The zinc concentrate market has tightened to crisis levels as mine closures and depletion at aging operations reduce feed availability. Spot treatment charges (TCs) have fallen to $15-20/mt, down from $150/mt in early 2025, reflecting the acute shortage.
Major mine closures include the permanent shutdown of the Century mine in Australia and the suspension of operations at Tara in Ireland following Vedanta's restructuring. Together, these two operations accounted for over 400,000 tonnes of annual zinc concentrate output.
Smelters in Europe and Asia are responding with production cuts. Nyrstar has announced a 30% reduction at its Budel smelter in the Netherlands, while Korean Zinc is operating at 85% capacity due to concentrate supply constraints.
The ILZSG projects a refined zinc surplus of 271,000 tonnes for 2026, but this masks a significant imbalance between concentrate availability and smelting capacity. The surplus is in refined metal, not concentrate — and without concentrate, smelters cannot produce.
Chinese domestic zinc mine output fell 2.5% year-on-year in the first five months of 2026, as environmental inspections and depletion at aging mines continue to constrain domestic supply. China's concentrate import dependency has risen to 40% of requirements.
The concentrate shortage will persist through at least Q3 2026. Zinc premiums for refined metal in Europe and the US are likely to widen. Lock in H2 volumes now and consider extending lead times to accommodate potential smelter allocation reductions.