🚀 Industrial metals rally as energy crisis shuts down smelters
While energy prices are no longer rising as quickly as they were recently, elevated prices remain an issue for energy-intensive businesses, like for example smelters. Nyrstar, one of world's largest zinc producers, said yesterday that it will halve output at 3 facilities in Europe due to rising energy prices and growing burden from emissions. Smelters in China are also reducing output to cope with high energy prices. Price of ZINC leaped 5% yesterday and reached the highest levels since 2007. Base metal trades another 3% higher today. Reduction of output by smelters will limit supply resulting in higher prices. Situation looks similar on ALUMINIUM with this base metal trading at the highest level since 2008.
COPPER is also trading higher. While the scale of gains on this market is much smaller than in the case of aluminium or zinc, copper price has broken above an important resistance today. The zone, ranging around 9,700 handle, marked the upper limit of the recent trading range. Moreover, a 50% retracement of the downward move started in May can also be found in this area. With today's break COPPER reached 4-month highs and may now target highs from May near 10,700 area.
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