UPDATE 1-Boliden says cuts zinc output at smelters
reuters.com
Tue Dec 9, 2008 6:58am EST
STOCKHOLM, Dec 9 (Reuters) - Swedish copper and zinc miner and smelter Boliden (BOL.ST: Quote, Profile, Research, Stock Buzz) said on Tuesday it was cutting its zinc production at its Finnish and Norwegian smelters due to falling demand.
The firm said in a statement it would cut production by 60,000 tonnes on an annual basis and temporarily lay off of around 50 employees.
In 2007 Boliden produced around 460,000 tonnes of zinc, it said.
"We conclude that there is a falling demand for metals and we are therefore cutting production," said Boliden spokeswoman Marcela Sylvander.
Demand for zinc, used in galvanising steel, has declined sharply this year following a slowdown in global industry.
"The market is incredibly non-transparent at the moment, both for our customers and even more so for their respective customers," Sylvander said.
An analyst who declined to be identified said the news was not surprising.
"Others have cut their zinc output due to weak demand. So in the light of that, it is not surprising," the analyst said.
He noted: "So far, they don't say anything about the mining operations."
Boliden said the measures would be effective immediately.
Shares in the firm were unchanged at 18.40 crowns at 1124 GMT, while the Stockholm blue-chip index was up 1.3 percent.
(Reporting by Victoria Klesty, additional reporting by Johan Ahlander and Katarina Gustafsson; Editing by Rupert Winchester)
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