By Jesse Riseborough
Nov. 13 (Bloomberg) -- Zinifex Ltd., the world's third- largest mined zinc producer, said revenue will be cut this year by the declining price of the metal used to galvanize steel and a stronger Australian dollar against the US dollar.
The price of zinc may decline as additional supply from new mines and expansions comes on to the market, Tony Barnes, acting chief executive officer of the Melbourne-based company, said today in a slides presentation lodged with the exchange. Supply issues will keep lead prices high, Barnes added.
Citigroup Inc. yesterday cut its forecast for the first half of 2008 for zinc by 35 percent on gains in supply from mines. Zinifex is seeking to buy new mines or acquire rivals after selling most of its majority stake in smelting unit Nyrstar NV last month.
Zinc output from its Century and Rosebery mines in Australia will be higher for the year ending June 30, 2008, while lead production will be little changed, Barnes said. A new chief executive officer may be appointed by the end of the year, he said in the slides.
Zinifex fell 65 cents, or 4.2 percent, to A$14.80 yesterday on the Australian Stock Exchange.
The price of zinc has fallen 38 percent this year, the worst performance among all metals on the London Metal Exchange. An expected 57,000 metric-ton surplus in 2008 would be the first in three years, Citigroup said in the report.
To contact the reporter on this story: Jesse Riseborough in Melbourne atLast Updated: November 12, 2007 17:45 EST