2010 April Zn Output Data Analysis

SHANGHAI, May 31 (SMM) --
Zinc Concentrate:
According to the China Nonferrous Metals Industry Association (CNIA), China's output of zinc concentrate set a record high of 282 kt during April, up 10.6% MoM, and up 40.3% YoY.  YTD output of zinc concentrate was 978 kt, up 54.6% YoY.  Lower zinc prices negatively affected production of zinc concentrate during April 2009,  contributing to the high YoY growth rate of zinc concentrate output.  Zinc prices moved as low as RMB 18,000/mt during early May, but later fell to a yearly low of RMB 15,000/mt, and had a strong negative effect on production of zinc concentrate.  SMM predicts domestic output of zinc concentrate will continue to fall if zinc prices continue to move at low levels. 

Refined Zinc:
According to CNIA, China's zinc output was 432 kt during April, up 29.0% YoY, with YTD output of 1.608 million mt, up 35.6% YoY, and with the YoY growth rate exceeding 30% for four consecutive months.  The high YoY growth rate was closely related to lower zinc prices and tight raw material supply during April.  However, rapid declines in zinc prices will hamper the operation of some newly-commissioned projects.  In addition, a number of smelters are  now conducting unit maintenance ahead of schedule, and this will also negatively affect domestic zinc output. 

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