Zinc futures were trading around $3,700 per tonne, hovering near a four-year high, driven by tightening near-term supply, production disruptions, and low inventory levels. In China — the world’s largest zinc producer — heavy rainfall and flooding have threatened both mining and smelting operations. In addition, production adjustments at a mine in Southwest China are expected to reduce zinc concentrate output in August by about 1,000 tonnes, while maintenance at a smelter in Central China may cut refined zinc production by a further 1,000–1,500 tonnes.
Supply concerns are also emerging among other major producers. Glencore’s own-sourced zinc output declined in the first half of 2026, Boliden reported a quarter-on-quarter drop in zinc concentrate production, and MMG’s zinc production fell year-on-year in the second quarter. At the same time, LME zinc inventories have fallen to their lowest level since December, and the combination of high canceled warrants and shrinking on-warrant stocks indicates that less metal is available for immediate delivery.
