VANCOUVER (miningweekly.com) – The latest information published by the International Lead and Zinc Study Group (ILZSG) has found a 3% year-on-year wider zinc market supply gap for the first six months of 2017.

According to preliminary data recently compiled by the ILZSG, the global market for refined zinc metal was in deficit by 203 000 t, at 6.74-million tonnes, over the first six months of the year, with total reported inventories declining by 212 000 t over the same period.

The ILZSG said on Monday that world zinc mine output rose by 5.4% year-on-year to 6.48-million tonnes, compared with the first half of 2016. This was mainly owing to increased output in Eritrea, India and Peru.

Increases in refined zinc metal production in Brazil, France and India were mainly balanced by reductions in Canada, the Republic of Korea, Peru and Thailand during the six-month period, resulting in a small overall global rise of 0.5%.

The ILZSG's data showed that, despite a decrease in Chinese apparent demand for refined zinc metal of 2.1%, global usage rose by a marginal 0.6%. This was mainly owing to increases in the US and Taiwan.

Chinese imports of zinc contained in zinc concentrates increased by 33.9% to 549 000 t. Net imports of refined zinc metal amounted to 169 000 t – a decrease of 39.9% compared with the same period of 2016.

Adding 2% on Monday, zinc has gained 36% in value since the start of the year to trade at $3 124/t.

LEAD LOOKING GOOD
Further, the ILZSG’s data showed that world refined lead metal demand exceeded supply by 86 000 t during the first half of 2017, as the total reported stock levels decreased by 18 000 t during the same period.

An 11.7% rise in global lead mine output to 2.57-million tonnes, compared with the first half of 2016, was mainly owing to higher output in China, India and Kazakhstan, which more than offset a reduction in Australia.

Increases in China, India, the Republic of Korea and the US were the main influences on a rise in world-refined lead metal production of 7.8% to 5.93-million tonnes.

A 10% increase in global lead demand for refined lead metal was mainly a function of sharp rises in apparent demand in China and the US of 13.3% and 22.8% respectively. Use in Europe rose by a more modest 2%. Total use was 545 000 t higher when compared with the same six-month period of 2016.

Imports to China of lead contained in lead concentrates fell by 6.1% to 341 000 t, the ILZSG stated. Chinese net imports of refined lead metal totalled 52 000 t, compared with net exports of 12 000 t during the first half of 2016.

Lead traded at $2 335.25/t on Monday, up 24% so far this year.