Global mined zinc production to ramp up — report
Global mined zinc production will continue to ramp up as strong zinc prices prompt miners to bring idled capacity back online and invest in new projects, according to a new Fitch Solutions report.
The analyst’s outlook for global zinc production says that while some capacity taken offline over 2015-2016 was due to permanent mine closures, the return of some stalled capacity and new projects in key countries will drive growth over the coming quarters.
Fitch forecasts global zinc mine production to increase by 2.1% y-o-y in 2019 to 13.3mnt then increase to 15.8mnt by 2028, averaging 2.0% growth.
China’s zinc production will edge higher, from 4.3mnt in 2018 to 4.4mnt by 2028, averaging 0.2% annual growth, Fitch predicts. Despite this muted growth rate, China will remain the largest global producer of zinc by a wide margin. Fitch forecasts China’s position to erode from 33% of global mine production in 2018 to 28% by 2028.
Australia’s zinc sector will gradually recover as rising prices prompt miners to restart major operations. Fitch forecasts the country’s zinc production to increase from 940kt in 2018 to 1.0mnt by 2019, supported by fully operational Dugald River mine. By 2028 Fitch expects zinc production to reach 1.3mnt on the back of rising zinc prices and a solid project pipeline.
India will increasingly drive global zinc production growth, as the country’s key miner Hindustan Zinc Limited (HZL) implements a large-scale expansion plan. This commissioning of various projects will continue to happen over 2019, allowing for mining production gains in both 2019 and 2020, the report reads.
Fitch forecasts Peru’s zinc output to increase to 2.1mnt by 2028 from 1.6mnt in 2018, averaging 2.9% annual growth. According to Fitch’s Global Mines Database, Peru has the third highest number of new zinc projects in the pipeline.
Read the full report here