By Pratima Desai
LONDON, Dec 16 (Reuters) – Nyrstar’s Auby zinc operations will be placed on care and maintenance from the first week of January 2022 in response to significantly higher current and projected future power prices in France, the company said on Thursday.
“Power prices, already at historically high levels across Europe have continued to rise in recent weeks in France, in excess of neighbouring European countries,” the Belgian listed company NYR.BR said in a statement.
This, Nyrstar said, was because of “low availability of nuclear power, high carbon-related costs passed on by power companies and reduced fixed-price allowances for industry”.
“The price outlook for electricity prices in France in early 2022 indicates continued high prices and significant volatility.”
French power giant EDF EDF.PA said on Wednesday it had found faults on pipes in a safety system at its Civaux nuclear power station and shut down another plant because it used the same kind of reactors.
Planned maintenance will be brought forward and investment will continue, Nyrstar said.
“There will be no impact on permanent employment at the operation, which employs 297 people in total. Employee duties will be redirected to focus on maintenance, training and investment projects while the electrolyser is not producing zinc.”
Nyrstar did not say how much zinc production would be lost or provide the production capacity of its three European smelters.
Metal industry sources say Nyrstar has the capacity to produce 720,000 tonnes of zinc in Europe, with 300,000 of that at Budel in the Netherlands.
Global zinc supplies this year are estimated at around 14 million tonnes.
Benchmark zinc CMZN3 jumped after the Nyrstar news to $3,482 a tonne, the highest since Oct 25.
Nyrstar in October cut production by up to 50% at its three European zinc smelters — Budel, Balen in Belgium and Auby due to the soaring price of electricity.
(Reporting by Pratima Desai; editing by Kirsten Donovan)
(([email protected]; +44 207 513 5681;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
www.nasdaq.com