* LME/ShFE arb: http://bit.ly/2wZSAEz
* LME zinc stocks up nearly 60 pct since March 3
* Nickel hits two-week high above $14,000/T
(Adds news of industrial action and closing prices)
By Pratima Desai
LONDON, March 14 (Reuters) - Zinc prices slipped on
Wednesday as inventories in London Metal Exchange-approved
warehouses climbed, but support came from expectations of
stronger demand in top consumer China.
Benchmark zinc on the London Metal Exchange closed
down 1.8 percent at $3,226.5 a tonne. Prices of the metal used
to galvanise steel are down about 10 percent since hitting
$3,595.50 on Feb. 15, their highest level since July 2007.
"There is a shortage of galvanised steel in China. There
should be a big restock in the second quarter," said Macquarie
analyst Vivienne Lloyd, adding that the zinc market this year
would see a 500,000-tonne deficit.
"China's steel industry was impacted by the winter cuts,
production was weak and some operations had to close."
STOCKS: Stocks of zinc in LME warehouses have jumped nearly
60 percent since March 3 to 207,775 tonnes. Cancelled warrants -
material earmarked for delivery and so not available to the
market - account for about 8 percent of stocks, down from nearly
50 percent at the start of March. <MZNSTX-TOTAL>
CHINA: The country accounts for about half of global zinc
demand, estimated at 14.4 million tonnes.
SPREAD: Greater availability of zinc on the LME market has
seen the premium for the cash contract over the three-month
forward - above $55 a tonne at the end of January - slide into a
discount around $3.5 a tonne. <MZN0-3>
MINERS: "Higher zinc prices have helped miners' profit
margins, and this should work as an incentive to miners to speed
up their pipeline of projects or restart idled operations," GFMS
analysts said in a note.
"However, it is 'too little, too late' to fill the
concentrate supply gap that we forecast in 2018."
CONCENTRATE: Traders are watching treatment charges for zinc
concentrate. Sliding treatment charges suggest less availability
of concentrate, while a rising number would mean surpluses.
NICKEL: The stainless steel ingredient was untraded
at the close, but bid 0.3 percent lower at $13,835 a tonne. It
earlier hit a two-week high at $14,030.
NICKEL STOCKS: Concern about shortages on the LME market
have been fanned by a 10 percent fall in stocks since Jan. 10 to
325,434 tonnes and cancelled warrants rising to 39 percent from
30 percent. <MNISTX-TOTAL>
COPPER: Prices were supported by news of industrial action
at First Quantum's Cobre Panama project, "which has
reduced the level of work being performed on the project", the
company said in a statement.
PRICES: Copper ended up 0.6 percent at $6,987 a
tonne, aluminium lost 0.7 percent higher at $2,089, lead
gained 0.6 percent to $2,404 and tin slipped 0.1
percent to $21,150.
(Additional reporting by Peter Hobson
Editing by Dale Hudson and David Evans)
First Published: 2018-03-14 04:23:04
Updated 2018-03-14 19:15:19
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