Zinc
Canadian Minerals Yearbook (CMY) - 2009
Doug Panagapko
The author is with the Minerals and Metals Sector,
Natural Resources Canada.
Telephone: 613-992-2667
E-mail: doug.panagapko@nrcan-rncan.gc.ca
HIGHLIGHTS
- Canada is an important producer and exporter of zinc and zinc products. Zinc metal production in Canada dates from the early 1900s when the Consolidated Mining and Smelting Company of Canada (now Teck Resources Limited) started production at a small electrolytic zinc plant at Trail, British Columbia. Today, with a smelting capacity of 843 000 t/y from four metallurgical facilities located across the country, Canada produces roughly 6.5% of the world’s total supply of refined zinc.
- In November, Xstrata Copper Canada announced that it will permanently close its copper smelter and zinc metallurgical plant in Timmins, Ontario, effective May 1, 2010. This decision was taken due to a global smelting overcapacity, the difficulty in sourcing sufficient concentrates to an inland location, and higher power costs when compared with other Canadian smelters.
- Zinc prices were on a steady upward trend during the year, increasing from US56¢/lb in January to US$1.15/lb by year-end.
- Metal inventories continued to rise, ending the year at 925 000 t, due principally to low demand in Europe and North America, and increased metal production in China. Prices should be in the US85¢-95¢/lb range in 2010, and industrial demand is expected to gradually increase.
| World Data | 2007 | 2008 | 2009 | 2009/08 |
|---|---|---|---|---|
| (000 t) | (% change) | |||
| Mine production | 11 136 | 11 690 | 11 377 | -2.7 |
| Refined production | 11 356 | 11 655 | 11 277 | -3.2 |
| Usage (consumption) | 11 310 | 11 437 | 10 832 | -5.3 |
| Refined balance | 46 | 202 | 380 | n.a. |
| Refined stocks at year-end (1) | 580 | 764 | 925 | n.a. |
Source: International Lead and Zinc Study Group.
n.a. Not applicable.
(1) Producer, consumer, and LME.
| Zinc Prices | 2007 | 2008 | 2009 |
|---|---|---|---|
| Cash (US¢/lb) | 147.10 | 85.00 | 75.00 |
| Cash (US$/t) | 3 259.90 | 1 874.70 | 1 655.10 |
| 3 months (US$/t) | 3 253.82 | 1 897.80 | 1 681.84 |
| 15 months (US$/t) | 3 011.90 | 1 943.46 | 1 742.69 |
| 27 months (US$/t) | 2 751.27 | 1 963.43 | 1 763.70 |
Source: International Lead and Zinc Study Group.
| Canadian Data | 2007 | 2008 | 2009 | 2009/08 |
|---|---|---|---|---|
| (tonnes) | (% change) | |||
| Mine output (1) | 630 485 | 750 502 | 701 828 | -6.5 |
| Zinc refined production | 802 103 | 764 310 | 685 504 | -10.3 |
| Zinc domestic shipments | 171 655 | 162 621 | 138 027 | -15.1 |
| Zinc refined imports | 13 514 | 8 314 | 4 559 | -45.2 |
| Apparent zinc usage (2) | 185 169 | 170 935 | 142 586 | -16.6 |
Source: Natural Resources Canada.
(1) Zinc content of ores and concentrates produced. (2) Domestic shipments and imports.
INTRODUCTION
Zinc is a relative newcomer to the group of metals discovered and used by society. While the first use of copper pre-dates recorded history and the discovery of tin goes back 5000 years, the first recovery of metallic zinc came much later. The production of metallic zinc was first described in India around 1200 A.D. By 1374, zinc was recognized as a new metal, the eighth to be discovered at that time, and a limited amount of commercial zinc production was under way. Although brass-making had developed much earlier, the zinc in brass was obtained by treating zinc ore to produce zinc vapour, which combined with granulated copper under heat. From India, zinc production was introduced to China sometime around 1600 A.D. and then began to be exported to Europe.
The first full-scale zinc smelting operation outside of Asia started in Bristol, England, about 1743. By the beginning of the 19th century, zinc production was established on the continent of Europe, notably in Belgium and parts of Eastern Europe. In the latter half of the century, large zinc industries developed rapidly in the United States and Germany.
HISTORY OF ZINC MINING IN CANADA
Zinc production in Canada dates back to the First World War when the Consolidated Mining and Smelting Company of Canada began operating a small electrolytic zinc plant at Trail, British Columbia, to help offset a critical wartime shortage of zinc in the United Kingdom. At that time, the Consolidated Mining and Smelting Company of Canada and The Anaconda Copper Mining Company in Montana were pioneering the production of zinc in North America by the electrolytic method.
The ores used at Trail came from the Sullivan mine near Kimberley, B.C., but production was hampered because the complex lead-zinc-iron ore was difficult to treat using existing methods. In 1920, however, the differential flotation method was successfully applied to separate the Sullivan ore into a lead concentrate, a zinc concentrate, and an iron by-product. This marked the beginning of significant zinc production in Canada. Today, the Trail operations are the world’s largest fully integrated lead and zinc smelting and refining complex. Owned and operated by Teck Resources Limited of Vancouver, the Trail facility has a zinc production capacity of 295 000 t/y.
In Manitoba, the discovery of significant zinc and copper ore with important quantities of gold in 1915 led to the development of the Flin Flon-Snow Lake mining camp, smelter complex, and dedicated power plant in the late 1920s. Since 1930, Hudson Bay Mining and Smelting Co. Limited, now a subsidiary of HudBay Minerals Inc., has owned and operated some 30 mines that have in turn fed the company’s metallurgical complex at Flin Flon. The Flin Flon smelter and refinery complex has undergone significant capital improvements since it first commenced operations in 1930 with the introduction of zinc pressure leach technology in the early 1990s and a new tank house in 2000 that expanded zinc production capacity to 118 000 t/y.
The Kidd Creek orebody near Timmins, Ontario, was discovered in 1963 and Texasgulf Inc. began open-pit mining of the deposit in 1966. The Kidd Creek zinc plant started production in 1972. In 1983, Kidd Creek started up a zinc pressure leaching facility. The mine and plant continued operation under Falconbridge until 2006. Today, Xstrata Copper owns and operates the Kidd Creek complex with a zinc metal production capacity of 150 000 t/y.
With the discovery of significant zinc-bearing ores in the Matagami region of northern Quebec in the late 1950s and early 1960s, Noranda Inc. began looking at options to build an electrolytic zinc plant. Construction began at Valleyfield, Quebec, west of Montréal, in 1962 and Canadian Electrolytic Zinc (CEZ) was brought into production in 1963. Xstrata Zinc has a 25% interest in the CEZ refinery held through the Noranda Income Fund. The plant’s capacity has increased steadily from its original 64 000 t/y at the time of opening to 280 000 t/y today.
CANADIAN PRODUCTION FACILITIES
In 2009, Canadian mines produced 701 828 t of zinc in concentrate, compared to 750 502 t in 2008, a 6.4% decrease (Table 1). Refined metal production for 2009 was 685 504 t , compared to 764 310 t in 2008, a decrease of 10.3%. Table 4 shows zinc production and exports for the period 1988-2009.
Zinc is produced at eight mines located in six provinces (Figure 1). A small amount of zinc was produced from stockpiled ore at the Scotia mine in Nova Scotia, which closed in late 2008. During the year, three zinc mines closed, all victims of low metal prices. The trend in total Canadian zinc mine production for the period 1999-2009 is shown in Figure 2. Zinc metal is produced from domestic and foreign concentrates at four metallurgical sites in Quebec, Ontario, Manitoba, and British Columbia (Table 8). Refined zinc metal production for the period 1999-2009 is shown in Figure 3. Metal production has declined steadily since 2006. Zinc oxide is produced at one plant located in Brampton, Ontario. Statistics on exports and imports of zinc concentrates, metal, and semi-fabricated products are provided in Table 2.
The following is a summary of Canadian zinc mines and metal production facilities in operation during 2009.
Newfoundland and Labrador
The Duck Pond mine, owned by Teck Resources Limited, is located 90 km south of Buchans. A total of 21 000 t of zinc in concentrate was produced during the year (2009 4th Quarter Report).
Nova Scotia
The Scotia mine of Acadian Mining Corporation closed permanently in March 2009 following the processing of stockpiled ore. Acadian holds the mine through subsidiary ScoZinc Limited. During the year, the company was assessing the potential conversion of the mill in order to facilitate the processing of gold ores.
New Brunswick
Xstrata Zinc Canada owns the Brunswick zinc and lead mine located 30 km southwest of Bathurst. In 2009, the mine produced 3.32 Mt of ore grading 8.6% zinc and 3.3% lead, up slightly from 3.31 Mt in 2008, resulting in the production of 252 416 t of zinc in concentrate, up from 242 478 t in 2008 (Production Report, December 2009). The mine is expected to close by the end of 2011 due to the depletion of ore reserves.
Blue Note Mining Inc. closed the Caribou mining operation, located 50 km west of Bathurst, in October 2008, and Blue Note Caribou Mines filed for bankruptcy in June 2009. In November 2009, it was announced that Maple Minerals Corporation had acquired certain assets at the former Caribou and Restigouche properties.
Quebec
Zinc is produced at the LaRonde mine, owned by Agnico-Eagle Mines Ltd.; the mine is situated about 60 km west of Val-d’Or. It is a gold-silver-copper-zinc orebody comprising massive to disseminated sulphide lenses within a regional shear zone. In 2009, the mine produced 56 185 t of zinc in concentrate from 2.55 Mt of ore milled at a grade of 2.96% zinc, which was a 14% decrease from the previous year (2009 Annual Report). Zinc production at LaRonde is expected to continue to decline as the zinc-rich parts of the orebody are mined out. By 2013, the company expects to produce 12 300 t of zinc per year.
The Perseverance mine at Matagami, owned by Xstrata Zinc Canada, completed its first full year of production in 2009. The mine is accessed by ramp and the ore is being processed at Xstrata’s 2600-t/d Matagami mill. During the year, the mine treated 1 011 000 t of ore at a grade of 14.4% zinc, resulting in the production of 135 708 t of zinc in concentrate (Production Report, December 2009). The mine is expected to produce about 140 000 t/y of zinc in concentrate over a five-year mine life.
Breakwater Resources Ltd. owns the Langlois mine located 213 km northeast of Val-d’Or. The mine was on care and maintenance during 2009. The company plans to spend $4.6 million to develop two ramps that will access separate zones in the mine; however, no decision to re-open the mine has been announced.
The CEZ zinc hydrometallurgical plant. located in Salaberry-de-Valleyfield just west of Montréal is owned by the Noranda Income Fund. Xstrata plc owns 25% of the fund units. The rated capacity of the plant is 280 000 t/y of refined zinc. In 2009, the plant produced 228 000 t of saleable zinc from 260 420 t of cathode zinc, compared to 291 580 t of cathode zinc produced in 2008 (2009 Annual Report). The reduced production was the result of cutbacks in response to weak markets for by-product sulphuric acid.
Xstrata Zinc Canada operates the General Smelting zinc and lead foundry located at Lachine, Quebec. During 2009, the plant produced 6000 t of zinc and lead foundry products, including zinc anodes and alloys.
Ontario
Xstrata Copper Canada operates the Kidd Creek copper-zinc mine, located about 25 km north of Timmins, as well as a copper smelter and zinc hydrometallurgical plant. The orebody was discovered in 1963 and open-pit mining commenced in 1966. Mining was later converted to underground and the mine is presently developed to a depth of 2773 m (9100 ft). The Kidd Creek mine produced 2.27 Mt of ore containing 108 100 t of zinc in concentrate in 2009 (2009 Annual Report).
The zinc hydrometallurgical plant located at Hoyle, 25 km east of Timmins, has a capacity of 150 000 t/y. In 2009, the plant produced 112 700 t of refined zinc, down from 121 000 t in 2008 (2009 Annual Report). In December, Xstrata Copper announced the permanent closure of the hydrometallurgical zinc plant, along with the copper smelter, effective May 1, 2010. The company cited global smelting overcapacity and high operating costs as reasons for the decision to close the metallurgical facility.
HudBay Minerals Inc. owns a zinc oxide production facility in Brampton. It is the third largest producer of zinc oxide in North America with a production capacity of 45 000 t/y. Production for 2009 was 25 107 t of zinc oxide, consuming 20 555 t of zinc metal.
Manitoba
HudBay Minerals Inc. operates an integrated mining and smelting business through its wholly owned subsidiary, Hudson Bay Mining and Smelting Co. , Limited (HBMS). It operates the 777 and Trout Lake mines and a smelter complex in Flin Flon, situated about 630 km northwest of Winnipeg. It also owns the Chisel North mine, located in Snow Lake, situated 120 km east of Flin Flon. The Chisel North mine and the Snow Lake concentrator were closed during 2009 due to continued low metal prices. In October, the company announced the restart of the mine and concentrator, expected by the second quarter of 2010. The Flin Flon concentrator produced 142 600 t of zinc concentrates from ore mined at 777 and Trout Lake. The Snow Lake concentrator produced 8646 t of zinc concentrates from ore mined at the Chisel North mine (2009 Year-End MD&A). The 777 mine produced 1.54 Mt of ore grading 4.36% zinc in 2009 while the Trout Lake mine produced 679 300 t of ore grading 3.1% zinc. The Chisel North mine produced 48 695 t of ore grading 9.2% zinc.
The zinc hydrometallurgical plant is situated at Flin Flon and employs two-stage pressure leaching and electrolysis technology to produce special high grade zinc. It has an annual capacity of 118 000 t of refined zinc metal. The plant produced 106 782 t of refined zinc in 2009, down from 112 955 t in 2008. This total can be broken down to 70 577 t from HudBay concentrates and 36 205 t from purchased concentrates. The amount of purchased concentrates increased substantially due to the lack of production from the Chisel North mine.
British Columbia
The Myra Falls zinc mine, owned and operated by Breakwater Resources Ltd., is located within Strathcona Provincial Park on Vancouver Island, about 65 km southwest of Campbell River. Production in 2009 was 30 900 t of zinc in concentrate (down from 35 762 t in 2008) from 449 930 t of milled ore grading 7.8% zinc (2009 Financial Report). As of December 2009, the mine had proven and probable reserves of 6.3 Mt grading 5.1% zinc.
The integrated zinc and lead smelting and refining complex at Trail, owned by Teck Resources Limited, has a capacity of 295 000 t/y of refined zinc. The complex produces refined zinc and lead, as well as gold, silver, cadmium, germanium, indium, sulphuric acid, and fertilizers. In 2009, production at Trail was 240 000 t of zinc, down from 270 000 t in 2008 (2009 Annual Report). This reduced production was the result of lower monthly production during the first eight months of the year.
RECENT DEVELOPMENTS
Kria Resources is considering the development of the Halfmile Lake property located 70 km southwest of Bathurst, New Brunswick. The deposit has an NI 43-101 resource estimate consisting of 6.26 Mt of indicated resources grading 8.13% zinc, 2.58% lead, and 30.7 g/t silver, and the company has completed a preliminary economic assessment for the project. It is considering the possibility of shipping ore to the Xstrata Brunswick mill 40 km away. Xstrata Zinc Canada currently owns 24% of the common shares of Kria.
Slam Resources Ltd. released an NI 43-101 technical report on its Nash Creek property located 50 km northwest of Bathurst, New Brunswick. The updated report defined indicated resources of 7.81 Mt grading 2.72% zinc and 0.55% lead, and inferred resources of 1.21 Mt grading 2.66% zinc and 0.52% lead.
Donner Metals Ltd. released a technical report on the resource calculation for its Bracemac-McLeod deposit near Matagami, Quebec. The property is located only 5 km from the 2600-t/d Matagami Lake mill complex owned by Xstrata Zinc Canada. The mill is currently processing ore from Xstrata’s Perseverance mine. Indicated resources have been calculated at 3.62 Mt grading 11.52% zinc, 1.6% copper, and 31.6 g/t silver. Xstrata, as Donner’s partner in the project, is in the process of completing a feasibility study. The overall objective is to supplement production from the Perseverance mine and to provide a longer-term feed source for the Matagami mill.
HudBay Minerals Inc. continued an aggressive drilling program at the Lalor project, located approximately 3 km from the company’s Chisel North mine near Snow Lake, Manitoba. In December, the company released a resource update that calculated 12.3 Mt of indicated resources at 8.7% zinc, 0.66% copper, and 1.5 g/t gold, and 5.0 Mt of inferred resources at 9.39% zinc, 0.57% copper, and 1.4 g/t gold. The deposit is interpreted to consist of six stacked lenses. Recent drilling also intersected at least five lenses of gold mineralization that combined have a potential mineral resource of 10.6-12.0 Mt grading 4.3-5.2 g/t zinc and extending to a depth of 1250 m. A ramp access into the deposit from the Chisel North mine has commenced and is expected to be completed in 2011. A prefeasibility study is under way.
Canada Zinc Metals Corp. continues to advance its SEDEX-type Akie zinc-lead deposit located in central British Columbia about 280 km northwest of Mackenzie. The company has published NI 43-101 compliant inferred resources of 23.6 Mt grading 7.6% zinc and 1.5% lead (using a 5% zinc cut-off). The company expects to continue exploration of the Cardiac Creek deposit by drilling in 2010. Tongling Nonferrous Metals Group Holdings Co. Ltd. has acquired a 13% equity interest in Canada Zinc Metals. This deposit is in rocks similar to those that host the Cirque and Cirque South deposits located 20 km to the northwest and owned by Teck Resources Ltd. and Korea Zinc.
Selwyn Resources Ltd. is continuing towards a production decision and the development of an underground mine at its Howard’s Pass zinc-lead project in east-central Yukon. This would be followed by a later expansion to open-pit mining. Initial mining would be at a rate of 8000 t/d. Annual metal output would be approximately 255 000 t of zinc and 65 000 t of lead. The company is proceeding with environmental assessment work and First Nations consultations, as well as with work permit applications for underground development activities. A high-grade mineral resource estimate for four separate deposits is 16.1 Mt grading 10.25% zinc and 4.23% lead. In December, the company announced that it had reached a joint-venture agreement with Yunnan Chihong Zinc & Germanium Co. Ltd. whereby Yunnan could earn a 50% interest in the project by investing $100 million and taking the project to the feasibility stage.
The Wolverine mine project, located 175 km northwest of Watson Lake, Yukon, owned by Yukon Zinc Corp., continues to proceed through the Yukon government regulatory approvals process. All major permits have been awarded. The deposit contains proven and probable reserves of 5.15 Mt grading 9.71% zinc, 0.93% copper, 1.26% lead, 284.2 g/t silver, and 1.36 g/t gold. Once in production at a daily rate of 1700 t, the mine is expected to produce 53 400 t of zinc in concentrate and 5860 t of lead in concentrate annually over a 10-year mine life. A tailings infrastructure construction plan was recently approved and construction activities at the site are continuing. Yukon Zinc Corp. is owned privately by Jinduicheng Molybdenum Group Ltd. and Northwest Nonferrous International Investment Company Ltd.
Canadian Zinc Corporation continued activities at its Prairie Creek zinc-lead-silver project located in the western Northwest Territories. The project is environmentally sensitive as it lies within the Nahanni River watershed and is surrounded by the recently expanded Nahanni National Park. Activities included filing reports with the Mackenzie Valley Land and Water Board and submitting applications for environmental assessment. The property consists of a partially developed mine with a 1000-t/d mill and related infrastructure. Published resources include measured and indicated resources of 5.84 Mt grading 10.7% zinc, 9.9% lead, and 161 g/t silver. Some rehabilitation work on the winter road was completed during 2009.
Sabina Gold & Silver Corp. released an updated preliminary economic assessment for its Hackett River silver-zinc deposit located in western Nunavut. It has calculated indicated resources of 43.3 Mt grading 4.65% zinc, 0.64% lead, and 144 g/t silver, and an inferred resource of 14.6 Mt grading 4.46% zinc, 0.57% lead, and 136 g/t silver. The company is proceeding with a water licence and other permits as part of the environmental assessment process. The updated economic assessment estimates metal production for the first 10 years of 166 000 t/y of zinc, 21 000 t/y of lead, and 13.6 million oz/y of silver at a milling rate of 12 000 t/d. The deposit is located 75 km from tidewater and would require a road and port to be built to supply the mine and ship concentrates.
Minerals and Metals Group (MMG), a subsidiary of China’s Minmetals Non-ferrous Co. Ltd., purchased the assets of Australian miner OZ Minerals in June. This purchase includes several Canadian gold and base-metal deposits, including the Izok Lake and High Lake massive sulphide deposits. The Izok Lake deposit, located 360 km north of Yellowknife, Northwest Territories, in western Nunavut, contains an indicated resource of 14.4 Mt grading 12.9% zinc, 2.5% copper, and 1.3% lead. High Lake, situated 570 km north of Yellowknife, contains an indicated resource of 14.3 Mt grading 3.5% zinc, 2.3% copper, and 76 g/t silver. MMG also owns the mill at the former Lupin gold mine located 70 km east of Izok Lake. The company completed a scoping study of the Izok Lake project in December.
WORLD PRODUCTION
According to the International Lead and Zinc Study Group (ILZSG), world zinc mine production for 2009 was 11.37 Mt, down from 11.69 Mt in 2008, due to several mine closures in response to weak metal prices late in the year (Table 5). World refined zinc metal production was 11.28 Mt, down from 11.66 Mt in 2008, in response to reduced demand in Europe and North America (Table 6). In terms of mine production, Canada ranked fifth behind China, Peru, Australia, and the United States. The top five zinc metal-producing countries in 2009 were China, Canada, India, South Korea, and Japan. The top five zinc mining companies are Xstrata, Teck Resources, Hindustan Zinc, MMG Minmetals, and Glencore, which together account for 30% of world zinc mine production.
The top five zinc mines in terms of zinc-in-concentrate production in 2009 were: Rampura Agucha, India (591 700 t); Red Dog, Alaska (582 500 t); Antamina, Peru (456 300 t); Century, Australia (360 600 t); and Mt. Isa, Australia (273 300 t). Figure 4 shows world zinc mine production for the period 2007-09 while Figure 5 shows refined metal production for the same period. Refined metal output from China has increased 16.4% since 2007, while production in Europe has declined 19.3% over the same period.
USES
The greatest use for zinc is as a coating for iron and steel products to make them resistant to rust and corrosion. The application of a zinc coating, known as galvanizing, is accomplished electrolytically or by hot-dip methods. Galvanizing accounts for about 60% of the worldwide use of zinc.
The most commonly galvanized products are sheet and strip steel, tube and pipe, and wire and wire rope. The automobile industry is the largest user of galvanized steel. The desire to reduce weight and improve fuel efficiency has led to the increased use of galvanized steel by the automotive industry to protect the thinner gauges of steel from corrosion. Both hot-dipped and electro-galvanized steel are used, the thicker coating of hot-dipped steel giving more corrosion protection to unexposed surfaces and the thinner coating of electro-galvanized steel providing a smoother finish for exposed, painted surfaces.
Galvanized sheet and strip steel are also widely used by the construction industry for roofing and siding, and for heating and ventilation ducts, as well as for many other applications. Nails and other building materials are often hot-dip galvanized. Zinc and zinc-aluminum thermally sprayed coatings are used for the long-term corrosion protection of large steel structures such as bridges and hydro-electric transmission towers.
Another important use of zinc, using about 16% of world supply, is in the manufacture of a vast range of die-cast products. Because it has a relatively low melting point and is very fluid, die-cast zinc is easy to pour when melted. Therefore, it is well suited to rapid, assembly-line die-casting, particularly to produce small and intricate shapes.
A major use of die castings is in the automobile industry as trim pieces, grills, door and window handles, carburetors, pumps, and other components. However, with the trend toward lighter, more energy-efficient cars, zinc demand for this purpose has declined in recent years. Other familiar zinc die castings include small electrical appliances, business machines, and other light equipment, tools, and toys.
Zinc is also an essential ingredient of brass, which is basically an alloy of copper and zinc with the proportion of zinc ranging from 5 to 40%. The zinc brasses have good physical, electrical, and thermal properties, and are corrosion resistant. They are used in plumbing, heat exchange equipment, and a wide range of decorative hardware, to name a few applications. Rolled zinc metal is a basic component in dry-cell batteries, and zinc oxide is used as a catalyst in the manufacture of rubber and as a pigment in white paint. It is also used in agricultural products, cosmetics, and medicinal products.
Table 7 and Figure 6 show a breakdown of worldwide zinc use by geographic region for the period 2007-09, according to data from the ILZSG. Notably, zinc consumption in China increased 17.8% in 2009, compared to an 11.5% increase in 2008, whereas zinc consumption in Europe declined by 25% in 2009. Table 3 and Figure 7 show a breakdown of zinc use in Canada for the period 2005-07. In Figure 7, other products include rolled and ribbon zinc and zinc oxides. The overall trend in total world zinc consumption for the period 1993-2009 is shown in Figure 8.
HEALTH AND ENVIRONMENT
Zinc plays an important role as a micro-nutrient in the development and health of a variety of plants and animals. In humans, zinc is a key element in the function of more than 200 enzymes, for the stabilization of DNA and the expression of genes, and for the transfer of nerve signals.
The human body contains 2-3 g of zinc. The recommended daily zinc intake is 10 mg for children, 12 mg for adult women, and 15 mg for adult men. Daily intake is not only dependent on food, but also on gender, age, and general health status. Growing infants, children, adolescents, women in pregnancy, and the elderly have a higher zinc requirement.
Food is the primary source of zinc for humans with only a small part coming from drinking water. Some dietary sources of zinc include red meat, nuts, poultry, and milk products. Zinc deficiency is the most common micro-nutrient deficiency affecting many agricultural areas in Asia, Africa, and the Middle East. The World Health Organization attributes 800 000 deaths worldwide each year to zinc deficiency. Zinc in fertilizers can significantly enhance the quality and yield of crops.
In 2009, the International Zinc Association, in partnership with UNICEF, launched the “Zinc Saves Kids” initiative. This campaign is a fund-raising effort in support of UNICEF’s zinc supplementation programs in Asia, Africa, and Latin America. Zinc nutritional supplements will reduce zinc deficiency in children and is an inexpensive way of treating diseases such as diarrhea and pneumonia. This program was recognized by the Clinton Global Initiative in New York in September as a global strategy that can save many lives for little money.
A separate project, launched in conjunction with the International Fertilizer Industry Association, consists of crop trials in India, Laos, China, and Thailand to demonstrate the value of using zinc-enhanced fertilizers to increase crop yields.
INTERNATIONAL LEAD AND ZINC STUDY GROUP
The International Lead and Zinc Study Group (ILZSG) is an intergovernmental organization that regularly brings together 30 member countries in an international forum to exchange information on lead and zinc. Particular attention is given to providing regular and frequent information on supply, demand, and the outlook for lead and zinc prices and markets. The twice-yearly supply-demand and metal balance reports compiled by ILZSG with member government support are widely used in industry as a basis for determining potential price directions.
The Study Group, headquartered in Lisbon, Portugal, represents most of the world’s major lead- and zinc-producing and using nations. The Group has an extensive information-gathering and dissemination role, and acts as an effective mechanism for increasing market transparency related to the production, use, and trade of lead and zinc. The Group is also an important forum for communication among governments, among industry, and between governments and industry. It holds a general session each year in October.
More information about the Group’s activities can be obtained from its web site at www.ilzsg.org/static/home.aspx.
PRICES AND STOCKS
Figure 9 shows average monthly London Metal Exchange (LME) settlement prices for the period 2005-09, along with zinc metal stocks. Total stocks, comprising producers, consumers, and LME stocks, stood at 925 000 t at the end of 2009. Producer and consumer stocks ended the year at 420 000 t, down 15% from the previous year. LME metal stocks increased substantially from 253 000 t at the end of 2008 to 489 000 t in December 2009. Monthly average settlement prices on the LME during 2009 ranged from US$1112/t in February to US$2376/t in December. Annual average zinc prices for 1988-2009 are shown in Figure 10. Figure 11 shows the LME daily official cash settlement prices for 2009. The price started the year at US54¢/lb and ended it at US$1.08/lb. Table 9 shows the monthly average zinc prices for 2008 and 2009. The yearly average price dropped 11.6% from its 2008 level.
OUTLOOK
Zinc prices recovered substantially during 2009 despite increasing metal stocks and continued weak demand in Western economies. Most analysts believe that prices will weaken in 2010 given that price response in 2009 is not tied to the fundamental supply-demand balance. Over the longer term, shortages in mine concentrate supply associated with the closure of some large producers (e.g., Brunswick and Century) due to the depletion of ore reserves will put upward pressure on prices. Fundamental demand from the galvanized steel sector should increase steadily in the next few years, which should reduce worldwide stocks to more reasonable levels.
The ILZSG predicts that global zinc mine output for 2010 will be 11.97 Mt, an 8.1% increase from the previous year, in part due to the start of production at Goldcorp’s Penasquito mine in Mexico. Refined metal production, according to the ILZSG, should be 12.26 Mt, a 10% increase from 2009. The ILZSG expects that refined zinc metal usage will be 12.04 Mt in 2010, an increase of 11.9%. There is expected to be a net surplus of 227 000 t of zinc in 2010.
Zinc prices are expected to vary within the US$1760-$2200/t (US$0.80-$1.00/lb) range during 2010.
OTHER SOURCES OF INFORMATION ON ZINC
American Galvanizers Association
www.galvanizeit.org
International Zinc Association
www.zincworld.org
London Metal Exchange
www.lme.co.uk
U.S. Geological Survey
http://minerals.usgs.gov/minerals/pubs/commodity/zinc/
World Bureau of Metal Statistics
www.world-bureau.com
Zinc Information Centre
www.zincinfocentre.org
North American Die Casting Association
www.diecasting.org
International Fertilizer Industry Association
www.fertilizer.org
Notes: (1) For definitions and valuation of mineral production, shipments and trade, please refer to the chapter entitled “Definitions and Valuation: Mineral Production, Shipments, and Trade.” (2) Information in this review was current as of May 31, 2010. (3) This and other reviews, including previous editions, are available on the Internet at www.nrcan-rncan.gc.ca/smm-mms/busi-indu/cmy-amc-eng.htm.
Note to Readers
The intent of this document is to provide general information and to elicit discussion. It is not intended as a reference, guide or suggestion to be used in trading, investment, or other commercial activities. The author and Natural Resources Canada make no warranty of any kind with respect to the content and accept no liability, either incidental, consequential, financial or otherwise, arising from the use of this document.
Figure 1
Zinc Producers in Canada, 2009
Zinc-Producing Mines
1. Duck Pond
2. Brunswick
4. LaRonde
5. Perseverance
6. Kidd Creek
8. Trout Lake
777
9. Myra Falls
Zinc Metallurgical Plants
3. Valleyfield
6. Kidd Creek
8. Flin Flon
10. Trail
Zinc Oxide Plants
7. Zochem
www.teck.com
www.xstrata.com
www.agnico-eagle.com
www.xstrata.com
www.xstrata.com
www.hudbayminerals.com
www.hudbayminerals.com
www.breakwater.ca
www.norandaincomefund.com
www.xstrata.com
www.hudbayminerals.com
www.teck.com
Teck Resources Limited
Xstrata Zinc Canada
Agnico-Eagle Mines Limited
Xstrata Zinc Canada
Xstrata Copper Canada
HudBay Minerals Inc.
HudBay Minerals Inc.
Breakwater Resources Ltd.
Canadian Electrolytic Zinc Limited
Xstrata Copper Canada
HudBay Minerals Inc.
Teck Resources Limited
HudBay Minerals Inc.
Figure 2
Canadian Mine Production of Zinc, (1) 1999-2009
Source: Natural Resources Canada.
(1) Zinc content of ores and concentrates produced.
Figure 3
Canadian Refined Zinc Metal Production, 1999-2009
Source: Natural Resources Canada.
Figure 4
World Zinc Mine Production, 2007-09
Source: International Lead and Zinc Study Group.
Figure 5
World Zinc Metal Production, 2007-09
Source: International Lead and Zinc Study Group.
Figure 6
World Refined Zinc Use, 2007-09
Source: International Lead and Zinc Study Group.
Figure 7
Canada, Zinc Use, 2005-07
Source: Natural Resources Canada
Figure 8
World Zinc Usage, 1993-2009
Source: International Lead and Zinc Study Group.
Figure 9
Zinc Prices and Stocks, (1) 2005-09
Source: International Lead and Zinc Study Group.
(1) LME monthly average settlement prices and reported total stocks.
Figure 10
Average Cash Settlement Zinc Prices, 1988-2009
Source: International Lead and Zinc Study Group.
Figure 11
LME Daily Official Cash Settlement Prices, 2009
Source: International Lead and Zinc Study Group.
| Item No. | Description | Canada | United States | EU | Japan | ||
|---|---|---|---|---|---|---|---|
| MFN | GPT | USA | Canada | Conventional Rate | WTO (2) | ||
| 2603.00.30 | Copper ores and concentrates: zinc content | Free | Free | Free | Free | Free | Free |
| 2607.00.30 | Lead ores and concentrates: zinc content | Free | Free | Free | Free | Free | Free |
| 2608.00.30 | Zinc ores and concentrates: zinc content | Free | Free | Free | Free | Free | Free |
| 2616.10.30 | Precious metal ores and concentrates: silver ores and concentrates: zinc content | Free | Free | Free | Free | Free | Free |
| 2617.90 | Other ores and concentrates: other | Free | Free | Free | Free | Free | Free |
| 2620.11 | Slag, ash and residues (other than from the manufacture of iron or steel) containing metals, arsenic or their compounds: containing mainly zinc: hard zinc spelter | Free | Free | Free | Free | Free | Free |
| 2620.19 | Slag, ash and residues (other than from the manufacture of iron or steel) containing metals, arsenic or their compounds: containing mainly zinc: other | Free | Free | Free | Free | Free | Free |
| 2817.00 | Zinc oxide; zinc peroxide | Free-5.5% | Free | Free | Free | 5.5% | 4.3% |
| 2827.39.40 | Chlorides, chloride oxides and chloride hydroxides; bromides and bromide oxides; iodides and iodide oxides: other chlorides: other: of zinc | Free | Free | Free | Free | 5.5% | 3.9% |
| 2837.19.00.30 | Cyanides, cyanide oxides and complex cyanides: cyanides and cyanide oxides: other | Free | Free | Free | Free | 5.5% | 3.3% |
| 2836.99 | Carbonates; peroxocarbonates (percarbonates); commercial ammonium carbonate containing ammonium carbonate: other: other | Free-3.5% | Free-3% | Free | Free | 3.7-5.5% | 3.3% |
| 2842.90 | Other salts of inorganic acids or peroxoacids (including aluminosilicates whether or not chemically defined), other than azides: other | Free-3% | Free | Free | Free | 5.3-5.5% | 3.3% |
| 32.06 | Other colouring mattes; preparations as specified in note 3 to this chapter of the Canadian Customs Tariff, other than those of heading 32.03, 32.04 or 32.05; inorganic products of a kind used as luminophous, whether or not chemically defined | ||||||
| 3206.42 | Other colouring mattes and other preparations: lithopone and other pigments and preparations based on zinc sulphide | Free-2% | Free | Free | Free | 6.5% | 3.9%-2.6% |
| 3206.49.89 | Other colouring mattes and other preparations; other | Free-6.5% | Free-3% | Free | Free | 6.5% | 2.5%-2.6% |
| 7901.11 | Unwrought zinc: zinc, not alloyed: containing by weight 99.99% or more of zinc | Free | Free | Free | Free | 2.5% | Free-4.30yen/kg |
| 7901.12 | Unwrought zinc: zinc, not alloyed: containing by weight less than 99.99% of zinc | Free | Free | Free | Free | 2.5% | Free-4.30yen/kg |
| 7901.20 | Unwrought zinc: zinc alloys | Free | Free | Free | Free | 2.5% | Free-4.30yen/kg |
| 7902.00 | Zinc waste and scrap | Free | Free | Free | Free | Free | Free |
| 7903.10 | Zinc dust, powders and flakes: zinc dust | Free | Free | Free | Free | 2.5% | 3% |
| 7903.90 | Zinc dust, powders and flakes: other | Free | Free | Free | Free | 2.5% | 3% |
| 7904.00 | Zinc bars, rods, profiles and wire | Free | Free | Free | Free | 5% | 3% |
| 7905.00 | Zinc plates, sheets, strip and foil | Free | Free | Free | Free | 5% | 3% |
| 7907.00 | Other articles of zinc | Free-3% | Free-3% | Free | Free | 5% | 3% |
| 8506.60 | Primary cells and primary batteries: air-zinc | 7% | 5% | Free | Free | 4.7% | Free |
Sources: Canadian Customs Tariff, effective January 2010, Canada Border Services Agency; Harmonized Tariff Schedule of the United States, 2010; Official Journal of the European Union (Tariff Information), October 31, 2009 edition; Customs Tariff Schedules of Japan, 2010.
GPT General Preferential Tariff; MFN Most Favoured Nation; WTO World Trade Organization.
(1) The customs duties applicable to imported goods originating in countries that are Contracting Parties to the General Agreement on Tariffs and Trade or with which the European Community has concluded agreements containing the most-favoured-nation tariff clause shall be the conventional duties shown in column 3 of the Schedule of Duties. (2) WTO rate is shown; lower tariff rates may apply circumstantially.
Sources: Natural Resources Canada; Statistics Canada.
– Nil; . . Not available; (p) Preliminary.
(1) New refined zinc produced from domestic primary materials (concentrates, slags, residues, etc.) plus estimated recoverable zinc in ores and concentrates shipped for export. (2) Zinc content of ores and concentrates produced. (3) Refined zinc produced from domestic and imported ores.
Note: Numbers may not add to totals due to rounding.
Sources: Natural Resources Canada; Statistics Canada.
– Nil; . . Not available; . . . Amount too small to be expressed.
Notes: HS Code change from 2827.36 to 2827.39.40 as of 2007. HS Code change from 2833.26 to 2827.39.40 and 2833.29.00.90 as of 2007. HS Code change from 7906.00 to 7907.00.20 and 7907.00.20.30 as of 2007. Numbers may not add to totals due to rounding.
Sources: Natural Resources Canada; Statistics Canada.
x Confidential.
(1) User survey does not represent all Canadian users and is therefore consistently less than the apparent quantity used. (2) Due to confidentiality in some end-use categories, a breakdown of primary and recycled sources is not provided in order to be consistent.
Note: Numbers may not add to totals due to rounding.
Sources: Natural Resources Canada; Statistics Canada.
(p) Preliminary.
(1) Beginning in 1988, exports are based on the new Harmonized System and may not be in complete accordance with previous method of reporting. Ores and concentrates include HS classes 2608.00.30, 2603.00.30, 2607.00.30 and 2616.10.30. Refined production includes HS classes 7901.11 and 7901.12. (2) New refined zinc produced from domestic primary materials (concentrate, slags, residues, etc.) plus estimated recoverable zinc in ores and concentrates shipped for export. (3) Refined zinc produced from domestic and imported ores.
Source: International Lead and Zinc Study Group.
– Nil; (p) Preliminary.
Source: International Lead and Zinc Study Group.
– Nil; (p) Preliminary.
(1) Total production by smelters and refineries of zinc in marketable form or used directly for alloying, including production on toll in the reporting country, regardless of the type of source material from which it is produced, i.e., whether ores, concentrates, residues, slag, or scrap. Remelted zinc and zinc dusts are excluded.
Source: International Lead and Zinc Study Group.
. . Not available; (p) Preliminary.
(1) Total refined zinc use, including zinc used directly for the production of zinc alloys, regardless of the type of source material from which it is produced, i.e., ores, concentrates, residues, slags, or scrap. Remelted zinc and zinc dusts are excluded.
| Company and Location | Annual Rated Capacity |
|---|---|
| (000 tonnes of slab zinc) | |
| PRIMARY | |
|
Canadian Electrolytic Zinc Limited Salaberry-de-Valleyfield, Quebec |
280 |
|
Xstrata Zinc Canada Timmins, Ontario |
150 |
|
HudBay Minerals Inc. Flin Flon, Manitoba |
118 |
|
Teck Cominco Limited Trail, British Columbia |
295 |
| Total primary, Canada | 843 |
Source: Natural Resources Canada.
|
LME Special High Grade Settlement |
|
|---|---|
| (US$/t) | |
| 2008 | |
| January | 2 340.1 |
| February | 2 438.1 |
| March | 2 511.5 |
| April | 2 263.8 |
| May | 2 182.1 |
| June | 1 894.5 |
| July | 1 852.4 |
| August | 1 723.3 |
| September | 1 735.5 |
| October | 1 302.1 |
| November | 1 152.6 |
| December | 1 100.6 |
| Yearly average | 1 874.7 |
| 2009 | |
| January | 1 187.4 |
| February | 1 112.1 |
| March | 1 216.8 |
| April | 1 378.9 |
| May | 1 483.8 |
| June | 1 557.3 |
| July | 1 578.6 |
| August | 1 821.7 |
| September | 1 884.0 |
| October | 2 071.6 |
| November | 2 193.4 |
| December | 2 376.0 |
| Yearly average | 1 655.1 |
Source: International Lead and Zinc Study Group.