Global crude steel production held roughly flat at an annualized rate of 1.7 billion tonnes through May 2026, according to World Steel Association data. Since galvanized steel accounts for approximately 60% of global zinc consumption, stable steel output provides a demand anchor for zinc even as the broader base metals complex sells off on macro concerns.
The demand picture varies by region. US infrastructure spending rose an estimated 12% year-over-year in the first half of 2026, driven by federal highway and bridge programs that are steel-intensive. The US is consuming more galvanized rebar and structural steel, supporting zinc demand. Automotive production -- another major zinc consumer -- has been steady globally, with light vehicle output up roughly 2% year-over-year.
The offset is in construction: the Eurozone construction PMI sits at 46.2, firmly in contraction territory. Commercial real estate activity in both Europe and China has slowed meaningfully. Chinese housing starts are down roughly 15% year-over-year through May, reducing demand for galvanized steel in residential construction.
Infrastructure spending is replacing some of the lost construction demand. China's infrastructure investment grew 8% year-over-year in the first five months of 2026, and India's infrastructure spending continues to rise at double-digit rates. These projects are more steel-intensive per dollar than commercial construction, which is a structural positive for zinc demand even as the housing cycle turns down.
Zinc’s demand profile is more resilient than aluminum’s — the shift from construction to infrastructure spending is mildly positive for zinc intensity. For procurement, this means zinc could recover faster than aluminum when the macro selloff exhausts itself. Don’t treat all base metals as equally exposed to the demand slowdown. Zinc’s demand anchor is holding.