FX.co ★ Zinc Reapproaches 1-Year Low

Zinc futures have dipped to approximately $2,600 per tonne, hovering near the one-year low of $2,560 recorded on April 9th. This decline is attributed to bleak forecasts for global manufacturing demand coupled with new alleviations in supply concerns. Following a series of tariff hikes, China imposed a 125% levy on the US and included additional companies in its export-restriction list. In retaliation, the US increased tariffs to 145% and indicated further potential barriers on certain metals, clouding manufacturing prospects in major economies. Concurrently, US President Trump's assertive steel tariffs have escalated coil prices due to restricted domestic production capacity, consequently impacting zinc demand in galvanization. On the supply side, the possibility of a rebound in mining activity this year, driven by expanded capacities in Russia and the Democratic Republic of Congo, has led to an international increase in treatment charges, shortly after Chinese smelters encountered negative treatment charges at the end of 2024.