A tight concentrate market and rising disruptions in the refined end amid low inventories are the major fundamental drivers behind the strong zinc market. In the view of strategists at ING, zinc prices could keep elevated.

Rising supply disruptions to refined zinc supply from Europe and China

“In case the power shortage issue lasts for longer, this raises the risks of further supply losses from both China, the world largest zinc producer, and Europe.”

“As mines in northern China start to head into winter hibernations, smelters stockpiling before winter only increase demand for concentrate in the short term. This also highlights the sticky tightness in the concentrate market.”

“Prices could stay elevated at least before the current power crisis dissipates.”