Zinc experienced a decline of 1.11% to Rs 310.55, as profit-taking emerged after a robust rally. Concurrently, renewed apprehensions regarding a slower trajectory of U.S. rate cuts and uncertainty surrounding Chinese demand contributed to the prevailing sentiment. Investors in China reduced their expectations for immediate stimulus following key leadership meetings that indicated a more cautious approach to policy.

Nonetheless, losses were constrained by a reduction in on-warrant availability in LME warehouses and a positive shift in activity indicators from the euro zone, where business activity in November grew at its most rapid rate in more than two years. Global fundamentals presented a blend of signals.

The zinc market surplus contracted to 20,300 tons in September, down from 32,700 tons in August, as reported by ILZSG. Nevertheless, the refined zinc market recorded a cumulative surplus of 120,000 tons during the first nine months of 2025. Production disruptions have also contributed to market support, as several zinc mines in Central and Southwest China are gearing up for maintenance shutdowns in December, which will limit concentrate output.

Zinc inventories on the SHFE decreased by 4.17% compared to the previous week, indicating a contraction in domestic supply. However, the increase in LME stocks, which have risen by 60% since early November to reach 54,325 tons, has limited upward momentum. In September, China’s refined zinc production experienced a month-on-month decline of 4%, yet it exhibited a robust year-on-year increase exceeding 20%. Furthermore, exports in October saw a remarkable surge of nearly 244%, driven by diminished domestic demand and elevated premiums in international markets.