Zinc Drops As Global Refined Market Seen Swinging To 25,000‑Ton Surplus In 2027
Kedia Advisory – Zinc slipped 0.27% to Rs 423.1 as traders priced in a global refined zinc surplus by 2027. The drop was cushioned by short‑term supply tightness and falling Chinese stocks, which kept the loss modest. LME cash contracts still traded at a premium to three‑month contracts, showing that near‑term supply feels scarce.
Shanghai Futures Exchange data showed zinc inventories fell 1.5% from the prior Friday, easing the stock overhang in China—the world’s biggest zinc consumer. In September 2026, China’s refined zinc output dropped 1.9% month‑on‑month and 6.4% year‑on‑year, while Western refined production was down 3.4% year‑on‑year in the first half of 2026 because of higher energy costs and limited raw material access. On top of that, Nyrstar launched a strategic review of its loss‑making Budel smelter in the Netherlands, adding another supply risk.
On the upside, more Chinese zinc concentrate could loosen the supply pinch, as domestic mine output is set to bounce back in October after earlier accidents and safety checks halted operations. Japan’s Mitsui Kinzoku plans to crank out 117,700 tonnes of refined zinc in the second half of fiscal 2026 – a 32% year‑on‑year jump that could feed global supply.
The International Lead and Zinc Study Group projects the refined zinc market will swing from an 88,000‑tonne deficit in 2026 to a 25,000‑tonne surplus in 2027. Global refined zinc production is expected to rise 2% to 14.21 million tonnes in 2027, while mine production should grow 3% to 12.78 million tonnes. Demand is forecast to increase 1.2% to 14.19 million tonnes, driven by Europe, India and the United States. Chinese demand, however, is likely to slow to 0.3% from 1.8% in 2026 as real‑estate investment weakens. China’s net imports of refined zinc plunged 79% year‑on‑year to 38,000 tonnes in the January‑June period, reflecting higher domestic smelting capacity and better self‑sufficiency.
From a technical view, zinc is seeing a long unwind: open interest fell 4.34% to 1,741 contracts and the price slipped Rs 1.15. Immediate support sits around Rs 420, with another level at Rs 417. Resistance is near Rs 426; a clear break could push prices toward Rs 429.50.
Should you invest $2,000 in NYR right now?
ProPicks AI runs NYR through its monthly screen of thousands of stocks using over 100 ficial metrics. The engine leans on data‑driven analysis – no hype, no bias – to spot companies that offer the best risk‑reward balance today. Past winners highlighted by the system include Super Micro Computer (+185%) and AppLovin (+157%). If you want to know whether NYR appears in any current ProPicks AI strategy or if there are stronger picks in the same sector, just ask.
Conclusion for Businesses and Traders
The market is gearing up for a surplus of refined zinc in 2027, which could keep prices under pressure despite short‑term tightness. Companies that rely on zinc should monitor inventory trends in China and watch for any operational changes at key smelters like Budel. Hedging or locking in supply now may help manage the expected price dip, while firms with excess zinc exposure might look for buying opportunities as the surplus builds.