Despite the summer months bringing the excitement and
anticipation of a holiday, those working in many industrial
minerals markets are still being chilled by falling prices and
a lack of demand.
For many industries the period
beginning at the end of May and running to the beginning of
September marks a slower season; one where markets plod on at a
pace that is sustainable until business picks back up towards
the final quarter of each year.
However, for some mineral markets,
price drops that have been experienced since the beginning of
the year look set to stay, and some industry observers agree
that this could affect end-of-year profits for some.
Yet its not all doom and
gloom, as optimism persists in many of these industries and
some companies activities suggest that the seasonal lull
- which has in some cases been exaggerated by the economic
downturn synonymous with recent years - will soon end and
prices will begin to rise once more.
Barite prices move down in
China and Morocco
Barite (barytes) saw prices fall
for drilling grades in both China and Morocco in July as demand
for in the oilfield market remained soft.
In China, sources suggested to
IM that several factors, including the
weakened supply and demand for barite as well as exchange
rates, could be behind the price drops for API unground lump
Sources also advised that
drilling-grade barite, API unground lump, FOB China, SG 4.1 and
SG 4.2 grades were also being sold at different levels, with SG
4.1 selling between a range of $110-130/tonne and SG 4.2
between $120 and $140/tonne.
IM has since added
the SG 4.1 grade to its list of prices, and expects to do the
same for API grades in Morocco and India.
In Morocco, sources suggested that
the reason behind the price drops is that at least three of the
major producers have 300,000 tonnes in stock, meaning there is
an oversupply in a sluggish market.
Iodine prices slide to
Prices for iodine also dropped this
month, slipping below the $55/kg mark for large contracts,
sources have reported to IM.
This represents a further softening
from the average price in Q1 2013, which producers including
US-based Iofina Plc and TSX-listed Sirocco Mining Inc., said
had fallen by around 15% from the $65/kg-level seen a year
Chile-based Sociedad Quimica y
Minera SA (SQM) reported slightly stronger iodine prices in its
first quarter earnings statement at the end of May, saying that
prices had remained flat with Q4 2012 values, which were closer
Smaller contracts and spot prices
for iodine may still be holding above $55/kg, but this is
likely to be for the minority of orders, sources said.
The weakness in prices has been
broadly attributed to new supplies of iodine coming on stream
in Chile in the second half of 2012.
Market participants have stressed
that the long-term outlook for the iodine market remains
robust, however, as consuming industries such as
pharmaceuticals and x-ray contrast media continue to
Based on market information,
IM has moved its ranges for both spot and
contract iodine prices down to $55-59/kg, down from previous
ranges of $59-65/kg for spot orders and $59-62/kg for
Ilmenite prices continue to
The ilmenite pricing situation
continued this month as Michael Carvill, CEO of Irish ilmenite
miner Kenmare Resources Plc, told IM that
declining ilmenite prices are becoming a problem for producers
of the titanium dioxide (TiO2) feedstock
It seems to me that ilmenite
producers at this level will generally lose money, he
Carvill added that he doubts that
current ilmenite prices are feasible in the long run.
We dont believe that
ilmenite prices can sustain themselves at these present levels
- its not enough. I think that they are going to have to
return to higher levels, he explained.
Far Eastern ilmenite producer, IRC
Ltd, saw its prices slip by 15% during Q2 2013 down to
$233/tonne and sold more than it produced, eating into the
inventories it accumulated during the recent period of weak
The company produced 38,155 tonnes
ilmenite during the quarter, up 33% year-on-year driven mainly
by the installation of two new ilmenite separators installed
At the end of June this year,
we had a record quarter for mining and were marginally ahead of
our iron ore production targets and on track to meet our
ilmenite production targets, noted Jay Hambro, executive
chairman of IRC.
The price for ilmenite
concentrate deteriorated sharply at the end of the first
quarter and into the second quarter, before recovering
slightly, the company said.
The average achieved selling
price was $233/tonne, a 15% decline compared to the previous
quarter, it added.
Ilmenite prices did rise during the
TiO2 feedstock pricing boom of 2011 and early 2012 -
reaching more than $300/tonne - but, as with the higher-grade
feedstocks, have slipped back down again, reaching as low as
Ilmenite has experienced a
price decline. I think that the price decline is not as extreme
as rutile or synthetic rutile because it hadnt seen that
level of price appreciation that they had, Carvill told
Salt supplies in North
Australia-based salt producer
Ridley Corp. announced this month that Penrice Soda Holdings
has terminated its take-or-pay salt contact after finalising
the decision to halt the production of soda ash.
Penrice is now supplying its soda
ash customers through a joint venture (JV) with SASS Victoria
Australia, called Pro Asia Pacific.
There has been an oversupply of salt on the market since
last year as warmer-than-expected winter weather in the US
meant many supplies of de-icer salt were left almost fully
stocked (see p17).