Zinc concentrate treatment charges (TC) rose to their highest level so far this year at the end of June on a cif Asia Pacific basis, while the head of the Chinese zinc association has called for a 10% cut in national production to support zinc prices and TCs.
Metal Bulletin assessed zinc concentrate TCs cif Asia Pacific at $20-$40 per tonne on Friday June 29. That compares with $20-$35 per tonne a month ago. "There is a problem in China with securing business at the moment because some [smelters] have advanced maintenance programs, while some prefer to buy [concentrate] locally and there is very poor liquidity. As a result the spot [zinc] TC will continue to go up," a miner source told Metal Bulletin. China's fourth largest zinc smelter, Dongling, cut refined zinc output indefinitely by 62% to 9,000 tonnes per month in May. Meanwhile, Dongling's founder Li Hei-ji, also head of China Nonferrous Metals Industry Association's (CNIA) zinc-lead branch, called for an industry-wide 10% output cut at a meeting of major Chinese zinc smelters in Shaanxi on Thursday. The call comes at a time when cash-strapped zinc smelters in China are facing margin squeezes as a result of softer TCs,...