Zinc futures in the UK climbed to $3,330 per tonne in March, holding close to the three-year high of $3,430 reached on January 29th, as rising operating costs for refiners amplified the impact of constrained supply. Iran’s moves to disrupt energy exports from the Persian Gulf have driven power prices sharply higher across major economies, increasing costs for energy-intensive smelters that rely on electrolytic processes.
Excluding China, refined zinc production declined by 1.6%, even as global mined output rose by 5.4%, reflecting ongoing output cuts at smelters in Kazakhstan and Japan. At the same time, zinc treatment charges increased to around $105 per thousand tonnes, up from $23.05 per thousand tonnes at the start of last year, following the near depletion of on- and off-warrant inventories at the onset of the fourth quarter.
Broader base metals markets were also supported by expectations that the continued drive toward electrification and sustained investment in data centers will underpin demand for industrial raw materials, despite persistent headwinds to global economic growth.
