Zinc futures retreated below $3,300 per tonne after briefly touching a one-month high, as lingering uncertainty over a potential Middle East ceasefire weighed on the broader demand outlook. Sporadic fighting persisted across the region, with Israel carrying out strikes in Lebanon amid disputes between Iran and the US–Israeli side over whether any ceasefire arrangement would extend to Lebanese territory.
Nonetheless, underlying fundamentals remain broadly supportive for prices. China’s factory activity has returned to expansion, lifting demand expectations for base metals. At the same time, inventories on the Shanghai Futures Exchange fell by 1% over the past week, while ongoing mine closures and operational disruptions are contributing to short-term supply tightness.
Even so, additional output from projects such as Tara and Kipushi, together with increased production plans from other major producers, is expected to keep the zinc market in a modest surplus.
