The zinc concentrate market has tightened significantly over the past 12 months. Spot treatment charges have fallen to $70-90/dmt, compared to benchmark settlements of $150-165/dmt for 2025 annual contracts. The compression reflects growing competition for limited concentrate units among global smelters.
Several mine restarts that were expected to add supply in 2025-2026 have been delayed. The Tara mine in Ireland resumed operations but below pre-shutdown capacity. New projects in Australia and Africa face permitting delays and equipment availability issues.
Chinese domestic mine production has been flat as environmental inspections limit output from smaller operations. Imports of zinc concentrates have risen 8% year-on-year to compensate, but global availability remains constrained.
Smelter utilization rates have declined to approximately 78% globally, as some facilities lack sufficient feedstock. This dynamic limits refined zinc production even as demand remains steady, creating a buffer that supports current price levels.
The tighter concentrate market is expected to persist through 2027 as the next wave of mine projects remains in early development stages.
Tight concentrate supply means refined zinc production is constrained. This supports prices and limits spot availability. Secure term supply contracts and avoid relying exclusively on spot purchases for Q3-Q4 requirements.