At the end of October, the global
fluorspar community met in London for the annual
IM Fluorspar event, where delegates heard,
among other things, that fluorspar prices are expected to
remain flat, or decrease, until 2016.
Using what he called a
conservative estimate, Jon Hykawy, head of global
research at Byron Capital Markets, said during a presentation
that prices for acidspar were expected to average $376.86/tonne
in 2014, with an estimated supply of 4.8m tonnes and demand of
Weve made the
assumption that production will be maintained and the new
projects that have been announced will come online, he
The price of acidspar in 2015 is
expected to be at $356.82/tonne, with a demand of 4.8m
However, by 2016, demand will
return to the market, reaching 5.08m tonnes and the price is
expected to increase by around $30/tonne.
Driving demand will be the end of
the global recession, Hykawy said, as well as a growth in
consumer demand for products that contain fluorochemicals, such
Weve seen attitudes
shifting in how people want non-stick products in developing
economies, Hykawy said.
Following the relatively bearish
outlook from Hykawy, John Zhao, vice president of Asian
fluorspar producers China Kings, said that Chinese producers of
hydrofluoric acid (HF) and aluminium fluoride (AIF3)
will have to increase their prices if they are to cope with the
increased cost of production, government safety initiatives and
Producers of AlF3
and HF are fighting to survive, Zhao said.
Production costs have increased, labour has increased,
electricity and transport has also increased.
Added to the pressure of the higher
costs was government pressure to invest in beneficiation. Any
plant producing above 30,000 tpa must have its own
beneficiation, Zhao added.
New environmental and production
laws mean that mine owners could be imprisoned if they fail to
comply with these regulations, he explained.
I dont think the price
could be any lower - thats my opinion, Zhao
The current domestic price of
fluorspar in China is around Chinese renminbi (Rmb) 1,750/tonne
($287/tonne*), he continued.
According to the
IM prices database, current China FOB prices
are at $280-310/tonne for acidspar (wet/dry filtercake).
The price of fluorspar, AIF3
and HF will go up for two reasons. Firstly, if we continue to
run at the current price, producers will have to shut
down, Zhao said.
Also, reserves have been used
quickly, Zhao added, pointing to a decrease of 26% of
Chinas high-grade deposits from 2003-2011.
Production will not go up or
down, but the price will go up, Zhao insisted.
China Kings are the largest
fluorspar producer in China in terms of reserves, holding eight
mines and 918,000 tonnes of reserves.
Speaking to delegates after the
presentation, IM learned that the arguments
presented were probably valid, but some added that while they
were interesting, it was in a producers interest to say
prices would increase.
For iodine, prices resisted falling
below the $45/kg mark in November, despite a continuing
slowdown in the market, sources have reported to
When asked about reports that
prices had sunk to around $42/kg at the end of September, from
a previously reported low of $48/kg earlier in the month,
market participants said that they had not observed such a
European, North American and South
American sources agreed that although the market has slowed
down considerably during the first nine months of 2013, spot
and contract prices are holding above $45/kg.
Some Europe-based sources said that
prices were pushing the $50/kg boundary, while South American
contacts have continued to report prices upwards of $52/kg, and
even as high as $60/kg.
Other market participants have
said, however, that they would be very surprised to
discover that any buyers would be willing to pay prices above
Since the beginning of the
year, consumers have resisted paying these higher iodine prices
and as a result, contract prices have begun to decline,
said Roskill analyst, Vincent Pedailles, in an iodine market
update published in early October.
The Roskill update also pointed to
an overall increased iodine output in Chile this year from
Algorte Norte, ACF Minera and Sirocco Mining, although
production from other major producers including SQM is expected
to decline in 2013. Japanese production is stable, meanwhile,
Prices are now anticipated to
remain steady according to some producers, but the market could
still be slightly over supplied by new Chilean production
coming on stream by 2014, keeping a lid on any price
rises, Pedailles said.
Prices during the fourth
quarter of 2013 are therefore expected to remain stable or even
decrease very slightly, he added.
Based on market feedback,
IM has adjusted its prices for iodine (99.5%
min, drums) to a range of $45-55/kg for both spot and contract
Sliding rare earths prices appeared
to halt their decline at the end of October having fallen by
around 15%, on average, over the course of the month.
Buffering the market was the
renewal of rumours that Chinas State Reserve Bureau may
shortly begin purchasing rare earths to create a national
stockpile of the minerals, following the publication of
inflated rare earth offer prices by Baotou Steel Rare Earth Co.
Ltd at the beginning of November.
According to the SunSirs commodity
index, Chinese domestic prices for dysprosium oxide were Rmb
1.9m/tonne ($311/kg) at the beginning of November, down 13.6%
since the start of October.
Domestic Chinese rare earths prices
are typically around 10% lower than internationally-traded
Also this month, several paper
chemicals companies announced price increases for kaolin.
German chemical producer BASF said
it will increase its kaolin prices globally for paper
applications by up to 7%, varying dependent on the product and
are effective immediately.
The companys energy surcharge
policy will remain the same with the threshold at $5/mmbtu,
Although demand for packaging
products supplied by the paper chemicals has remained stable,
demand for chemicals for graphic paper production, primarily in
Europe and North America, feel sharply over the third quarter
of 2013, the company said.
This, together with negative
currency effects, lower sales prices and decreased volumes, led
to a decline in sales for BASFs paper chemicals division
Increasing pressure was
additionally intensified by overcapacity in the market,
the company explained in its third quarter results last
Despite our strict margin and
cost management, earnings declined as a result of lower sales
volumes, BASF added.
US kaolin producer KaMin LLC also
said it will increase its prices depending on product category
and industry, effective 1 January 2013, or as contracts will
The company announced that the
price increases of 4 to 7% will affect its kaolin clay products
for the global paper industry, as well as kaolin produced for
global industrial markets.
Although the company raised kaolin
prices at the same time last year, pointing to growing
production costs as the reason, it did not indicate the driving
factor behind the latest set of increases.
KaMin is committed to
investing the necessary resources in technology, innovation and
people for long-term sustainability in order to continue to
serve its paper customers at a high level, the company
KaMins goal is to
create the greatest value for its paper customers through
partnerships geared towards delivering cost effective solutions
designed to reduce coating formulation cost and to optimise
paper and printing performance, it added.
The companys energy surcharge
policy for 2014, which also comes into effect from 1 January,
will remain unchanged at $6/MMBTU, and incremental surcharges
by product type will remain the same.
The surcharge policy applies to
KaMins slurry, spray-dried hydrous and calcined kaolin
grades sold to the paper industry worldwide.
for kaolin clay products for the paper industry from CADAM SA,
in which KaMin has had a 61.5% stake since May 2012, are also
to increase by 4 to 7% from 1 January 2014, dependent on
KaMin purchased a 61.5% majority
ownership in CADAM from iron ore group Vale SA for $30m last
year, which placed it as the second largest supplier globally
of refined kaolin after Imerys SA.
CADAMs facilities include an
open-pit mine in Amapa, Brazil, a beneficiation plant, and a
private port, in Para, Brazil. The mine and the plant are
linked via a 5.8km pipeline for the kaolin slurry.
Prices for kaolin, as reported by
IM, are between $161-209/s.ton (no 1 paper
coating grade, ex-Georgia plant), while prices for kaolin, (no
2 paper coating grade, ex-Georgia plant) are between
Antimony trioxide prices fell by as
much as $400/tonne in early November, sources have indicated to
Prices for antimony trioxide (99.5%
Sb2O3) on FOB China, CIF
Antwerp/Rotterdam and ex-works US bases, have slipped from a
range of $9,200-9,600/tonne in October to around
$9,000-9,200/tonne in mid-November.
Meanwhile, market reports suggest
that a cessation in lower offer prices for europium oxide,
which had been pulling values down since mid-October, mean that
prices have stabilised and are likely to hold firm for the
Despite losing ground in October
following slight value gain in September, prices of most rare
earth minerals are stronger that they were a year ago, although
light rare earths are continuing to suffer.
Lynas reports stronger prices year-on-year
At the beginning of November,
Australias Lynas Corp. reported its quarterly report for
the three months ending 30 September 2013, saying that the
average Mount Weld basket price for rare earths increased by
14% to $21.80/kg on a China domestic basis during the period
compared to the previous quarter.
Since the end of September,
the basket price on a China domestic basis has increased
further to $22.89/kg, the company added.
Lynas production increased in
the September quarter compared with the prior quarter but
remained at a low level as the group continues to make
improvements to its cracking and leaching units at its
Malaysia-based rare earths refinery.
Total quarterly production at
Lynas Malaysian operations was 253 tonnes, a 76% increase
from the prior quarter, with 218 tonnes shipped, an increase of
86% year-on-year. Cash receipts from sales during the period
reached Australian dollar (A) $3.2m ($3.04m).
Lynas said that it believes the
global rare earths market could grow at 5-6% per annum to 2020,
based on demand forecasts for key end markets such as
automotive, electronics and renewable energy.
*Conversions made November 2013
ONE TO WATCH
This rare earth has lost considerable value since the price
spiked in 2011; however renewed demand in the polishing market
in Japan could see prices rebound in the short- to-medium
ONE TO WATCH
Drilling-grade bentonite prices are not expected to move before
the end of the year, but could increase slightly in early 2014,
US-based sources have told IM.
After fluctuating over the past 12
months, sources suggest that some price movement will occur in
the first two months of next year, but for now prices are
As we enter 2014, according to one
source, prices could increase 3-4%, while another suggested
pricing will remain flat into next year.