Vancouver-headquartered Trevali’s production of lead and zinc declined in the first quarter of 2020 (Q1) compared to the prior year quarter (Q12019) and the previous quarter (Q4) due to adverse changes caused by the COVID-19 pandemic. The company has four operating mines in Canada, Peru, Burkina Faso and Namibia.
The company produced 99mn lb (44,905mt) of zinc in Q1, down by 2pc from Q1 2019 and down 6 pc from Q4. Lead production fell by 7pc in Q1 to 10.70 mn lb from Q1 2019 and fell 22pc from Q4. The company’s ore milled at Rosh Pinah, Namibia and Perkoa, Burkina Faso improved but the grade of the ore was lower than planned. At Caribou mine in Canada, there was a change in operations (mine sequence) following a fall of ground, which significantly lowed production volumes in Q1. Santander mine in Peru produced higher grades in accordance with the mine plan.
| Trevali’s zinc production and sales in Q1 | ||||||
| Metal | Q1 2020 | Q1 2019 | Change (YoY) | Q4 2019 | Change (QoQ) | |
Production (mn lb) | Zinc | 99.0 | 100.60 | -2% | 104.8 | -6% |
| Lead | 10.70 | 11.50 | -7% | 13.8 | -22% | |
Sales (mn lb) | Zinc | 91.1 | 125.4 | -27% | 110.4 | -17% |
| Lead | 5.8 | 10 | -42% | 14.8 | -61% | |
Sales of zinc fell by 27pc to 91.1mn lb in Q1 from a year ago quarter and fell 17pc from Q4. Lead sales dropped 42pc to 5.8mn lb in Q1 from the year prior quarter and down 61pc from Q4.
Zinc market continues to be disrupted after hitting 15-year lows, while the declines in zinc prices have, however, reversed and prices have been rising gradually, according to Trevali. Off-site costs including treatment charges and shipping costs have started to decrease on easing of the restrictions put on mining activities due to the pandemic.
China was worst hit by the COVID-19 pandemic where smelters and mine production was restricted at the beginning of Q1 but as it progressed, Chinese smelting production increased but at the same time, smelters and mines in Europe and America started shutting operations. As a result, zinc supply has reduced more rapidly than projected leading to reduced spot treatment charges in Q2 to date, according to Trevali.
Trevali’s previous guidance for 2020 remains suspended as approximately 25pc of global zinc mine supply was limited due to COVID-19 restrictions and supply chain disruptions, cited Trevali.