News

May 29, 2009

ZincOx Will Be In Production In The First Half Of Next Year, Just As A Further Uptick In The Zinc Price Looks Likely

By Alastair Ford

The zinc price has been showing a certain amount of relative strength recently, a trend that Andrew Woollett of Zincox isn’t complaining about. In time, as he moves Zincox into production, he’d quite like to reduce the at times merciless correlation between his company’s share price and the zinc price. Eventually, he hopes, profitability will become the key metric on which the market values Zincox, rather than simply pricing the shares in accordance with the price movements of zinc on the London Metal Exchange. But for now, with production from the Jabali mine in Yemen still more than six months away, and development work on the company’s flagship recycling projects in the US waiting on secure financing, it’s as a pure play on zinc that Zincox will be traded.

Given that harsh reality, to look at a three year price chart for zinc metal is to appreciate that times have not been easy for Zincox’s investors of late. The US$2.00 per pound price that zinc hit at the end of 2006 is now a distant dream, as is the 280p Zincox share price that went with it. Zincox shares subsequently traded even higher as the bull market rolled on, though zinc itself then began a long slide that only really came to an end a couple of months ago. But as the economic outlook...