Zinc prices advanced 1.93% to settle at Rs 375.9, bolstered by constricting near-term supply conditions and a resurgence in manufacturing activity across major economies. A more robust manufacturing outlook from China, Europe, and the United States has enhanced sentiment for industrial metals. Concurrently, supply disruptions at critical mining and smelting operations have sustained prices, even in the face of rising input costs. Fundamentally, China’s zinc production rose by 9.4% year-on-year in May, showcasing robust domestic output.

Concurrently, inventories in warehouses monitored by the Shanghai Futures Exchange fell by 2.2% from the previous week, suggesting stable physical demand. U.S. manufacturing activity has sustained its expansion for the sixth consecutive month, albeit with a slight moderation in growth compared to the robust pace observed in May. On the supply side, Glencore’s Kazzinc facility in Kazakhstan remains operational below capacity due to an explosion, whereas Nexa’s Cajamarquilla smelter in Peru is slowly returning to full operations following disruptions caused by a fire.

Production concerns continue to loom at Boliden’s Garpenberg mine in the aftermath of previous seismic activity, contributing to a relatively tight refined zinc market. The International Lead and Zinc Study Group reported that the global zinc market surplus narrowed significantly to 26,500 metric tonnes in April from 56,300 metric tonnes in March, although the market remained in surplus during the first four months of the year. Meanwhile, Japan’s Mitsui Mining and Smelting intends to boost refined zinc production by 3.2% in the first half of the 2026-27 financial year.

Goldman Sachs projects a slight global surplus in zinc for this year, yet foresees supply shortages outside of China beginning in 2027, driven by a deceleration in mine supply growth alongside a consistent increase in demand. Technically, zinc continues to attract fresh buying interest, evidenced by a 10.66% increase in open interest in conjunction with rising prices. Immediate support is positioned at Rs 370.4, with subsequent support at Rs 365.0, whereas resistance is identified at Rs 379.6. A sustained breakout above this level could extend gains toward Rs 383.4.