Network Metals LLC

With lead and zinc prices rising on the LME and looking like they will continue up for the time being, talk of price participation is reemerging from lead/zinc smelters who are grappling with miners asking for higher premiums on concentrates. There have been some recent articles on Chinese smelters asking for yearly contracts for concentrates to include price participation clauses. This makes sense, from their perspective, given the volatility of the LME market over the past several months. However, it is unclear how receptive miners will be to these requests, given that this is the first time in a year that they have seen consistently buoyed base metals prices. We do not expect them to want to share in the current upside until the prices stabilize at least at current levels.