Global refined zinc market to face supply deficit in CY'24, lead to see surplus: study

• China's zinc, lead usage to rise in 2024, 2025
  
  
• Zinc, lead demand expected to grow in India
  
  

The International Lead and Zinc Study Group (ILZSG) has issued its forecast of supply and demand dynamics in the global lead and zinc industries for the remainder of 2024 and 2025.

While a supply deficit is expected in the global refined zinc market in CY'24, the lead market will witness a surplus. On the other hand, in CY'25, supply is expected to outpace demand in both segments.

Zinc demand

Global demand for refined zinc is projected to exceed supply by 164,000 tonnes (t) in 2024, but a production surplus of 148,000 t is expected in 2025.

Global demand for refined zinc is projected to increase by 1.8% to touch 13.83 million tonnes (mnt) in 2024 and by 1.6% to 14.04 mnt in 2025. In China, zinc usage is expected to grow 0.7% in both 2024 and 2025. While the production of galvanised sheets, passenger cars, and home appliances rose in the first half of 2024, investment in the real estate sector continued to decline. Moreover, European demand for zinc dropped by 8.6% in 2023, with an additional decline of 1% expected this year. This decrease will largely stem from reductions in Bulgaria, Germany, Italy, and Poland, though it will be somewhat offset by increases in Finland and France.

In other regions, apparent zinc demand is projected to grow significantly in India and South Korea. Increases are also expected in Brazil, Mexico, Taiwan, Turkiye, and Vietnam. Conversely, apparent usage in the United States will likely decline in 2024.

In 2025, zinc usage is expected to increase in Europe, India, and Vietnam, while a decline is forecasted for the Republic of Korea.

Zinc supply

Global zinc mine production is forecast to decline by a further 1.4% to 12.06 mnt in 2024. However, a recovery of 6.6% to 12.86 mnt is expected in 2025, mainly influenced by robust growth of 8.9% outside of China.

European zinc output is expected to drop 11.4% this year, primarily due to reductions in Ireland and Portugal, where the Tara and Aljustrel mines were placed on care and maintenance in late 2023. Declines in output are also expected in China, Canada, South Africa, the United States, and Peru, particularly at the Antamina mine. However, these reductions may be partially offset by increases in Australia, Mexico, and the Democratic Republic of Congo. For instance, the Kipushi mine, commissioned by Ivanhoe Mines, in the Democratic Republic of Congo, has a capacity of 280,000 t per year.

Lead demand

Global demand for refined lead is projected to rise 0.2% to 13.13 mnt in 2024 and 1.9% to 13.39 mnt in 2025.

Global refined lead metal supply is projected to exceed demand by 63,000 t in 2024, with a larger surplus of 121,000 t expected in 2025.

European lead demand is projected to decline 1.8% in 2024, primarily due to reduced apparent usage in Austria, the Czech Republic, France, Italy, and Poland. This decrease will outweigh increases in Finland, Greece, and the Russian Federation. Additionally, demand is expected to fall in Japan, Mexico, Turkiye, and the United States while rising in Brazil, India, the Republic of Korea, the United Arab Emirates, and Vietnam.

In China, lead demand is expected to rise 0.9% this year and 0.5% in 2025. After a significant 10.5% increase in 2023, production of lead-acid batteries saw a more modest growth of 0.5% in the first half of 2024.

In 2025, demand is expected to rebound in Europe and Mexico, while it is anticipated to keep increasing in India and Vietnam.

Lead supply

Global lead mine supply is forecasted to grow 1.7% to 4.54 mnt in 2024, followed by a further 2.1% increase to 4.64 mnt in 2025. In China, production is anticipated to rise 0.5% in 2024 and 1.5% in 2025.

Lead mine production in Mexico is expected to increase significantly this year, following a strike at Newmont's Penasquito mine in 2023. Growth is also forecasted in Australia, Bulgaria, Kazakhstan, and Sweden, while output in Ireland, Portugal, and South Africa is projected to decline.

In 2025, global supply is expected to rise, primarily due to increases in China, Ireland, and Russia, where the new Ozernoye mine has begun operations. Bosnia and Herzegovina will also see growth from the Vares mine, although this will be partly offset by a decrease in Australian output.

Meanwhile, global refined lead supply is projected to decrease by 0.2% to 13.20 mnt in 2024 but is expected to recover with a 2.4% rise to 13.51 mnt in 2025.

In 2024, refined lead production is anticipated to decline in China, Poland, Sweden, and Canada due to scheduled maintenance at Teck Resources' Trail Operations in the second quarter. However, this decline will be partially balanced by increases in Australia, Bulgaria, India, Italy, Japan, Kazakhstan, and South Korea.

In 2025, metal supply is expected to increase in Canada, China, and India, while it will decrease in the United Kingdom.