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Zinc Price 2024 Year-End Review
What other factors impacted the zinc market last year? Read on to find out.
How did zinc prices perform in 2024?
In the first half of 2024, the zinc market reacted to fallout from Q4 2023 production cuts.
An oversupply situation that drove prices down at the end of 2023 forced operators to curtail output, as high costs made production unsustainable. However, these cuts had little effect, and by the end of the first quarter, aboveground supplies at London Metal Exchange (LME) warehouses had surged to over 270,000 MT.
That supply/demand backdrop provided opportunities for some companies — in early April, Canada's Teck Resources (TSX:TECK.A,TECK.B,NYSE:TECK) was able to strike a deal with Korea Zinc (KRX:010130) that will see Teck pay US$165 per MT for treatment charges — that's the lowest amount since 2021 and a 40 percent discount over 2023.
In Q2, a price run failed to maintain momentum, as the market lacked the fundamentals to sustain its rise.
“Risk-on investor buying led to a sharp rally in zinc prices in April and May, as bullish sentiment on future copper demand related to the energy transition and AI data centres boosted the LME basket of metals,” Helen O’Cleary, zinc market specialist with CRU Group, wrote to the Investing News Network at the time.
Higher zinc prices came alongside speculation of a US Federal Reserve interest rate cut and renewed hope that rule changes for the Chinese housing markets would boost zinc’s fortunes.
However, by the end of Q2, the Chinese housing market had failed to improve — in fact, the slowdown in the sector had accelerated, with the value of new home sales in July slipping 19.7 percent from the same period one year earlier.
A Fed rate cut also didn’t materialize, with the expectation of when it would happen pushed back to July and then September, when the central bank ultimately made a jumbo-sized 50 basis point cut.
Zinc price, H2 2024.
Chart via Trading Economics.
As H2 began, the price of zinc was US$2,928.50, slightly off its first-half high of US$3,139.50 set on May 21. The metal continued to decline as July wore, falling to its H2 low of US$2,581.50 on August 7.
The next two months saw zinc experience significant volatility. It reached a peak of US$2,943 on August 27, slipped back to US$2,712 on September 10 and then rebounded to a yearly high of US$3,198 on October 2.
Zinc remained rangebound above US$3,000 for much of Q4. It fell below that mark on November 8, but by November 25 it was once again trading above that level. Zinc ended the year at US$2,978.50 on December 31.
What factors impacted the zinc market in 2024?
The most significant contributor to zinc's price rise in H2 was the lack of concentrate available to Chinese refiners, which are responsible for more than half the global supply of refined zinc. This resulted in increased competition, with some smelting operations reducing their treatment charges to under US$0 per MT.
Ultimately, 14 processors agreed to curtailments that would reduce their 2024 ore demand by nearly 1 million MT.
Despite the cuts, Reuters columnist Andy Home wrote at the end of August that the global refined zinc market was in surplus by 228,000 MT during H1, with much of that material finding its way to LME warehouses.
Also important in H2 were several large purchases of refined zinc from LME warehouses. Gains were fueled after 106,775 MT were removed from the LME network, leaving just 154,125 MT available, the lowest since November 2023.
At least some of the metal seemed destined for Trafigura, a leading trader and refiner of the metal, but the company declined to comment on the purchase. The move is reminiscent of Citi's (NYSE:C) zinc purchases from LME stockpiles during the second half of 2023 — the firm requested delivery of 40,000 MT of zinc at the time.
For now, the market remains weak on the demand side. More than half of refined zinc is used in the production of galvanized steel destined for the construction sector, which has been weak in China and Europe.
A raft of new stimulus measures in China have yet to affect the broader economy, and the country’s real estate sector is still reeling from the collapse of top construction firms.
Meanwhile, in Europe, the construction sector has been affected by the dual impact of high inflation and high interest rates. With the post-pandemic outlook coming into better balance, the industry is expected to rebound in 2025.
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Securities Disclosure: I, Dean Belder, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.
Group Eleven Resources: High-grade Zinc-Lead-Silver, Germanium Discovery in Ireland
With Glencore and Michael Gentile as the two largest shareholders, Group Eleven Resources (TSXV:ZNG) offers lucrative investment opportunities through zinc exploration in Ireland. The company's project portfolio encompasses the PG West and Stonepark projects. PG West and Stonepark are contiguous, forming the largest exploration position in the Limerick region, renowned for its zinc potential. Group Evelen's Ballywire discovery, a significant new finding in 2022, has demonstrated the presence of a high-grade mineralized system making it a potentially transformative asset for the company.
The close alignment with Glencore provides Group Eleven with both industry expertise and a collaborative advantage, further enhanced by Glencore's presence on Group Eleven’s board. This strategic partnership reflects confidence in Group Eleven’s potential within Ireland’s prolific zinc landscape.
The PG West and Stonepark projects together span an extensive ground area, creating a formidable position in the Limerick region. This strategic region features the Limerick Volcanic Complex, hosting the second largest zinc deposit discovered to date in Ireland, Glencore’s Pallas Green deposit.
Company Highlights
- Group Eleven Resources is a mineral exploration company focused on advanced stage zinc exploration projects in Ireland.
- The company’s Ballywire discovery has revealed high-grade zinc-lead-silver mineralization spanning over 2.5 km, with notable grades of up to 40.8 percent zinc and 1,440 g/t silver (and local copper kicks up to 5.9 percent).
- Group Eleven’s strategic relationship with Glencore, which holds a 17.1 percent stake, includes Glencore’s representation on the board, enhancing industry collaboration.
- The PG West and Stonepark projects form Group Eleven’s core exploration focus, situated near Glencore’s Pallas Green deposit in a highly mineralized region.
- Carrickittle West, a high-potential target within Stonepark, is a Pallas Green ‘lookalike’ target, showing many geological similarities.
- Ireland ranks well on the Fraser Institute Annual Mining Survey and is No. 1 in the world for zinc found per square kilometer, reflecting numerous discoveries to date.
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Group Eleven Resources
Investor Insight
Group Eleven Resources’ new high-grade zinc discovery, its strong shareholders, and infrastructure-rich jurisdiction present a compelling investment case. With Glencore and Michael Gentile as the two largest shareholders, the company is well-positioned to leverage its discoveries into high-return opportunities.
Overview
Group Eleven Resources (TSXV:ZNG) is a Canadian mineral exploration company highly regarded for its focus on zinc exploration in Ireland. Group Eleven’s current project portfolio encompasses two principal assets: the PG West and Stonepark projects. PG West and Stonepark are contiguous, forming the largest exploration position in the Limerick region, renowned for its zinc potential. In addition, the company’s Ballywire discovery, a significant new finding in 2022, has demonstrated the presence of a high-grade mineralized system making it a potentially transformative asset for the company.
Zinc is a critical metal for the modern economy, used extensively for galvanizing in infrastructure projects, green technologies and increasingly in grid-scale energy storage. Amid global shifts toward renewable energy, zinc demand is projected to surge due to its applications in battery technology, particularly zinc-air and zinc-ion batteries, which are emerging as viable alternatives to lithium-based solutions for large-scale energy storage. This advantage in energy storage could significantly drive demand for zinc in the coming years, especially as nations accelerate infrastructure investments and seek energy security through diversified, sustainable technologies. With global refined zinc inventories at historical lows, prices are expected to remain buoyant, providing favorable conditions for new projects like Group Eleven’s portfolio in Ireland.
Ireland has a robust track record spanning over 60 years of successful zinc production, which has made it a prime destination for global mining investment. The country ranks as one of the most mineral-rich areas for zinc worldwide, housing some of the world’s largest deposits, such as the Tara mine, which has been operational for more than five decades. Ireland also ranks high on the Fraser Institute's Mining Survey, noted for its favorable policies for mining investment. This standing makes the country not only a strategic base for Group Eleven but also a point of attraction for global mining giants like Glencore, which holds a 17.1 percent stake in Group Eleven, as well as South32, Teck and Boliden.
The close alignment with Glencore provides Group Eleven with both industry expertise and a collaborative advantage, further enhanced by Glencore's presence on Group Eleven’s board. This strategic partnership reflects confidence in Group Eleven’s potential within Ireland’s prolific zinc landscape.
Company Highlights
- Group Eleven Resources is a mineral exploration company focused on advanced stage zinc exploration projects in Ireland.
- The company’s Ballywire discovery has revealed high-grade zinc-lead-silver mineralization spanning over 2.5 km, with notable grades of up to 40.8 percent zinc and 1,440 g/t silver (and local copper kicks up to 5.9 percent).
- Group Eleven’s strategic relationship with Glencore, which holds a 17.1 percent stake, includes Glencore’s representation on the board, enhancing industry collaboration.
- The PG West and Stonepark projects form Group Eleven’s core exploration focus, situated near Glencore’s Pallas Green deposit in a highly mineralized region.
- Carrickittle West, a high-potential target within Stonepark, is a Pallas Green ‘lookalike’ target, showing many geological similarities.
- Ireland ranks well on the Fraser Institute Annual Mining Survey and is No. 1 in the world for zinc found per square kilometer, reflecting numerous discoveries to date.
Key Projects
PG West and Stonepark Projects
The PG West and Stonepark projects together span an extensive ground area, creating a formidable position in the Limerick region. This strategic region features the Limerick Volcanic Complex, hosting the second largest zinc deposit discovered to date in Ireland, Glencore’s Pallas Green deposit.
PG West holds substantial promise driven by the Ballywire discovery in 2022, which introduced a new high-grade zinc-lead-silver find contained within a 6 km by 2 km prospective area. The drill results have identified robust mineralization extending over a significant distance of 2.6 kilometres to date, with assays reporting high-grade values up to 40.8 percent zinc, 1,440 grams per tonne (g/t) silver, marking it as one of the most impactful findings in Irish zinc exploration in over a decade.
PG West’s Ballywire discovery marks an inflection point for the company. The discovery hole was announced in September 2022, characterized by massive sulphide zinc-lead-silver mineralization over substantial widths. Drilling efforts have identified multiple intercepts with notable thicknesses and grades. Located only 20 kilometers from the Pallas Green deposit, Ballywire has potential for not only significant tonnage and grade but also extensive synergy value.
Discovery at Ballywire showed high-grade massive sulphides including 6.9 m of 15.4 percent zinc and lead and 160 g/t silver within; a more recent hole drilled approximately 500 m along strike intersected 29.6 m of 10.6 percent zinc and lead and 78 g/t silver.
To date, 37 holes have been drilled at Ballywire, all mineralized, over a strike of 2.6 kilometres. As the company keeps stepping out towards the northeast, it has been finding increasing intensity of grades and thicknesses in the form of flat lying zinc-rich massive sulphide horizons. The company has two rigs turning on Ballywire and ample cash to continue drilling for months to come. Four gravity high anomalies exist along a six-kilometre trend at Ballywire and the above drilling has only tested one of them. With three more gravity anomalies remaining to test, this prospective six-kilometre trend is increasingly looking like the next major discovery in Ireland.
Outside of Ballywire, the company is focussed on one other big target. The Carrickittle West prospect, spanning about 11 kilometres, is located predominantly within the 76.56%-owned Stonepark project, and to a small degree, at its contiguous 100%-owned PG West project. The company is targeting a ‘Pallas Green lookalike’ located only a few kilometres away from Glencore’s Pallas Green deposit. The target is located on the opposite side of an oval-shaped volcanic complex which hosts the Pallas Green deposit on its north side. Pallas Green deposit represents one of the largest undeveloped zinc deposits in the world, hosting an inferred 45 million tonnes at an average grade of 8.4 percent combined zinc and lead. Adjacent to Pallas Green, the company’s Stonepark deposit hosts an inferred resource of 5.1 million tonnes at an average of 11.3 percent zinc and lead. Similar to Ballywire, any exploration success at Carrickittle West would have immediate synergy potential in the camp.
Key Board and Management
Bart Jaworski – CEO and Director
Bart Jaworski, based in Ireland, has been the chief executive officer and a director of Group Eleven Resources since incorporation in 2015. He has over 25 years’ experience in the mining industry, commencing his career as an exploration geologist for over six years followed by 12 years as a mining analyst at Raymond James in Vancouver and then J & E Davy in Dublin. During his time as an exploration geologist, he was involved in properties located in Canada, Russia and Costa Rica, and was associated with the early stages of the Coffee Creek gold discovery in the Yukon. Jaworski has a Bachelor of Science (Hons) in Geology from the University of British Columbia.
Michael Gentile - Director
Michael Gentile is considered one of the leading strategic investors in the junior mining sector, owning significant top five ownership stakes in over 20 small-cap mining companies. He is currently a director of Northern Superior Resources, OnGold, Radisson Mining Resources, Roscan Gold, and Solstice Gold. He is a strategic advisor to Northisle Copper and Gold. He co-founded Bastion Asset Management in January 2022, a rapidly growing money management firm in Montreal with over $425 million in assets under management, focused on small to mid-cap equities in the USA and Canada. Gentile was previously a vice-president and senior portfolio manager with Formula Growth, where he worked from 2002 to 2018.
Gatlin Smeijers - Director
Gatlin Smeijers is Glencore’s appointee to the Group Eleven Resources board. He is a corporate and regulatory lawyer and member in good standing of the Law Society of Ontario. Prior to joining Glencore in 2022, Smeijers practiced law for 10 years at leading Canadian law firms. He holds a Juris Doctor from Queen’s University and a Bachelor of Applied Science in Geological Engineering from the University of Waterloo, where he currently teaches Engineering Law and Ethics.
Dr. Mark Holdstock – Project Manager
Dr. Mark Holdstock is a professional geologist with over 30 years exploration experience including in Noranda, Billiton, Outokumpu, Boliden and Tara Mines. At Tara, he led the team that discovered the 20+ Mt SWEX extension to the world class Navan zinc-lead ore body in Ireland. Holdstock has published a number of academic papers on carbonate-hosted zinc deposits. Prior to joining Group Eleven Resources in 2018, Holdstock was managing director at Ireland-based Aurum Exploration Services, a position he held since 2005.