By IM Staff
The majority of the industrial mineral industry is still
waiting for the post-summer resumption of buying activity to
take effect, pricing information gathered by
IM in September suggests.
While most markets - graphite and
fluorspar in par-ticular - were characterised by a stagnation
during the first few weeks of September, the second half of the
month saw some industries reach tipping point, leading to price
falls for flake graphite and acidspar in response to week
demand.
Pro-ducers of rare earths and soda
ash, meanwhile, had something to be cheerful about, with buying
activity tipped to re-turn to these industries on the back of
the global economic recovery.
Antimony metal range
narrows upwards
Purchasing activity by China
Minmetals Corp. stemmed the slide in antimony metal prices in
early September while antimony trioxide prices remained
unmoved.
The lower end of the antimony price
range ticked up by around $100/tonne for low bismuth antimony,
to $10,200-10,500/tonne, and standard grade II antimony, to
$10,100-10,400/tonne, according to Metal Bulletin,
while Chinese sources reported strength in prices of antimony
ingot (99.65% min).
State-owned China Minmetals began
buying up antimony stocks from both Chinese and European
warehouses in July in an effort to support prices which dropped
steeply earlier in the summer.
Antimony prices covered by
IM remain within their current ranges, with
sources expecting values to hold firm in the short-term but
with potential rises in store later this quarter if Chinese
demand picks up.
Producers hike bromine
product prices
US chemicals producer Albemarle
Corp. raised the price of its SAYTEX CP-2000 brominated flame
retardant by 15% in September for all shipments, effective
immediately, or as contracts allow.
Albemarle did not say why it was
raising the price of its flame retardants, but has upped the
price of a number of its bromine products in recent months
after highlighting narrowing margins caused by a decline in the
price of elemental bromine this year.
Other bromine producers including
Israel Chemicals Ltd (ICL) and Chemtura-subsidiary, Great Lakes
Solutions, have also recently cited pricing pressure for
bromine as a result of weakness in bromine product end markets,
such as manufacturing and construction.
The price of bromine remained
relatively steady throughout July and August, indexes tracking
the mineral show, but has declined slightly since the end of
August.
Chromite slips by up to
$40/tonne in August
Chromite foundry and refractory
grade prices have slipped by as much as $40/tonne, sources told
IM at the end of August, on the back of
falling demand in metals markets.
Traders and suppliers confirmed
that they had seen prices fall across the market, with the
largest discrepancy between IM’s
published and realised prices in August being
in chemical grade (46% Cr2O3, wet bulk
FOB South Africa), which one source said could be 40% above
market values.
Elsewhere, even the most bullish of
producers accepted that prices had fallen; adding that they
thought further reductions would take place in Q4 2013.
Prices began to fall off as demand
for chromite waned on the back of a bearish steel and
refractories market.
Fluorspar market stagnant
going on weak
Fluorspar remained largely quiet
once again during September, although there have been some
signs that acidspar markets may be weakening.
Prices for acidspar, 97%
CaF2, dry filtercake, CFR, China to Japan,
reportedly fell 8.6% at the beginning of September, according
to IM Data.
Continuing stagnation of
fluorochemical markets continues to erode the value of higher
purity fluorspar grades, the data service said.
Metspar prices were unchanged at
the time of going to press, although IM Data
is following up reports that prices could be falling again.
Graphite supply out of
kilter with demand
Disagreement over the future
direction of graphite prices divided the market at the end of
August as market commentators offered differing opinions on the
supply-demand balance.
Stephen Riddle, CEO of Asbury
Carbons, hinted that price increases are unlikely to
materialise in the foreseeable future, arguing that the market
is weighted on the supply side.
“I do not agree that there is
any limited supply, or supply issues,” Riddle said.
“The market has a surplus of
supply of most qualities. We know of drop-off in worldwide
demand - mostly from the refractory users and with biggest drop
in demand coming from Chinese refractory industry - on the
flake-type graphite side, and also of a big drop-off in demand
from Japan for amorphous-type graphite,” Riddle said.
“The growth markets are still
way too small to pick up this added excess supply,” Riddle
added.
This analysis proved to be correct
when, in mid-September, flake prices fell by roughly
$50-100/tonne on average, according to figures collected by
IM Data.
The data service said that a lack
of significant upturn in demand has been met with increased
production, particularly in China, in preparation for the
winter season which has compounded the excess supply in the
market.
High purity (94-97%), large flake
graphite (+80 mesh) is now between $1,250-1,300/tonne on a CIF
basis shipped into Europe.
Prices of medium flake material
(94-97% C, -100 mesh, CIF, Europe), the more commonly traded
product for industrial steel refractories, slipped to
$850-950/tonne, IM Data said, while lower
grade flake (85-87% C, +100 -80 mesh, FCL, CIF, Europe) prices
were down to $700-800/tonne.
Amorphous prices, meanwhile,
remained unchanged.
Gloomy prospects for iodine
producers
Iodine prices are likely to remain
stable for the rest of the year,
although at weaker levels than have
been reported this quarter, sources indicated to
IM in September.
South American contacts reported
spot and contract prices in the $55-60/kg range, but sources in
Europe and Asia said that customer demand is not supporting
prices at this level.
European contacts said that prices
appear to have settled in the range of $48-52/kg, with buyers
in the fine chemicals and pharmaceuticals industries buying at
the $50+/kg end of the market.
Meanwhile, Chinese domestic iodine
prices have been reported as being around $46/kg owing to low
customer demand.
Sources were generally downbeat
about longer-term prospects for iodine, saying that the market
had been quiet and that the price buoyancy seen in 2011 and the
first half of 2012 had all but petered out.
Iodine producers and traders were
however hopeful that most of the excess iodine produced in
South America over the last 12 months has now been absorbed by
the industry.
Lithium prices going up,
says SQM
Despite negativity in other areas
of its portfolio (see below), Chile’s SQM said in
its latest earnings report that that prices for lithium
carbonate have been strong this year, rising 9% year-on-year in
the second quarter.
ICL backs future potash
demand growth
The end of August saw some rare
positivity expressed in the potash industry.
ICL stated that it was optimistic
that the prices and demand for potash will pick up in the long
term, and confirmed that it intends to go ahead with the
development of the Danakil Valley potash project in Ethiopia,
in a joint venture with TSX-listed Allana Potash.
The news was a welcome ray of hope
given the recent volatility in the potash market and the
forecast by Russian potash giant, Uralkali, that prices could
fall below $300/tonne.
However, ICL’s enthusiasm was
somewhat countered by more sobering analysis from SQM, whose
CEO Patricio Contesse said in the company’s second quarter
earnings that Uralkali’s announcement could have a
negative impact on potash prices.
Average prices for potassium
chloride and potassium sulphate have decreased around 8% y-o-y
over the six month period, SQM added.Ê
Elsewhere, North American phosphate
producer Mosaic Co. lowered its expectations for both potash
and phosphate as a result of market uncertainty caused by the
Belarusian Potash Company (BPC) break-up in August.
“In the short term, [...]
dealers are cautious and are deferring purchases. As a result,
we have lowered our price and volume guidance for both the
potash and phosphates segments for the third calendar quarter
of 2013,” said Mosaic CEO, Jim Prokopanko.
Potash prices are expected at
around $330 to $340/tonne including transportation and
distribution costs, while the gross margin rate is expected in
the low to mid 30% range.
Its third quarter guidance has been
revised to 2.6m to 2.8m tonnes, and phosphate prices are
expected at around $430-$440/tonne for the period.
Prokopanko added, however, that
despite the short-term lower demand, the long-term fundamentals
for the fertiliser market are still the same.
Rare earths climb on China
stockpile rumours
Rare earths prices entered
September on a reassuringly upward trend, and remained at
higher levels throughout the month, indexes tracking the
minerals showed.
The price of praseodymium oxide
jumped more than 10% to around $89/kg at the end of August, up
from a range of $75-80/kg at the start of the month, while
neodymium oxide prices were trading at the upper end of
IM’s range of $57-62/kg.
Europium oxide prices approached
$820/kg mark in early September and dysprosium oxide prices
were steady around the $400/kg mark.
Both oxide and metal values
remained robust during September, even though buying activity
was reported to be limited, as traders held off from giving
quotations in anticipation of an announcement that the Chinese
government intends to create a national stockpile of rare
earths.
Recovery could be in store
for soda ash
Soda ash producer OCI Resources
said in September that demand was starting to return to the
soda ash market as the global economy begins to recover.
Kirk Milling, CEO of OCI
Enterprises, which operates the Wyoming Green River facility in
the US, told IM that he expected soda ash
demand consumption to increase in line with economic
improvement in both developing and established markets.
Prices are expected to move higher
on the back of extra demand from Australia and Europe where
Penrice and Solvay recently announced they were taking plants
offline, he explained.
Meanwhile, fellow US Soda ash
producer, FMC Wyoming Corp., announced in mid-September that it
will increase the price of two soda ash grades sold to South
African customers by $30/tonne, with immediate effect, or as
contracts allow.
The increase applies to FMC
Wyoming’s Grade 260 “dense” soda ash and Grade
100 “light” soda ash sold to South African
customers.
FMC Wyoming said that the move was
necessary in order for the company to recover increasing costs
and continue to invest in its soda ash operations.
At the time of going to press, FOB
Westvaco and FOB Granger, Wyoming, list prices for bulk
material stood at $275/s.ton for dense grade, $280/s.ton for
Grade 100 and $290/s.ton for AbsorptaPlus.
FOB Westvaco, Wyoming, prices for
packaged soda ash list prices were at $340/s.ton for dense and
$245/s.ton for Grade 100 in 50lb loads.
For 2000lb loads, prices stood at
$330/s.ton for dense and $335/s.ton for Grade 100.
Titanium dioxide and
feedstock prices fall
Asian TiO2 prices are
falling, according to sources in the industry who have pointed
to slack demand in China, Korea and Taiwan.
Reporters in Asia said that FOB
prices for TiO2 were currently in arrange of
$3,340-3,355/tonne, while FOB Anatase prices were in the range
of $3,505-3,520/tonne.
The IM Prices
Database, which contains one CFR Asia price, listed
the level as being at between $2,700-3,000/tonne at the end of
August.
Demand for TiO2
feedstocks was also subdued during the second quarter of 2013
due to a destocking cycle by the pigment industry, according to
Irish mineral sands miner, Kenmare Resources.
However, demand has returned in
some areas, with Kenmare pointing to a slight improvement in
demand from Europe and the US over the last two quarters due to
an increase in construction in these regions.
Rutile and ilmenite producer Sierra
Rutile reported that lower mineral sands prices had decreased
its revenue by 33% for the first six months of 2013, when
compared to the same period in 2012.
Average realised prices fell from
$2,522/tonne in H1 2012, to $1,265/tonne, but volumes were 40%
higher, Sierra Rutile said.
Full information on all
IM’s prices can be found on the
pricing pages (pp52-54) and online on the IM Prices
Database.