A wide range of reports were presented at Metal Pages’ Minor Metals & Rare Earths conference this year, which not only covered a variety of metals, but also included perspectives from privately held and publicly traded producers, exploration and development companies, as well as research organizations.
Two presentations specifically examined the current indium market. Growing use in liquid crystal display (LCD) and cadmium-indium-gallium-selenide (CIGS) photovoltaic applications have attracted much attention to the indium market over the past five years. Feng Yuncong, from the Antaike research group, however, expressed doubt about any large indium price increases in the near future due to the high number of large-scale producers that are capable of extracting at high recovery rates. Claire Mikolajczak, Director of Metals and Chemicals at Indium Corp., discussed the effect of the flat panel display (FPD) industry on indium demand. Currently accounting for about 56 percent of indium demand, according to Ms. Mikolajczak, the FPD market is the primary driver of indium prices. Moreover, although the LCD growth rate is decreasing, it still remains strong and demand for indium continues to be supported by growth in the photovoltaic cell (PV), CIGS and light-emitting diode (LED) industries. Consequently, some estimates have world demand for indium nearly doubling over the next decade. However, despite strong end-use growth estimates, most in the industry believe production can keep pace over the long-term, leaving only temporary periods of price volatility
Jack Telford, Executive Director and CEO of Gippsland Ltd. provided an update on his company’s tantalum project in Egypt. The Abu Dabbab project is focused on developing a tantalum-tin-feldspar deposit in the Central Western Desert, near the Red Sea. According to the Gippsland CEO, the deposit is shallow enough to allow for more cost-effective open-pit mining and has a possible mine life of more than 50 years. Although the ore grades of the deposit are not overwhelming, supply concerns for both tantalum and tin continue to push demand and prices upward, making this project of key interest to tantalum market watchers.
The very amiable Michael Xiong, Managing Director of Vital Specialty Materials Co. Ltd., followed with a discussion on the role of tellurium and selenium in PV cells. Mr. Xiong emphasized that instability in the global PV cell industry is expected to continue due to the slow economic recovery in the West, decreasing government support – particularly in Europe – and dominance by market leader First Solar Inc. Vital Specialty Materials does not expect silicon demand in the solar industry to continue growing after 2010, while cadmium-telluride (CdTe) and CIGS technology will begin to account for a larger share of the solar cell market. Despite this growth, they do not foresee any long-term pressures on tellurium or selenium supply.
Terry Harris of Johnson Matthey introduced the rhodium and ruthenium markets to many attendees unfamiliar with these specialty products. The markets for both rhodium and ruthenium are not only highly concentrated in their supply, he explained, but also in their end-use applications. The result of this being serious price volatility, which further deters the development of new applications. As Mr. Harris pointed out, prices for rhodium dropped from a high of roughly US$ 10,000 per ounce in 2008 to roughly $1000 per ounce after the financial crisis. Currently, over 80 percent of the world’s rhodium comes from South Africa.
One theme that was persistent throughout the conference, and was mentioned by almost every presenter, was the issue of rising production costs in China. Most were concerned about how increasing energy and labour costs, along with a rising renminbi, will impact the price for many minor metals. Danny Wu, Commercial Manager for Xiamen Tungsten Co. Ltd., explained how these factors, in combination with Chinese export restrictions and strong demand from the resource exploration and automotive industries, will likely result in higher prices for tungsten in 2011. Cao Junyi, Deputy General Manager of Jinduicheng Molybdenum Co. Ltd, also discussed the influence of export restrictions and productions costs on the molybdenum market. Mr. Cao noted the increasing involvement of state-owned enterprises (SOEs), such as Sinosteel and China Minmetals, in the Chinese molybdenum industry. According to Mr. Cao, two major factors will affect the industry in the coming five years; first, the growing demand from China, which became the largest consumer of molybdenum in 2009 (accounting for some 30 percent of global consumption), and second, expected growth in global production capacity as new projects come on-line.
Final presentations looked at two minor metals with widely differing experiences during 2010; Germanium and antimony. The germanium market has remained flat since 2008, mainly due to declining demand in its core end-use industries: infrared optics and optical fiber. Nevertheless, Zhao Lihui, Director of China Germanium Co. Ltd., painted a fairly optimistic outlook for germanium, suggesting that new civil applications for infrared technologies along with growth in demand for CIGS will stimulate demand for germanium products. Antimony markets, in contrast, have seen much more action this year, with prices nearly doubling over the past year. As Liu Chun, Direct of Guangxi Youngsun Metals & Chemicals Corp. Ltd., explained, this has been due to five factors:
1. Decreases in global antimony production
2. Low stock levels after the financial crisis
3. Closures of illegal producers in China
4. Growth in Chinese antimony consumption
5. More strict production and environment policies in China
Like the molybdenum industry, antimony has also seen growing consolidation and involvement from SOEs. Plant closures have been a major factor in the price rise this year, as all but two major plants have been shut-down, according to Mr. Liu, due to more rigid enforcement of environmental regulations. The increasing gap between supply and demand likely means that antimony prices will not drop below US$ 10,000 per metric tonne in 2011
(Disclosure: No positions held in any publicly-traded companies discussed)
Comments