Sulphur 422 Jan-Feb 2026
28 January 2026
Mixed smelter for Tennessee
Korea Zinc says it will partner with the US government to construct a critical minerals smelter in Clarksville, Tennessee, producing zinc, lead, and copper. Korea Zinc will begin site preparation next year, followed by phased commercial operations from 2029. The plant is planned to process around 1.0 million t/a of raw materials and turn out 540,000 st/a of finished products. Processing of gold, silver, and key strategic minerals such as antimony, indium, bismuth, tellurium, cadmium, palladium, gallium and germanium, are also planned in what is being touted as a “state-of-the-art” facility. Sulphuric acid and semiconductor-grade sulphuric acid will also be produced. The output will include 300,000 t/a of zinc production, 200,000 t/a of lead, 35,000 t/a of copper and 5,100 t/a of rare and strategic metals. Development will be through Korea Zinc’s US subsidiary, Crucible Metals.
Core capex is put at $6.6 billion, plus $800 million in working capital and financing costs, giving a total of $7.4 billion. The US Department of War is conditionally investing $1.4 billion in the project and arranging around $2.15 billion of smelter construction costs with investors. The new unit’s design will be based on Korea Zinc’s Onsan smelter in Ulsan, South Korea. The project is also backed by the US Department of Commerce. The US will also have preferred access to a portion of Korea Zinc’s expanded production in South Korea, US Secretary of State for Commerce Howard Lutnick said.
“Establishing a production base in the United States, where investment, regulatory and policy predictability are high, is expected to effectively transform geopolitical volatility, export restrictions and logistics disruptions into strategic opportunities,” Korea Zinc said, adding that sourcing raw materials and scrap directly from the US will diversify the global supply chain and enable more flexible corporate responses.
CRU assesses that even if the construction of the smelter were to go ahead, imports from neighbouring countries Canada and Mexico, which typically provide around 70% of the imports into the country, would not be significantly impacted. Still, imports from countries further afield, such as Peru, Australia, Spain, and South Korea itself, may experience reduced demand for refined zinc in the US in the future. The potential new Korea Zinc smelter would also have an interesting impact on the zinc concentrates market. CRU assesses that there are only 3-7 years’ worth of reserves left at the East Tennessee and Middle Tennessee mines, and even before they close, the new zinc smelter might only be able to obtain just one third of its raw material feed requirement from these mines. Korea Zinc will be heavily reliant on the custom market for concentrate feed and will seek to source material from nearby mines, likely including Teck Resources’ Red Dog mine in the US.
