The Outlook For Zinc And Lead

The purpose of this discussion is to try to offer some suggestions as to how the zinc and lead markets will perform over the balance of the decade, review some of the factors influencing production and come to some conclusions regarding prices. The past 2 years have been simply awful in terms of consumption, prices and overall profitability for the industry. In looking ahead to the year 2,000, it is probably not a bad idea to look back about 20 years to see where we have been and how we got to where we are. Zinc consumption from 1950 to the early 1970's increased steadily and rather nicely at an annual average rate of close to 4.0%. It was starting in the early 1970's that things started to get volatile and at times, difficult for the industry. The general economic boom of the early 70's was marked by annual consumption rates close to 5.0 million tons, a level not seen again for over 10 years. The First Oil shock of 1973-74 was followed by the sharpest consumption drop in memory. In two years, Western World zinc consumption fell 27%. While our chart shows a rather dramatic recovery thereafter, the average annual growth rate since 1970 has only been a rather modest 1.5%.