With Mining and Exploration, it always comes down to the macroeconomic fundamentals. Global demand and supply for any particular commodity will invariably set the backdrop determining, to a greater part, the worth of companies within that sector. So given the burgeoning levels demand from China and its equally vociferous neighbours, what are the fundamentals for Zinc? Often overlooked by investors, yet its rust resistant properties make it an essential element in the manufacturing of many modern day appliances. And as the global economy continues to re-balance with the economies of Emerging Markets coming to the fore, how are things looking on the supply side of the equation? As we witnessed with Uranium and more recently with Rare Earths, nothing focuses the mind more than a potential supply squeeze!
We took the opportunity to talk to John Teeling, Chairman of Connemara Mining Plc (LON:CON) . Zinc is their business. The Company has a total of 37 exploration licences in Ireland covering over 1,000 sq kms, and is the fourth largest ground holder by size in Ireland. Connemara have recently raised £1million providing the cash to fund their medium term exploration.
We hope you find this interesting:
MM: Connemara is focused on Zinc opportunities in Ireland. Can you provide our readers with some background with regard to Zinc in terms of its industrial usage and the anticipated global supply/demand balance going forward?
JT: Zinc is one of the most widely used metals in the world. It is used in housing, automobiles, goods etc. It has a number of specific properties which makes it an ideal metal for many uses. Zinc sacrifices itself to rust so you coat your tin roof or iron bucket or metal water tanks with zinc. When the metal is attacked by rust it eats the zinc and leaves the underlying metal so it greatly extends the life of these items.
Zinc is perfect for die casting in that it can be finely moulded to close tolerances hence its use in cars, fridges etc. The best example is model toys – the famous dinkies, all made from zinc. You can see the fine detail in the models.
Zinc consumption is directly correlated with industrial growth. The fast growing BRIC economies are using ever increasing quantities of zinc. In China the number of cars are expected to increase 10 fold in 10 years. There…
