Market evolution: Zinc oxide (CN 2817) — 2015–2025

Introduction

This report examines the EU's external trade in zinc oxide and zinc peroxide (customs code CN 2817) over the period 2015–2025. The decade was marked by a fundamental repositioning of the EU within the global zinc oxide market. What began as a structurally import-dependent market — with a trade deficit of €32.8 million and a net import reliance of 16.6% in 2015 — evolved into a near-balanced position by 2025, with the deficit shrinking to under €0.4 million and import reliance falling to just 1.3%. This transformation was driven by a combination of rising domestic production, growing export capacity, and a significant reorientation of supplier geographies. The report is structured around three main dynamics: the convergence of the trade balance, the geographic reshaping of trade partnerships, and the evolving resilience and vulnerability of the EU's supply position.

1. From structural deficit to near-balance: the closing of the trade gap

1.1. Export growth outpaced import growth throughout the decade

The most striking macro-level trend is the divergence in growth trajectories between EU exports and imports. Over the full period, the value of EU exports of CN 2817 grew by 45.9%, rising from €80.7 million to €117.8 million, while import values grew by only 4.0%, moving from €113.6 million to €118.1 million. The result was a convergence of the two flows: by 2025, the EU was exporting almost as much zinc oxide by value as it was importing.

1.2. Volume trends tell a different story: rising exports, falling imports

While the value picture already reveals convergence, the quantity data shows an even more dramatic structural shift. Export volumes rose by 16.4%, from 50,052 tonnes to 58,270 tonnes, whereas import volumes fell by 20.2%, from 67,428 tonnes to 53,804 tonnes. By 2025, the EU was actually exporting more zinc oxide by weight than it imported — a reversal of the 2015 position.

1.3. Rising unit prices amplified value movements on both sides

Both import and export unit prices increased substantially over the period — imports by 30.4% (from €1,684/t to €2,196/t) and exports by 25.3% (from €1,613/t to €2,022/t). These price increases partly reflect global inflationary pressures and commodity price dynamics, particularly the zinc price surges of 2021–2022. However, the fact that the EU's import prices consistently exceeded its export prices suggests that the EU may have been sourcing higher-grade or more processed product on average, or that supply conditions for imports were tighter.

1.4. Domestic production expanded substantially

Underlying the trade rebalancing was a significant expansion of EU domestic production. Production quantities rose by 39.2%, from 286 million kg to 398 million kg, while production values grew by 13.9%, from €511 million to €582 million. The faster growth in volume than in value points to declining unit production values — consistent with increased capacity and competitive pricing — and helps explain the EU's ability to substitute domestic supply for imports while simultaneously expanding exports.

2. A reoriented geography: new suppliers emerge, old ones disappear

2.1. Russia's collapse and the rise of Türkiye and Vietnam

The most dramatic geographic shift in EU imports was the virtual disappearance of the Russian Federation as a supplier. Russia went from €17.0 million in import value in 2015 to essentially zero by 2025 — a decline of 100%. This is almost certainly linked to the sanctions regime imposed following Russia's invasion of Ukraine in 2022. Russia's coefficient of variation (0.63) was among the highest of any import partner, reflecting the abruptness of this disruption.

The vacated supply was partly absorbed by two main sources:

• Türkiye grew from €7.6 million to €20.2 million (+164.9%), becoming the third-largest supplier by 2025.
• Viet Nam emerged from near-zero (€22,049 in 2015) to €12.0 million, representing extraordinary growth of over 54,000%. However, Vietnamese imports also showed extremely high volatility (CV of 1.00), suggesting this supply is still relatively unstable or episodic.

2.2. Mexico and Peru remained the dominant suppliers but with diverging paths

Mexico and Peru continued to account for the largest share of EU imports throughout the decade. Mexico remained relatively stable, growing modestly by 11.4% and exhibiting the lowest volatility among major suppliers (CV of 0.10). Peru, by contrast, experienced a slight decline of 9.6% and somewhat higher volatility (CV of 0.17). A notable price shock was detected in Mexican imports in 2017, with an abnormality score of 366.9 and a 31.9% price shift, likely reflecting supply tightness or a change in contract structures at the time.

2.3. The United States became the EU's top export destination

On the export side, the most significant development was the rise of the United States as the EU's largest export market. US-bound exports nearly doubled from €16.4 million to €31.3 million (+90.7%), overtaking the United Kingdom, which saw a 41.2% decline from €20.7 million to €12.2 million. The UK decline likely reflects post-Brexit trade friction and supply chain restructuring. Other notable growth markets included Serbia (+203.8%), Viet Nam (+290.7%), and Romania (the latter reflected in the top EU reporter data with a 225.1% increase in export activity).

2.4. Concentration patterns diverged between imports and exports

The Herfindahl-Hirschman Index (HHI) for import value rose slightly from 1,974 to 2,129 (+7.8%), indicating a modest increase in import supplier concentration. This is consistent with the loss of Russia as a major supplier, which reduced the number of significant source countries. Export concentration moved in the opposite direction, declining from 1,264 to 1,076 (−14.9%), as the EU diversified its export markets beyond the UK toward the US, Serbia, and Vietnam. In volume terms, however, import concentration increased more sharply (+25.0%), while export concentration also rose (+9.9%), suggesting that the diversification in value terms partly reflects pricing differences rather than pure volume dispersion.

2.5. Within the EU, the Netherlands and Romania emerged as export hubs

Looking at EU member state specialization, the Netherlands stood out as both the most specialized exporter (RCA of 2.06, RSCA of 0.35) and the largest EU exporter by value (€48.0 million in 2025, +55.6%). Belgium showed the highest specialization (RCA of 3.01) and saw its exports grow by 18.2%. Romania was the fastest-growing EU exporter (+225.1%), rising from €2.7 million to €8.8 million, while Poland also expanded strongly (+95.2%). On the import side, Spain remained the largest EU importer despite a 20.5% decline, while Belgium's imports surged by 281.5%.

3. Resilience gained, but volatility and price shocks persist

3.1. Net import reliance collapsed to near-zero

The most consequential measure of EU supply security for CN 2817 is net import reliance, which fell from 16.6% in 2015 to just 1.3% in 2025 — a decline of 92.1%. This effectively means the EU has moved from a position of meaningful external dependence to near self-sufficiency in zinc oxide. This is the combined result of expanded domestic production, declining import volumes, and growing re-export capacity.

3.2. Export propensity surged, signaling an increasingly outward-oriented industry

The EU's export propensity — defined as the share of domestic production that is exported — increased from 3.6% to 18.6%, a rise of 413.2%. This was the highest-salience indicator in the vulnerability assessment (salience score of 444.6 versus 64.2 for trade intensity). It indicates that the EU's zinc oxide industry has become significantly more export-oriented, likely driven by competitive production costs, quality differentiation, and the opening of new markets such as the US and Serbia. Trade intensity (the ratio of total trade to domestic production plus imports) also rose, from 21.9% to 32.1% (+46.3%), confirming that the EU's zinc oxide market is more deeply integrated into global trade than it was a decade ago.

3.3. Supply volatility remains concentrated in emerging partners

While the overall supply position has improved, volatility analysis reveals persistent risks in specific bilateral relationships. On the import side, Viet Nam (CV of 1.00) and Malaysia (CV of 0.99) exhibit extremely high volatility, indicating that these newer supply relationships are still immature or subject to spot-market dynamics. Russia's import volatility was also very high (CV of 0.63), reflecting the abrupt cessation of trade rather than gradual adjustment.

On the export side, the EU's trade with Viet Nam (CV of 1.95) and China (CV of 1.31) showed the highest volatility, while more established markets like the United States (CV of 0.26) and Ukraine (CV of 0.23) were considerably more stable.

3.4. Price shocks tested the market at key junctures

Three significant price shocks were detected during the period:

The Mexican import shock of 2017 was by far the most significant in terms of abnormality and market impact, affecting 44.2% of import value. The US export price shock of 2022 — with prices more than doubling — likely reflects the post-pandemic commodity supercycle and zinc price spike, amplified by strong US demand for EU-origin product. The Japanese shock, while dramatic in percentage terms, was marginal in market impact given Japan's small share of EU exports.

Conclusion

Over the 2015–2025 decade, the EU's zinc oxide market underwent a fundamental structural transformation. The most important development was the near-elimination of the trade deficit and the collapse of net import reliance from 16.6% to 1.3%, driven by a 39% expansion of domestic production and a doubling of export propensity. Geopolitical events — particularly the sanctions on Russia — reshaped the import landscape, eliminating a major traditional supplier and accelerating the rise of Türkiye and Vietnam as alternative sources. On the export side, the United States emerged as the dominant destination, displacing the post-Brexit United Kingdom. While the EU's overall supply resilience has improved markedly, volatility remains a concern in newer trading relationships, and the sharp price shocks observed in 2017 and 2022 underscore the sensitivity of this market to global commodity and geopolitical dynamics. Looking forward, the key question is whether the EU can sustain its newly achieved near-self-sufficiency while managing the risks inherent in its increasingly export-oriented zinc oxide industry.