FX.co ★ Zinc Futures Rise on Supply Concerns

Zinc futures advanced to approximately $3,260 per tonne on January 23, continuing a pattern of notable gains for the second session in a row. This movement in price comes as markets assess mixed signals on the supply front. In Shanghai, zinc inventories rose by 3.3% week-on-week. Meanwhile, the LME cash zinc contract was priced $14 per tonne below the three-month forward rate, indicating slight tightness in the near term. Globally, the International Lead and Zinc Study Group (ILZSG) reported a 7,700-tonne deficit for November. However, despite this shortfall, the refined zinc market maintained a surplus for the first 11 months of 2025, underscoring a short-term squeeze within a broader surplus trend. Furthermore, zinc concentrate availability might face constraints, as several Chinese mines enter maintenance phases, including a notable reduction of 700 tonnes in metal content from a Southwest operation. Additional price support arose from a declining US dollar, largely influenced by President Donald Trump's threats of tariffs against European nations opposing his proposed Greenland acquisition, a stance he later eased following a preliminary agreement with NATO.