Ann: Change in substantial holding , page-14

Mayo,

Zinc's primary usage is in finished steel products or galvanized steel. A rebound in steel demand will be tepid for the the next few months but should rebound stronger from April to October, which is peak metal demand season.

There are other reasons though to be bullish on zinc demand and KZL longer-term. For example, the growth and development of new industries for zinc, such as it's use in fertlizers, which may treble in the next few years as Indian and Chinese farmers adopt it. It currently represents about 5% of zinc oxide applications, which could grow to 25% in the next few years.

To put that in perspective.

- Metal usage for 2011 = 12,709,000t

- Metal use in zinc oxide = 1,200,000t

- % of zinc oxide used in Farming = 6% or 72,000t

- Growth of zinc oxide in farming = 216,000t (+144,000t)

- Zinc surplus 2011 (production - usage) = 353,000t

- Zinc surplus 2012 (forecast by ILZSG) = 135,000t

Farming alone could tip zinc into deficit by -9000t by 2014.

You can see info about this new industry here.

Zinc in Fertilizers

At any rate China is by far the dominant supplier and also the largest user, followed by the U.S, which is rebounding and this also bodes well for future metal demand.