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Zinc prices have almost doubled this year as government stimulus spending globally has increased demand for the industrial metal used to galvanize steel and in die casting.
21 Dec 2009
NEW DELHI (Commodity Online): Mitsui Mining & Smelting Company has resumed its Pallca mine in Peru as rising demand boosts metal prices.

The Tokyo-based company said in a press note that the firm has resumed operation at Pallca mine from October. Mine output at Pallca which has annual capacity of 15,000 tonnes to 16,000 tonnes of zinc in concentrate was suspended in December 2008.

Zinc prices have almost doubled this year as government stimulus spending globally has increased demand for the industrial metal used to galvanize steel and in die casting.

In 2008, the price fell 49% as the global credit crunch following the collapse of Lehman Brothers Holdings Inc. pushed the world into recession.

Pallca currently produces 130 tonnes of ore a day versus its daily output capacity of 500 tonnes. The company plans to raise the mine’s output to 500 tonnes of ore containing 10% zinc from April.

In India, Zinc futures prices on Monday moved up to 0.4 per cent as traders indulged in covering-up of short positions on good demand in the physical markets and firming trend overseas.

At the Multi Commodity Exchange counter, zinc for delivery in December traded higher by Rs 0.45, or 0.4 per cent, to Rs 112.70 per kg with an open interest of 4,809 lots.

January contract also moved up by Rs 0.35 or 0.31 per cent to Rs 113.05 per kg with an open interest of 1,039 lots.

Market analysts said the rise in zinc prices at futures market was mostly supported by covering-up of short positions by traders and firm trend in the spot markets on good demand from consuming industries.

Besides, firming trend at the London Metal Exchange also influenced prices, they said.

Meanwhile, at the LME zinc rose 0.42 per cent to $2,415 per tonne.
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