Killing children: is China addressing its lead poisoning scandals?

China's top zinc miner to double lead smelting capacity

Top Chinese zinc producer, Zhuzhou, is to double its 100,000 tonne lead capacity to treat growing residues from its zinc processing and reduce pollution

By Polly Yam, Reuters

10 September 2009

LANZHOU, CHINA - Zhuzhou Smelter, the top zinc producer in China, will double its lead capacity with a 100,000 tonne-a-year smelter it plans to start building by the end of the year, a trade executive said.

Zhuzhou needs the new lead capacity to digest its rising residues from zinc smelting, a way to reduce pollution, Wang Jianjun, managing director at Zhuzhou's international trade unit, said in an interview in Lanzhou. Zinc and lead commonly co-exist in concentrate.

"We need to match our rising zinc capacity, which is producing more residues," said Wang, interviewed by Reuters late on Wednesday on the sidelines of a lead and zinc conference in Lanzhou in Gansu province.

The company operates half a million tonnes of zinc capacity in Hunan province, where authorities recently shut a number of small smelters after cases involving lead poisoning of children.

Beijing, which aims to close 600,000 tonnes of outdated lead smelting capacity in the next few years, is set to tighten controls over lead smelting following lead poisoning cases in Shaanxi and Hunan provinces.

After the completion of the new lead smelter, the firm is likely to start upgrading plan its existing 100,000-tonne-a-year lead plant to help meet the nation's higher environmental protection standards, Wang said.

Zhuzhou has started production at a new 100,000 tonne-a-year zinc facility and that facility may reach full production rates by the end of the year, boosting zinc production to 500,000 tonnes next year, Wang said.

"Our concentrate imports may rise above 200,000 tonnes of zinc in concentrates next year," he said, adding this year's imports were 100,000-200,000 tonnes of zinc in concentrate.

A Pakistan lead and zinc mine, which is 33 percent owned by Zhuzhou's parent, will load the first concentrate shipment to Zhuzhou this month. The shipment will have 3,000-4,000 tonnes of concentrate, Wang said.

The mine in Pakistan is set to produce 50,000 tonnes of zinc in concentrate and 25,000-30,000 tonnes of lead in concentrate a year. Zhuzhou is given the right to buy the mine's production before other buyers at market prices.

"It is not helping a lot to meet our concentrate needs, but at least we have one more choice on concentrate buying," Wang added. (Editing by Michael Urquhart)

© Thomson Reuters 2009. All rights reserved.

Henan smelters uncertain of when they can bring refined lead production facilities back online

By Li Chunlan, Interfax China Metals and Mining

11 September 2009

It is still uncertain when suspended refined lead production facilities in Henan Province's Jiyuan and Lingbao cities can resume operations, a government official told Interfax on Sept. 8.

"Some smelters with outdated refined lead production facilities in Jiyuan were temporarily shut down as they failed to meet environmental standards. We are still discussing a timetable outlining when these facilities can restart operations in the future," an official from the Environmental Protection Bureau of Jiyuan, surnamed Liu, told Interfax.

"More than 200,000 tons worth of refined lead production facilities, which used outdated production techniques, have been suspended in Jiyuan since August, following the lead pollution scandal in Shaanxi Province's Fengxiang county. Jiyuan's current idle refined lead production facilities include 80,000 tons from our company as well as some from Henan Yuguang Gold and Lead Group Co. Ltd., and some small-sized lead smelters," an employee surnamed Li from Jiyuan Wanyang Smeltery Group Co. Ltd., a 160,000-ton lead smelter, told Interfax.

Meanwhile, an unnamed employee fom Huabao Industry (Group) Co. Ltd., a lead smelter in Lingbao, told Interfax that the local government recently requested lead smelters temporarily halt operations at their outdated refined lead production facilities.

"Our company's 30,000-ton outdated refined lead production facilities have all ceased operations, and another local lead smelter, Zhicheng Jinqian Share Co. Ltd., has also been asked to suspend its outdated refined lead production facility, which has 100,000 tons of annual production capacity. Other small-sized lead smelters in Lingbao have received similar requests from the local government," he said.

"Environmental protection is the main reason behind the closures," the Huabao employee added.

On Aug. 13, Xinhua news agency reported that Shaanxi Dongling Group's refined lead production facility in Fengxiang failed to meet environmental emission standards and allegedly led to lead poisoning in 166 local children. The company has been forced to stop production.

"It remains to be seen how these idle facilities will affect domestic refined lead supply and prices, as there is some uncertainty whether they will be closed indefinitely or be allowed to resume operations at some point in the future," Hao Lei, an analyst from ChinaCCM.com, told Interfax.

Benchmark refined lead prices stood between RMB 16,000 ($2,342.61) and RMB 16,200 ($2,371.89) per ton on the Shanghai Yangtze River Nonferrous Metals market on Sept. 8.

Henan is China's biggest refined lead producing province. Its lead output reached 723,134 tons in the first seven months of 2009, amounting to 35.04 percent of China's total of 2.06 million tons in the period.

Interfax commentary: Treatment charges (TCs) that both domestic and overseas lead concentrate miners pay Chinese lead smelters are on the rise, which is unusual as domestic spot refined lead prices are strengthening. This indicates that there is an increasing supply of lead concentrate on the domestic market. Current TCs that overseas lead miners pay Chinese smelters stand at around $80 per ton of lead concentrate, while in August, the TC level stood around $50 per ton.

There is speculation that domestic refined lead supply is very tight at the moment, as major lead smelters have recently curtailed sales. Interfax believes these major smelters are intentionally stocking their refined lead output to push up domestic prices. However, high refined lead prices and lead concentrate TCs will entice Chinese smelters to produce more, which will inevitably pull down prices.