LME zinc prices surge amid supply tightness and firm demand outlook

• LME zinc cash prices gain 1.63% w-o-w
• Zinc stocks edge 0.25% lower during the week

The London Metal Exchange (LME) zinc market surged during 12-16 January 2026, breaking out from recent consolidation. Prices climbed steadily on technical buying, short-covering, and renewed focus on tight concentrate supply, despite elevated exchange inventories providing some counterbalance.

Price trends

LME zinc cash prices rose from $3,150/t on 12 January to $3,259.50/t on 13 January, peaking at $3,288.50/t on 15 January before settling at $3,201.50/t on 16 January–a weekly gain of 1.63%. The three-month contract tracked higher from $3,195/t to $3,308/t on 15 January & closed at $3,242/t on 16 January (up roughly 1.5% w-o-w), testing resistance near recent 2025 highs around $3,250/t.
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Inventory analysis

LME zinc stocks edged lower during the week, declining from 106,800 t on 12 January to 106,725 t on 14 January and 106,525 t by 16 January-a weekly drop of 0.25%.
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MCX zinc trends (12-16 Jan)

On the MCX, 27 February zinc futures gained 0.9% w-o-w, trading INR 313,000-321,000/t in line with LME’s rally. The active future contract closed at INR 313,750/t on 12 January, peaking at INR 321,250/t on 15 January and closed at INR 316,600/t on 16 January. Post-holiday volumes strengthened as galvanising demand picked up, supporting prices despite comfortable domestic supply levels.

SHFE zinc trend

On the SHFE, the March 2026 contract (ZN2603) traded around CNY 23,100/t, up 1.2% w-o-w with SHFE/LME spreads near 7.59. Tight domestic TC levels at CNY 1,500/t and closed export arbitrage sustained firmness amid steady concentrate constraints.
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Hindustan Zinc drives low-carbon zinc adoption

Hindustan Zinc Limited and Silox India have strengthened their long-standing partnership with the adoption of EcoZen, Hindustan Zinc’s low-carbon zinc brand, across Silox’s manufacturing operations to cut embedded carbon emissions and advance sustainable industry practices. Produced entirely with renewable energy, EcoZen has a verified footprint under 1 t CO₂/t zinc–about 75 % lower than the global average. The move supports ESG goals and greener zinc supply chains in India’s metals and chemicals sectors.

Outlook

In the near term, zinc is expected to remain firm, with upside bias intact as long as concentrate tightness persists. However, elevated exchange inventories and resistance above $3,300/t could cap gains unless demand indicators strengthen further.