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China Sees Higher '10 Zinc Output to Meet Global Demand
Sep 13,2010 11:14CST
industry news
China zinc output in 2010

SHANGHAI, Sept. 13 -- China's zinc output this year may grow 15 percent to 5 million tonnes while lead output is likely to grow 7 to 8 percent from last year to 4.05 million tonnes in response to rising demand, said an industry official.

Zhao Cuiqing, head with the lead and zinc department of China Nonferrous Metals Industry Association, told a conference that the industry is still undergoing expansion, with an expected 1.16 million tonnes of lead capacity in operation between 2010 and 2011.

New zinc capacity of 1.12 million tonnes is under construction or scheduled to be built. That is in addition to 770,000 tonnes of capacity that had been scheduled to be operational in 2009 but was delayed to 2011, Zhao said.

Separately, the general manager of China's top zinc producer, Impo & Expo Co of Zhuzhou Smelter <600961.SS>, said the country's zinc smelting capacity is expected to grow to 8-9 million tonnes per year by 2015.

Zinc smelting capacity in China will grow by 400,000 tonnes per year over the next five years, from more than 6 million tonnes per year now, said Wang Jianjun.

Hunan Nonferrous Metals Co <2626.HK> controls Hunan-based Zhuzhou Smelter as well as Hsikwangshan Twinkling Star Co, China's top producer of antimony. China is the world's largest producer of zinc and antimony.

Wang estimated the country's zinc output would reach 4.8 million tonnes this year.

Beijing has tried to concentrate up to 70 percent of the output among 10 major zinc producers, and the world's largest metal consumer is also considering discouraging metal exports to limit capacity expansion and help cut energy use and carbon emissions.

Zhao expected domestic zinc prices to stay high this year while lead prices face pressure due to low production costs and high inventories.

Global zinc demand in 2011 is likely to grow by 1 million tonnes from an estimated 11 million tonnes for 2010, said a senior official with the International Zinc Association.

"Demand may further expand to 13 million tonnes in the year 2012, with growth mainly from emerging markets," said Huang Huang, the association's chief representative in China.

Global demand for hot-dipped galvanised sheet, the major consumer of the zinc metal, will grow 15 percent a year in coming years, mainly from the auto sector, said Huang.


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