Zinc Fundamentals
Market overview
Statistics from the trade organization the International Lead and Zinc Study Group (ILZSG) show that there has been a supply deficit in global zinc output since 2004. Currently low stocks of refined zinc are contributing to market tightness and the industry expects the supply shortage to continue well beyond 2012.
| 2005 | 2006 | 2007 | 2008 | 2009 | |
|---|---|---|---|---|---|
| Zinc Mine Production | 10,127 | 10,346 | 11,122 | 11,677 | 11,371 |
| Metal Production | 10,229 | 10,711 | 11,360 | 11,655 | 11,286 |
| Metal Consumption | 10,614 | 11,006 | 11,307 | 11,436 | 10,853 |
| Surplus/(Deficit) | (385) | (295) | 53 | 219 | 433 |
| Source: International Lead and Zinc Study Group | |||||
The ILZSG reported that it expects global zinc mine production to increase in 2010 by 6.3% to 12.05 million tonnes. This will be due to both the reversal of some of the cutbacks and suspensions that were implemented in 2009 and the opening of new capacity. World demand for refined zinc metal is expected to rise by 11.3% to 12.05 million tonnes in 2010.
After having taken into account the latest information on zinc production and usage received from its members, the ILZSG anticipates that refined zinc supply will increase at a similar rate to demand this year resulting in a global market surplus of 418,000 tonnes.
Uses of zinc
The principal worldwide use of zinc is for the galvanizing of steel which consumes 49% of total demand. Zinc used in specialist alloys and in the production of brass and bronze each consume a further 18% with other uses such as for the production of chemicals and semi-fabricated castings account for the balance.
Zinc's low melting point (420 degrees C), and strength make it suitable for die-casting and gravity casting for a wide range of products including castings for automotive and household white goods. It is also used in the manufacture of electrical components and batteries, and in the production of brass, bronze, and other alloys.
Mine Production of Zinc
Statistics from the British Geological Survey show that China is the world's largest producer of zinc with 2005 output of 2.53m tonnes or 25% of global mine supply. Australia, with 1.37m tonnes or 13.5% of output is the world's next largest producer, closely followed by Peru (1.2m tonnes or 11.9%). On a global scale, European mine production is a relatively modest 9.1% of world output, however within the EU, Ireland is the dominant producer with 2005 production of 445,400 tonnes comprising 49% of the total.
Last updated: July 1, 2010