Zinc rises following meteorite explosion
The trail of a falling object is seen above Chelyabinsk. A shock wave from the blast destroyed a wall in a concentrate warehouse at the Chelyabinsk Zinc Plant site and smashed windows in other buildings. Photograph: www.chelyabinsk.ru/Reuters
Zinc rose in London, narrowing this week's drop, after an exploding meteorite caused damage at a Russian plant producing the metal.
A shock wave from the blast destroyed a wall in a concentrate warehouse at the Chelyabinsk Zinc Plant site and smashed windows in other buildings, spokesman Evgeny Ponomarev said today. The plant is working as usual, he said. Chelyabinsk Zinc produced 160,000 metric tons of refined zinc and alloys last year, according to the company website.
"Your immediate knee-jerk reaction is that this is potential supply being taken out of the market," Nic Brown, head of commodity research at Natixis SA in London, said by phone today. "And then you spend time thinking, 'How much impact does this have?'"
Zinc for delivery in three months added as much as 0.9 per cent on the London Metal Exchange. Prices were up 0.1 per cent at $2,190.50 a ton by 7.38am New York time, reducing this week's drop to 0.7 per cent. Copper was little changed at $8,238 a ton and $3.7545 a pound for May-delivery metal on the Comex in New York.
Chelyabinsk Zinc is a unit of billionaire Iskandar Makhmudov's Ural Mining and Metallurgical Co. The meteorite broke apart at about 7.25am Moscow time, the Emergencies Ministry's division in the Urals district said today on its website.
Copper headed for a second weekly drop on the Comex after figures this week showed the euro-region economy shrank the most in almost four years in 2012's final quarter. Inventories of the metal tracked by the LME rose above 400,000 tons for the first time since November 2011 today on deliveries in Malaysia's Johor and New Orleans,
exchange figures showed.
"We do expect the copper market to be moving into surplus at some point this year, but we think it's a little bit soon to be suggesting that the rise in stockpiles is an indication that it's already happening," Brown said.
Inventories gained 0.6 per cent to 401,675 tons as orders to draw copper from warehouses fell 1.7 per cent to 30,350 tons.
Aluminium, lead, tin and nickel rose in London. Financial markets in China, the world's biggest consumer of industrial metals, are closed this week for the Lunar New Year.