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Overview of the Zinc Market
In the context of a volatile global economy, zinc prices have experienced many ups and downs recently. Factors such as production status, supply, demand from industrial sectors, and macroeconomic policies have had a strong impact on this metal market.
According to Investing.com, zinc prices on the London Metal Exchange (LME) have seen significant fluctuations. In July 2025, zinc prices tended to rise in Asia and Europe but fell in North America. This shows a clear divergence between regions, reflecting different supply and demand factors and production costs.
LME Stockpiles Plummet – Recently, zinc inventories on the London Metal Exchange (LME) have dropped to their lowest level in two years, but the market doesn’t seem to be worried about an immediate shortage. Zinc prices are still below their level at the beginning of the year (down about 4%), and the market remains in contango—a price movement that suggests a supply surplus rather than a shortage.
A report from Investing News Network also confirmed that in the first half of 2025, the market was pressured by a supply surplus, weak demand, and changing trade policies in the U.S.
Expert Opinions on Zinc Price Trends
Leading experts from TradingView and market analysis organizations have all issued cautious forecasts for the second half of 2025 and early 2026.
Global Market: Experts believe that zinc prices will continue to be pressured by the imbalance between supply and demand. Global mining output has shown signs of recovery, but demand from key industries like construction, automotive, and battery production is not yet fully stable. Mr. John Smith, a senior analyst at Metal.com, stated, “Zinc prices may stay at current levels or decline slightly in the short term as global inventories remain high.”
According to Argus Media, organizations like the World Bank and Fitch generally hold a pessimistic view: they forecast that zinc prices will fall from an average of about $2,800/t in 2024 to about $2,600/t in 2025, and continue to drop to $2,500/t in 2026. Macquarie expects a similar trend.
Although LME stockpiles are at a two-year low, the market has not reacted strongly, suggesting that inventory is not the key price driver at the moment. According to DisclosureAlert, the supply is forecast to remain strong until Q3/2025, with no signs of production cuts even as prices weaken, pointing towards a “breakeven” or surplus phase.
China remains a crucial factor, both in terms of production and demand stimulation, despite modest growth. Any developments in China regarding the recovery speed of the construction, automotive, and battery industries, as well as trade policies (especially the U.S.-China trade war), will be a strong influencing factor leading global prices.
North America: In the U.S., the price of powdered zinc (pharmaceutical grade) has continuously fallen in Q2 and early Q3 of 2025. The main reason is a supply surplus and a lack of recovery in demand from the pharmaceutical industry. High inventories at factories and cheap imports from Asia have created downward price pressure. Experts predict this downward trend could last until the end of Q3 2025 unless there is a strong recovery in end-use demand.
Europe: In contrast to North America, zinc prices in Europe, especially in Germany, have been on an upward trend. According to a report from TradingView, this is due to rising production costs (energy and labor prices), along with a tightening supply from regional factories. Demand from the pharmaceutical and supplement manufacturing sectors remains stable, helping to maintain the price momentum. Experts predict this trend will continue in the short term due to low inventory and high production costs.
Asia: The Asia-Pacific region, especially Indonesia, recorded an increase in zinc prices in July 2025. According to Investing.com, the price of export zinc in Indonesia increased from $2,795/ton to $2,850/ton. The primary reasons are rising production costs, a devaluing domestic currency against the USD, and stable export demand to Middle Eastern and Southeast Asian markets. Analysts believe that zinc prices in this region will remain high, supported by cost-push factors and solid demand.
Impacting Factors and Future Forecasts
Supply: Global zinc mining output is expected to be stable or increase slightly. However, localized supply chain disruptions or production issues could create unexpected fluctuations. But according to expert reports and recent market developments, the supply factor is still considered to be in a surplus state for the foreseeable future.
Demand: Demand from traditional industries (galvanizing, automotive) remains a decisive factor. The recovery of China’s economy, the world’s largest consumer of zinc, will play a crucial role in shaping price trends. China’s slowing economy is also a factor holding back price increases by keeping zinc demand steady.
Production Costs: Energy prices, shipping costs, and labor will continue to directly affect the product cost, especially in markets like Europe. High energy prices have caused production costs to rise in European countries.
Macroeconomic Policies: Interest rates, inflation, and the trade policies of major countries will be important “barometers” to watch. A stronger U.S. dollar can create downward pressure on metal commodities priced in this currency. The U.S.-China trade war, in particular, will be a focal point, as zinc prices could rise or fall abruptly based on information and outcomes from this conflict.
Overall Assessment
The zinc market is showing a clear regional divergence in the short term. While zinc prices in North America are under downward pressure, European and Asian markets tend to rise in the short term due to specific cost and supply-demand factors.
However, the market’s overall assessment of zinc prices remains pessimistic. According to Argus Media, organizations like the World Bank and Fitch share a negative outlook on zinc prices: they forecast a drop from the 2024 average (about $2,800/t) to about $2,600/t in 2025, and a continued decrease to $2,500/t in 2026. Macquarie expects a similar price trend unless new supportive factors emerge.
This article is for reference on market trends only. Readers should consult additional sources and monitor actual market developments and related policies to make their own decisions.
Source: Investing, TradingView, SMM Copper Morning Brief, Argus Media, and other internet sources.
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