CANCUN, Mexico U.S. Zinc
Corp. is on track to expand zinc oxide production at its two
Tennessee operations, executive vice president Tracy Baugh told
AMM on the sidelines of the International Zinc
Association conference in Cancun.
"We started the engineering work
last year and are in the process of ordering and acquiring
equipment for completion later this year or in early 2014,"
Baugh said. "As long as automotive stays strong, we anticipate
slightly better demand this year, specifically in the tire
The Houston-based subsidiary of
São Paulo-based Votorantim Metais Ltda. will add one
muffle furnace each to its Clarksville and Millington
facilities, which will increase its annual zinc oxide
production by 14,000 tonnes by the end of the year, Baugh
The 14,000 tonnes is a
conservative estimate, he added, noting that U.S. Zinc could
still reach its initial target of 17,000 tonnes per year set
last summer (
amm.com, July 17).
In addition to automotive
demand, the recent recovery in the construction sector is a
positive sign for zinc markets in 2013, Baugh said, although he
maintained that domestic economic growth will be stifled until
politicians in Washington resolve the countrys debt
"Year-over-year growth in
automotive and construction improving will help demand this
year," he said. "Its much better than it was a year ago,
but theres still lots of room for improvement."
In the meantime, the political
stalemate will continue to cause uncertainty, leading business
owners to put a halt on investing, he added.
Baugh said the trend for
special-high-grade (SHG) zinc premiums seems to be pointing to
a steady increase, pegging the spot zinc premium at 8 cents per
pound. "Raw materials for SHG are more expensive. Theres
also increased iron and ore costs, fuel, transportation
logistics," he said.
AMMs SHG zinc
spot premium is in a range of 7.5 to 8.5 cents per pound.