Short Term Commodity Outlook 2025: Aluminum and Zinc

The market in the metal industry is constantly evolving – and so are commodity prices. IKB Deutsche Industriebank regularly publishes a report that focuses on the stocks and prices of aluminum and zinc. The most important developments are highlighted in the current report from June 2025.

Diagram showing the development of aluminum inventories.

Aluminum developments and forecasts

The global production of primary aluminum was 4.1 percent above the previous year's level by the end of April 2024, following a new production record set last year. Aluminum stocks at the LME increased sharply during May 2024, more than doubling since the beginning of the month.

Several shipments to Malaysian warehouses caused the stocks to rise rapidly. After the warehouse ban for Russian aluminum announced in April due to new US sanction regulations, LME stocks initially fell. Potential "rent deals" could be the reason for the increase in stocks. At the SHFE, aluminum stocks remained stable.

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The price of primary aluminum rose by an average of 2 percent in May 2024, after increasing by 13 percent in April – due to the new sanction regulations for Russian aluminium. The price of recycled aluminum rose by 3 percent, following price stagnation in the past two months.

The long-awaited economic upturn is now becoming visible and, along with partially limited production capacities, is causing prices to rise. Investment demand increased by 11.4 percent in May. Aluminum consumption also rose sharply by 6.1 percent in the first three months.

Trend: For the price of primary aluminum, we see a movement of plus or minus 300 US dollars around the value of 2,600 US dollars per tonne by the end of the third quarter of 2024; the price for aluminum alloy is expected to be around 400 US dollars per tonne lowerx.

Diagram showing the development of the price of aluminum.

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Diagram showing the development of zinc inventories.

Zinc developments and forecasts

Zinc mine production declined by 1.2 percent in 2023, following a 2.3 percent decrease in 2022. This was due to both planned and unplanned mine closures. Consequently, only a slight production increase of 0.7 percent is expected for 2024. Most of the production growth is anticipated to come from Australia, Mexico, and the Congo, where a mine is set to resume operations.

Refined zinc production is expected to increase by only 0.6 percent this year, as Chinese production, which constitutes a significant portion of global refined zinc production, will grow by just 1 percent. Global zinc consumption is projected to rise by 1.8 percent in 2024.

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In May 2024, zinc stocks at the LME tended to move sideways on average. Slight increases in mid-month declined again by the end of the month. At the SHFE, zinc stocks at the end of May were slightly above the previous month at 129,000 tonnes.

At the Comex, zinc stocks decreased again after the recent buildup and stood at 2,500 tonnes at the end of May. Despite demand growing faster than supply, we still expect an oversupply this year.

Trend: By the end of Q3 2024, we see the zinc price moving around the mark of 2,800 US dollars per tonne, within a range of plus or minus 500 US dollars.

Diagram showing the development of zinc prices.

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