China zinc production grew 2.5% in March

SHANGHAI, Apr 8 (SMM) – China’s zinc output rebounded last month, as smelters resumed production after being closed for raw material shortages or holidays in February. The production increase, however, was limited by new maintenance at some smelters in Inner Mongolia, Gansu and Qinghai.

The latest SMM survey showed that 464,200 mt of refined zinc was produced in China in March, up 2.48% from February and 2.67% from March 2019. Zinc capacity which was covered in the SMM survey remained unchanged at 6.09 million mt on an annualised basis.

Surveyed smelters produced 68,700 mt of zinc alloy last month, up 1.68% from the previous month, and hot-dipped material accounted for 48,500 mt.

China’s production of refined zinc is expected to continue to expand in April, increasing 15,900 mt from March to 480,100 mt, as smelters, especially those in Hunan, Inner Mongolia and Shaanxi, return online or ramp up production.

May and June are likely to see concentrated maintenance at zinc smelters in China, however, as ore supply tightens. Measures introduced to contain the spread of the coronavirus pandemic have led to the closure of a number of mines and smelters outside China, while zinc mines in China held back on sales due to concerns over prices and other woes. Low existing stockpiles added to concerns over raw material among Chinese zinc smelters.   

In China, treatment charges for domestic zinc concentrate with 50% Zn content fell to 5,800 yuan/mt of Zn content as of April 3, while TCs for imported materials slipped to $230/dmt. TCs for imported zinc concentrate were quoted as low as $200/dmt this week.