European zinc premiums were at new record low levels in the week ended Tuesday May 28, while US premiums fell for the first time since February and a historic backwardation level in spreads led to a spike in financing costs and a drop in spot trading interest.
Backwardation in the London Metal Exchange cash to three-month zinc spreads remained the key factor. This was at $161 per tonne on May 28. It was once as wide as $163 per tonne in 2006.Hand-to-mouth purchases were still being seen in Northern Europe over the week. Zinc premiums for Rotterdam and Antwerp both dropped to $80-105 per tonne. The Rotterdam level was at its lowest since the assessment was launched in 2005.The US zinc premium fell amid persisting LME backwardations.With the LME lead price staying low at $1,800 per tonne, Indian buyers kept taking spot units. The price of secondary lead units rose notably this week to reflect inflows of more expensive duty-free units into India. New record low for European zinc premiumsEuropean zinc premiums were at record low levels this week because a historic backwardation level in spreads led to a spike...