Curragh schedules production shutdowns

Zinc producers need to follow the lead of Curragh (TSE) and cut production if they want to prevent further erosion of the zinc price, says Julian Baldry, an analyst with Nesbitt Thomson.

Curragh says it will shut down its Faro lead-zinc mine in the Yukon for two weeks at Christmas and another 32 days in 1993 to help reduce a worldwide surplus of concentrates. Faro was closed for three weeks last August. “What Curragh is doing is certainly going to help,” said Baldry. “Other producers need to take heed.”

Since September, the price of zinc has fallen to 47 cents from 60 cents per lb. on the London Metal Exchange. During the same period, lead prices have fallen to 20 cents from 30 cents per lb.

Next year’s shutdown will reduce Curragh’s annual concentrate production — 488,000 tonnes in 1991 — by about 10%.