Reuters reported that Shenzhen Zhongjin Lingnan Nonfemet of China closed its Shaoguan lead and zinc smelter completely on October 21 to comply with a provincial government pollution investigation. The company said that the closure will cost the firm CNY 27 million in reduced profits per month of closure.

Mr Li You analyst at Minmetals Star Futures in Shenzhen city said that "We have heard the smelter will be closed until the end of this year. The closure will not have a big impact on zinc because its monthly production accounts for less than 5% of the country's zinc production. Shaoguan's lead production is about 10,000 tonnes a month too little to affect the market."

Shaoguan smelter has two facilities with a total designed capacity of 330,000 tonnes of lead and zincs a year. Zinc accounts for two thirds of the total.

Zhongjin said in the statement that excessive levels of poisonous thallium had been detected in the Beijiang River in the southern Guangdong province and the finding was that its Shaoguan smelter in Shaoguan city was the source. The closure was requested by the provincial government.

The smelter has previously been closed between December 2005 and February 2006 following a toxic spill of cadmium. In 2010, Zhongjin planned to produce a total 325,300 tonnes of lead and zinc in concentrate and 420,000 tonnes of refined lead and zinc of which 350,000 tonnes would come from Shaoguan smelter.

In the first 9 months of the year it produced 232,600 tonnes of lead and zinc in concentrate and 312,300 tonnes of refined lead and zinc of which Shaoguan produced 256,200 tonnes.

Zhongjin also owns another zinc smelter in Shaoguan city with a designed capacity of 90,000 tonnes a year and is building a 120,000 tonne per year lead smelter next to it.

(Sourced from Reuters)