LME zinc cash settled at $3,811 per tonne on October 12, 2026, with registered stock reaching 132,850 tonnes, according to Westmetall data read on October 13, 2026. The three-month price stood at $3,760, maintaining a cash premium of $51 above the forward contract. Analysts forecast LME zinc will decline to $3,550 per tonne by November 20, 2026, in the base case scenario.
This target aligns with the July 15, 2026 three-month settlement level, when cash was trading at $3,553.50 with stock at 112,450 tonnes. The bull case sets a target of $4,000 per tonne, contingent on registered stock falling below 100,000 tonnes. The bear case projects $3,349 per tonne, which would occur if cash prices trade below the three-month price.
The forecast is based on the International Lead and Zinc Study Group (ILZSG) preliminary data released on August 26, 2026, which reported a refined zinc surplus of 120,000 tonnes in the first half of 2026. Registered inventories increased by 92,000 tonnes during the same period. Global mine output declined 2.6% due to lower production at Antamina, Garpenberg, and Red Dog, along with the end-2025 closure of Lady Loretta.
However, refined output rose 1.3% overall, driven by Chinese production increases of 5.9%, though output outside China fell 3.4%. The cash premium has narrowed significantly from $217 on August 27 to $51 on October 12, reflecting the market's adjustment to rising visible inventories. Despite the stock buildup, the London curve remains backwardated, meaning cash prices trade above three-month futures prices.
Analysts attribute this to Chinese refined metal exports, which Reuters reported at 40,668 tonnes in August 2026, the second-highest monthly total in nearly 20 years according to World Bureau of Metal Statistics (WBMS) data. The base case forecast will be invalidated under four specific conditions: a Friday official cash settlement above $4,060, registered stock falling back below 99,125 tonnes, a cash premium wider than $150 while stock continues to rise, or a published ILZSG summary from the October 14 to 16 Lisbon session showing a full-year 2026 refined deficit. Tom Price, analyst at Panmure Liberum, noted that steel production remains a primary demand driver for zinc.
Guido Janssen, chief executive of Nyrstar, indicated that refining operations are facing difficult financial conditions. The October analysis follows an earlier August 17 forecast predicting zinc would reach $4,100 during the fourth quarter of 2026, a level that was exceeded when cash settled at $4,186 on September 9. Chinese concentrate imports surged 8.3% to 1,324,000 tonnes in the first half, while net refined imports declined to 39,000 tonnes from 180,000 tonnes in the same period of 2025.
The market will watch for updated forecasts from the ILZSG meeting in Lisbon and continued Chinese export flows through Asian trading hubs including Hong Kong, Singapore, and Kaohsiung. Source: The Industry Spread, reporting by Abdelaziz Fathi, filed October 13, 2026. Data sourced from Westmetall LME official settlement data and ILZSG August 26, 2026 preliminary release.
Source: theindustryspread.com