By Leia Michele Toovey-Exclusive to Zinc Investing News

Strong evidence that the world’s economies will weather the current storm resulted in zinc having one of its most positive weeks, in terms of price gains. Zinc futures soared on the with positive bias on the Asian market, ending at $99.15 per kg. On the MCX, zinc for December delivery rose by 2.20 percent to a two-week high of $101.35 in early morning trading. Shanghai zinc futures jumped more than 4 percent, supported by speculative buying. Shanghai’s three-month zinc hit a high of 18,275 Yuan per tonne, near its upside limit of 18,465 Yuan. “There’s some speculative buying in Shanghai and zinc is the usual target because it’s cheaper than copper,” said a metals trader in Shanghai. Gains in Shanghai spilled over to three-month zinc on the London Metal Exchange which rose 3.1 percent to $2,227 a tonne, off a high of $2,235.

This is welcome news for a commodity that has witnessed a rollercoaster of a year. Over the passed year zinc has fallen 17 percent; whereas the other metals have enjoyed the rally, copper has climbed 12 percent, gold has ascended 25 percent, and silver has soared 63 percent. Wednesday was the first day that zinc witnessed a rally in a long time, last week; its price was hampered by concerns over political instability as North Korea attacked South Korea.

The zinc market is currently in a surplus and large build-up of stocks in 2010 will cap price gains for the remainder of this year and in 2011, as the market is likely to show another surplus in the year ahead. It will take some time to work off these accumulated stocks, however, the closure of many of the world’s largest zinc mines will start to influence fundamentals by about 2012.