IM Prices December 2017

Fluorspar

Fluorspar prices rise amid tight supply

Industrial Minerals staff

As 2018 contract negotiations got into full swing, market participants attributed the increase mostly to supply constraints due to production cuts in China, a major producer and exporter of acidspar.

It is not possible to buy acidspar in Europe below $300 per tonne, buyers, sellers and traders told Industrial Minerals at the time.

Chinese output has fallen substantially in recent months due to government efforts to protect the environment while production levels for other producing regions have dropped due to generally weaker market conditions.

While demand begins to pick back up from the fluorchemicals sector, production cannot increase quickly enough, a fluorspar producer said, adding that it would take a year to bring some capacity back online.

Prices in Europe, cif Rotterdam, remained lower than fob China prices, however, due to the availability of acidspar from other locations at cheaper levels.

Market participants there attributed the rise to a shortage of supply.

"Winter is already here. As usual, in every year during winter time production will become less, especially in the north of China where the weather is severe. But this year the situation is different - even the southern part of China is affected, not by cold weather but by the severe environmental inspections," a trader in China told Industrial Minerals.

Stronger hydrofluoric acid and aluminium fluoride markets are also lending support to higher acidspar, a key feedstock for both industries. 

"Downstream industries are performing well too. Both hydrogen fluoride and aluminum fluoride prices are around 12,000 yuan per tonne. The former remains at high levels while the latter hit its highest in recent years," the trader continued. 

Chinese sellers had raised their offers to $400 per tonne and above to consumers in Europe, the United States and India in November.

"If you go to China, they would say $500 but they don’t have any material - it’s a polite way of saying 'no’," a buyer told Industrial Minerals. 

One Chinese supplier told him he would not have anything available until mid-2018, he claimed.

Prices in the US, Mexico and South Africa are likely to rise also, according to buyers and sellers, but in the absence of any trades Industrial Mineral’s prices for acidspar in those regions have remained unchanged.

Metspar

The price of metspar for export from China rose on November 24, reflecting domestic consumption rates taking a large proportion of supplies.

The price rise stems from "smooth" demand from the steel sector, according to a trader.

Acidspar, 97% CaF2, Wet Filtercake, FOB, China $/tonne

Source: Industrial Minerals

Martim Facada

Lithium spot prices in China are expected to remain high, consumers and producers told Industrial Minerals late in November, although some consumers expect a softer market if local and central governments in the country reduce the subsidies to be given in 2018.

"The market remains quite tight on [battery-grade] lithium carbonate availability and we expect this trend to persist while spot and contract prices move upward as we enter 2018 and throughout the year," a consumer told Industrial Minerals at the time.

"We have not purchased lithium carbonate this week because we are stocked until the end of the year and are waiting to see whether the decrease in subsidies… will cool down the market," a second consumer added.

In these conditions, spot prices for battery-grade lithium carbonate (min 99.5% Li2CO3), ex-works China, moved up to 170,000-180,000 yuan ($25,856-27,377) per tonne on November 23 from 170,000-173,000 yuan per tonne on November 16, according to Industrial Minerals’ assessments.

Spot prices for technical- and industrial-grade lithium carbonate (min 99% Li2CO3), ex-works China, rose to 155,000-165,000 yuan per tonne on November 23 from 150,000-160,000 yuan per tonne on November 16.

Quiet in Europe, North America

The European and North American markets reported unchanged prices due to a lack of market activity.

The spot prices for technical and industrial grades of lithium carbonate (min 99% Li2CO3) and for battery-grade lithium carbonate (min 99.5% Li2CO3) remained at $16-17 and $18-19 per kg respectively.

Spot prices for lithium hydroxide (min 56.5% LiOH.H2O) in technical and industrial grades in Europe and the United States remained at $18.50-20.00 per kg on November 23.

The spot market was similarly unchanged for battery-grade lithium hydroxide (min 56.5% LiOH.H2O), remaining at $18.50-20.00 per kg on November 23.

Lithium carbonate min 99% Li2C03 technical and industrial grade, spot price range, ex-works domestic China, RMB/tonne

Source: Industrial Minerals

Martim Facada

The antimony trioxide (typically 99.5% Sb2O3) market picked up in November when antimony metal prices pushed up the selling prices of flame retardants in China.

"Higher antimony metal prices in recent weeks have pushed our antimony trioxide prices up. We have achieved higher prices this week and expect a final push for [even] higher prices before Christmas," a producer told Industrial Minerals on November 14.

The spot price for antimony trioxide fob China was driven by the antimony metal price and by suppliers’ market expectations. It rose by $50 per tonne to $7,000-7,150 per tonne on November 14 from $7,000-7,100 per tonne previously, according to Industrial Minerals’ assessment.

Some antimony trioxide producers were bullish due to the higher antimony metal price; still, some suppliers were more conservative in their predictions of where antimony trioxide and metal prices will move by the end of 2017.

"We started to see higher prices offered from China and saw the market moving slowly up," a trader told Industrial Minerals.

"However, producers in China have to meet their export quotas before the end of the year. [That] could slow down the price increase or promote the availability of material at lower prices [from] suppliers in China which want to get rid of old stocks… to reach their export quota," the trader added.

The price of antimony metal, MMTA Standard Grade II $ per tonne in warehouse Rotterdam, increased to $7,900-8,100 per tonne on November 10 from $7,750-8,100 per tonne on November 8, according to Industrial Minerals sister publication Metal Bulletin.

Europe, US

In Europe and the United States, import prices remained stable. Consumers have held back from buying while starting negotiations to source more material before the end of the year.

"We feel that the market hit the bottom weeks ago and is now moving upward. Our suppliers have sent us higher price quotes, but we will be browsing for material before committing to higher prices," a consumer told Industrial Minerals in November.

Slow spot market activity due to low demand, despite higher offer prices, kept the market for antimony trioxide (99.5% Sb2O3) cif Antwerp/Rotterdam unchanged week-on-week on November 14 in the range of $7,200-7,300 per tonne while the cif US East Coast price was similarly unchanged at $7,300-7,400 per tonne.

The domestic European and US markets were more active, with confirmed sales pushing the prices up to €6.30-6.70 per kg ($7.34-7.81) in Europe and $3.41-3.48 per lb in the US on November 14. They were previously €6.30-6.60 per kg and $3.41-3.46 per lb respectively.

"Antimony metal prices have climbed in recent weeks and we have started increasing our antimony trioxide prices as a consequence," a supplier told Industrial Minerals.

"The antimony metal and trioxide market is becoming firmer and we expect to continue to see prices rise due to the higher offers received in the past week alongside the tightness [in the availability] of material in the market," a consumer said.

Antimony trioxide, typically 99.5% Sb2O3, 20 tonne lots FOB China, $/tonne

Source: Industrial Minerals

TiO₂

William Clarke

Titanium prices held firm, with markets remaining tight and physical deals thin on the ground, after another round of Chinese producer price rises in November.

Industrial Minerals assessed European titanium dioxide pigment, bulk volume, cif Northern Europe at an unchanged €2,700-3,190 ($3,172.51-3,748) per tonne at the end of October, maintaining its year-high price level that began on May 11.

The continued strength in the market was forcing paint makers to raise product pricing due to raw material costs eating into their margins.

"[Paint companies] are saying 'we don’t have any choice’," a European titanium dioxide (TiO2) dealer said at the time, adding that the market now showed no sign of easing until the end of the year, at least.

Since the cost of TiO2 makes up some 30-40% of the end price of many coatings, paint companies only have a limited ability to absorb price rises.

PPG raised North American prices by an average of 6% across its industrial coating range, citing increases in "both raw material and labor costs."

"Cost-control measures have not sufficiently offset rapidly rising costs in the supply chain," PPG’s vice president for industrial coatings in the Americas, Kevin Braun, said.

Titanium dioxide pigment, bulk volume, CIF Northern Europe, €/tonne

Source: www.indmin.com

Davide Ghilotti

Strong demand and limited availability of chromite continue to support the foundry grade market, keeping prices high, Industrial Minerals heard at this year’s Chromium 2017 conference in South Africa in November.

"It has been a good year in foundry chromite – there’s no doubt about it," one supplier told Industrial Minerals. Several others described the market in similarly positive terms.

While metallurgical chrome ore has been dogged by volatility so far in 2017 - with a few notable swings in prices - the price of foundry grade chromite has remained close to the benchmarks it reached at the end of 2016, when the grade increased to a five-year high.

Foundry grade chromite, 46% Cr2O3, wet bulk, was trading at $400-450 per tonne fob South Africa, according to Industrial Minerals’ assessments in November.

Lower-purity foundry material, 45.8% Cr2O3, wet bulk, was assessed at $390-440 per tonne fob South Africa, while refractory grade chromite, 46% Cr2O3, was priced at $390-450 per tonne fob South Africa.

High demand, limited output

On the supply side, the closure of several operations between 2015 and early 2016 took a chunk of foundry output off the market, creating a gap that has yet to be filled.

"I have done a lot of business in Asia [in 2017]," a distributor told Industrial Minerals. "We have seen a notable increase in China but also in other Southeast Asian destinations."

The spread of demand across several regions made for an overall more stable market in foundry compared with, for example, chemical grade chromite, where China - the single largest importer - had the magnitude to determine price tendencies much more, depending on demand flows.

In conversation with Industrial Minerals in Johannesburg, sellers reckoned that 2018 may be another strong year for the foundry business because the market fundamentals remain broadly unchanged.

"The situation of undersupply has not gone away. That condition is still here," one said.

Another added: "Until new supply comes online, and as long as demand doesn’t drop across the board, this scenario will maintain prices."

Chromite, foundry, 46% Cr2O3, wet bulk, FOB South Africa $/tonne

Source: www.indmin.com

Zircon

Cameron Perks

There is no zircon available outside of contracted channels, several traders in China and the United States told Industrial Minerals at the end of November. 

Zircon consumers in Japan and Europe reported a similar story, predicting price rises.

Zircon, premium grade, min 66.5% ZrO2, bulk, cif China, remained at $1,200-1,320 per tonne on November 24 while zircon premium grade min 66.5% ZrO2 bulk fob Australia rose to $1,170-1,270 from $1,000-1,050 previously.

China is the world’s largest consumer of zircon, importing almost a third of all global supply. Most of this is used in ceramics, in the production of sanitaryware or tiles, with increasingly more going into the chemical markets (see p18).

Zircon, premium grade, min 66.5% ZrO2, bulk, CIF China, $/tonne

Source: www.indmin.com

Graphite

Davide Ghilotti

The company did not disclose the extent of the price rise.

"The whole natural graphite industry is following new market price levels that will allow producers to invest in technologies and processes to reduce the environmental impact of their mining activities," vice president and general manager of Imerys Graphite & Carbon, Hugues Jacquemin, said.

The price increase comes at a time when demand has risen for all graphite grades in Europe, with Industrial Minerals’ flake graphite prices rising at the start of October. The most recent increases in Europe follow a series of upticks in China for both + and - mesh sizes.

BFA prices tick up on China’s supply squeeze

The restrictions put in place in refractory minerals producing areas in China have taken yet another toll on local supply as customers struggle to secure the volumes the need.

Prices for brown fused alumina (BFA) edged upward the first week of December with availability constraints in China intensifying after the latest government-led shutdowns of facilities in key producing regions.

As provincial governments in areas of China including Henan pushed through with another round of stoppages to some industrial operations – this one, which started in mid-November, is due to last until March – the availability of bauxite for BFA production has collapsed.

"With the bauxite kilns shut, there are no raw materials for BFA," one supplier said.

"They knew the measure was [imminent], so companies could get ready somehow. But production has drastically dropped," he added.

"Bauxite output was already short, and is getting even shorter. This creates a struggle between BFA producers and bauxite sellers, as each of them tries to source enough volumes," a distributor added.

Industrial Minerals assessed the price of brown fused alumina, refractory grade, at $750-800 per tonne fob China on 1 December, compared with $750-770 per tonne in previous weeks.

The price of abrasive-grade brown fused alumina (FEPA F8-220) is also appreciating, with the material assessed at $810-850 per tonne fob China at the same time.

The price of the commodity has been on the rise since July, when widespread inspections and new environmental norms put a squeeze on local outputs in the main refractories-producing areas of China.

Additionally, lead times from China into Europe have been getting longer.

"Customers are desperate to book volumes," one supplier said. "Sellers, on the other hand, want to wait, or at least hold until they get the price they want."

One large European buyer added: "We are trying to secure long-term agreements, but so far we haven’t had any success in that. No one wants to commit beyond one or two quarters."

Some market participants reckon – or hope, for want of a better word – that the tightness may ease somewhat after the Chinese New Year holiday, in the second quarter of 2018.

The understanding is that companies would be able to go back to business by then, although Chinese authorities have so far been scant on details.

Additionally, some state-owned suppliers of dynamite and equipment, now currently shut, would start supplying local companies again. Industrial Minerals has been hearing about this for some time now although, again, precise details remain unclear.

Magnesia

Davide Ghilotti 

European fused magnesia spot prices were rising in October while buyers sought to secure whatever volumes may be still available for sale amid a widespread shortage of material.

Sellers had already booked contracts for the supply of a large proportion of next year’s fused magnesia production, buyers said, while the price of material sold on the spot market climbed further.

According to Industrial Minerals’ October assessment, European fused magnesia fob Europe was trading at $1,500-1,700 per tonne. This climbed $1,550-1,750 per tonne in November.

This compares with a previous range of $1,400-1,600 per tonne, earlier in October, and a range of $480-650 per tonne throughout the first half of 2016.

Over 2017, prices of this grade have risen to their highest since Industrial Minerals started to monitor this market in 2008, which reflects tight supply.

The rise in fused magnesia prices has been indirectly affected by the dramatic increase in prices of graphite electrodes in September and October, one supplier said.

In the US, the price of graphite electrodes, which are used predominantly to melt scrap in electric arc furnaces (EAFs) to produce steel, rose to as much as $16 per lb in October for some sizes from $1 only a few months ago.

The surge in prices was driven mainly by reduced supply of electrodes from China caused by a government crackdown on pollution that led to the closure of some electrode plants there.

The comparatively high consumption rates of graphite electrode during the production of fused magnesia has made this a much costlier process than that of other grades of magnesia products in recent months.

"When you melt magnesite in the electric arc furnace [to produce fused magnesia], you consume up to 35kg of electrode per single tonne of FM," the supplier said.

This compares with a much lower usage level of around 1kg per tonne of steel.

"That’s another factor that has led FM prices to increase much more than, say, DBM [dead burned magnesia] prices have. It’s the electrode effect," the supplier added.

Magnesia, fused, European, FOB Europe, $/tonne

Source: www.indmin.com

Rare earths

Albert Li

Two of China’s biggest rare earth producers lowered several of their public guidance prices in November for light rare earths in the north and center of the country and for heavy rare earths in the south.

China Northern Rare Earth High-Tech Group cut its guidance prices for all materials apart from lanthanum oxide and cerium oxide, both of which it held at the September level of 15,500 yuan ($2,338) per tonne. These prices were not raised in October.

It also cut its neodymium oxide price by 26% to 520,000 yuan per tonne from 370,000 yuan in September although it is still up 39% from January.

The group cut its praseodymium/neodymium and neodymium metals prices by 25.19% and 25.31% respectively from its September guidance prices. But these prices are still up 47% and 41% respectively since January.

In the south of the country, China Southern Rare Earth Group kept all of its prices unchanged since it lowered them on October 9 - other than cutting its terbium oxide price by 3.9% to 3.7 million yuan per tonne on November 13 from 3.85 million yuan tonne previously.

PRICING NOTICE: Industrial Minerals suspends rare earths pricing

Industrial Minerals has suspended its rare earths pricing and invites market participants to enter into a consultation to establish their future requirements.

In recent months, Chinese producers of rare earths have started to publish their rare earths prices publicly while the industry there takes steps to consolidate the market and improve market conditions.

Industrial Minerals regularly reviews its pricing offering to ensure we deliver the most up-to-date and robust pricing in the industry.

Industrial Minerals has no financial interest in the level or the direction of the index.

To see all Industrial Mineral’s pricing methodology and specification documents, please go to: www.indmin.com/Methodology

Industrial Minerals will continue to publish rare earths market news as well as producer pricing while this consultation takes place. To stay up to date, please see the Rare Earths section of our website.

William Clarke

French minerals producer Imerys has announced that it will introduce "substantial" price rises for mica, talc, and wollastonite from its Performance Additives Division from the start of 2018.

"The Performance Additives Division will initiate a substantial price increase, effective from January 2018, or as contracts allow," Imerys said, adding that the segment "cannot continue to absorb these cost increases."

A company representative said the increase in prices would only affect mica, talc, and wollastonite.

Martim Facada

Industrial Minerals launched lithium hydroxide monohydrate min 56.5% LiOH.H2O battery grade, spot price range, ex-works domestic China, yuan/tonne and lithium hydroxide monohydrate min 56.5% LiOH.H2O technical and industrial grade, spot price range, ex-works domestic China, yuan /tonne to extend our lithium price coverage of the Chinese domestic market.

The two grades will be published both as a single number and as a range. 

After a consultation period, Industrial Minerals has launched the prices for lithium hydroxide monohydrate min 56.5% LiOH.H2O battery grade, spot price range, ex-works domestic China, yuan/tonne and lithium hydroxide monohydrate min 56.5% LiOH.H2O technical and industrial grade, spot price range, ex-works domestic China, yuan /tonne.

This comes at a time where demand for critical raw materials used in batteries is increasing, which has led to a growing demand for transparent lithium prices while an increasing number of car manufacturers announce plans to produce electric vehicles (EVs).

These two lithium prices will be launched to replace the hydroxide, spot, 56.5-57.5%, packed in drums or bags, del China price currently tracked by Industrial Minerals.

Industrial Minerals, which has tracked lithium prices since the 1980s, has noticed the increasingly important role Chinese domestic prices are playing the global market and the need to differentiate battery grade material from technical and industrial grade.

The two new grades complement Industrial Minerals and the Metal Bulletin Group’s wider coverage of the global lithium hydroxide market, the raw material used by cathode markers for NCM622 and NCM811 battery production.