Zinc consumption — approximately 70 per cent of which is consumed in the construction and automotive industries in the form of galvanised (zinc coated) steel or other components such as diecast parts — is forecast to increase by 1.5 per cent to 11.8 million tonnes in 2009 following an estimated rise of 2.5 per cent in 2008. The majority of the forecast increase in world zinc consumption is being driven by rising consumption in developing countries while consumption in OECD economies is likely to decline.

The construction sector is the largest end user of zinc in developed economies through the sector’s use of galvanised steel. Zinc consumption in the United States and Europe is forecast to decline in 2009 because the global financial crisis has significantly reduced construction activity.

Zinc is also widely used in manufacturing industries such as production of household appliances and motor vehicles — there are approximately 10 kilograms of zinc in a car. Production of these products is expected to fall in the United States and western Europe because consumer spending is declining. Increased competition from imports, especially from the emerging economies in Asia and eastern Europe, will also place further downward pressure on US and western European manufacturing activity, which can be expected to reduce zinc demand.

Zinc consumption in developing Asian economies is expected to continue growing in 2009. Underpinning this growth will be increased government spending and significant easing of monetary policy. For example, the Chinese Government announced US$586 billion of spending in November primarily aimed at infrastructure, and earthquake reconstruction in Sichuan province. Zinc consumption in India should also grow solidly because of ongoing investment aimed at improving India’s power generation and transport infrastructure.