Zinc experienced a modest increase, closing 0.21% higher at Rs 327, bolstered by ongoing supply concerns despite the mixed signals regarding broader demand. The combination of constrained inventories and intermittent mining interruptions in China provided a foundation of support. A mine in southwest China halted production earlier this month, while a lead-zinc operation in central China initiated holiday-related shutdowns, collectively reducing the availability of concentrate in the short term. Nonetheless, supply risks are being partially mitigated in other areas.

Operations at Boliden’s Tara mine in Ireland have recommenced, while Ivanhoe’s Kipushi project in the DRC is steadily increasing its output. In December, China’s refined zinc production reached an unprecedented 675,000 metric tonnes, reflecting a year-on-year increase of 13.1%, as smelters took advantage of advantageous margins. Production for the full year 2025 increased by almost 6% to reach 7.41 million tonnes.

In November, the global refined zinc market experienced a modest deficit of 7,700 tonnes, yet it continues to exhibit a surplus when evaluated on a year-to-date basis. On the macroeconomic landscape, the Federal Reserve’s minutes disclosed a spectrum of opinions regarding interest rate policy, while disappointing data from China and inconsistent domestic demand limited upward momentum.

The market is currently experiencing short covering, evidenced by a significant decline in open interest of 41.72%. Immediate support is observed at Rs 326, with a potential decline toward Rs 324.8. Resistance is positioned at Rs 328.9, and a persistent advance beyond this level may propel prices towards Rs 330.6.