It is reported that zinc price of the Shanghai Futures Exchange which plunged from CNY 18,100 per tonne to CNY 17,750 per tonne last week is predicted to rally in the near future due to the influence of the earthquake hitting Wenchuan, Sichuan on May 12th 2008.

According to a report of ATK, nonferrous metal research body in China, after the quake, zinc smelting plants in the area have stopped production and the production of zinc smelting plants with a combined production capacity of 500,000 tonnes in Sichuan, southern Gansu and southern Shaanxi are also affected. Sichuan Hongda, the largest zinc smelting enterprise in Sichuan confirmed recently that its plant in Mianzu suffered a big loss.

Analysts believed that if the transportation in Sichuan can not be improved in the coming two weeks lead zinc smelting plants that have not been affected by the quake will likely be forced to reduce production.

At present, lead zinc ore in Sichuan can not be shipped out of the province for the transport reason.