Commodity Market Report

Global zinc strategic planning outlook Q1 2023

29 March 2023

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29 March 2023

Global zinc strategic planning outlook Q1 2023

Report summary

The dominant factors influencing the zinc price and market in the medium-term are set to be mainly exogenous. Coronavirus restrictions have eased but it remains an issue. Disruptions to supply chains and the inflationary pressures that were also previously easing, have been reignited by Russia's invasion of Ukraine. In the near- to medium term, our base case outlook for the zinc market is one of refined zinc stocks at close to historically low levels, only becoming excessive in the latter part of the decade. Consequently, the zinc price is forecast to remain buoyant through to 2025. We have also considered a downside scenario featuring stagflation caused, in part, by the consequences of the war in Ukraine.

Long term forecasts, base case and high-low thresholds
Medium term forecasts
Overview
- Medium term outlook
- China
- India
- Europe
- USA
Changes to forecast zinc consumption since previous quarter
- Market adjustments
- Mine projects
- Strategic planning outlook - Long term supply considerations
- Geopolitical landscape
- Environmental challenges
- Stricter limits on Chinese concentrate imports
- Africa
- Europe
- China
- Latin America
- Oceania
- Russia and the Caspian
- Smelter supply changes since last quarter
- Africa
India
China
- Europe
- North America

Tables and charts

This report includes 35 images and tables including:

The relative strength of the dollar plays a key role in influencing the zinc price
Requirement for new mine production
Cost price relationships are used to forecast long-term prices

Price forecasts and refined market balances
The zinc market is facing substantial surpluses in the concentrate and metal markets for the medium term
Concentrate market balances table
Macro economic concerns and rising metal stocks will weigh on the zinc price in the medium term
Near- to medium-term price scenario price forecasts
Scenario prices and refined stocks in days of global consumption
Global zinc consumption by region
Long term growth in zinc consumption will be driven by Asia
Global zinc consumption is dominated by China
Per capita zinc consumption growth will be modest
Developing economies will drive consumption growth
Structural shifts in zinc's first uses have resulted in a sharp decline in intensity of use
Cyclical downturns have a significant impact on global zinc consumption
Changes to forecasts
World mine capability forecasts by region and global market adjustment
Current mine production capability is expected to peak in 2025
Chinese per capita consumption will not track Japan and South Korea
India will drive Asian consumption growth
Turkey and East European economies will drive Europe's zinc demand growth
European zinc consumption
Breakdown of the mine production adjustment
Requirement for new mine production
Mine project allowance breakdown
Mine production capability estimate was cut in 2022 and 2023 but is to increase in most years to 2030
Cumulative impact of changes to the mine production capability forecast for the period 2023-2027
Increased smelter production capability is needed from 2026
World smelter capability forecasts by region and global market adjustment
Requirement of future smelter production
Smelter utilisation forecast to rise in the medium-term
2020 smelter capability forecast has been increased by 119kt and lowered by 95kt in 2021
Cumulative impact of changes to the smelter production capability forecast for the period 2023-2027
Power prices are falling from the peak but to remain elevated