Zinc/Lead Market Weekly Updates - 2025/8/1

The SMM Imported Zinc Concentrate Index for this week is $78.75/dmt, with a 3.28% WoW increase.

The SMM Imported Lead Concentrate average spot TC for this week is $-60/dmt, unchanged WoW.

Spot Market & Tender Updates

• Sentiment toward imported concentrates remained muted this week, as most smelters still report ample feedstock inventories. Import arbitrage continues to look unfavorable, dampening purchasing enthusiasm.

• Offers for rich concentrates from Antamina and Bisha remained in the range of US$60–70/tonne CIF, according to multiple market sources, but no deals were concluded at those levels.

• Market participants noted that ordinary concentrates at Lianyungang are now quoted around RMB 4,000/tonne, with lower-grade material over this level. Recent quotes for September/October arrival bulk shipments have reached as high as US$90, though no confirmed transactions have been reported.

• One smelter reported purchasing a blended cargo of 1,000 tonnes from Dugald River and 4,000 tonnes from Bisha at a price of US$65/tonne on a self-pickup basis at port. After factoring in port-related costs (over US$10/tonne), the effective cost was estimated to be in the US$60s/tonne.

• The market also heard of small containerized shipments of high-grade Cuban material offered at just above US$50, while some high-end quotes included US$120 for Shouxin and US$100 for Gamsberg. Market participants reckoned that the US$100 offers likely reflect sellers looking to quickly offload material close to arrival, while US$70–90/tonne remains the more “normal” range for comparable quality. Antamina typically trades at a US$10/tonne premium over standard grades.

• A trading house reported concluding a small volume lead concentrate deal—several hundred tonnes at M+3 pricing, minus US$60–70, for material with silver content below 200g/t.

Global Mine & Smelter Insights

• According to South Korean media reports on July 30, the South Korean government is considering encouraging domestic companies to participate in U.S.-led efforts to restructure global supply chains away from China. Korea Zinc has reportedly become a key factor in the ongoing tariff talks. A government official revealed that working-level discussions are underway between the U.S. and South Korea regarding Korea Zinc’s proposed investment to build a non-ferrous metal smelter in the United States. Supply chain cooperation has become central to recent U.S. trade agreements with the EU and Japan. For example, Japan pledged a $550 billion investment fund to support joint development in advanced manufacturing and strategic minerals. Analyst at the Korea International Trade Association noted that U.S. demands now go beyond tariff reduction, emphasizing economic security and resilient supply chains.

• On July 30, 2025, the Trump administration and South Korea reached a provisional agreement to lower the previously planned 25% tariffs on South Korean automobiles and other goods to 15%. In return, South Korea committed to investing approximately US$350 billion in the United States and purchasing US$100 billion worth of American energy products in exchange for tariff reductions or exemptions. As of now, it remains unclear whether the reported investment from Korea Zinc has been included in the final negotiation package or not. If so, it may have a material impact on the non-ferrous metal supply chain for North America.

• Xinjiang Huoshaoyun: The company may proceed with another round of concentrate sales this year, as production has been smoother than expected. Due to potential transport disruptions from snowfall in Q1, the mine is expected to ship additional material to the smelter in advance. The smelter is located on the plains, approximately 5,000 kilometers from the mine. In July, 110kt of zinc concentrate were delivered to the smelter, and the mine still holds an estimated 50kt in stock. The mine’s August production target is 100kt, and it remains possible to reach the 500kt-600kt annual target. The smelter currently holds around 250kt of raw material inventory. The 50kt zinc ingot production plan remains unchanged, with output expected to begin in September, while lead ingot production is likely to start in October.

• On July 31, Nexa announced that Phase I of its Cerro Pasco integration project has reached key milestones, including the completion of engineering design and receipt of all necessary permits. Phase II is advancing on schedule. The project is expected to extend the mine life of Atacocha and El Porvenir by over a decade while enhancing overall profitability.

• At the Aripuanã mine, the procurement and installation of the fourth tailings filter remain on track for completion in the second half of 2025, with commissioning anticipated in the first half of 2026—unlocking full production capacity. Zinc in concentrate production in Q2 2025 reached 74kt, up 9% QoQ, primarily driven by improved operational performance at Nexa’s Peruvian mines. Compared to Q2 2024, production was down 12% due to lower output from Brazilian operations, partially offset by higher contributions from Atacocha and El Porvenir. In Q2, refined zinc and zinc oxide sales totaled 145kt, up 12% from Q1, supported by higher production at Cajamarquilla and Juiz de Fora, along with increased zinc oxide output at Tres Marias. Total production of refined zinc and zinc oxide reached 139kt, up 5% QoQ and down 9% YoY, in line with Nexa’s full-year sales guidance of 560kt to 590kt. As a integrated mining-smelting enterprise Nexa only sources part of their concentrate from external sources, and they sign third-party concentrate purchase contracts with 3-year moving average TC to avoid short-term volatility. Only approximately 30% of zinc concentrates Nexa purchased in 2025 are exposed to 2025 TC, with most contracts signed before April. A similar level is expected in 2026.

Weekly SMM Data

• This week, zinc concentrate inventories at major Chinese ports totalled 333,500 tonnes, down by 20,500 tonnes from last week. As of Thursday, SMM surveyed social inventories across seven regions in China, totalling 103,200 tonnes, with a slight weekly depletion of 500 tonnes and a WoW increase of 4,900 tonnes. Arrivals are steady, but downstream procurement and offtake remain limited amid the off-season in consumption.

• This week, lead concentrate inventories at major Chinese ports totalled 17,700 tonnes, up by 3,700 tonnes from last week. As of Thursday, social inventories across seven regions in China stood at 73,000 tonnes, with a weekly build of 1,300 tonnes and a WoW increase of 1,600 tonnes. Lead supply has seen a short-term increase this week as primary smelters gradually resume operations and secondary lead smelters restart or ramp up new capacity. Part of the market participants are opting for warehouse delivery as a hedging strategy, leading to a continued rise in social inventories of lead ingots.

• In July 2025, China's refined zinc production reached 602,800 tonnes, marking an increase of 17,700 tonnes MoM or 3.03%, and a YoY rise of 23.11%. Cumulative production for January to July totaled 3.84 million tonnes, up 4.67% YoY, exceeding prior expectations. Zinc alloy production in July was reported at 1.102 million tonnes, up by 3,600 tonnes from June. SMM forecasts that refined zinc production in August 2025 will reach 621,500 tonnes, representing a MoM increase of 18,870 tonnes (3.1%) and a YoY increase of 27.8%. Cumulative production from January to August is projected at 4.464 million tonnes, up by 7.38% YoY.

• In July 2025, China's secondary lead production reached 258,000 tonnes, an MoM increase of 31.6 tonnes or 14%. Despite the continued negative profit margin, new capacity additions and post-maintenance restarts this month have largely offset the volume lost from ongoing curtailments. SMM forecasts that secondary lead production in August 2025 will reach 273,900 tonnes, representing a MoM increase of 15,960 tonnes (6.2%). We are still working on Chinese primary lead production and will bring up a summary on this section early next week.

Author: Yueang He, Zinc & Lead Analyst of SMM UK

Contact: yueanghe@smm.cn | +44 (0)7522 173725