Global Zinc Market Falls into Pessimism
Zinc prices on the London Metal Exchange have continued their downward trend since early March, currently stabilising at around $2,600 per tonne. This prolonged decline underscores growing pessimism among global market participants, who are increasingly concerned about the widening imbalance between supply and demand. One of the main contributing factors is the anticipated reduction in the production of flat galvanised rolled products and hot-dip galvanised steel structures, which are vital components in infrastructure, automotive, and construction sectors. Weak demand in these industries is casting a shadow over near-term zinc consumption forecasts.
These market anxieties were recently validated by news of an unusually low smelting fee in a contract between Canadian company Teck Resources and South Korea's Korea Zinc. The agreed fee of $80 per tonne is the lowest seen in fifty years. For comparison, the fee reached a historic high of $300 per tonne in 2020, dropped to $159 in 2021, rebounded to $274 in 2023, and fell again to $165 in 2024. This latest figure suggests a deeply troubled pricing environment for smelting services.
Additional pressure on prices comes from increased availability of zinc concentrates, particularly from Russia and the Democratic Republic of Congo. These new flows of raw material are shrinking the global net metal deficit, which was reported to be 62,000 tonnes last year by the International Lead and Zinc Study Group. The prospect of an even smaller deficit in 2025 is weighing heavily on the market.
The demand outlook for 2025 remains muted. Sluggish activity in the global construction industry continues to limit demand for zinc-coated steel products. Compounding the situation, new import tariffs imposed by U.S. President Donald Trump have discouraged trade, adding further deflationary pressure. Zinc prices, which briefly touched $3,000 per tonne earlier in the year, have retreated by nearly 15% as a result.
If current trends persist, it is likely that sustained low prices will force some zinc producers to curtail operations, particularly those mining complex polymetallic ores with low-grade zinc content that require multi-step enrichment processes. This potential production pullback may help balance the market in the longer term, though any near-term recovery remains highly uncertain.
Australia Plans Its First Cobalt Smelter
Two Australian companies, Cobalt Blue and Iwatani Australia, have signed a cooperation agreement to jointly advance the Kwinana cobalt smelter project, aiming to build the country’s first facility of this kind. Despite abundant cobalt resources, Australia has until now lacked domestic smelting capabilities. This agreement marks a significant step toward changing that.
The memorandum includes several key milestones leading up to a final investment decision. These include the validation of cobalt sample specifications, the securing of long-term material purchase agreements, and the formalisation of a joint venture structure. If the project proceeds, Cobalt Blue will hold 70% equity, while Iwatani Australia will own the remaining 30%.
The plant will primarily process mixed hydroxide precipitate from the Broken Hill cobalt deposit, one of the largest in the country. It may also accept feedstock from third-party suppliers to ensure year-round operation. The project’s timing is significant, following a dramatic spike in cobalt prices to $26,000 per tonne, driven by an export ban from the Democratic Republic of Congo earlier this year.
The cobalt market is relatively small, with an estimated capacity of 300,000 tonnes annually. The DRC remains the dominant player, producing 220,000 tonnes in 2024, followed by Indonesia with 28,000 tonnes. Australia’s output of 3,600 tonnes underscores the need for local value-added processing to enhance its presence in the market.
Cobalt is indispensable in the manufacture of high-strength alloys, magnetic materials, catalysts, and notably, lithium-ion batteries for electric vehicles and portable electronics. With rising global demand, establishing domestic smelting capabilities could significantly boost Australia’s role in the critical minerals supply chain.
Platinum Group Metals Revises South Africa Project Strategy
Platinum Group Metals has been compelled to rethink its approach to the Waterberg mine project in South Africa. Under governmental pressure to keep more mineral value within the country, the company has started planning for the construction of a local smelter that will convert platinum-rich concentrate into matte.
The Waterberg mine is located in the Bushveld Complex and is expected to yield over 353,000 ounces of platinum group metals annually for up to 55 years. Capital costs are estimated at $946 million, and the project is projected to generate 1,425 permanent jobs for South African workers.
Initially, the plan was to export all 130,000 tonnes of concentrate annually to Saudi Arabia for processing. This was in line with Saudi Arabia’s economic diversification strategy, which promotes non-oil industrial development. However, the South African government insisted on domestic processing to maximise economic retention and industrial capacity building. Under the revised plan, only 8,000 tonnes of matte will now be exported to Saudi Arabia for further refining.
Ajlan & Bros Mining, Platinum Group Metals’ partner in Saudi Arabia, will handle the final stages of metallurgical processing. The revised approach not only satisfies South Africa’s policy objectives but also reduces the environmental footprint associated with raw concentrate export.
Ownership of the project is split between Platinum Group Metals (37.19%), Impala Platinum (14.86%), the HJ Platinum consortium (21.95%)—which includes Japan Oil, Gas and Metals National Corporation, Hanwa, and a Black Economic Empowerment partner—and Mnombo Wethu Consultants (26%).
Adani Group Builds the World’s Largest Copper Smelter
India’s Adani Enterprises is close to completing the first phase of the Kutch Copper project, which will establish the world's largest copper smelter when fully operational. The facility’s initial capacity is 500,000 tonnes per year, with $1.2 billion already invested in infrastructure, machinery, and technology.
The first delivery of copper cathodes has already been made, supported by a long-term copper concentrate supply agreement with Chile’s Codelco. Upon the successful commissioning of phase one, Adani plans to double the plant’s capacity to 1 million tonnes annually during a second phase expected to be greenlit in 2026 or 2027.
Currently, Hindalco Industries is India’s only significant copper producer, with a similar annual capacity. However, Indian copper demand, which currently stands between 1 million and 1.2 million tonnes, is projected to soar past 2.3 million tonnes by 2030.
This expected growth aligns with the Indian government’s "Make in India" initiative, which encourages domestic manufacturing across sectors. Copper demand is expected to surge in response to expanded construction, power infrastructure, electric mobility, and industrialisation.
Despite these developments, India lacks sufficient domestic copper ore reserves. Most raw materials must be imported from major exporters such as Chile, Peru, and Indonesia, leaving Indian producers vulnerable to price fluctuations and supply disruptions.
Palladium-Graphite Composites Boost Electrochemical Technologies
Russian scientists have created new carbon and palladium-based nanocomposites with enhanced electrochemical properties, showing strong potential for use in high-efficiency energy devices. These materials are poised to significantly improve the performance of batteries, fuel cells, and industrial catalysts.
Researchers employed plasma chemical synthesis to combine graphite and palladium powders into nanoscale composite particles. This method uses an ionised gas stream to heat and break materials into atoms, which then recombine into uniform nanoparticles with desired chemical structures.
Carbon composites are valued for their high electrical conductivity and mechanical stability, while palladium contributes excellent catalytic performance and resistance to heat. Together, these attributes create a material well-suited for next-generation electrochemical applications.
Early testing shows that the composites can accelerate electrochemical reactions, improving efficiency and reducing energy losses in devices. These advancements could benefit a wide range of technologies—from fuel cells and rechargeable batteries to environmental sensors and waste treatment systems.
Particularly notable is the presence of fullerene-like carbon forms and a high concentration of palladium oxides, both of which enhance reaction rates. Such features open up new possibilities for designing lightweight, low-cost, and durable components for clean energy systems.
The development represents a step forward in materials science and highlights the role of advanced nanocomposites in driving innovation across multiple sectors of the energy economy.
