TORONTO (Dow Jones)--Teck Cominco Ltd. (TEK.B) intends to be a leader in
zinc production cuts the way that BHP Billiton Ltd. (BHP), Codelco and Phelps
Dodge Corp. (PD) led the way in copper production cuts, Teck Cominco president
Steven Dean said Wednesday.
In February, Teck Cominco said it would reduce refined zinc production by
55,000 metric tons in 2002. The cuts are to come from its Cajamarquilla and
Trail refineries in Peru and British Columbia, respectively. The company also
plans to reduce production at its Red Dog mine in Alaska, by 30,000 to 40,000
tons.
At a mining conference, Dean said the goal is to minimize zinc inventory
buildup so that when demand does recover, it won't take several years to have
a positive impact on prices. "We hope that other large producers will be
independently applying similar discipline, aiming to move forward to metal
balance, and possibly deficit and inventory draw-down by year end," Dean said.
Generally, mining and refining companies are beginning to focus on what
their customers want, he said. "Rather than rushing into production just
because a new deposit has been found, we're learning to consider whether the
market wants the stuff," Dean said. "Believe it or not, we may even be
starting to manage our companies like normal businesses."
He reiterated previous corporate statements that Teck Cominco, as a mid-tier
company, won't pursue growth solely for the sake of getting bigger. "Our
ability to compensate for a smaller balance sheet and our cost of capital
versus that of our mega-size industry peers will depend upon how good our
people are," Dean said.
Company Web Site: teckcominco.com
-Lynne Olver, Dow Jones Newswires; 416-306-2012; lynne.olver@dowjones.com
(END) DOW JONES NEWS 03-13-02 |
