Price trend

According to the business data analysis system of SunSirs, zinc prices in 2025 showed a trend of initial decline followed by a rise. The price at the beginning of the year was 25,846 RMB/ton, and the price at the end of the year was 23,276 RMB/ton, resulting in an overall decrease of 9.94% in zinc prices in 2025.

The overall zinc market in 2025 exhibited a significant "initial decline followed by a rebound" trend. In the first three quarters, due to the combined effects of unexpectedly increased supply and the escalating US-China trade friction, zinc prices steadily declined, repeatedly hitting new lows for the year. In the fourth quarter, market trends diverged between domestic and international markets. The accelerated release of new smelting capacity in China led to Shanghai zinc prices fluctuating within a low range, with a price correction trend towards the end of the year. In 2026, against the backdrop of increased supply and a diversified demand structure, zinc prices are expected to remain under pressure and continue to fluctuate within a range.

I. Current Status of Zinc Supply and Projections for 2026

Overseas zinc mine supply increased, but smelters were showing a trend of reduced production. In contrast, domestic smelting production had increased significantly. This shift had altered the global supply pattern of zinc, gradually concentrating supply in China.

In 2026, the increase in mining output will be concentrated in five major projects:

1. Five major mines

The five projects—Ozernoye, Kipushi, Huoshaoyun, Tizapa, and Lady Loretta—are expected to collectively increase production by 260,000 tons in 2026, accounting for 68% of the global mine production increase.

2. Concentrated regional distribution

The new production capacity is concentrated in Russia, the Democratic Republic of Congo, China, Mexico, and Australia, with a geographically dispersed distribution but a manageable commissioning schedule.

3. Strong cost competitiveness

Newly commissioned mines generally have cash costs below $2,000 per ton, giving them strong market competitiveness and supporting long-term stable supply.

4. Upward trend in the first half, downward trend in the second half

The increase in mine production is mainly concentrated in the first half of the year, with a slowdown in growth in the second half, forming a "higher in the first half, lower in the second half" supply pattern.

Zinc Smelting Analysis for 2026

It is projected that China's smelting capacity will increase from 7 million tons to 7.3 million tons, with an additional 250,000 tons from overseas (secondary zinc from South Korea, India, and Turkey), and a potential export flexibility of up to 300,000 tons.

II. Current Status of Zinc Demand and Projections for 2026

Galvanizing accounts for 54% of global zinc demand, representing a core component of consumption and serving as a fundamental support, widely used in the construction and infrastructure sectors.

Zinc used in construction accounts for 58%

Zinc accounts for 58% of downstream applications, but its growth is limited by the sluggish real estate market. The slowdown in urbanization has weakened the demand for zinc in the traditional construction sector.

Automotive demand accounts for 18%.

The automotive industry has a stable demand for galvanized steel sheets and is relatively resistant to economic cycles. The development of new energy vehicles has led to a slight increase in the use of galvanized steel for structural components.

Photovoltaic-driven demand rises to 5%.

Large-scale construction of photovoltaic mounting structures is driving new demand for galvanized steel. An additional 120,000 tons of zinc demand is expected by 2026, becoming a key growth driver.

It is expected that by 2026, the drag on zinc demand from the infrastructure and real estate sectors may slow down, while the automotive sector within the transportation industry is expected to maintain its strong performance. Overall, the growth rate of zinc demand is projected to remain relatively weak in 2026, although domestic end-user demand is expected to show greater resilience than overseas markets.

III. Inventory Analysis

As of December 2025, global visible zinc inventories totaled approximately 153,800 tons, an absolute level that was at a seasonal low for the past five years. The cumulative inventory reduction for the entire year of 2025 reached approximately 110,000 tons. Against the backdrop of expected oversupply, the low inventory levels and the continuing trend of inventory reduction provide strong support for zinc prices.

Summary

In 2026, the zinc trade landscape is undergoing a profound transformation, shifting from a previous unidirectional import-dependent model to a new stage of development characterized by bidirectional interaction and competition between domestic and international markets. In this process, the international environment, regional supply and demand dynamics, and policy adjustments are all key variables influencing the evolution of this landscape.

Based on a comprehensive analysis, the global zinc ingot market is likely to be in a state of tight balance by 2026. Specifically, the surplus of refined zinc in the Chinese market is expected to decrease further, while the global supply of zinc ore may remain relatively tight. In this market environment, supported by mining costs and underpinned by structural demand, zinc prices will demonstrate strong resilience. The average zinc price for the year is expected to be roughly the same as this year's level, with the price of the main futures contract likely fluctuating between 21,000 and 25,000 RMB/ton.

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