Import window closed in June, with no expected increase in refined zinc imports [SMM analysis]

SMM News on June 20:

According to the latest customs data, imports of refined zinc in May 2025 stood at 26,700 mt, a decrease of 1,500 mt MoM or down 5.36% MoM, and a decrease of 39.85% YoY. The cumulative imports of refined zinc from January to May reached 155,900 mt, a year-on-year decrease of 16.66%. In May, exports of refined zinc were 1,400 mt, resulting in a net import of 25,300 mt of refined zinc for the month.

The top three countries for refined zinc imports in May were Kazakhstan (15,600 mt, 58.7%), Australia (3,600 mt, 13.56%), and Spain (2,800 mt, 10.57%). From a country-specific perspective, Spain and Brazil saw significant increases, while decreases were mainly concentrated in Kazakhstan and Australia.

Overall, refined zinc imports in May were basically flat MoM but fell short of expectations. This was primarily due to the brief opening of the import window in early May, which provided opportunities for some spot order imports. Zinc ingots from Spain and Brazil flowed in accordingly, but within the month, regular import volumes from Kazakhstan resumed, leading to a significant decline in imports. From a YoY perspective, imports decreased significantly, mainly due to a larger inflow of bonded warehouse goods in the same period last year, whereas there were fewer bonded warehouse goods flowing in this May, resulting in limited inflows.

Entering June, on the macro side, geopolitical risks in the Middle East have increased, the US Fed has maintained interest rates unchanged, but stagflation risks have risen, and there has been no progress on tariff policies, leading to a bearish macro sentiment. On the fundamentals side, overseas LME inventory has continued to fall to less than 130,000 mt, with limited production increases at smelters. Domestically, with the supplement of imported ore and the production release from domestic mines, TCs have continued to rise. With sufficient raw materials, smelters have shown high production enthusiasm. On the consumption side, apart from weakened exports due to tariff issues, domestic consumption has entered the off-season. With increased supply and weakened demand, social inventory has started to build up, and price support is weak. With overseas market outperforming domestic market, the SHFE/LME zinc price ratio has declined, and the import window has closed. However, goods locked in at previous prices are still flowing in, and imports are expected to remain at around 25,000 mt.

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