The Chinese zinc market was in surplus by well over 300,000 tonnes last year and experienced significant demand substitution, Claire Hassall of consultancy CHR Metals said at the Metal Bulletin Zinc and its Markets Seminar.
Higher prices and developments in technology have meant that aluminium substitution has eaten into Chinese zinc demand, which also took a hit from the government-led environmental crackdown last year. China is the world's largest consumer of zinc, and higher domestic and imported supply aligned with anaemic demand growth is starting to affect premiums in the country, Hassall said. "It's had a massive impact on the domestic market price....