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Why is zinc expected to see significantly higher zinc prices later this decade?
A spate of scheduled mine closures, an underdeveloped project pipeline and steady demand growth is expected to provide the basis for significantly higher zinc prices later this decade.
In 2015, the world's largest zinc miner, Glencore, made the decision to cut production by the equivalent of 4% of global output. As a consequence of these and other production losses, global stocks of zinc concentrates have already fallen to very low levels some 12 to 18 months earlier than previously expected.
The constraints on refined metal production growth imposed by the reduced availability of zinc concentrates, combined with growing demand for zinc, is forecast to result in global inventories reaching critically low levels next year. This will provide fundamental support for a rally in the zinc price from current levels close to $2300/t, to levels comparable to the 2006 price peak.