China stainless steel mogul fights to avoid a second collapse
A debt crisis is threatening the future of one of the world’s top stainless steel producers, Jiangsu Delong Nickel Industry.
State-owned Zijin Mining, China’s largest listed gold producer, said Friday net profit for 2015 dropped by almost 30% to $261 million (1.7 billion yuan) from the previous year’s $353m (2.3 billion yuan) as a result of weak metal prices.
The firm, which also mines copper, zinc and lead, said it aims to increase gold production this year by 15% to 42.5 tonnes this year. It also expects to hike copper output by 3% to 155,000 tonnes.
“As gold and other metals are seen as safe haven metals, we expect prices to be well supported with some room for rises this year. Base metal prices are also expected to rebound gradually,” Zijin said in the statement quoted by Reuters.
The firm, which also mines copper, zinc and lead, said it aims to increase gold production this year by 15% to 42.5 tonnes this year.
Zijin, which is also China’s second-largest copper producer, has been looking for assets to acquire for at least ten years, but it has only become a significant player in the last five.
In December 2014, it reported an $81 million investment in Canadian miner Pretium Resources (TSX, NYSE:PVG). It then announced two significant investments deals with Barrick Gold (TSX, NYSE:ABX) and Ivanhoe Mines (TSX:IVN).
Zijin also bought a stake in Barrick’s Porgera mine, in Papua New Guinea, and paid Ivanhoe $412 million for an interest in the Kamoa copper project in the Democratic Republic of Congo.
The deals have made of Zijin, established in 1993, a well-know name in the global mining industry.
