Zinc Climbs to Over 4-Year High

Zinc prices rose above $3,950 a ton, hitting their highest level since April 2022, amid tightening supply conditions. The metal posted a fifth consecutive monthly gain in August and is up 27% so far this year, outperforming other major base metals. Supply concerns have been fueled by disruptions at several mines, including in China, while Middle East tensions have constrained Iranian ore shipments. The squeeze is also reflected in sharply lower smelter treatment charges, signaling a shortage of zinc concentrate available for processing. At the same time, stockpiles at LME warehouses remain relatively low by historical standards, while physical availability outside China is particularly tight. Meanwhile, Chinese inventories have risen significantly, creating a notable divergence between the world’s largest zinc consumer and other major markets.

Zinc prices climbed above $3,850 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%.