Belgian lead and zinc producer Nyrstar's production in the first quarter fell as the group's operation was hit by tight liquidity.
Zinc metal production in the first four months this year fell to 240,000t, down by 5pc compared to the same period last year.
"Zinc metal production in the first quarter was negatively impacted by raw material feed constraints that were imposed to manage Nyrstar's tight liquidity position during the capital structure review process," the firm said on 26 May.
In addition to the feed constraints imposed at all of the smelters, the decrease in zinc metal production was because of a number of unplanned outages at Nyrstar's sites globally.
Production in Auby, France, was shut down by a four-day unplanned maintenance in March. Balen in Belgium was affected by roaster de-fluidisation in January, followed by a national strike in February and a reduced rectifier capacity for one week in March. In the Netherlands at Budel, an unplanned roaster outage in January also affected production. A rotary drum cooler failure at Clarksville, Tennessee, in January and at Hobart, Australia, the failure of a clean gas fan in March were impacting output.
The zinc concentrate 2019 benchmark treatment charges settled at the end of the first quarter at a base rate of $245/dry metric tonne of concentrate, based on a zinc basis price of $2,700/t.
Mining in Myra Falls, Canada, restarted in September 2018 and the first shipments of zinc concentrate is expected in the third quarter.
Net debt increased by €55m, or 3.3pc, to €1.698bn by the end of first quarter because of substantial working capital outflow during the period as a result of tightened credit terms with a number of suppliers, weak earnings and the reclassification of €19m of prepayments for zinc metal deliveries from deferred income to loans.
The group also had to borrow on 31 March as it had no ability to settle by physical delivery of zinc metal from its own production.
Nyrstar, the world's second-largest zinc producer, has entered a lock-up agreement with Trafigura in April, which has issued a proposal to Nyrstar's creditors to exchange debt for perpetual securities and other capital from Trafigura. This debt restructure was effective from 7 May. Trafigura already owns 24.42pc of Nyrstar.
Nyrstar's lead metal output also fell by 6pc year on year to 37,000t in the first quarter.
Reduced lead production was because of the suspension of the sinter plant operation, which resulted in reduced lead throughput to the blast furnace compared to the first quarter last year.
