- Zinc dross, oxide prices rise by INR 7,800-10,800/t w-o-w
- Low LME stocks support replacement costs despite benchmark correction
India’s zinc dross and zinc oxide prices rose sharply w-o-w in the week ended 20 August 2026, supported by elevated replacement costs and LME zinc inventories remaining below 100,000 t. However, subdued downstream demand kept buying activity largely need-based, limiting the scope for further gains.
Three-month LME zinc prices stood at $3,652/t on 19 August, down from $3,727.5/t on 13 August. Prices climbed to $3,768/t on 17 August before correcting to $3,652/t by 19 August.
LME zinc inventories increased to 95,050 t on 19 August from 92,550 t on 13 August after falling to 86,525 t on 18 August. Despite the recovery, stocks remained below the 100,000-t mark, keeping replacement costs elevated for secondary zinc products.
Zinc dross, oxide prices rise
Domestic zinc dross prices increased by INR 7,800/t w-o-w to INR 337,800/t ex-Delhi, from INR 330,000/t previously.
Zinc oxide (99% Zn) prices rose by INR 10,800/t w-o-w to INR 325,800/t ex-Delhi, compared with INR 315,000/t a week earlier.
The sharper increase in secondary zinc prices compared with the movement in benchmark zinc reflected firm replacement costs and resistance among sellers to lower offers. Suppliers continued to factor elevated primary zinc costs into their pricing despite the recent correction in international and domestic benchmarks.
Demand, however, remained subdued. Buyers continued to purchase mainly against immediate requirements and were reluctant to build inventories at higher price levels.
Scrap prices remain supported
In the north Indian zinc scrap market, big Tukdi (97-98% Zn) was heard at around INR 342,000/t ex-Delhi.
Regular Tukdi (97-98% Zn) was reported at INR 337,000-338,000/t, while small-sized Tukdi was heard at around INR 335,000-336,000/t.
Scrap quotations remained supported by higher replacement costs, with sellers maintaining offers in line with firm secondary zinc prices. However, trading remained selective as consumers continued to limit purchases to immediate requirements.
Zinc-bearing scrap availability remained adequate, with no major supply constraints reported. The availability of material, combined with subdued downstream consumption, kept transaction volumes limited despite higher seller offers.
Domestic benchmark correction limits upside
Market sentiment remained cautiously positive as LME zinc inventories stayed below 100,000 t and replacement costs remained elevated. However, the correction in benchmark zinc prices from the 17 August high indicated some easing in primary market momentum.
Domestic SHG zinc prices stood at INR 403,000/t on 19 August, down from INR 406,500/t on 13 August. The INR 3,500/t w-o-w decline in the domestic benchmark contrasted with the sharper increase in secondary zinc prices during the same period.
The rise in dross and oxide prices despite lower primary zinc benchmarks indicates that secondary market pricing was being supported by replacement costs and firm seller expectations rather than an improvement in physical demand.
Buyers continued to resist aggressive price increases amid weak downstream consumption. Enquiries remained available, but conversions were limited, keeping overall trading activity subdued.
Outlook
Zinc dross and zinc oxide prices are likely to remain supported as LME inventories stay below 100,000 t and domestic replacement costs remain elevated.
However, the recent correction in benchmark zinc prices and subdued downstream demand may limit further sharp gains. Buyers are likely to continue procuring primarily against immediate requirements.
Further price direction is likely to depend on LME inventory movements, benchmark zinc prices and domestic replacement costs. Unless downstream demand improves materially, secondary zinc prices may remain firm but see only gradual movements.
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