ILZSG: World Zinc Market Deficit Widened Further to 178 kt

SPOKANE (Scrap Monster): The latest statistics published by the Lisbon, Portugal-based International Lead and Zinc Study Group (ILZSG) indicates that global refined zinc market deficit widened further during the initial five months of the year.

The global zinc market ended in a deficit of 178,000 tonnes during January to May this year, as compared with the deficit of 133,000 tonnes recorded during the corresponding five-month period in 2016. The total reported zinc inventories have declined by 167,000 tonnes during the above-mentioned period.

During the five-month period, global zinc mine output rebounded sharply, reporting a jump of 6.3% when matched with the previous year. The mine production from major producing nations including Eritrea, India, Peru and Turkey reported increases. However, the rise in output from these countries was partially offset by declines in Australia and the US.

The refined zinc metal production during the initial four months of 2017 totaled 5.585 million tonnes, marginally higher by 0.4% when compared with the 5.565 million tonnes output during corresponding five-month period from January to May in 2016. The refined zinc metal output from India rose significantly by nearly 55% over the previous year. On the other hand, refined output reported sharp declines in other producing countries including Canada, Japan, the Republic of Korea, Peru and Thailand. The reduced output from these countries almost balanced the output surge in India.

The global demand for refined zinc metal increased slightly by 1.1% to 5.763 million tonnes during January to May this year, as compared with 5.698 million tonnes during the same period last year. Europe’s apparent usage rose slightly by 1.8% during this period. The apparent zinc metal usage by China reported marginal decline of 2.8% during the first five months of the current year. However, the drop in usage was offset by strong apparent usage by the US. Incidentally, the US recorded 19% jump in apparent usage of refined zinc metal, after recording sharp fall in 2016.

Interestingly, Chinese net imports of zinc contained in concentrates increased sharply by 27.9% during Jan-May ’17 in comparison with the corresponding period in 2016. The country’s imports of zinc contained in zinc concentrates totaled 477,000 tonnes. The Chinese net imports of refined zinc metal tumbled by 48.4% to 129,000 tonnes.

The ILZSG preliminary data indicates that global zinc mine output totaled 1.089 million tonnes during the month of May alone. The global refined zinc metal production totaled 1.108 million tonnes, whereas global zinc demand totaled 1.148 million tonnes during the month.

Meantime, zinc prices climbed higher to touch $2,825 per tonne. Incidentally, Zinc metal prices are up by 10% since the beginning of the current year.