The International Lead and Zinc Study Group (ILZSG) released its most recent 2019 forecast for lead and zinc, forecasting a lead surplus, while zinc demand is forecast to exceed supply.
The ILZSG forecast a lead surplus of 71,000 tons in 2019.
Global lead demand declined 0.2% in 2018, but is forecast to jump 1.2% this year to reach 11.87 million tons. According to the ILZSG, an increase in usage in India, Japan and the Republic of Korea will help offset an expected 1.1% decline in China’s lead usage.
Meanwhile, lead usage is also forecast to rise in the U.S. and Europe, by 1.1% and 1.8%, respectively.
On the supply side, world lead mine production is forecast to increase in 2019 by 1.8%, reaching 4.75 million tons. The increase comes largely on the back of expected increases in lead mine production in China and India, in addition to expected increases in Canada, Europe and South Africa.
Refined lead metal output is forecast to rise 2.5% up to 11.94 million tons, also primarily on the back of increases in China and India. In addition, refined output from Australia is forecast to surge 14.3% in 2019.
Zinc Demand to Rise 0.6%
Unlike lead, zinc is forecast to be in deficit this year, with demand exceeding supply by 121,000 tons.
Zinc demand is forecast to increase 0.6% in 2019, according to the ILZSG, to reach 13.77 million tons.
Usage is forecast to rise 0.7% in Europe, with increases also expected in India and Mexico.
On the supply side, zinc mine production is forecast to rise 6.2% in 2019 (compared with 1.3% in 2018). As with lead, zinc mine production is expected to surge in Australia (29.4%), powered by a rise in production at the “Dugald River, McArthur River and Lady Loretta mines together with increases at the recently commissioned Century and Woodlawn tailings projects.”
Meanwhile, U.S. zinc mine production is forecast to fall 2.3% this year.
Refined zinc output is forecast to increase 3.6% to 13.65 million tons, which includes a bounceback in China’s output (expected to rise 5.3% this year after a 3.1% decline in 2018).