Regional Changes in Refined Zinc Output and Demand

摘要

Global refined zinc output has grown from 8.9 Mt in 2000 to around 11.8 Mt in 2019, an increase of almost 3 Mt. Only 530 kt of this increase occurred outside China, while China's output rose by over 2.4 Mt. The major expansion in China's refined zinc production capacity took place in the ten years to 2010, with some further moderate increase to 2016, but there has been a net decrease in capacity since then. Refined zinc usage globally grew from 8.9 Mt in 2000 to 12.2 Mt in 2019, an increase of 3.3 Mt, but China accounted for more than this total rise, effectively taking away zinc demand from the rest of world. However, China's share of global zinc demand is now changing as its economy matures and, in the last 3 years, China's demand for zinc has stagnated at best, and in some years has fallen significantly. Higher costs, more extensive and better enforced environmental regulations, and the effect of trade disputes have seen China's manufacturing industry more constrained, with some Chinese manufacturing companies now basing activities off-shore, and with other countries now better able to compete in world markets than in the initial 10-15 years after China's entry into the WTO at the end of 2002. The last nine years have seen 13 zinc smelters outside China close, with the loss of close to 1 Mt of annual capacity. The last greenfield zinc smelter ex-China was commissioned in 2010, and capacity expansions have taken place at a number of plants, notably in South Korea, Mexico, India, and Norway, compensating for capacity losses, but not adding to capacity overall. The next five years are expected to see growth in refined zinc demand concentrated in countries other than China, with South-Eastern and South Asian countries leading the way. This raises the question of where and how the additional requirement for refined zinc will be met and whether China will play any role in supplying zinc to these expanding markets. This presentation will provide an analysis of recent regional changes in zinc demand and supply as outlined above and examine the prospects for future zinc demand and the potential sources of additional refined zinc output globally.