The global zinc market is at an inflection point. China has built a significant surplus in zinc production, driven by increased smelter output and steady mine supply. Meanwhile, the rest of the world faces a moderate shortfall, creating a two-speed market that is progressively moving toward global balance.
Fastmarkets projects that global surpluses will persist into 2026-27 as the new mine supply pipeline delivers. The average LME zinc price for 2025 is forecast at $3,218 per tonne, with a slight increase expected in the first half of 2026 due to ongoing regional disparities. However, prices are projected to decline as surplus builds.
The demand picture is mixed. Galvanizing and infrastructure sectors remain resilient in developed markets, but Chinese construction activity, a major end-use for galvanized steel, continues to soften. Automotive production is stable but not accelerating, while infrastructure stimulus in China has yet to translate into meaningful zinc demand growth.
Macro factors will cause continued volatility into early 2026. Trade policy uncertainty, Chinese economic stimulus measures, and energy price fluctuations all influence the zinc price trajectory. The key variable is the pace at which new mine supply reaches the market: accelerated delivery would hasten the price normalization.