Zinc on MCX settled down -0.54% at 192 after the update from WBMS data that Zinc markets record slight deficits in 2016. Also pressure seen after the dollar was on course for its steepest gain against the euro in more than a month following hawkish comments from Federal Reserve officials, while European political uncertainty also boosted the greenback.
A stronger dollar erodes the buying power for those paying for dollar-denominated commodities with other currencies. Meanwhile the worldwide zinc market has recorded deficit during January to December last year. It must be noted that the zinc market had ended in surplus in the whole of 2015. As per WBMS data, the global zinc market recorded deficit of 177 kt during the full twelve-month period of 2016 from January to November.
It should be noted that the worldwide zinc market had reported a surplus of 100 kt during the entire year 2015. Global refined zinc production witnessed decline of 2.2% during 2016. The Chinese production of locally refined zinc increased marginally by nearly 1.9% when compared with 2015. The global demand for the metal witnessed decline of 21 kt when matched with January to December in 2015.
The Chinese apparent demand totaled 6,689 kt and accounted for over 48% of the global total. The Japanese demand for the metal rose slightly by 1.6% when matched with the levels recorded during Jan-December ’15. The demand during the entire year 2016 totaled 487 kt. Now technically market is getting support at 190.9 and below same could see a test of 189.7 level, And resistance is now likely to be seen at 193.7, a move above could see prices testing 195.3.