IM22: Innovation will lead the way for industrial minerals

By Siobhan Lismore-Scott
Published: Friday, 11 April 2014

The keynote speech delivered by Rio Tinto’s CEO Xiaoling Liu at IM’s biannual industry meeting in Vancouver marked a fresh outlook for an industry which has faced significant challenges since the global economic downturn.

Innovation will be key to driving growth in the industrial minerals industry in the near term, was the overriding message conveyed at IM’s 22 Congress, held last week in Vancouver, Canada.

The tone was set with an evocative keynote speech by Rio Tinto Mineral’s CEO, Xiaoling Liu, who underlined her own humble background as a working class Chinese student and said that increasing infrastructure and middle class consumerism in China and other emerging economies meant that there would be an increase in the demand for industrial minerals.

“We have all faced significant challenges,” Liu said. “I think challenges can be a good thing. For industrial minerals, challenges can be a saw that swings both ways,” she added.

 
 Michael Le Page, Rio Tinto's Chief commercial officer takes questions after Xiaoling Liu's presentation

A difficult two years

Difficult subjects were broached by many of the IM22 speakers included the dip in exchange markets, the recession and the subsequent slowing of demand.

While these have been well documented in many company results across the industry, it was obvious that many companies believed that the effects of the recession would be shorter and less severe than they had proved to be.

However, this has not quelled the push for innovation, with several companies explaining the steps they were taking to look at diversifying their markets.

Most underlined that they were continuing to invest in new technologies and in innovation and research in their companies. Following from Liu’s broad statement that “innovation has been at the core of growing industry,” speakers were keen to show how they had moved to embrace creative ideas in challenging times.

Zeolites

For New Zealand’s Blue Pacific Minerals this meant looking at the resources locally and seeing how these could be used to supply the domestic and international market.

The company is developing the zeolite industry in New Zealand, using it as a substitute for cat litter and floor sweeping chemicals.

“Zeolite is not a curiosity - there’s a market for zeolite,” Bernard Novak, market development manager, told delegates.

The company supplies Australia and is developing markets in South East Asia for cat litter and floor chemicals. But elsewhere, it has also developed new uses for zeolite, Novak continued.

It has been used as a feed additive to improve feed utilisation – this will meet growing demand for formulated feed farming in New Zealand, as the country’s dairy farming markets expand.

Zeolites have also been used to treat turf in stadiums.

“It comes back to innovation,” Novak said, outlining the ground that can be gained by taking an entrepreneurial perspective on long-established markets.

Zeolites have been processed to be used in turf markets, as an alternative to kaolin in paper fillers and also to be used as a replacement for bentonite in cat litter, he explained.

“We don’t want to be a one horse wonder,” Novak said, adding that it is also looking to develop its perlite deposits as well as other ore bodies in New Zealand.

“Perlite has developed from nothing to a business where we have a proven resource,” Novak said.

Iluka look to innovate

Liu told the delegates that growing urbanisation would build infrastructure and change the way people in emerging economies live.

“Growth is linked to urbanisation and a growing middle class,” she said, adding that she believed that Rio Tinto Minerals thinks demand will double in the markets it serves, or is hoping to serve (borates, minerals sands, lithium and fertilisers).

“This will increase demand for industrial minerals (...) all of which is a good outlook for our industry,” she added.

David Robb, managing director of Iluka meanwhile said that he believed growth would return to the mineral sands industry, but said that it would be in a different market to that which is recognised now.

“We believe in the industry’s future, but things will be different. We believe in our industry and we are investing in its future,” Robb said.

Robb took delegates through the company’s acquisition of Metalysis, underlining that this could “transform demand for titanium metal”.

The $20.3m acquisition of Metalysis, a UK Cambridge University spin out, was announced in the company’s 2013 results. Metalysis has developed a process that can produce titanium powder from rutile.

“This is a potentially disruptive technology if it is successfully commercialised,” Robb said.

Logistics move forward

Logistics service providers to the industrial minerals industry were also eager to showcase innovation, with speakers focusing on ways to mitigate rising costs and avoid bottlenecks in the supply chain.

Rusty Safine, president of US-based FBC Logistics, said that new packaging and container options were needed to compensate for the lack of handling infrastructure at many ports, which in itself is scuppering growth, with one possible solution being the use of larger, intelligently designed bags for transporting dry bulk material.

Port of Amsterdam’s manager of agribulk, minerals and recycling, Marcel Gorris, opened the floor to the IM22 audience and appealed for greater co-operation and communication between mineral suppliers, buyers and logistics providers.

“Amsterdam aims to be a port of partnerships,” Gorris said, “but in order to do that, we need to know what you need”.

Cost and flexibility were two of the main issues raised by delegates, who agreed that growth in the industrial minerals sector was sometimes hamstrung by the difficulty of taking product to market.

Look to Istanbul 2016

There were many predictions for the next two years given over the course of the week. Many said that they believed the market would turn around, but that things would be more challenging in the near term.

What was highlighted is that there is no shortage of investment for the right project – and that innovation and research and development are more important than ever in these challenging times.