Price trend

Last week, zinc prices continued to rise. According to the commodity price analysis system of SunSirs, as of January 30th, the price of 0# zinc was 25,776 RMB/ton, an increase of 4.43% compared to the price of 24,682 RMB/ton on January 26th. The price showed strong support at the bottom (January 26-30).

Market analysis

Macroeconomic Overview

Market expectations of a Federal Reserve interest rate cut were growing, leading to a continued weakening of the US dollar, which was providing strong support for non-ferrous metal prices. However, the market sentiment was highly volatile, and the uncertainty surrounding capital flows was increasing.

Raw materials

Global zinc mining capacity is expected to increase in 2026, but some major mines (such as Antamina and Red Dog) are experiencing production cuts, resulting in a slowdown in overall growth. Domestically, there is uncertainty regarding the ramp-up progress of the Huoshaoyun zinc mine; successful production would increase zinc ingot supply, but actual output depends on the mine's operational efficiency. Processing fees are declining at a slower pace, and import losses for zinc concentrate are narrowing. The supply of domestic and imported zinc concentrate remains relatively stable, but domestic production is affected by seasonal reductions, easing overall supply pressure.

Supply and demand

Traders and smelters were actively shipping and quoting prices, and the overall spot premium remained at a low level. However, downstream companies were gradually starting their holidays, resulting in weak demand for zinc ingots. Coupled with the strong upward trend in futures prices, market participants were hesitant due to the high prices, leading to fewer purchase inquiries and a relatively quiet trading atmosphere in the overall spot market.

Traditional demand: Demand from traditional sectors such as infrastructure and real estate continued to show weakness, with a decrease in end-user orders, suppressing the consumption of zinc ingots.  At the same time, galvanized sheet exports faced significant challenges due to trade barriers, resulting in overall weak demand.

Emerging demand: Photovoltaic installation volume showed a recovery growth month-on-month, and demand for zinc in areas such as new energy vehicles demonstrated some resilience, although the growth rate has slowed. This is insufficient to fully and completely offset the impact of the decline in traditional demand.

Market outlook

In the short term, zinc prices are likely to remain volatile at high levels, supported by marginal improvements in supply and positive macroeconomic sentiment. However, the medium-to-long-term pattern of increasing supply and weakening demand remains unchanged, limiting the upside potential for prices. We recommend monitoring the production progress of the Huoshaoyun zinc mine, the production increases at overseas refineries, and changes in macroeconomic policies.

If you have any inquiries or purchasing needs, please feel free to contact SunSirs with support@sunsirs.com.