Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

Global lead and zinc markets reported a surplus of 223,000mt and 533,000mt, respectively, at the end of 2020 on lower consumption, according to the International Lead and Zinc Study Group (ILZSG) data.


Refined lead consumption in 2020 declined by 5.3pc to 11.52mn mt from 12.16mn mt in the previous year, while zinc consumption during the same timeframe dropped by 4.4pc to 13.10mn mt from 13.70mn mt.


Lead production falls

Lead output from mines as well as refining declined last year, ILZSG noted. Global mine supply of the metal fell 5pc to 4.48mn mt in 2020 compared to 4.72mn mt in the previous year, due to the significant impact on the global mining industry because of the COVID-19 pandemic. 


Mine output in key lead-producing countries like Mexico, Bolivia, Argentina, Peru, and South Africa declined due to the pandemic-related restrictions. Canada, where lead output from the Silvertip and Caribou mines was disrupted in the first quarter of 2020 also saw reduced production of the metal.


Global refined lead output decreased by 3.6pc to 11.75mn mt last year from 12.18mn mt in 2019. ILZSG attributed the decline to reduced production in Mexico, the US, Belgium, India, France, and Korea, though some of the declines were offset by a 3.6pc increase in metal production in Australia. The closure of Glencore’s Belldune smelter in December 2019, also reduced Canada’s refined lead production last year.


The share of refined lead output from secondary or recycled raw material declined in 2020 to 62.9pc from 64.8pc in the previous year.


In terms of consumption, refined lead usage plummeted in Europe and the US by 12pc and 7.8pc, respectively after the automotive industries in this region suspended operations through most of the first half of the year due to the pandemic. Reduced consumption in Brazil, Japan, Korea, Mexico, and Australia was offset by a marginal increase in usage in China during the year.


Refined zinc output up

The production of refined zinc inched up by 1.2pc last year to 13.64mn mt from 13.48mn mt in 2019, ILZSG indicated. However, global zinc mining output declined by 5.9pc to 12.13mn mt from 12.89mn mt during the same period. Like lead, the decline in mine production was attributed to the COVID-19 restrictions across the world in the first half of the year. The closure or suspension of activities at some key zinc mines in Canada, Namibia, Japan, Mexico, and Peru further impacted zinc output during the year.


However, refined zinc output increased on a 2.9pc growth in production in China along with increasing refined zinc output from France, Canada, and Australia. In the US, the reopening of American Zinc Recycling’s North Carolina plant that has a capacity of producing 155,000mt of zinc per year also contributed to the increase in refined zinc output.


Zinc consumption during the year declined despite a 1.3pc rise in usage of the metal in China, according to ILZSG data. Global net refined zinc imports last year also fell by 5.8pc to 512,000mt despite China’s imports of zinc contained in zinc concentrates rising by 20.7pc to 1.81mn mt in 2020 compared to 2019.

Leave a Reply

Your email address will not be published.