OZ Minerals CEO expects more zinc cuts in Europe

SYDNEY, Feb 27 (Reuters) - European zinc producers are preparing to make further production cuts to combat a growing supply glut and weak prices, world No. 2 producer OZ Minerals Ltd (OZL.AX) said on Friday.

Output has already been slashed by 10 percent, or 1 million tonnes worldwide -- more than a quarter coming from European producers so far -- in response to the sharp decline in demand for zinc in galvanised steel making that's led to a 55 percent fall in zinc prices in the past one year.

The production cuts to date are causing sharp drops in spot treatment and refining charges in Asia and are also responsible for decline in this year's benchmark terms, which are now being settled at much more favourable terms for miners but had yet to arrest falling metal prices, Oz Minerals Chief Executive Andrew Michelmore told reporters.

"We've seen over a million tonnes come off," he told reporters, and added a significant amount of tonnage had also been eliminated in China.

Spot treatment charges for zinc concentrates shipped to China for smelting have plummeted to $110-$120 tonne from $190 a tonne at the start of 2009, Michelmore said.

"If the market was so oversupplied (with concentrate) the treatment charges would be rising, but in fact they are falling," he said.

Sources told Reuters this week the benchmark was set at $194 per tonne based on a $1,250 a tonne London Metal Exchange zinc price [ID:nN25445522]

Further production cuts are likely to occur among the producers in Europe where a strong euro was providing little cushion for suppliers, given the hefty declines in U.S. dollar zinc prices, he said.

In Europe, Germany's Ruhr Zinc, Romania's Copsa Mica and Romanian zinc and Sometra, Bulgaria's KCM and Cartagena in Spain have closed or trimmed back, removing some 300,000 tonnes of zinc from the supply pool.
http://uk.reuters.com/article/rbssIndustryMaterialsUtilitiesNews/idUKSYD23139220090227

Zinc

Research: In the study, 209 seventh graders, 111 girls and 98 boys, consumed four ounces of fruit juice containing 0, 10 or 20 mg of zinc gluconate each school day for 10-12 weeks. Students, their parents and teachers did not know who was receiving which, if any, zinc supplementation until the study was completed. At the beginning and the end of the study, students performed a battery of tasks designed to measure mental and motor skills, like attention, memory, problem-solving and hand-eye coordination.

Results: Adolescents who drank orange juice packed with 20 mg of zinc performed better on memory and attention exercises compared to those whose diet was not supplemented and youngsters who received the recommended 10 mg per day. Researchers noted zinc deficiency is not uncommon, even in the U.S. The risk could be particularly high in adolescents because they are undergoing rapid growth and often have poor eating habits.
http://findarticles.com/p/articles/mi_hb223/is_5_8/ai_n29182488?tag=content;col1

METALS-Shanghai copper, zinc jump 5 pct on China econ hopes

* Shanghai copper, zinc rise by 5 percent daily limit

* London copper extends Friday rally on China factor

* Rally seen "fragile" (Updates prices, adds details)

By Manolo Serapio Jr.

MANILA, Feb 9 (Reuters) - Shanghai copper futures surged by their 5 percent daily limit for a second straight session on Monday, tracking London's Friday rally on optimism about economic recovery in China, the world's biggest consumer of the industrial metal.

Copper's gains lifted other base metals, with zinc also hitting its 5 percent ceiling and aluminium jumping more than 3 percent.

"There is a return of optimism in the market on hopes of a recovery or a bottoming-out in economic conditions within this year, and China is a big part in this following some signs of better economic data there,"
http://www.forbes.com/feeds/reuters/2009/02/09/2009-02-09T080458Z_01_MAN375358_
RTRIDST_0_MARKETS-METALS-UPDATE-2.html

HZL prices firm on anticipated zinc demand

MUMBAI: Zinc Futures strengthened anticipating rise in demand in the next financial year. Prices of Zinc Futures rose marginally on the MCX following reports of the increase in the demand of steel as the infrastructure activities pick up pace.

It is felt globally that recession is a time to get the infrastructure projects going. In building infrastructure projects, the economy gets wider as more and more money get rotated creating more employment opportunities and more need for infrastructure related raw materials.

Country's largest zinc producer, Hindustan Zinc Ltd (HZL) declared that it would increase its production on the possibility of rise in demand. As a result, stock prices of HZL have seen an upward swing on the BSE. Stock touched its intra-day high of Rs.341 and settled at Rs.333 up by nearly 2% in the afternoon session.

However, company, which exports about 20 percent of its output, had announced price cut in zinc by Rs.800 to Rs.68,900 per tonne with effect from 31st January, 2009, only a fortnight after its previous announcement of price cut by Rs.1400 to Rs.73,300 per tonne on January 15 when the company stock traded at Rs.355 on the BSE.

Zinc consumption slackened due to slowing construction activity and weak sales of autos and consumer goods. However, as fallout of the directives by the central government to the states to speed up developmental construction activities, the demand for steel is anticipated to rise, which would prove as a booster for the zinc production too, which is used in producing galvanized steel.
http://www.commodityonline.com/news/HZL-prices-firm-on-anticipated-zinc-demand-14857-3-1.html