Zinc Moves Back Near 3½-Year High

Zinc futures rose past $3,400 per tonne, moving back close to a more than 3½-year high amid tightening near-term supply. The decline in LME inventories, alongside a narrowing Cash-3M contango, signaled reduced prompt availability. Falling treatment charges for zinc concentrate also underscored constraints in raw material supply. Additionally, stocks at the Shanghai Futures Exchange continued to drop and port-side concentrate inventories fell sharply. Ongoing mine closures and operational disruptions are further straining supply. Some relief, however, may come from the expected restart of Boliden’s Tara mine, the ramp-up of Ivanhoe’s Kipushi project, and the resumption of output at Garpenberg in Q2, all of which could add incremental supply. On the demand side, improving industrial activity in China supported sentiment, but persistent tensions in the Middle East continued to cloud the broader outlook.

Zinc futures fell toward $3,320 per tonne, pulling back from an over 3-1/2-year high, as Boliden’s plan to resume production at Garpenberg in Q2 helped ease some supply concerns. Still, downside pressure remained limited, with fundamentals pointing to a tight supply in the near term. LME inventories continued to fall, while the narrowing Cash-3M contango signaled a firmer market structure. Declining treatment charges for zinc concentrate also highlighted constraints in raw material availability. In addition, stocks at the Shanghai Futures Exchange fell 1.8%, and port-side concentrate inventories dropped sharply. Ongoing mine closures and operational disruptions have added to supply-side strain, although the restart of Boliden’s Tara mine and the ramp-up of Ivanhoe’s Kipushi project may offer some relief. On the demand side, improving industrial activity in China supported sentiment, but persistent tensions in the Middle East continued to cloud the broader outlook.

Zinc futures dropped below $3,400 per tonne as investors took profits after prices surged to an over 3½-year high driven by tightening near-term supply conditions. Falling LME inventories and a narrowing Cash-3M contango signaled a firmer market structure, while lower treatment charges for zinc concentrate underscored constraints in raw material availability. Stocks at the Shanghai Futures Exchange also declined 1.8%, while concentrate inventories at ports dropped sharply, further highlighting tight feedstock. Ongoing mine closures and operational disruptions have added to supply-side pressure, though the restart of Boliden’s Tara mine and the ramp-up of Ivanhoe’s Kipushi project could provide some relief. Meanwhile, Peru’s zinc concentrate output showed mixed trends, falling monthly but improving from a year earlier. On the demand side, improving industrial activity in China supported sentiment, but persistent tensions in the Middle East continued to cloud the broader outlook.