Reuters reported that Australian zinc miner CBH Resources Ltd was cutting more than a third of its work force at its main mine to save costs as it combats declining prices for the metal.

CBH Resources said that it is shedding 220 jobs or 37% of the workforce, at is Endeavor lode in eastern Australia, where it has spent more than AUD 90 million on improvements recently.

Mr Stephen Dennis MD of CBH in a statement said that “The job losses were regrettable but necessary to establish a foundation for the company's future during the existing difficult lead and zinc market.”

He added that the move will save the company around AUD 100 million a year.

Zinc prices have tumbled 20% to around AUD 1,885 a tonne since January on the London Metal Exchange MZN3 as demand for the metal used in steel galvanizing falls and inventories balloon. According to figures released by the International Lead and Zinc Study Group, the global zinc market showed a 78,000 tonne surplus in the first four months of 2008.