Lead and Zinc. Threats and Opportunities in the Years Ahead

147 Pages·2002·8.53 MB·English

by  Nnamdi Anyadike (Auth.)

Lead and zinc
Threats and opportunities in the years
ahead
Nnamdi Anyadike
WOODHEAD PUBLISHINGLIMITED
Cambridge England
Published by Woodhead Publishing Limited, Abington Hall, Abington
Cambridge CB1 6AH, England
www.woodhead-publishing.com
First published 2002, Woodhead Publishing Ltd
© 2002, Woodhead Publishing Ltd
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Executive summary
PART 1: LEAD
INTRODUCTION
Lead has been worked since ancient times, and its anti-corrosion properties, which made it a
favourite metal for use in water pipes in the Roman Empire, are still valued today. It is now used in a
number of applications, but overwhelmingly in the automobile sector in the form of the starter
lighting ignition (SLI) battery. For the rest of its applications, it has come under attack from Western
environmental lobbyists who have driven through some stringent 'anti-lead' legislation. Yet the lead
industry is far from pessimistic about its prospects and paints a bright future for the metal. Demand
for lead for SLI batteries is rising along with growth in new car demand in Eastern Europe, China,
the rest of the Far East and Latin America, while in the developed world the demand for replacement
SLI batteries is a constant and growing feature. Over 80% of all the lead now used in the US is for
the production of lead-acid batteries.
SUPPLY OUTLOOK
A forecast rise of 2.9% to 3.03 million tonnes (mt) will result in global lead mine output exceeding
3 mt for the first time in 2001. In the Western World, an increase of 2.2% to 2.27 mt is anticipated.
Further reductions in the USA will be mainly as a result of additional cutbacks at Doe Run's
Missouri mines. Canadian output is also expected to be lower, principally because of the closure of
Cominco's Sullivan operation. These decreases will, however, be more than balanced by further rises
in Australia, China, Ireland and Mexico.
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EXECUTIVE SUMMARY
World supply of refined lead metal is forecast to increase by 0.9% to 6.64 mt in 2001. In the Western
World, however, a fall of 0.2% to 5.06 mt is expected.
A rise of 1.6% in Europe will be mainly a consequence of a significant recovery in UK production
after cutbacks at Britannia Refined Metals in 2000. Further increases in China and the opening of a
new plant in Malaysia will be the main impetus behind a 2.6% expansion in Asia. US output is,
however, forecast to fall by 3%.
Global lead mine production
Lead mined supply is set to increase on the back of new zinc projects. According to various industry
sources over 80% of lead concentrate is currently estimated to come from operations that produce
zinc as the primary ore, and the current expansion is zinc mining projects is likely to increase the
proportion of lead produced as a by-product. The most important mine to have come onstream in
recent years is BHP's 180 000 tonnes per year (tpy) Cannington mine in Australia, which is primarily
a lead producer. But in addition, several new zinc-producing mines, also in Australia, will also yield
significant amounts of lead. These include: Pillara, which will produce 34000 tpy of contained lead;
Century, which will ultimately produce 45 000 tpy of contained lead; and George Fisher, which will
produce 100000 tpy of contained lead.
These new projects have led to a recent upturn in lead production, which in 1995 had fallen to 2 mt,
its lowest level since the early 1960s. The dramatic reduction in mine output in 1995 resulted in a
concentrate deficit of 150000 tonnes. In 2000, Australian mine production increased by some 2.7%
compared with 1999. Although this is substantial, it is less than had been anticipated owing to the
closures at Los Frailes, Faro, Woodlawn and Caribou, along with other supply disruptions.
DEMAND OUTLOOK
Lead consumption is estimated to rise in 2001 by 1.1% worldwide to 6.57 mt and in the West by
0.2% to 5.66 mt from the previous year.
Current projections indicate that lead demand will not be affected by the present economic downturn
as much as a number of other commodities. This relates to the fact that its major end-user market is
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EXECUTIVE SUMMARY
replacement lead-acid batteries, a sector that is generally not as sensitive to economic fluctuations as
other industries.
Demand in the USA and Europe in 2001 is forecast to be at a similar level to 2000. In Asia, a rise of
3.5% is expected* primarily through further growth in Chinese domestic demand.
Western World refined metal balance
It is likely that the level of Chinese net exports of refined lead metal to the West in 2001 will be
constrained by the availability of suitable raw materials. They are therefore forecast to be 10% lower
than in 2000. Shipments from the Commonwealth of Independent States (CIS) and Eastern Europe
are expected to be at a similar level to 2000.
Overall, after having also taken into consideration releases from the United States Defence National
Stockpile, the forecasts indicate that demand will exceed supply in the Western World in 2001,
resulting in a market deficit of 59 000 tonnes.
Transport demand
Over the past twenty-five years the lead industry has witnessed sweeping changes, which have had an
impact on every aspect of production, consumption and international trade. SLI batteries, used in
motor vehicles for motive power, and also in standby applications, today provide the core end-use
for lead. From a little over 50% of Western World demand around 1985, batteries now account for
around 73% of total demand. To reach this share, use in batteries has grown at an average rate of
4% per annum since 1984. Within 10 years (2010), this share looks set to rise close to 80%. The key
driver for consumption growth comes from motor vehicles.
In the Western World, the vehicle fleet is growing at an annual average rate of 3%. But substantial
growth is also being seen in the emerging economies. In South East Asia, for example, vehicle fleet
growth per annum is in excess of 6%.
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EXECUTIVE SUMMARY
Electric vehicles (EVs)
One threat to the traditional lead-acid SLI automotive battery, though one that is unlikely to be
realised in the near future, is the development of EVs or hybrid electric vehicles (HEVs). Battery
producers are developing a range of batteries, such as nickel-metal hydride (NiMH) batteries, that
could be used in the new generation of vehicles.
HEVs: a more realistic prospect
While the prospect of fully electric vehicles replacing internal combustion engine-driven automobiles
stretches far into the horizon, the more promising development of HEVs may yet provide battery
makers with the longed-for takeoff in demand for NiCd, NiMH and other rechargeable batteries. In
2000 and 2001, a number of high-profile HEVs were launched in the USA, Europe and Japan,
following on from announcements made by leading automobile producers in 1999. Among the
Japanese producers are Honda, Toyota and Nissan, who were the first to launch new HEV models in
1999, followed by US and European automobile producers in 2000 and 2001.
Lead threatened by rival materials
The use of lead in non-battery automotive applications is coming under increasing threat from
legislators in Washington and Brussels. In Europe, moves have been made to ensure that end-of-life
vehicles are no longer be a source of pollution and a waste of resources, following the adoption of a
Directive on ELVs at the end of 2000.
The Directive states that producers should control the use of hazardous substances from the concept
stage of new vehicles, and in particular, the use of lead, PVC, mercury, cadmium and hexavalent
chromium should be phased out in vehicles put on the market after 1 January 2002, although lead in
batteries is exempt.
This legislation affects the use of lead in many areas on vehicles, such as wheel weights, light bulbs,
radiators, paint, fuel tanks, and stabilisers in PVC cable sheathing and trimming and tinned wires.
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EXECUTIVE SUMMARY
Lead solders demand
One of the non-battery sectors where lead use has come under increasing attack is solders for the
electronics industry. The concern about the use of lead in the electronics industry stems from
occupational exposure, lead waste derived from the manufacturing process and the disposal of
electronics assemblies. Although the use of lead by the electronics industry appears to be minimal,
the potential for lead exposure cannot be ignored.
Lead-free solder: R&D
The California-based Ames Laboratory and Sandia National Laboratories in New Mexico have
developed a lead^free solder alloy consisting of tin, silver and copper. The significance of the new
lead-free solder to industry was underscored in 1999 by the signing of a licensing agreement with
Multicore Solders, a European-based company with a major manufacturing plant in Richardson,
Texas.
THE BASEL CONVENTION: IMPLICATIONS FOR THE LEAD
INDUSTRY
The Basel Convention on the 'Control of Transboundary Movements of Hazardous Wastes and
Their Disposal' is an environmental agreement designed to protect countries (particularly
developing) that may not have the capability and technology to manage waste properly.
For the lead industry, in the longer term, the implications of the Convention's List Ά' ban are
complex and worrying:
• OECD recyclers could become more competitive at the expense of non-OECD recyclers as the
volume of material they handle increases following the diversion of exports to the OECD's
internal market
• Competition for secondary materials in the OECD may decrease as the supply rises. More
selective recycling could result in lower-grade scrap and residues, which are more difficult and
expensive to recycle, going to landfill
• Non-OECD recyclers may have a more limited and less flexible source of supply. Their degree of
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EXECUTIVE SUMMARY
competitiveness relative to OECD recyclers will be reduced. New non-OECD recycling projects
may become less attractive to investors
• As their consumption increases, non-OECD countries will be forced to develop further their
primary metal industries and/or to increase imports of refined metal products such as lead-acid
batteries.
PART 2: ZINC
INTRODUCTION
Centuries before zinc was discovered in the metallic form, its ores were used for making brass and zinc
compounds. Zinc is produced from sulphides or oxide ores, and for about 500 years it was produced
from oxide ores, which are far less abundant than the sulphides, before the sulphides became the major
source of supply. The technology of zinc production changed gradually over the centuries towards a
more pyrometallurgical route. However, this tendency underwent a radical change during World War I
when the roasting-leaching-electro winning process was introduced, and in the 1980s, when pressure
leaching electrowinning offered another practical route to zinc production.
ZINC'S PROPERTIES AND USES
Zinc's most remarkable quality is its natural capacity to protect, and this quality has provided it with
its most common end-use as a coating for steel in the process known as galvanising. Nearly 50% of
zinc is used in galvanised steel (see below). An important market for galvanised steel, i.e. one-third of
the total, is the automotive sector. The average car is estimated to contain around 17.3 kg of zinc:
7.7 kg are used in the form of galvanised steel for anti-corrosion purposes, while another 9 kg are
used to make zinc die-cast parts like door handles and locks. In addition, each tyre contains about
0.23 kg of zinc, which is needed to cure rubber.
Galvanising
Galavanising can take different forms, depending on the end-use application. The main methods,
however, are:
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EXECUTIVE SUMMARY
• hot-dip galvanising
• continuous galvanising
• electro-galvanising
In addition, zinc can also be alloyed with aluminium to make Galvalume (55% aluminium, 45%
zinc) and Galfan (95% zinc and 5% aluminium).
SUPPLY OUTLOOK
Global zinc mine output is expected to rise by 4.2% to 9 mt in 2001, and in the Western World by 3.4%
to 6.44 mt. This is mainly a consequence of increased output at the Lisheen mine in Ireland, additions
to capacity in Mexico and Peru as a result of the opening of the Francisco I Madero and Antamina
mines, respectively, and a further rise in output at the many small mines spread throughout China.
These rises will, however, be partially balanced by reductions in Canada, Japan, Spain, Sweden and
Turkey.
Production of refined zinc metal is predicted to increase by 4.6% to 9.34 mt worldwide and by 3.6%
to 6.38 mt in the West.
An expected rise of 3.6% in Europe will be due mainly to additional output in Belgium, Finland,
Italy, Norway, Spain and the UK. In the Republic of Korea, the new production plan recently
announced by Korea Zinc and Young Poong will result in a rise of 11.7%. Increases are also
anticipated in Australia, China and Mexico.
Production in Canada is forecast to fall by 8%. This is principally as a consequence of Cominco's
decision to sell power, resulting in a significant reduction in refined zinc output at its Trail refinery in
British Columbia.
DEMAND OUTLOOK
A small increase of 0.2% to 8.83 mt is forecast for global consumption of refined zinc in 2001. In the
West, an anticipated 1.4% contraction to 6.89 mt will be the first decrease since 1996.
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EXECUTIVE SUMMARY
The economic slowdown in the USA has resulted in a significant revision to the US demand forecast,
which now anticipates a fall of 9.1%. In contrast, growth of 0.7% is expected in Europe, with
increases mainly in Finland, Germany, the Netherlands and Spain being partially balanced by falls in
Belgium, France and the UK.
Despite an anticipated fall in Japanese demand of just over 5%, overall growth in Asia of 3.7% is
expected, mainly through rises in China, India and the Republic of Korea.
Western World refined metal balance
Good domestic demand and price levels higher than those available internationally restricted the
level of Chinese shipments of refined zinc to the West in the first part of 2001. If this trend continues
it was estimated that net exports from China for the year as a whole would be 14% below the total
achieved in 2000. Shipments from the CIS and Eastern Europe were, however, likely to be at a similar
level.
Overall, the cutbacks announced in production since the International Lead and Zinc Study Group
(ILZSG's) forecasts were published in October 2000 appear to have been balanced by downward
revisions to anticipated demand in a number of countries. As a result, the ILZSG still anticipates that
there will be a substantial surplus of refined zinc metal supply over demand in the Western World in
2001.
Automotive demand
The demand for zinc in the automotive industry has been rising and is currently one of the most
important downstream consuming industries of zinc. Over the last 50 years, rising demand for
personal transport has been one of the most significant economic trends. In 2000, some 40 million
vehicles were produced in the USA, Japan and Europe, of which two-thirds were cars. Zinc industry
sources suggest that while there has been a growth in the use of aluminium castings and plastics, the
zinc industry is banking on steel to continue to be the basic material of car manufacturing. This will
mean that the use of zinc in galvanised steel will continue to grow as the automotive industry strives
to meet ever stricter weight and corrosion targets for vehicle body and underbody steel components.
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