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Zinc, Lead and Tin

Commentary: Is the metals rout signal or noise? The zinc perspective – by Andy Home (Reuters U.K. – August 16, 2018)

https://uk.reuters.com/

LONDON (Reuters) – The London Metal Exchange (LME) base metals markets were a scene of carnage on Wednesday. The LME Index (.LMEX), a basket of the exchange’s six core contracts, slumped by almost four percent in a single day.

The bloodbath is part and parcel of the turmoil playing out across the financial market spectrum. But industrial metals find themselves at the epicenter of investors’ fears about global, particularly Chinese, growth and escalating trade tensions. A rising dollar and a falling yuan simply reinforce the macro negativity.

If Doctor Copper and his metallic friends are to be believed, global manufacturing is heading for a cliff-edge. But should we believe them? Those analysts that track the complex are not convinced.

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Commentary: Zinc bears get taught another lesson in timing – by Andy Home (Reuters U.K. – July 27, 2018)

https://uk.reuters.com/

LONDON (Reuters) – Zinc has fared worst in the industrial metals rout. From a 10-year high of $3,484.50 per tonne in February, the price of London Metal Exchange (LME) zinc slumped 30 percent to a mid-July low of $2,474. It is currently treading water around $2,570.

Zinc has been hit by the same global growth jitters as the other LME-traded base metals. The metal, in the form of galvanised steel, is heavily dependent on demand from the automotive and construction sectors, leaving it exposed to both U.S. tariffs and Chinese economic slowdown.

But speculators turned on zinc earlier than any of the other metals and they’ve pushed it harder. Down by 23 percent on the start of the year, it is the laggard in an under-performing LME pack.

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Smelting constraints make zinc’s price plunge look overdone – by Pratima Desai (Reuters U.S. – July 17, 2018)

https://www.reuters.com/

LONDON (Reuters) – Expectations for a rise in zinc concentrate supplies in coming years have driven down the metal price to one-year lows, but smelting capacity constraints suggest the sell-off is premature.

Benchmark zinc on the London Metal Exchange (LME) hit $2,473.85 a tonne on Monday, its lowest since mid-June 2017 and 31 percent below February’s 11-year high of $3,595.50. Prices of the metal, which is used to galvanise steel, have underperformed other LME metals this year.

Projects that will deliver more zinc concentrate to market include Vedanta’s Gamsberg mine in South Africa and three Australian projects, namely Dugald River owned by MMG, another mine run by New Century Resources and Glencore’s Lady Loretta mine.

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Trade war jitters have halted the commodity rally and could disrupt miners’ plans for big projects – by Gabriel Friedman (Financial Post – July 14, 2018)

https://business.financialpost.com/

Speaking at a conference in early June, Vancouver-based Teck Resources Ltd.’s chief executive Don Lindsay raved that his company invested “in the right commodities at the right time,” with a nod to one of its biggest bets — copper.

Lindsay predicted copper soon would hit US$3.50 per pound, at which point his company’s long-planned Quebrada Blanca 2 project — a 300,000-ton per year copper mine to be constructed in northern Chile’s high desert — would add $1 billion dollars per year in cash flow.

“That price is not far off,” he said at the June conference in Chicago, organized by Deutsche Bank, at a time when copper had experienced nearly a year of gains.

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Canadian startups focus efforts on zinc, instead of lithium-ion, for future batteries – by Tyler Hamilton (Globe and Mail – July 11, 2018)

https://www.theglobeandmail.com/

The energy storage market is a battlefield, littered with the corpses of failed newcomers that underestimated how deeply entrenched lithium-ion technology would become.

We’re talking 95 per cent entrenched, a market position growing stronger as demand for electric vehicles, wireless devices and cordless tools rise. Costs continue to plunge, with “gigafactories” and “Chinafication” driving the same economies of scale that turned solar photovoltaic panels into a commodity.

This has researchers at the Massachusetts Institute of Technology worried about “technology lock-in.” Their fear, outlined in a recent white paper, is that lithium-ion has become so dominant that it is preventing newer, better battery chemistries from getting funded, gaining market traction and achieving the scale needed to survive, let alone compete on cost.

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COLUMN-China zinc output cuts; hazy details but the pain is real – by Andy Home (Reuters U.K. – June 29, 2018)

https://uk.reuters.com/

LONDON, June 29 (Reuters) – Will China’s zinc smelters cut production?If they make good on a proposal to take a collective 10 percent hit, it would remove at least 400,000 tonnes of metal from the market on an annualised basis.

The news has halted the slide in zinc prices, both in London and Shanghai, though it may have been little more than narrative wrapping for an overdue correction.

The London Metal Exchange (LME) three-month zinc price is this morning trading at $2,875 a tonne, still close to Tuesday’s 10-month low of $2,815 and a long way from February’s peak of $3,595.50. That tells you the market isn’t that impressed either.

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Commentary: Zinc rally over? Bears think so but spreads bite back – by Andy Home (Reuters U.K. – June 21, 2018)

https://uk.reuters.com/

LONDON (Reuters) – Is that it for the zinc rally? After hitting a 10-year high of $3,595.50 per tonne in February, the London Metal Exchange (LME) price has been sliding ever since. The retreat has extended to $2,946.50 so far on Thursday morning, the lowest level since August last year.

Expectations for one last bull hurrah have faded as exchange stocks have rebuilt, apparently calling time on the supply chain tightness that underpinned zinc’s two-year charge from the January 2016 low of $1,444.50 per tonne.

As ever with this particular metal, though, appearances can be deceptive, as shorts have just found out to their cost. Time-spreads across the front part of the LME zinc curve have tightened sharply over the last couple of weeks, a seemingly anomalous outcome given rising inventory.

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Miners’ big spend shows commodities optimism – by Robert Guy (Australian Financial Review – June 18, 2018)

https://www.afr.com/

A $2 billion acquisition spree by South32 and Gina Rinehart’s Hancock Prospecting has underscored the more upbeat outlook on commodity prices among industry heavyweights, with the scramble to buy or develop world class assets and infrastructure heating up as the world’s largest miners emerge from years of austerity.

Australia’s largest miners have moved aggressively to stamp their dominance in key commodity markets amid expectations of strong Asian economic growth over the next decade, with South32’s $1.7 billion bid for Arizona Mining heralding its intent to be a bigger player in base metals, while Hancock Prospecting’s bold $390 million bid for Atlas Iron could position Australia’s wealthiest woman as a bigger player in iron ore shipments from Port Hedland.

The big miners are slowly opening their wallets after many years of cost cutting and a focus on improving shareholder returns, as management teams look to replace aging mines, maintain production and lay the foundation for future earnings growth.

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Why Arizona Mining executives want to cash out early from one of the world’s top 5 mining projects – by Gabriel Friedman (Financial Post – June 19, 2018)

http://business.financialpost.com/

In one of the largest mining deals this year, the board of directors of Arizona Mining Corp., which is developing a zinc, lead and silver mine near the U.S.-Mexico border, agreed to a $1.8 billion buyout by Australia’s South32 Ltd.

The all-cash bid of $6.20 per share represents a roughly 50 per cent premium on Arizona’s Friday’s trading price — which has hovered around $4 for most of the year. The Vancouver-based company’s stock surged 48 per cent to $6.13 on the news in Toronto on Monday. South32 was down 1.6 per cent in Sydney.

The deal comes as the prices of zinc, silver and lead have been sliding, while trade tensions mount, casting doubt on global economic growth.

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Australia’s South32 bids $1.3 billion for rest of Canada’s Arizona Mining – Staff (Reuters U.S. – June 17, 2018)

https://www.reuters.com/

MELBOURNE (Reuters) – Australia’s South32 Ltd has bid $1.3 billion to take full control of Arizona Mining, offering a hefty premium for the Toronto-listed firm which is developing zinc, lead, manganese and silver assets.

The offer of C$6.20 per share was pitched at a 50 percent premium to Arizona’s last close and implies a total equity value for Arizona Mining of $1.6 billion, South32 said in a statement. The Australian firm already holds a 17 percent stake in Arizona.

The directors of Arizona Mining, which owns the Hermosa Project in Arizona near the border with Mexico, unanimously recommended that shareholders vote in favor of the transaction, South32 said.

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Drills confirming zinc at Pine Point – by Shane Lasley (North of 60 Mining News – May 10, 2018)

https://www.miningnewsnorth.com/

Osisko Metals Inc. May 8 said its winter drilling continues to confirm historical zinc mineralization at its newly acquired Pine Point zinc-lead project in Northwest Territories.

Located near the community of Hay River, the Pine Point project benefits from substantial infrastructure that includes road access, rail head in Hay River and hydro-electric power available on site. A preliminary economic assessment completed in 2015 examined several development scenarios and settled on a mining plan where 10 open-pit deposits are mined in sequence.

The deposits included in the mine plan host 25.8 million metric tons of measured and indicated resources averaging 2.9 percent zinc and 1.1 percent lead, plus 3.7 million metric tons of inferred resources averaging 2.9 percent zinc and 0.8 percent lead.

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Federal government takes control of abandoned zinc mine in Yukon – Canadian Press (Financial Post – May 1, 2018)

http://business.financialpost.com/

WHITEHORSE — The Federal government has taken control of cleaning up a lead and zinc mine in Yukon, 20 years after the former operators declared bankruptcy and abandoned the site.

Yukon’s abandoned mines director, Stephen Mead, says Indigenous and Northern Affairs Canada officially took the Faro Mine over Tuesday. He says Parsons Corp., the company that has been managing site, has a contract to continue its work until April 2020.

Mead says a two-year, $100-million construction project will begin this summer to better manage water in the area, collecting and treating contaminated water and diverting away clean water.

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NEWS RELEASE: Pasinex Reports Net Income of $5.8 Million for 2017, Strong Operating Results at Pinargozu and Operating Guidance for 2018

https://pasinex.com/

TORONTO, ON – April 30, 2018 – Pasinex Resources Limited (CSE: PSE) (FSE: PNX) (The “Company” or “Pasinex”) today reported net income for 2017 of $5.8 million; a 700 percent increase from 2016 net income of $0.8 million.

Net income for the fourth quarter (Q4) of 2017 was $2.7 million compared to $0.6 million in Q4 2016. The significant improvement in the consolidated results is due to the strong operational and financial performance at Horzum AS (the 50% owned joint venture that holds the Pinargozu mine), which is reflected in Pasinex net income as Equity gain from Horzum AS.

Steve Williams, CEO of Pasinex commented, “We are very pleased with our 2017 financial results. Pinargozu reached its production expectations for the year resulting in a record year. This comes at a time of very strong zinc prices and we see this reflected in the robust 2017 financial results. We also received a $1.2 million dividend payment from Horzum AS in 2017 and we are expecting approximately $6.5 million in dividends paid to us during 2018.”

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Life in Missouri’s Fading Old Lead Belt – by Benjamin Hoste and Romke Hoogwaerts (MSNB.com – June 30, 2016)

http://www.msnbc.com/

Just an hour south of St. Louis sits the Southeast Missouri Lead District, home to the largest lead deposits in the world. Some 150 years ago, the area boomed alongside its lead mines, an exploitation of natural resources that altered economic fortunes as well as the physical terrain. A particularly plentiful subdistrict now known as the Old Lead Belt thrived.

Today, that landscape looks vastly different. Once-prosperous communities have declined, mines have closed and moved elsewhere. Environmental and health hazards loom large over a community that’s both proud and wary of its heritage as a major supplier of the world’s lead.

Recently, public concern over lead poisoning’s persistent issues across the United States has renewed, particularly in urban environments. Widespread lead contamination of tap water in Flint, Michigan, is only the most recent example.

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Osisko Sees Perfect Storm Brewing For Base Metals – by Neils Christensen (Kitco News – April 18, 2018)

http://www.kitco.com/

(Kitco News) – One of Canada’s most renowned gold mining companies is wading into the base metals sector, particularly zinc, as prices continue to trade near their highest level in more than ten years.

Osisko Metals is celebrating its first year of operation as it continues to develop two of Canada’s most prominent past producing zinc mining camps.

The Osisko brand is more known for its success in the precious metals sector as it developed its Canadian Malartic project, country’s largest open-pit gold mine now owned by Agnico Eagle and Yamana Gold.

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