Introduction to Zinc Price Trends
The zinc price experienced a significant decline during the first half of 2025, but it managed to recover by the end of the year, closing near its starting point. As a key component in the production of galvanized steel, zinc demand is closely tied to the housing and manufacturing sectors, which have faced challenges due to high inflation and interest rates. Additional pressures came from evolving US trade policies, causing uncertainty among investors and consumers, leading to reduced spending.
Zinc Price in 2025
The zinc price began 2025 relatively flat, starting at US$2,927 per metric ton (MT) on January 2 and closing the first quarter at US$2,855 on March 30. However, the second quarter saw a broad decline in base metals prices, with zinc falling to a yearly low of US$2,562 by April 9. Since then, zinc has gained steadily, ending the second quarter at US$2,753 on June 30, and continuing to rise through Q3 and Q4, reaching US$2,954 on September 30 and US$3,088 on December 29.
Key Trends for Zinc in 2025
Zinc saw a major price decline in early April, falling 14 percent in response to US President Donald Trump’s “Liberation Day” tariffs announcement. Analysts predicted that the proposed reciprocal tariffs could trigger a recession, impacting consumer spending on new homes and cars, both of which rely heavily on galvanized steel. Although the threat of a significant global recession eased as the proposed tariffs were dialed back, considerable uncertainty among investors and consumers remained, evident in the US housing market’s stagnation and the glut of unsold homes.
Likewise, China’s housing market, which collapsed in 2020, continued to struggle throughout 2025, with November sales from the country’s top 100 developers declining 36 percent over 2024, and down 19 percent through the first 11 months of 2025, according to CNBC. The International Lead and Zinc Study Group (ILZSG) predicted a 2025 zinc market surplus of 85,000 MT, with zinc mine production rising to 10.51 million MT, up from 9.87 million MT in 2024, and refined zinc production increasing slightly to 11.52 million MT from 11.12 million MT in the same period last year.
Zinc Surplus Expected in 2026
Oversupply is likely to persist as newly mined metal enters the market, while demand growth remains modest. The ILZSG predicts that global refined zinc demand will increase by 1 percent to 13.86 million MT in 2026, with Chinese demand posting a 1.3 percent gain in 2025, but remaining flat in 2026 due to the ongoing slump in the Chinese real estate sector. European zinc demand is likely to grow next year, following predicted 0.7 percent growth in 2025.
However, the ILZSG anticipates a more significant upward trend in zinc mine supply in 2026, with output increasing by 2.4 percent to 12.8 million MT, driven by higher output from existing operations in Europe, Australia, Brazil, the Democratic Republic of Congo, and China. Additional zinc supply will come from recent restarts and new projects, including the Almina-Minas Aljustrel mine in Portugal and the Xinjiang Huoshaoyun mine in China.
Zinc Price Forecast for 2026
A December report from Fastmarkets suggests that the upward momentum from the 2025 LME average of US$3,218 is expected to continue through the first half of 2026, driven by regional disparities, with Chinese production running at a surplus, while the rest of the world falls short. However, the expectation is that the zinc market will achieve a better balance in the second half of the year and into 2027 as global surpluses emerge, leading to declining zinc prices.
Morgan Stanley recently revised its zinc price outlook for 2026, calling for a yearly average of US$2,900 for the base metal, according to a mid-December Reuters article. Additionally, a November Argus report noted that long-term zinc contracts have slowed amid low LME inventories, creating near-term uncertainty and driving prices higher.
Conclusion and Outlook
Zinc is listed as a critical mineral in the US for its use in the production of galvanized steel for infrastructure and defense projects. The US has already given South32’s Hermosa project FAST-41 approval, providing access to streamlined regulatory processes. With building regional disparities and a tense relationship between the US and China, deteriorating trade relations could benefit US and western producers of the metal.
However, as long as refined supply of zinc remains in surplus against a backdrop of weak demand growth, investors can expect more of the same from the zinc market in the near term. This may open up opportunities for patient or less risk-averse investors who are willing to take a wait-and-see approach to how the sector evolves. For more information on zinc investing and price forecasts, visit Here
Smart Tip for Readers
To stay informed about zinc price trends and market analysis, follow reputable sources and industry experts, and consider setting up price alerts to stay up-to-date on the latest developments in the zinc market. This can help you make more informed decisions and navigate the complexities of the zinc industry.
