By Sungwoo Park
Dec. 1 (Bloomberg) -- Korea Zinc Co., the world’s second- biggest zinc smelter, will cut production of the refined metal by 10 percent for more than a year because of weakening demand and falling prices.
Korea Zinc will maintain the reduced output at its Onsan plant, which has annual capacity of 450,000 metric tons, from today to the end of 2009, the Seoul-based company said today in an e-mailed statement. That may change depending on market conditions, it said.
Zinc has tumbled nearly 50 percent this year as slowing economic growth and the worst financial crisis since the Great Depression curbed demand for industrial metals. Chinese zinc smelters, which are all unprofitable, have cut production to try to lift prices and ease a domestic oversupply.
Zhuzhou Smelter Group Co., China’s biggest zinc smelter, slashed production by 20 percent last month because of slumping metal prices and weak demand, an executive said Nov. 17.
Korea Zinc declined 1.7 percent to 68,000 won at 10:02 a.m. in Seoul, compared with a 0.8 percent drop in the benchmark Kospi Index. The Onsan plant is the company’s only zinc smelter excluding those owned by its affiliates.
The Korean company produced 433,000 tons of zinc and 195,000 tons of lead in 2007, according to its Web site.
Zinc futures in London fell 0.8 percent to $1,210 a ton on Friday. The metal is used to galvanize steel used in cars and home appliances.
To contact the reporter on this story: Sungwoo Park in Seoul at spark47@bloomberg.net.
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