Chinese Zinc Exports Surge as Global Supply Tightens; Market Holds Firm Across Exchanges

Key Highlights

• Global zinc inventories remain tight, supporting prices across major exchanges. 
• China’s output hit a record 665,000 tons, enabling exports of 50,000 tons in Nov–Dec.
• Spot zinc premium eased from US$ 300/ton to US$ 130/ton amid short-term relief.
• MCX zinc faces support at ₹295–298 and resistance at ₹305–310/kg.

Zinc Prices Hold Firm as Tight Inventories Support Global Markets

• LME Zinc Futures (3-Month):
  Opened at US$ 2,987.75/MT, traded between US$ 2,960.90 – 2,988.00/MT.
  LME cash settlement (17 Nov): US$ 3,231/MT; 3-month: US$ 3,024/MT.
  Latest LME movement: +0.2% to US$ 2,995/MT. 
• MCX Zinc Futures (Front-Month):
  Trading around ₹299.80/kg; opened at ₹300.70/kg; previous close ₹302.10/kg. 
• SHFE Zinc (ZN2512):
  Latest price: CNY 22,420/MT, up +70 (+0.31%) from previous close CNY 22,310/MT.
  Day’s range: CNY 22,330 – 22,475. 
• LME Zinc Stocks: ~39,975 tonnes.

Demand & Supply: China’s Record Output Sparks Strong Zinc Export Wave in Q4 2025

• Tight zinc inventories globally continue to support fundamentals. Indian and global markets show firmness despite mild short-term weakness. China’s zinc output hit an all-time high of 665,000 tons last month.
   
• A global supply squeeze has made Chinese zinc exports profitable again.
  1. Exports were ~10,000 tons in October.
  2. Expected to rise to ~50,000 tons combined in Nov–Dec 2025.
   
• Domestic (China) demand remains stagnant, leaving surplus for export. Zinc ingot prices in India remain steady, supported by firm premiums. Buyers remain cautious in bulk purchases ahead of year-end.

Market News: Spot Premium Drops but Market Still Reflects Near-Term Supply Squeeze

• Chinese smelters ramp up zinc exports due to profitable arbitrage created by global tight supply and higher overseas prices. 
• Spot zinc’s premium over 3-month LME futures spiked above US$ 300/ton recently, reflecting an immediate supply shortfall, though now narrowed to US$ 130/ton. 
• This export window is the strongest since May 2022, when China exported 35,000 tons after global smelter closures. 
• Hindustan Zinc Ltd (HZL) received a composite licence in Andhra Pradesh to explore and mine tungsten, marking diversification into critical minerals. 
• SHFE zinc futures continue to rise modestly, supported by global supply tightness and expanding Chinese output.

Market Expectation: Zinc Outlook Steady with Key Support–Resistance Levels on MCX & LME

• Analysts highlight tight inventories as the primary supportive factor for zinc across major exchanges (LME, MCX, SHFE).
   
• MCX Outlook:
  1. Support: ₹295 – ₹298/kg
  2. Resistance: ₹305 – ₹310/kg
  3. A breakout above ₹310/kg signals bullish continuation; below ₹295/kg indicates weakness.
   
• LME Outlook:
  1. Support: ~US$ 2,950/MT
  2. Upside potential: US$ 3,050 – 3,100/MT

Chinese exports are expected to rise further through Dec 2025, adding supply to global markets while domestic inventories typically build ahead of Lunar New Year.