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Informist, Wednesday, Oct. 8, 2025

 

MUMBAI – FitchSolutions company BMI has raised its annual average zinc price forecast to $2,750 per tonne for 2025 on optimism around rate cuts by the US Federal Reserve this year, a weaker dollar, and "continued broad--though volatile--market resilience". However, downside risks remain amid subdued global demand and an increase in production by China.

 

BMI now holds a more optimistic outlook for zinc prices in the second half of the year than it did previously. The agency expects prices to find support around the $2,700-$2,800 per-tonne level. After falling to $2,588 per tonne on Apr. 4, prices of the metal have rebounded and are up 3.7% this year as of Tuesday. Zinc prices climbed to $3,035 per tonne Friday, the highest level this year, amid notable drawdowns in stocks held at warehouses registered with the London Metal Exchange. However, BMI sees this break above the $3,000 per-tonne level as short-lived, with "the drawdowns largely reflecting warehouse positioning rather than a genuine tightening in the physical market".

 

Despite the inventory-led rally seen this month, the underlying narrative remains unchanged as recovering production of refined zinc and subdued demand growth will continue to cap prices, it said. BMI now expects a surplus of 187,000 tonnes in 2025, up from its previous projection of 167,000 tonnes.

 

In the long term, BMI expects zinc prices to average $2,774 per tonne over 2025-2029, remaining below the $3,440 per-tonne level seen in 2022. "The zinc market is forecast to remain in surplus over our forecast period (2025-2034)," BMI said. "However, we expect to see the surplus narrow, after peaking at 532kt (532,000 tonnes) in 2027. The acceleration of the clean energy transition is expected to significantly boost zinc demand in the coming years." 

 

At 1447 IST, the three-month zinc contract on LME was 0.2% higher at $2,746.5 per tonne.  End

 

US$1 = INR 88.79

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Reported by Ashutosh Pati

Edited by Rajeev Pai

 

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