China Turns Zinc Into Car Parts as Consumer Demand Surges By Alex Davis and Luzi Ann Javier Apr 22, 2014 6:34 AM ET 0 Comments Email Print Facebook Twitter Google+ LinkedIn Save Photographer: Daniel Acker/Bloomberg China will use 7 percent more zinc this year, according to Barclays. The nation now... Read More Record spending by Chinese consumers on new refrigerators, cars and laptops is boosting zinc demand, creating the biggest production shortfall for the metal in eight years. Demand for zinc used in everything from steel auto parts and brass plumbing fixtures to rubber and sunscreen will exceed output by 117,000 metric tons this year, almost double the 2013 deficit, the International Lead and Zinc Study Group estimates. Morgan Stanley predicts prices in London will rise more than any other industrial metal in 2015. Chinese producers including Baiyin Nonferrous Metals Co. are restarting smelters they closed last year as stockpiles tracked by the London Metal Exchange shrink to a two-year low. While the economy is slowing in China, the world’s biggest user, growth is more than twice the rate of the U.S. as Premier Li Keqiang seeks to spur consumer spending and car sales increase by double-digits. “The supply-and-demand picture has really improved,” said Sameer Samana, a St. Louis-based international strategist at Wells Fargo Advisors LLC, which oversees about $1.4 trillion. “Inventories have come down, and we’re starting to see the very beginning of demand rebounding.” Zinc for delivery in three months on the LME is up 1.1 percent this year at $2,077.50 a ton, after slipping 1.2 percent in 2013. An LME index tracking zinc, copper, aluminum, nickel, lead and tin is down 2.5 percent. The Standard & Poor’s GSCI (SPGSCI) Spot Index of 24 commodities rose 4.3 percent. The MSCI All-Country World Index of equities climbed 0.9 percent, and the Bloomberg Treasury Bond Index rose 2 percent.