Nyrstar results show shift in zinc market fundamentals

Feb 06, 2014 | 12:53 PM | Mark Burton

Tags  Nyrstar, zinc prices, zinc market, mine supply, zinc smelting, treatment charges, premiums, Coricancha Nyrstar

LONDON — Nyrstar NV’s 2013 financial results, which showed a €195-million ($263.6-million) net loss, provide early evidence of a structural change in the zinc market that could play out over the next few years.

As low prices and ore depletion prompt mines to shut down over the next couple of years, the market will experience a major shortage of zinc concentrates, and later metal, that will lift prices and physical premiums sharply, analysts predict.

"When zinc rallies, it rallies big time," Daniel Maté, Glencore Xstrata Plc’s head of zinc marketing, said.

But with zinc and precious metals prices stuck at the low point in the cycle last year, Zurich-based Nyrstar has been forced to write down the carrying value of several mining assets that are intended to provide stable feed to its smelters during the looming concentrates shortfall.....

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