Economic stimulus programs and the energy turnaround need raw materials

Zinc is primarily used for corrosion protection in iron and steel. Economic stimulus programs, whether in China or the USA, will boost demand for the metal. Many raw material prices have fallen because things are not going well for the global economy. Zinc is relatively resistant to this in terms of price and is still more expensive than at the beginning of last year. Of course, the zinc price is not completely immune to the known uncertainties. The zinc price received support from the physical market, where prices paid above the LME futures price remained high in the US and Europe. This was probably caused by concerns about production shortfalls. Inventories are also near multi-year lows. This is because smelters in Europe and China are reporting problems that are causing production cuts. The energy crisis caused some smelter closures in Italy and the Netherlands (Glencore, Nyrstar). On the one hand, demand for the metal is worsening as global consumption of galvanized metals has declined. But on the other hand, zinc is needed for the energy transition. Wind and solar modules need zinc, so demand is expected to increase from this side. At the same time, mining projects are limited.

Copper is also needed for decarbonization and for infrastructure projects. Over the last ten years, copper consumption has risen steadily. The economy is threatening to shrink this year and next. This is not conducive to the copper price, but nevertheless, as with zinc, consumption should rise again when the energy transition is more in focus again.

In terms of zinc production, China is led by Griffin Mining – https://www.youtube.com/watch?v=MgDgfmsT5UU – with its 88.8 percent joint venture at the Caijiaying zinc-gold mine.

Both zinc and copper are held by Kutcho Copper – https://www.youtube.com/watch?v=Rm7Z4Xa4UCw – in the high-grade Kutcho project in British Columbia. A very promising feasibility study is already available.

Current corporate information and press releases from Griffin Mining (- https://www.resource-capital.ch/en/companies/griffin-mining-ltd/ -) and Kutcho Copper (- https://www.resource-capital.ch/en/companies/kutcho-copper-corp/ -).

In accordance with §34 WpHG I would like to point out that partners, authors and employees may hold shares in the respective companies addressed and thus a possible conflict of interest exists. No guarantee for the translation into English. Only the German version of this news is valid.

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