As we near the midpoint of the year, zinc concentrate treatment charges (TCs) have repeatedly tumbled to historic lows. As of June 5, the average TC for domestic zinc concentrate fell to 50 yuan per metric ton of metal content, while the TC for imported zinc concentrate dropped to -70.75 US dollars per dry metric ton.

SMM, June 4 — According to SMM, Baiyin Nonferrous Group's Northwest Lead-Zinc Smelter has launched a public tender for the sale of approximately 100 tonnes of crude cadmium from its inventory. A minimum of three registered bidders is required for the auction to proceed. The registration deadline is 17:00 on June 9, 2026, with bidding commencing at 15:00 on June 10, 2026. Market participants noted that given the recent stability in cadmium prices, this tender warrants close attention, as it can serve as an indicator of the strength or weakness of market demand and provides a useful reference for the future direction of cadmium prices.

SMM June 4 News: According to SMM, the Northwest Lead-Zinc Smelter under Baiyin Nonferrous Group Co., Ltd. launched a public tender for the sale of approximately 100 mt of crude cadmium. Specifically, according to the official announcement, the base bidding price was set at a discount of 2,000 yuan/mt to the SMM average price, with the highest bidder winning after the auction. A minimum of three registered bidders is required for the auction to proceed. The registration deadline is 17:00 on June 9, 2026, and the bidding will start at 15:00 on June 10, 2026. Market participants noted that since cadmium prices have remained stable recently, this tender is also worth close attention, as it can to some extent reflect the strength or weakness of market demand and serve as a reference for the future direction of cadmium prices.

[June Refined Zinc Production to Decline, Smelter Profitability in Focus] According to SMM data, China's refined zinc production in May 2026 was down 0.41% MoM but up over 5.8% YoY. Cumulative smelter production from January to May was up nearly 5.8% YoY, exceeding expectations.

On May 29, Nexa Resources said its Cajamarquilla zinc smelter in Peru is gradually resuming production following the incident reported on May 13. the electrolysis lines are now fully operational, while one casting line has been back in operation and is currently producing zinc bars. Nexa plans to restart the second casting line within the next few days, followed by the final casting line by mid-June. As a result of the temporary disruption, Nexa estimates a refined zinc production impact of approximately 7,000 mt in Q2 2026, equivalent to around 2% of annual production. The company expects to recover the lost output during H2 2026 and has kept its 2026 sales guidance unchanged. No material financial impact's expected from the incident, with the cause remain under investigation.

[Insight into Provincial Profit Landscape: New Release of Zinc Smelting Profit Model by Province] In May 2026, the zinc market is experiencing unprecedented structural pressure. TCs for imported zinc concentrates have fallen to -$56.25/dmt, while domestic TCs dropped weekly to 400 yuan/mt Zn. Meanwhile, the sulphuric acid export control policy continued to take effect in May, with some 98% smelting acid in south China declining by around 300 yuan/mt, directly impacting an important by-product revenue source for smelters. LME zinc inventory of around 100,000 mt stands in sharp contrast to China's social inventory exceeding 260,000 mt. The pattern of "tight ore and loose ingots" has made smelters the most severely squeezed link in the industry chain......

[SMM Morning Meeting Minutes: Weak US Dollar, Zinc Prices Rise Accordingly] Overnight, LME zinc recorded a large bullish candlestick with a long lower shadow, with the middle Bollinger Bands providing support below. The US core PCE price index annual rate in April rose to 3.3%, in line with market expectations...

As of May 26, the Shanghai-LME zinc price ratio stood at 6.97, continuing its downward trend from 7.4 recorded in late March, which has led to a widening import loss of refined zinc ingots in China. According to calculations by Shanghai Metals Market (SMM), the current import loss of China’s refined zinc ingots has expanded to approximately RMB 3,800 per metric ton of metal.

SMM May 27: Overnight, LME lead opened at $2,011.5/mt, briefly touched a low of $2,010/mt during the Asian session before fluctuating upward; entering the European session, it probed a high of $2,022/mt before pulling back slightly, ultimately closing at $2,015.5/mt, up 0.12%. Overnight, the most-traded SHFE lead 2607 contract opened at 16,740 yuan/mt, fluctuating around the intraday moving average, with an intraday low of 16,710 yuan/mt and a high of 16,775 yuan/mt, ultimately closing at 16,745 yuan/mt, down 0.06%. Consumption side, the lead-acid battery market remained in off-season mode, with downstream enterprises' rigid demand still limited. Combined with the fluctuating rebound in lead prices, downstream enterprises became more cautious in procurement. Supply side, production at both primary lead and secondary lead enterprises was stable with a slight increase. Secondary lead losses began to recover, market circulating supplies increased, and spot lead trading gradually shifted to a discount (against SMM #1 lead). Meanwhile, tight supply of high-grade lead ingots in the Southeast Asian market has yet to ease, while Australian lead-zinc smelters ramped up production. With bullish and bearish factors coexisting, lead prices are expected to continue fluctuating at highs. Data source disclaimer: Data other than public information is derived from public information, market communication, and SMM's internal database models, processed by SMM for reference only and does not constitute decision-making advice.

Futures: Overnight, LME lead opened at $2,011.5/mt, briefly touched a low of $2,010/mt during the Asian session before fluctuating upward; during the European session, it probed a high of $2,022/mt before pulling back slightly, ultimately closing at $2,015.5/mt, up 0.12%. Overnight, the most-traded SHFE lead 2607 contract opened at 16,740 yuan/mt, fluctuating around the intraday moving average, with a low of 16,710 yuan/mt and a high of 16,775 yuan/mt, ultimately closing at 16,745 yuan/mt, down 0.06%. On the macro front: Uzbekistan fully resumed gold exports in April. Malaysia reportedly imposed a 10% tariff on imports of certain gold bars. According to Yonhap News Agency, a South Korean court rejected an injunction request to suspend negotiations with Samsung's main union. Micron Technology's total market capitalization reached $1 trillion, setting a new all-time high again. Since the beginning of this year, Micron Technology has accumulated a gain of 210%. Data from the China Academy of Information and Communications Technology showed that in April 2026, mobile phone shipments in the Chinese market reached 25.733 million units, up 2.8% YoY, of which 5G phones accounted for 24.736 million units. : In the Jiangsu, Zhejiang, Shanghai market, warrant quotations were limited, and suppliers continued to offer cargoes self-picked up from primary lead smelter production sites. Meanwhile, as SHFE lead retreated after rapid rise, suppliers had mixed sentiments on shipments — some eased their stance on holding prices firm while others held firm on prices for shipments. Mainstream origin primary lead was quoted at premiums of 0-50 yuan/mt against the SMM #1 lead average price, with a few regions at premiums of 120-200 yuan/mt. Additionally, secondary lead smelters continued to operate at a loss, and their quotations remained relatively firm, with secondary refined lead quoted at premiums of 0-50 yuan/mt against SMM #1 lead on an ex-factory basis. Downstream enterprises had limited rigid demand, especially with lead prices fluctuating at highs, and downstream enterprises made few inquiries, with spot market transactions turning sluggish. Inventory: On May 26, LME lead inventory decreased by 775 mt to 285,700 mt; as of May 25, SMM lead ingot social inventory across five locations decreased by 3,200 mt compared with May 18. Lead Price Forecast for Today: Consumption side, the lead-acid battery market remained in off-season mode, with downstream enterprises' rigid demand still limited. Combined with lead prices rebounding, downstream enterprises became more cautious in procurement. Supply side, primary lead and secondary lead enterprises maintained stable to slightly rising production, with secondary lead losses beginning to recover and market circulating supply increasing, as spot lead trading gradually shifted to discounts (against SMM #1 lead). Meanwhile, tight supply of high-grade lead ingots in the Southeast Asian market has yet to ease, while Australian lead-zinc smelters are ramping up production. With bullish and bearish factors coexisting, lead prices are expected to continue fluctuating at highs. Data Source Statement: All data other than public information is SMM processed data based on public information, market communication, and SMM's internal database model, for reference only and does not constitute decision-making advice.