Zinc Remains Near 4-Year High

Zinc futures hovered below $3,600 per tonne but remained near a four-year high, supported by easing geopolitical tensions and tight near-term supply conditions. The US and Iran remotely signed a memorandum of understanding to end their war, alleviating fears about global economic growth and improving the outlook for industrial demand. At the same time, recent disruptions across major producers have reinforced supply concerns. Glencore’s Kazzinc facility in Kazakhstan is running at reduced capacity after an explosion, while Nexa’s Cajamarquilla smelter in Peru was temporarily suspended due to fire damage, though production is gradually resuming. Goldman Sachs also noted that Boliden’s Garpenberg mine in Sweden could operate at structurally lower output levels for longer after a seismic activity earlier this year. Meanwhile, the US dollar strengthened amid increased bets on a Federal Reserve rate hike, pressuring dollar-priced commodities.

Zinc futures rose toward $3,600 per tonne, returning to levels close to a four-year high, supported by easing geopolitical tensions and tight supply conditions. Sentiment improved after the US and Iran reached an agreement to end their conflict, which helped ease concerns over global economic growth and improved expectations for industrial demand. At the same time, recent disruptions across key producers have reinforced concerns about global availability, especially as the International Lead and Zinc Study Group projects a refined zinc deficit of around 19,000 tonnes this year. Glencore’s Kazzinc facility in Kazakhstan is running at reduced capacity after an explosion, while Nexa’s Cajamarquilla smelter in Peru was temporarily suspended due to fire-related damage, though it recently announced a gradual resumption of production. Partially offsetting these constraints, Boliden’s Garpenberg mine is expected to resume production in the second quarter.

Zinc futures fell toward $3,450 per tonne, the lowest in a month, as investors grew concerned about the demand outlook amid escalating tensions in the Middle East and expectations of tighter US monetary policy. The latest strikes between the US and Iran risk prolonging the conflict and fueling inflationary pressures, which could weigh on global growth and metal consumption. The downside was limited by tightening supply conditions. Glencore’s Kazzinc facility in Kazakhstan are running at reduced capacity after a fatal explosion, while Nexa’s Cajamarquilla smelter in Peru was temporarily suspended due to fire-related damage, though it recently announced a gradual resumption of production. These disruptions have reinforced concerns about global zinc availability, especially as the International Lead and Zinc Study Group projected a refined zinc deficit of 19,000 tonnes this year. Meanwhile, Boliden’s Garpenberg mine is set to resume production in Q2, helping to ease some supply pressures.