Great Investment Articles

A repository of great articles to help make informed investment decisions.

Wednesday, August 23, 2006


China's Zinc Demand to Increase 56% by 2010, Antaike Forecasts

Interestingly, this analyst with a great track record says this forecast is "definitely conservative"...

By Chia-Peck Wong

Aug. 24 (Bloomberg) -- The demand for zinc in China, the world's biggest consumer of the metal, may rise 56 percent by 2010, Beijing Antaike Information Development Co. has forecast.

The country may need 4.8 million metric tons of zinc by the end of the decade, from 3.08 million tons in 2005, as it requires more of the metal to coat steel to prevent corrosion, Feng Juncong, a senior analyst at Antaike, a research agency that advises the government, said yesterday at a conference.

``As China's construction and transportation sectors grow, consumption has entered its peak growth rate,'' she said in a presentation in Inner Mongolia, a region in western China.

Zinc prices in London have surged 75 percent this year and reached a record $4,000 a ton in May on expectations China's expanding economy will require more metals, while smelter output in China has been stymied by a lack of mined material.

``China will definitely need to rely on imports to fulfill its annual needs'' in the next few years, said Feng, who has been tracking the industry for 12 years and correctly forecast China would become a net importer of refined zinc in 2004.

The domestic supply of mined zinc is likely to lag behind demand by more than 10 percent this year, pushing up concentrate prices, she said. She didn't provide an estimate of China's zinc production in 2010, saying that the country is likely to remain a net importer till then.

This year, China's net imports of zinc products, including mined output, or so-called concentrates, are likely to be stable at 860,000 tons, little changed from last year, as higher internationally-traded prices led Chinese smelters to export more, she said.

Record Forecast

Zinc prices in London, which have fallen about 16 percent from their record, are likely post a new peak in the fourth quarter as stockpiles continue to dwindle, Feng said.

``The fundamental demand and supply factors are still good,'' she said, without forecasting how high prices may rise.

Zinc stockpiles at warehouses monitored by the London Metal Exchange have plunged 55 percent this year to 179,175 tons as of yesterday, the lowest since early 1992.

China's lead consumption may surge 43 percent to 2.3 million tons in 2010 as demand from lead-acid battery makers soars 65 percent to 1.79 million tons, Feng said.

The forecast is ``definitely conservative as over the past 10 years, apparent consumption in China has grown 20 percent every year,'' she said.

Comments: Post a Comment

<< Home


May 2006   June 2006   July 2006   August 2006   September 2006   October 2006   November 2006   January 2007   February 2007   March 2007   May 2007   July 2007   October 2007   February 2008   March 2008   October 2008   October 2009  

Great Investment Articles Home    Email GreatInvestmentArticles

Great Investments Blog     Great Trades Blog

Disclaimer: Great Investment Articles may have a position in all or some of the stocks discussed in this blog, but is not paid by any company to promote their stock. Great Investment Articles contains opinions, none of which constitute a recommendation that any particular security, transaction, or investment strategy is suitable for any specific person. Great Investment Articles does not provide personalized investment advice.

Enter your email address in the box below to get emailed any new blog entries (within an hour or so of an update). Your email address won't be listed or sold.


This page is powered by Blogger. Isn't yours?