In terms of the global zinc market, the single biggest supply hit so far has come out of India. Major producers of the country have temporarily halted all operations. More significant in terms of smelter supply chains is the part closure of Peru’s mining sector. The country’s mines churned out almost 1.5 million tonnes of zinc in both 2017 and 2018. Domestic smelter capacity is limited to Nexa Resources’ Cajamarquilla plant, which produced 333,000 tonnes of refined metal in 2018. The extent of the collective shutdown is still uncertain with some mines, such as the giant Antamina, deemed to be critical and allowed to continue operating.
On the other hand, the major drivers for this market are increasing demand for galvanized steel and infrastructure development in emerging markets like India, Brazil, and Indonesia. Furthermore, growing demand from niche applications like smartphones, electric vehicles, mild hybrid engines, and power grid storage will drive the zinc market.
Emerging trends, which have a direct impact on the dynamics of the industry, include increasing use of hot-dip galvanizing in automotive for advance high strength steels (ahss) with exceptional surface quality, increase in the use of zinc-air batteries in electric vehicles, and use of zinc in medicine for the treatment of depression and psychosis. Glencore International, nyrstar, Hindustan zinc, Korea zinc, Boliden Group, china minmetal, nexa resources, Shanxi non-ferrous, teck, penoles, and Noranda are among the major suppliers of zinc.
That said, a cumulative supply-side shock is anticipated in the near future.