Theme of the Day: Lead in 109kt surplus, zinc in 19kt deficit in 2026 - ILZSG

Lead - Outlook for 2026 Global demand for refined lead metal is anticipated to increase by 1.1% this year to 13.72Mt. In the US, imports of refined metal rose significantly in 2025, and apparent usage increased by 6.1%. In 2026, a further increase of 3.6% in demand is anticipated. In Europe, demand is expected to grow more moderately, by 0.8% in 2026, after increasing by 3.3% last year. In China, production of both cars and e-bikes increased significantly in 2025, supported by government trade-in policies. However, net exports of lead-acid batteries declined over the same period, resulting in a limited growth of 0.4% in lead demand. In 2026, Chinese demand is forecast to fall by 0.7%. World lead mine production is forecast to grow by 1.2% to 4.60Mt in 2026, principally due to increases in Australia, China, India, Ireland and Portugal, where the recovery of lead and zinc at the Aljustrel mine resumed in Q4 25. These increases will be partially offset by reductions in the US and Sweden, where the Garpenberg operation is facing operational constraints due to increased seismic activity, which are expected to limit output this year. World refined lead metal output is expected to increase by 1.3% to 13.83Mt in 2026, mainly influenced by rises in China, India, Japan, Kazakhstan and Brazil, where new secondary capacity was commissioned in 2025. In the UK, however, production is expected to decline. World Refined Lead Metal Balance: ILZSG anticipates that global supply of refined lead metal will continue to exceed demand in 2026, with the amount of the surplus increasing to 109kt. Zinc - Outlook for 2026 Global demand for refined zinc metal is forecast to rise by 1.3% to 14.00Mt in 2026. In China, usage is expected to rise by a further 1.8% this year, following growth of 1.9% in 2025. In Europe and the US, demand increased by 3.5% and 7% last year respectively. In 2026, more moderate rises of 1.1% in Europe and 1.4% in the US are anticipated. Elsewhere, demand is forecast to rise in India and South Korea, but to fall substantially in Iran, due to major damage to infrastructure, particularly in the steel industry, caused by the ongoing conflict in the region. After declining over three years, world zinc mine production rose by 4.8% in 2025, mainly influenced by a robust growth of 5.9% in the world ex-China. In 2026, global output is expected to rise by a more modest 0.3% to 12.55Mt. Production is anticipated to increase in the DRC, Portugal, and China, where a substantial amount of new capacity, including the large Huoshayun mine, is expected to be commissioned this year. However, output is expected to decline in Peru, Sweden and the US, principally due to significant reductions at the Antamina, Garpenberg and Red Dog operations respectively. ILZSG anticipates that world refined zinc metal output will rise by 1.4% to 13.99Mt in 2026. Chinese refined zinc metal output is expected to benefit from the commissioning of new capacity and rise by 3%, following a substantial increase of 6.7% last year. European output is also expected to increase, driven by rises in Norway, where Boliden recently completed an expansion at its Odda smelter, and in the Russian Federation, influenced by the upcoming start of the new Verkhny Ufaley smelter in the Chelyabinsk region. These increases will be partially offset by declines forecast for several other European producers, mainly as a result of higher energy costs and lower availability of concentrates. Elsewhere, production is forecast to increase in South Korea but to decline in Iran and Canada, where Teck Resources expects lower output at its Trail Operations in 2026. Regarding the global market balance, ILZSG anticipates that demand for refined zinc metal will exceed supply in 2026 by a limited amount, with the deficit currently forecast at 19kt.