Low Zinc TCs Signal Persistent Pressure on Global Smelters

Teck Resources

Low zinc TCs are showing that zinc concentrate supply remains tight across the global market. Smelters are still competing for limited feedstock, keeping treatment charges far below levels that support strong processing margins.

The 2026 benchmark zinc smelter treatment charge between Korea Zinc and Teck Resources has been set at $85 per tonne. That is $5 per tonne higher than last year’s historic low, but it remains sharply below previous market levels.

The benchmark is still 48% lower than the 2024 level and 69% lower than the 2023 level. This means the modest year-on-year increase does not signal a real recovery in smelter economics.

Zinc Concentrate Supply Remains the Main Constraint

Zinc concentrate supply continues to define the market balance. The annual Korea Zinc and Teck Resources settlement is widely followed across the global zinc industry, with regional discounts or premiums applied by individual buyers and sellers.

Smelters remain exposed because the new benchmark does not provide attractive margins. High energy costs, delayed plant ramp-ups, and limited concentrate availability are keeping refined zinc output under pressure.

Producers with internal mine supply or strong recycled feed positions are better protected. Boliden, for example, expects to source most of its smelter feed internally, reducing its exposure to volatile third-party concentrate markets.

Chinese Spot TCs Show Ongoing Feedstock Competition

Chinese spot TCs also point to persistent tightness. Imported zinc concentrate spot treatment charges in China were recently assessed at $15–28 per dry metric tonne, far below quarterly guidance levels.

The gap between spot TCs and guidance reflects intense competition among Chinese smelters. Several suppliers have limited imported concentrate stocks, while winter shutdowns at mines in northern China have kept feed availability constrained.

China’s zinc concentrate imports rose 30% year on year to 2.58 million tonnes in 2025. Strong import demand, combined with surplus refined metal exports, has increased pressure on spot TCs as smelters fight for concentrate.

The emergence of negative treatment charges in late 2024 showed how severe the squeeze had become. In that market structure, smelters effectively paid mining companies to secure feedstock, highlighting the imbalance between smelting capacity and available concentrate.

The Metalnomist Commentary

Low zinc TCs show that zinc’s pressure point is not only demand, but feedstock control. Smelters with captive mines, recycled inputs, or flexible procurement will hold a structural advantage while concentrate remains scarce.