. There are already output cuts by Auby smelter, this is in France, and then Glencore Portovesme smelter as well. So the output cuts have been consistent and have seen deeper cuts coming in, especially from Europe.
    Besides, China is also imposing stringent power restrictions with zinc output from the country in August seeing a decline of 2.8 percent on a month-on-month basis and a near 9 percent dip on a year-on-year basis. Between January and September, the Chinese zinc output is estimated to have declined by 2.6 percent.
    Investment firm Citi has upgraded zinc prices going forward in the next three months and has put out a target of around Rs 3,200. For six to 12 months, they are expecting the zinc prices to continue to gain up to an average of $3,400 per ton.
    CNBC-TV18's Manisha Gupta explains more in the video
    Check out our in-depth Market Coverage, Business News & get real-time Stock Market Updates on CNBC-TV18. Also, Watch our channels CNBC-TV18, CNBC Awaaz and CNBC Bajar Live on-the-go!
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