Commodity Blog

Zinc and lead consumption in Europe and Japan fell to their lowest levels last year since at least 2005, according to the latest figures from the International Lead & Zinc Study Group (ILZSG). Consumption of refined zinc in Europe fell 232,000 tonnes — or 8.1% -to 2.62 million tonnes in 2008 from the previous year as the economic slowdown hit galvanizers and others that use zinc, the ILZSG’s figures show. Lead usage in Europe dropped 126,000 tonnes to 1.81 million tonnes, down 6.5% year-on-year, it said, as demand from the battery sector fell. Japanese users cut zinc consumption by 18,000 tonnes or 3.1% to 570,000 tonnes, while lead consumption in the country fell 11,000 tonnes or 3.9% to 268,000 tonnes.
Global lead usage rose 6.4% year-on-year to 8.71 million tonnes, powered by China, where it grew by 24.8% to 3.21 million tonnes. Refined lead production in China jumped 15% to 3.21 million tonnes last year. The country’s exports fell 209,000 tonnes in 2007 to 35,000 tonnes.
Net imports of lead in concentrate rose for the sixth consecutive year to a record 795,000 tonnes, the ILZSG said. Demand for lead recovered partially in the USA, climbing 4% year-on-year to 1.57 million tonnes. This was still below the level of 2006, though, when the USA consumed 1.62 million tonnes, the trade body said. But worldwide production grew to 8.73 million tonnes, creating a surplus of 19,000 tonnes, the ILZSG said. “This is the first time world production has exceeded usage since 2002,” the ILZSG said.
World refined zinc production rose 2.9% to 11.68 million tonnes, exceeding demand by 195,000 tonnes. “After peaking in June, monthly refined zinc metal output fell off during November and December as a consequence of a number of closures and cutbacks,” the trade body said. Canadian producers cut 41,000 tonnes of zinc output, or 5.1%, to 761,000 tonnes last year, it said. Producers in Europe slashed output by 1.7% to 2.47 million tonnes as refiners in China increased production by 170,000 tonnes, or 4.5%, to 3.91 million tonnes. The country’s imports of zinc metal exceeded exports by 111,000 tonnes in 2008. This is a reversal of 2007, when China’s exports were 127,000 tonnes higher than imports, the ILZSG said.

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