Data and analytics company GlobalData has forecast that worldwide zinc production will grow at a compound annual growth rate of 3.8% between this year and 2022. This growth will be underpinned by production increases and the opening of new mines in Canada, China, India, Kazakhstan and Mexico, and will result in total global production of 15.7-million tons in 2022.
“After declining substantially in 2016, global zinc mine production increased in both 2017 and 2018, reaching 13.2-million tons and 13.4-million tons respectively,” pointed out GlobalData senior mining analyst Vinneth Bajaj. The 2018 production increase was driven by a 9.9% increase in Australian production, an 8.5% increase in Peruvian output, a 7.9% rise in Indian production and a 5.9% increase in the US.
The rise in production in Australia was the result of increased output from MMG’s Dugald River project (MMG was previously the Minerals and Metals Group and is a subsidiary of China Minmetals Corporation, which holds some 74% of the company) and from the commissioning of two other projects. These were the New Century mine (belonging to Australian miner New Century Resources) and the Hellyer Tailings project (which belongs to Australia-based, but London NEX Exchange listed, NQ Minerals).
“However, the market has remained in a severe deficit, impacted by several mine closures and production cuts over price concerns,” he observed. Production of zinc in China was believed to have fallen, although only slightly (by 1%), as a result of environmental measures. China is the world’s largest zinc producer. The consequence was that total production was still 1.1-million tons below the global demand, which had reached 14.5-million tons. Demand for zinc has been growing in Belgium, China, Germany and the US.
“Looking ahead, there are almost 100 zinc projects expected to commence operations between 2019 and 2022, of which around 24 are currently under construction, while the remainder are under various stages of development,” reported Bajaj. “Of these projects, around 15 are located in Australia, 11 in Canada, eight in Mexico, six in Peru, five in the US and four each in Kazakhstan, Russia and China.” With the forecast increase in production, the currently rising zinc prices should stabilise around 2022.