Zinc Prices Edge Up Amid Stock Drop, Surplus Outlook Caps Gains

Key Highlights

• LME zinc at $2,736.80/mt, up +0.14%; SHFE and MCX also higher
• LME stocks drop to 81,500 t, down 3,450 t day-on-day
• 2025 global surplus forecast: ~93,000 t (ILZSG)
• Supply risk from delayed Russian Ozernoye mine

Prices Edge Higher Across LME, SHFE, and MCX

• LME (3-month cash): US $2,736.80/mt, up approximately +0.14% on the day
• SHFE: Most-active SHFE zinc futures contract (SZNc1) is trading at ¥24,065/mt, up approximately +0.61%. The day’s range was ¥23,950 to ¥24,150
• MCX: MCX zinc futures are trading around ₹270.35/kg, up +0.69%. The day’s range is ₹268.20 to ₹270.50. Open interest stands at 3,161 contracts

Supply & Demand: Bearish Investor Sentiment on Weak Demand Outlook

• LME Stocks: As of 8 Aug 2025, LME zinc cash-settlement stocks were 81,500 t, down by 3,450 t from the previous day.
• ILZSG Outlook: The global zinc market is projected to shift from a deficit in 2024 to a ~93,000-ton surplus in 2025. Mine output is expected to rise by ~4.3% to 12.43 Mt, while refined output increases by ~1.8% to 13.73 Mt. Demand growth is modest at ~1%.

News & Market Sentiment: Russian Mine Delays Pose Concentrate Supply Risks

• Investor Sentiment: Investment funds have turned increasingly bearish on zinc, reacting to oversupply and a weak demand outlook.
• Supply Tightness Risks: Delays at the Russian Ozernoye zinc mine due to sanctions and equipment issues may restrict concentrate availability, tightening treatment charges and impacting output.

Expert Opinion and MCX Technical Levels

With the current MCX zinc price at ₹270.35/kg, it’s just above support. Given the bearish fundamentals and elevated global inventories, significant upside seems limited unless there’s a major supply shock or an unexpected demand surge.