IM prices January 2015

By Laura Syrett
Published: Saturday, 27 December 2014

External pressure on bentonite and bauxite prices to continue in 2015

Oil price turmoil may hit bentonite prices

The steep drop in global oil prices could undermine prices in the bentonite market in 2015, industry observers have suggested.

Crude oil prices dipped below $60/barrel in mid-December 2014 (see p34), having been well north of the $100/barrel mark as recently as the previous June.

The December falls were triggered by a report from the Organization of the Petroleum Exporting Countries (OPEC), which lowered its demand forecast for OPEC-produced crude to the lowest level in a decade.

Bentonite clay is used in conventional oil and gas well drilling to form muds that provide suspension for weighting agents and drill cutting, as well as forming an impervious coating on the drill hole walls to prevent gas or liquid migration. The market for bentonite had been robust throughout the first half of 2014. This left prices steady throughout most of the year, although freight bottlenecks for drilling-grade bentonite were reported to be limiting price increases for the oilfield mineral back in April.

Oil prices are likely to rise from their current levels, with an expected average price of $75-85/barrel in 2015, according to Bank of America Merrill Lynch (BoA ML) research published in December, but market observers still fear that oilfield mineral demand may be curtailed as higher cost operations are mothballed.

Prices for API grade bentonite (bagged, rail car, ex-works Wyoming) shifted upwards slightly towards the end of 2014, from of $92-130/s.ton to $95-135/s.ton.

Bentonite, API grade, bagged, rail car, ex-works, Wyoming, $/s.ton

price1

Bentonite, rail hopper cars, crude, bulk (all grades), ex-works Wyoming, US, s.ton $70-150

Bentonite, IOP grade, crude, bulk, ex-works Wyoming, s.ton $68-72

Bentonite, Indian, FOB Kandla, crushed and dried, loose bulk, IOP grade, tonne $36-40

Bentonite OCMA/Foundry grades crude and dried, bulk, FOB Milos, tonne €60-80

Bentonite, foundry grade, bagged, rail cars, ex-works Wyoming, s.ton $97-124

Bentonite, API grade, bagged, rail car, ex-works, Wyoming, s.ton $95-135

Shanxi bauxite shambles to continue in 2015

Rising labour and energy costs will continue to hurt refractory grade bauxite producers in Shanxi Province, northeast China - the word’s principal source of the material, into 2015, as the industry is yet to reform its practices, sources told IM in December,

Earlier in 2014, sources said that average wages in the region had increased by around 45% 

in the last year, while gas and electricity prices in Shanxi are also reported to be uncompetitive.

The province saw a number of bauxite plants shut down in 2014 after it emerged that many suppliers were attempting to evade taxes by mis-describing the content of shipments and conducting cash-only transactions.

Crackdowns by the Chinese government have put a stop to some illegal practices but the industry remains choked. Owing to weakness in demand from refractories manufacturers, this has not had a significant impact on prices to date.

Prices for round kilned Shanxi bauxite (FOB Xingang) stand at between $310-385/tonne, depending on grade. Pure rotary kilned bauxite (FOB Xingang) prices stand at between $320-395/tonne.

Prices for Shanxi calcined bauxite (FOB Xingang) stand at between $330-390/tonne, depending on grade.

Shanxi, FOB Xingang, Round kiln 87/2.0/3.2

price2  

Shanxi, FOB Xingang, Round kiln 87/2.0/3.2, tonne $375-385

Shanxi, FOB Xingang, Round kiln 86/2.0/3.15-3.20, tonne $370-380

Shanxi, FOB Xingang, Round kiln 85/2.0/3.15, tonne $310-320

Shanxi, FOB Xingang, Rotary kiln 86/1.8/3.15, tonne $385-395

Shanxi, FOB Xingang, Rotary kiln 85/1.8/3.15, tonne $320-335

Shanxi, FOB Xingang, Calcined kiln 88/1.8/3.25, tonne $395-415

Shanxi, FOB Xingang, Calcined kiln 87/2.0/3.20, tonne $370-390

Shanxi, FOB Xingang, Calcined kiln 86/2.0/3.15, tonne $350-370

Shanxi, FOB Xingang, Calcined kiln 85/2.0/3.10, tonne $330-350

IM’s full price listing will now only be published online at www.indmin.com/PricingDatabase. If you have any comments or concerns, or wish to discuss any of the grades or prices listed, please contact Laura Syrett, Prices Editor, at lsyrett@indmin.com. 

For in-depth fluorspar and graphite price analysis, please visit the IM Data mineral tracker pages online.

Bold indicates a price change from the previous month (it may have changed more than once during the month). All prices are listed in US$ and quoted per tonne unless indicated.