Outlook Commodity Prices and 2013 Production Teck 2012 Annual Report 60 We continue to experience volatile markets for our products. Commodity markets have historically been volatile, prices  can change rapidly and customers can alter shipment plans. This can have a substantial effect on our business. Ongoing  economic uncertainties in Europe and the United States and less robust growth rates in China, India and other emerging  markets have affected both demand and prices for some of our products. We believe that the medium- to longer-term  fundamentals for steelmaking coal are quite favourable, although the recent weakness in the seaborne steelmaking coal  market is expected to persist for at least the first half of 2013. Markets for copper remain steady while zinc markets have  shown some weakness. In the meantime, the Company’s financial position is strong, and we continuously monitor all  aspects of our key markets as conditions evolve in order to be in a position to take whatever actions may be appropriate. Commodity prices are a key driver of our profit. On the supply side, the depleting nature of ore reserves, difficulties  in finding new orebodies, the permitting processes and the availability of skilled resources to develop projects, as well  as infrastructure constraints, political risk and significant cost inflation may continue to have a moderating effect on  the growth in future production. Although we are concerned about current global economic conditions, we believe  that, over the longer term, the industrialization of emerging market economies will continue to be a major positive  factor in the future demand for commodities. Therefore, we believe that the long-term price environment for the  products that we produce and sell remains favourable. Based on our expected 2013 mid-range production estimates and a Canadian/U.S. dollar exchange rate of $1.00,  the sensitivity of our annual profit attributable to shareholders to the indicated changes in commodity prices, before  pricing adjustments and the U.S. dollar exchange rate is as follows: Notes: Foreign exchange translation gains and losses on our U.S. dollar denominated debt arising from exchange rate fluctuations  are not expected to have a significant effect on our 2013 profit, as our debt level is expected to be designated as a  hedge against our investments in U.S. dollar denominated foreign operations and working capital items. Copper and zinc prices, to date in 2013, are trading similar to 2012 average prices. Coal market conditions softened in  the third quarter and remained lower through the fourth quarter. The fluctuations in the Canadian/U.S. dollar exchange  rate can have a significant effect on our profit and financial position. The Canadian dollar, to date in 2013, has averaged  approximately $1.00 against the U.S. dollar compared with $1.00 in 2012. (1) The effect on our profit attributable to shareholders of commodity price and exchange rate movements will vary from quarter to quarter depending on  sales volumes. (2) Zinc includes 285,000 tonnes of refined zinc and 575,000 tonnes of zinc contained in concentrates. (3) All production estimates are subject to change based on market and operating conditions. 2013  Mid-Range Effect of  Production Change Effect on  Estimates Change on Profit EBITDA Coal  (000’s tonnes)  24,500  US$1/tonne  $ 16 million  $ 25 million Copper  (tonnes)  350,000  US$0.01/lb  $  4 million  $  7 million Zinc  (tonnes)  860,000  US$0.01/lb  $  7 million  $ 11 million US$ exchange  Cdn$0.01  $ 45 million  $ 70 million