[SMM Analysis]Zinc Concentrate Market Sentiment Warms Up, TCs Seem to "Replicate" Last Year's Trend!

SMM Dec 25 News:

On December 25, SMM recorded the guidance price for domestic zinc concentrate TCs in January 2026 at 1,200–1,600 yuan/mt in metal content, with an average price of 1,400 yuan/mt, down 600 yuan/mt MoM. Throughout the year, domestic zinc concentrate TCs rose first and then fell. In Q4, domestic zinc concentrate TCs largely repeated last year's pattern, with domestic zinc concentrate TCs seemingly set to return to historically low levels. However, recently, sentiment in the domestic zinc concentrate market has shown signs of warming up. Why is this

Supply side, according to SMM, as the zinc price spread between domestic and overseas markets rebounded significantly, China's zinc concentrate import window reopened in mid-December. This indicates that the price difference between domestic and imported zinc concentrates has largely narrowed. With the price advantage disappearing, smelters' enthusiasm for competing to purchase domestic zinc concentrates has weakened. Although due to the overseas Christmas holiday, recent offers and transactions in the imported zinc concentrate market have been limited, market expectations for improved supply in Q1 have increased with anticipated inflows of imported zinc concentrates.

Demand side, since Q4, as domestic zinc concentrate TCs continued to decline, smelters' production profits significantly decreased. According to SMM calculations, currently, smelters are facing losses exceeding 2,000 yuan/mt in metal content, without considering sulphuric acid and by-products. Consequently, since November, some regional smelters have begun production cuts, and the trend of increasing cuts has strengthened, leading to weaker demand for zinc concentrates.

Overall, due to ongoing production cuts by domestic smelters and the diminished price advantage of domestic zinc concentrates, the market expects that the supply-demand situation for domestic zinc concentrates may improve in January, which has led to a certain degree of recovery in market sentiment. Currently, it is a critical pricing period for domestic zinc concentrate TCs in January 2026, and SMM will continue to track subsequent developments.

(The above information is based on market collection and comprehensive evaluation by the SMM research team. The information provided in this article is for reference only. This article does not constitute direct advice for investment research and decision-making. Customers should make cautious decisions and should not replace their independent judgment with this information. Any decisions made by customers are not related to SMM.)