Trafigura Group has ordered thousands of tons of zinc out of London Metal Exchange warehouses, fueling a rally in prices, according to people familiar with the matter.

Orders to withdraw zinc from warehouses overseen by the exchange have surged by 97 225 t over the past two days, the biggest jump in more than a decade. The move leaves less stock available to other buyers, and helped underpin a gain in prices since Monday.

Trafigura — which runs several zinc smelters and is one of the world’s biggest traders and producers of the metal — was behind the orders, said the people, who asked not to be identified due to the commercially sensitive nature of the matter.

Spokespeople for Trafigura and the LME declined to comment.

While the orders are the biggest seen in the zinc market in years, physical traders like Trafigura routinely withdraw large volumes from LME warehouses for a variety of reasons. Sometimes metal is shipped out to manufacturers in response to upticks in demand and shortfalls in supply, or is simply moved into cheaper storage locations elsewhere.

Demand in the underlying market remains subdued, but concerns about supply are growing as the global zinc smelting industry contends with a sharp drop in operating margins. The processing fees paid to smelters for the costs of turning ores into refined metal have fallen sharply this year, raising the risk that some plants may need to curtail output.

The volume of zinc held in LME warehouses has rebounded sharply from critically low levels seen in early 2023, with a mountain of stock accumulating in Singapore during a downturn in demand for the steelmaking material. Much of that metal was delivered by Trafigura, Bloomberg has previously reported.

Data from the exchange shows that a single entity had bought up more than half of the readily available stock in the LME’s warehousing network.

With a large volume of stock set to leave the system, the remaining zinc inventory available to other buyers dropped to a one-year low of 154125 tons on Wednesday.

Zinc was up 1.8% at $3 129.50 a ton as of 4:30 p.m. local time on the LME, bringing its gains this week to 5.5%.