SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Gold/Mining/Energy : Gold and Silver Juniors, Mid-tiers and Producers
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: zoo york who wrote (11254)5/14/2006 10:53:36 AM
From: Mr. Aloha  Read Replies (1) of 78416
 
Froth or not, one thing that stands out to me is that the metals stockpiles continue to shrink. So often during past cycles, when metals prices started to rise, there would be a feedback loop of increased production leading to a glut, and then collapse. This time around, I do not think there is going to be a big increase in production anytime soon.

I agree, particularly in the case of zinc. Look at the shrinking stockpiles of zinc at the LME (bottom charts): kitcometals.com. At the current rate, there will no zinc inventory left in the fall, and prices could go ballistic.

As for a big increase in production, look at the chart of the coming zinc supply gap (first chart): greattrades.blogspot.com. With many big mines scheduled to close in coming years, there's not enough new zinc production coming online to even come close to keeping up with current demand. With demand increasing every year, the supply/demand situation will be way out of whack, likely leading to much higher prices over the long term.

I believe there may be short-term froth in some metals where there are lots of speculators trading, but the long-term supply/demand imbalances will sustain this metals bull market for a lot longer than most think.
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News