LME zinc hit $3,703.50, its highest since June 2022, as Chinese mine and smelter disruptions, weak producer output, low inventories and negative treatment charges tightened supply.
Zinc futures rose above $3,650 per tonne, with three-month LME zinc briefly reaching $3,703.50 per metric ton on August 3 before easing to close at $3,641.00, down $2.00 or 0.05% on the day. The move left zinc at its highest level since June 2022, extending a broader rally that has run for four straight months through July. The advance was driven by tightening supply signals. In China, production adjustments at a zinc mine in the southwest are expected to cut zinc concentrate output by about 1,000 tonnes in August, while scheduled maintenance at a major smelter in central China could reduce output by another 1,000 to 1,500 tonnes. Broader producer data also pointed to softer supply: Glencore reported a 21% year-on-year drop in own-sourced zinc production in the first half of 2026 while maintaining full-year guidance, Boliden posted a 16.8% quarter-on-quarter decline in zinc concentrate production, and MMG recorded a 1% year-on-year fall in the second quarter. Low global inventories and treatment charges falling into negative territory added to expectations of tight supply by reducing incentives for smelters to raise output. Strength in copper, which traded at $13,870 per metric ton, also drew investment into zinc and other base metals, while a weaker U.S. dollar supported prices by making dollar-priced commodities cheaper for buyers using other currencies. Market participants remain focused on whether supply tightness will persist and whether higher prices could begin to curb demand for galvanized steel.