Zinc prices increased by 0.4% to Rs 301.55, bolstered by a significant supply constraint in the global market beyond China, where stockpiles have fallen to multi-year lows. LME zinc stocks experienced a significant decline, reaching 35,200 tons, which is close to their lowest levels since March 2023. This represents an 85% reduction since the beginning of the year, heightening apprehensions regarding imminent shortages. The cash-to-three-month premium on the LME increased to approximately $250 per ton, indicating a pressing demand for immediate delivery.

In contrast, China’s social zinc ingot stocks increased to 162,000 tons as of October 23, a notable rise from approximately 100,000 tons earlier this year, highlighting a pronounced disparity between China’s surplus and the global scarcity. Indicators of diminishing U.S.–China trade tensions and a positive shift in Chinese economic metrics, highlighted by the most rapid industrial profit growth observed in almost two years, have contributed to an uplift in sentiment.

In the latest report the global refined zinc market exhibited a surplus of 47,900 tons in August. This development has resulted in a cumulative surplus of 154,000 tons for the first eight months of 2025, an increase from the 138,000 tons recorded during the same period the previous year. In September, China’s refined zinc output experienced a 4% decline compared to the previous month, yet it marked a significant 20% increase year-on-year. Projections for October indicate a potential rise of 4% month-on-month and 22% year-on-year, notwithstanding the ongoing maintenance activities in key smelting areas.

From a technical perspective, the market is experiencing renewed buying activity, evidenced by an 8.71% increase in open interest, reaching 2,721 lots. Support stands at Rs 299.9, beneath which prices may approach Rs 298.2, whereas resistance is identified at Rs 303.4, with a breach above potentially leading to a test of Rs 305.2.