The lingering backwardation in cash/three-month zinc spreads pressured the Southeast Asian premium down this week; lead premiums were largely stable with market participants focused on securing long-term contractual supply amid the continued absence of Iranian lead units.
Backwardation in cash/three-month zinc spread stood at $77 per tonne as of Wednesday December 12. The backwardation still resulted in lackluster interest in zinc spot trading. More African and Russian lead units will flow into the market to replace the supply gap arising from the loss of Iranian units. Offers as low as $70/t for European zinc European zinc market participants were largely forced to the sidelines this week by the backwardation in London Metal Exchange cash/three-month zinc spread, which has greatly increased the cost of holding metal. Although the backwardation has already come off from three-digit levels of last week, it still stood at $77 per tonne as of Wednesday afternoon. A few parcels sold have been reported to Fastmarkets at premiums close to $120s per tonne. This kept the Rotterdam zinc premium on a duty-paid fca basis unchanged at $118-125 per tonne on Tuesday December 11. The Antwerp premium...