Zinc Ore TC Continued to Rise in June; What is the Current Situation of the Domestic Zinc Ore Market? [SMM Analysis]

SMM News on June 11:

       As of June 6, 2025, the SMM domestic weekly zinc concentrate TCs rose to 3,600 yuan/mt (metal content), and the SMM imported zinc ore index increased by $50.35/dmt, with overall TCs continuing to rise compared to May. Behind the sustained growth in smelter production, what factors are driving the increase in zinc concentrate TCs in June? Let's analyze it from the supply side:

Domestic ore perspective:

       The production of mines that had previously reduced or halted operations gradually recovered, and the resumption of production at mines in Xinjiang also brought significant incremental supply. In May, the SMM domestic zinc concentrate production continued to increase MoM. As June arrives, the capacity of resumed mines continues to climb, and it is expected that domestic zinc concentrate production will further increase. Additionally, despite recent environmental protection checks in some domestic regions, their impact on lead-zinc mine production has been limited, with the entire industry maintaining normal production operations.

From the perspective of imported ore:

       According to data from the General Administration of Customs of China, China's cumulative zinc concentrate imports from January to April reached 1.7125 million mt (dmt), up 45.26% YoY, indicating a relatively high level of overall imported zinc ore. Furthermore, a large shipment of 0Z zinc ore from Russia arrived at the Manzhouli port in May, effectively supplementing the supply in north China regions such as Inner Mongolia. Combined with the continuous arrival of imported zinc ore previously ordered by smelters, this collectively supported a more significant increase in zinc concentrate TCs in north China compared to south China in June.

       Overall, due to the continuous supplementation of imported zinc ore, the days of raw material inventories at smelters, as tracked by SMM, remained at around 27 days in May, with raw material supply remaining relatively abundant, driving up zinc concentrate TCs in multiple regions in June. However, as newly commissioned smelters gradually commence production in June, along with the gradual resumption of production at smelters that had previously undergone maintenance, the demand for zinc ore will become more robust. If there is no further supplementation of imported zinc ore, it is expected that the upside potential for subsequent zinc concentrate TCs may be limited. Continuous attention should be paid to the subsequent inflow of imported zinc ore.

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