Zinc Hits 35-month High

Zinc prices climbed past $3,900 a metric ton, reaching their highest level since May 2022, as concerns over limited availability intensified. The rally has been driven by disruptions at several major mining operations, where operational difficulties and logistical constraints have reduced the pace of supply growth. HSBC expects global zinc mine output to decline this year, while disruptions at both mines and smelters could keep the market undersupplied. At the same time, inventories registered by the London Metal Exchange have fallen sharply, while physical supplies in key markets outside China remain particularly tight. Demand has also provided support, with manufacturing activity in Europe and the US showing signs of a moderate recovery. Meanwhile, Chinese inventories have risen significantly, creating a notable divergence between the world’s largest consumer and other regions.

Zinc increased to 3804.00 USD/T, the highest since June 2022. Over the past 4 weeks, Zinc gained 5.76%, and in the last 12 months, it increased 35.37%.

Zinc futures rose past $3,700 per tonne, hovering near their highest level since June 2022, supported by tightening supply, production disruptions, and low inventories. Heavy rainfall and flooding across parts of China, the world’s largest zinc producer, have threatened mining and smelting operations. On top of that, production adjustments at a mine in Southwest China are expected to reduce August zinc concentrate output by 1,000 tonnes, while maintenance at a smelter in Central China could cut refined production by 1,000–1,500 tonnes. Supply concerns have also spread to other major producers. Glencore’s own-sourced zinc production fell in the first half of 2026, while Boliden’s zinc concentrate output declined quarter-on-quarter and MMG’s production decreased year-on-year in Q2. Moreover, LME zinc inventories have fallen to their lowest level since December, while high canceled warrants and falling on-warrant stocks signal that less metal is readily available for immediate delivery.