Quotations for non-ferrous metals are mostly rising, Reuters reported. The energy crisis in Europe and China contributes to doubts about the sustainability of supply, but the potential growth of quotations is limited due to the weakening of the global economy and rising interest rates.

A lot of regions in China have recently imposed restrictions on electricity consumption by industrial consumers to make sure supply for households.

Because of restrictions on electricity consumption, China’s zinc production fell by 500,000 tons a year, CRU Group said Friday.

September zinc futures on the Shanghai Futures Exchange closed 1.8 percent to 25,365 yuan ($3,698.49) a ton.

Meanwhile, metal production in Europe is declining due to high energy costs. This affects quotations for non-ferrous metals and alloys. Last week, Belgium’s Nyrstar announced it would stop production at Budel, one of Europe’s largest steel mills, in the Netherlands, on September 1. The company also cut production by 50% at three zinc smelters.

Meanwhile, according to a trader in the zinc and lead markets, the short-term optimism seen amid power restrictions in China will fade when the weather turns cooler.

“The market is still under the influence of weak macroeconomic factors, and fears about recession and the possibility of further interest rate hikes by the Federal Reserve strengthen the downside risks,” added the trader.

Base metals rose in Asia

The dollar has been gaining support in recent sessions as Fed policymakers signaled an inclination to further tighten monetary policy ahead of the Jackson Hole conference later this week.

A rising dollar usually puts pressure on commodity prices, which become more expensive for holders of other currencies.

At the time of writing, nickel futures on the Shanghai Futures Exchange were trading up 0.7% to 177,270 yuan a ton. Quotes jumped 4.8 percent on Monday. Indonesian President Joko Widodo said in an interview with Bloomberg News last week that he was considering introducing a nickel export tax this year.

Indonesian authorities had previously talked about the likelihood of introducing the tax as early as Q3.

At about 07:48 GMT, three-month copper futures on the LME rose 1% to $8,103.50 a ton. Aluminum rose 0.8% to $2,408.5 a ton. Zinc rose 0.6% to $3,518.50 a ton, and lead fell 0.2% to 2010 dollars a ton.

Earlier we reported that the exchange price of electricity in France is rising by 5.5%.