Nexa Resources Estimates Up on Stronger Zinc

Research evidence excerpt

Nexa Resources Estimates Up on Stronger Zinc

ted in 2026, Adj. EPS ($)

supporting a higher-for-longer zinc price environment despite still-weak 2025A 2026E 2027E

demand. The team has cut nearly 300kmt from its 2026 global refined zinc Q1 0.09 0.67A

Q2 0.01 0.53

production forecast, tightening the global balance to a roughly 130kmt surplus. Q3 (0.28) 0.53

That headline surplus masks a sharp regional split: a large surplus in China Q4 0.38 0.44

(~390kmt) versus a deeper deficit in the rest of the world (~260kmt short). Greg FY 0.20 2.17 1.30

Shearer’s team highlights that mine supply growth has reversed sharply after Style Exposure

exceptional growth last year. They now forecast a -5% y/y contraction in 2026,

driven by disruptions and guidance misses from major producers across

Sweden, the US, and Peru. Ex-China refined supply is also expected to contract

by nearly 5% y/y amid smelter disruptions in Iran, Peru, Australia, and

Kazakhstan. Meanwhile, Chinese smelters remain incentivized to keep

production elevated even with negative spot treatment charges (TCs). On

demand, the team continues to see a challenging backdrop and forecasts global

zinc demand growth of just 0.9% y/y. Their central view is that the widening

bifurcation will ultimately be resolved via a stronger re-opening of China’s

export arbitrage, keeping LME zinc prices in a higher-for-longer range

of $3,400–$3,500/mt on average over the balance of 2026. Prices are then

expected to ease towards an average of ~$3,140/mt in 2027 as mine supply

rebounds (~4% y/y). They caution, however, that risks are skewed toward a

faster cooling in 2H26 if Chinese exports overshoot or if inflation curbs

demand more sharply than forecast.

• Recovery on track, still needing consistency. Nexa’s operating performance