Zinc prices on the domestic market may remain weak in the next few days on excess global supplies, weak demand from steel units and the rupee?s weakening against the dollar.
Zinc futures prices on MCX have weakened to Rs 77.45 per kg from previous week?s level of Rs 83.75 on continued selling pressure on reports of global surplus, market sources said.
One of the major factors that may influence the market next week is that large zinc smelters in China may not support output cuts proposed by smaller producers in China.
Small and medium smelters decided on Saturday to slash production by 10% from July-September, raising concern that the country?s large smelters would join and squeeze global supply.
On the other hand, Lisbon-based International Lead and Zinc Study Group?s (ILZSG) said on Monday that zinc market will be in excess of 2.15 lakh tonne in 2008.
Global zinc mine output rose by 9.2% over the first 5 months of 2008 (Jan-May) compared to the same period of 2007.
The most notable increases were in Australia, Bolivia, Kazakhstan, Peru, Portugal and the United States, a study group said.
The global zinc market was in surplus by 59,000 tonne in the first five months of 2008. Global refined zinc use rose to 4.77 million tonne from 4.72 million tonne a year earlier. World refined zinc output was 4.826 million tonnes in Jan-May period, up from 4.74 million tonnes a year earlier, the ILZSG said.