Base metal zinc’s price performed strongly in 2022, reaching historical highs. Although the price of zinc has cooled in 2023, ultimately the long-term fundamentals remain healthy.
Many of the base metals were hit with weakened demand this year as sticky inflation and higher interest rates have weighed on the economy, and zinc was no exception. However, zinc supply has also faced pressure this year from higher mining and refining costs, causing some major zinc operations and smelters to suspend operations, with more possible if the current economic situation continues. Once the economy rebounds along with demand, stunted supplies may once again push zinc prices to the upside.
1. Teck Resources (TSX:TECK.A)
Market cap: C$30.17 billion; current share price: C$57.50
Teck Resources is a major global polymetallic mining company, as well as one of the top zinc producers in the world. The company mines zinc at its Red Dog mine in Alaska, which produced more than 553,000 metric tons (MT) of zinc in concentrate in 2022. It also holds the Antamina copper-zinc mine in Peru, as well as a portfolio of zinc projects globally.
Last year, Teck announced plans to begin a Zinc Satellite program to ‘surface value’ at five of its zinc projects: Aktigiruq, Anarraaq and Su-Lik in Alaska; Cirque in BC, Canada; and Teena in Australia’s Northern Territory.
The company also owns the Trail Operations, which it describes as ‘one of the world’s largest fully integrated zinc and lead smelting and refining complexes.’ A report released in March found that Trail has an extremely low carbon footprint, with output of 0.93 MT carbon dioxide equivalent produced per metric ton of zinc, compared to a global average of 3 to 4 MT carbon dioxide equivalent for zinc production.
In June, Trail became the first stand-alone zinc processing site globally to receive the Zinc Mark verification. ‘To achieve the Zinc Mark, Teck’s Trail Operations was assessed and independently verified against 32 responsible production criteria including greenhouse gas emissions, community health and safety, respect for Indigenous rights and business integrity,’ stated the press release.
2. Lundin Mining (TSX:LUN)
Market cap: C$9.1 billion; current share price: C$11.65
Lundin Mining is a major base metals miner with mines in the Americas and Europe. The company produces significant amounts of zinc from its two European mines, the Neves-Corvo copper-zinc mine in Portugal and the Zinkgruvan zinc-lead-copper mine in Sweden. In fact, the company’s zinc output is second only to its copper production, with 2022 output for the two metals coming in at 249,659 MT copper and 158,938 MT zinc.
3. Fireweed Metals (TSXV:FWZ)
Market cap: C$181.42 million; current share price: C$1.29
Fireweed Metals is a critical metals company whose flagship Macmillan Pass zinc project is located in Canada’s Yukon. The company also has the Gayna River zinc project in the Northwest Territories and the Mactung tungsten project, which is in both the Yukon and the Northwest Territories. The company acquired Gayna and Mactung this year as part of its effort to expand beyond zinc; this shift is also reflected in the company’s recent name change from Fireweed Zinc.
Even so, the company still has a strong focus on Macmillan Pass, and exploration at the site last fall brought the highest-grade assays seen anywhere at the project, with a highlight of 60 meters at 19 percent zinc within 124 meters grading 12.3 percent zinc. The hits keep coming from Macmillan during the 2023 drill campaign. In July, Fireweed Metals released initial results from the first 18 holes of the program that confirmed the connection between the Boundary Main and Boundary West zones, which have now been consolidated under the name Boundary.
4. Trilogy Metals (TSX:TMQ)
Market cap: C$110.45 million; current share price: C$0.70
Trilogy Mining is a polymetallic company focused primarily on copper, zinc and cobalt at its Alaskan Upper Kobuk projects. Its most advanced zinc project is the Arctic copper-zinc-lead-gold-silver volcanogenic massive sulfide project, which is in the feasibility stage and has proven and probable reserves of 43.44 million MT grading 3.12 percent zinc.
Trilogy is currently working to advance permitting at the project and is performing further exploration as well. The company recently reported significant intersections of high-grade mineralization, including 42.77 meters of 3.09 percent copper, 6.21 percent zinc, 1.46 percent lead, 0.84 grams per MT gold and 72.14 grams per MT silver for a copper equivalent grade of 7.04 percent. “This represents the highest ever grade-thickness intersection of all 237 holes drilled at the Arctic Project to date,” stated the press release.
5. Emerita Resources (TSXV:EMO)
Market cap: C$76.71 million; current share price: C$0.37
Emerita Resources has a portfolio of high-grade, large-scale polymetallic projects covering more than 26,000 combined hectares in Spain’s Iberian Pyrite Belt. The company’s flagship asset is the Iberian Belt West (IBW) project, which hosts three massive sulfide deposits: La Infanta, La Romanera and El Cura.
Emerita completed its mineral resource estimate for the Iberian Belt West project in May of this year, and it also completed environmental baseline studies the following month. After C$11 million in financings closed in June, Emerita is now focused on advancing it towards permitting and a production decision.
Securities Disclosure: I, Melissa Pistilli, hold no direct investment interest in any company mentioned in this article.
