Ore shortage persists, zinc concentrate TCs continue to decline in September [SMM Zinc Concentrate Weekly Review]

SMM, September 4:

On a weekly basis, the SMM Zn50 domestic weekly average TC fell by 250 yuan/mt Zn WoW to -2,100 yuan/mt Zn, and the SMM Imported Zinc Concentrate Index fell by $1.25/dmt WoW to -$124.5/dmt.

Domestic ore market. In the first week of the month, TC negotiations between domestic smelters and mines remained tense, with mines continuing to push for lower TCs, but specific pricing in many regions across China had yet to be finalized, and the market awaited further clarity next week. It is understood that ore grabbing in the domestic zinc concentrate market is still ongoing, with EXW TCs for some zinc concentrate mines reportedly as low as around -2,500 yuan/mt Zn, and domestic zinc concentrate TCs extended their downward trend in September.

Imported ore market. This week, imported ore traders offered more cargoes. With the overall domestic ore shortage showing no improvement, some smelters purchased imported ore as needed, and imported zinc concentrate TCs remained at low levels. According to market sources, ordinary zinc concentrates recently traded at around -$120 to -$130/dmt, some zinc-rich concentrate container cargoes traded at around -$130/dmt, and offers from mines such as Antamina and Kipushi were around -$130/dmt.

Bunker Hill Mining Corporation announced on September 1 that the Bunker Hill lead-zinc mine in Idaho, US, produced its first lead and zinc concentrates at the end of June 2026 and is currently in the capacity ramp-up stage, with ongoing optimization of underground mining and beneficiation plant operations. The beneficiation plant has a design processing capacity of 1,800 mt/day and is planned to produce approximately 85,000 mt of zinc concentrates and silver-bearing lead concentrates per year. The company plans to supplement working capital through standby financing and concentrate prepayment arrangements, targeting full commercial production by the end of 2026.

This week, SMM zinc concentrate inventories at main ports in China totaled 277,000 mt in physical content, down 6,000 mt in physical content WoW, with Lianyungang port inventories contributing the bulk of the decline.