Mongolia has five fluorspar mines in development, a
representative of the Asian country’s mining
ministry told delegates at Fastmarkets’
Fluorspar Conference 2019 event in London in September.
Tsogtgerel Bayanjargal, adviser to the minister of
mining, could not give clear details about the expected ratio
of production between acid and metallurgical grades from these
assets nor about when the output from the various projects
would reach the market.
"[The five mines] are reporting to us that they
are starting, and within our investment program we will start
to issue permissions once we have cleared the environmental
issues," Bayanjargal said.
The identities and capacities of four of these
mines was not disclosed, and their ultimate effect on the
market could not be predicted because of the varying timelines
for each one to commence operations.
Mongolczechmetal, however, is developing an
acidspar-only plant with nameplate capacity for 40,000 tonnes
per year that is scheduled to start up in September 2020,
executive director Dalai Bicheerei told Fastmarkets.
Meanwhile, Mongolian stalwart Berkh Uul suspended
operations at its Delgerkhaan mine this year, according to
Oliver Rhode, managing director of chemicals and raw material
sourcing company Xenops Chemicals, which has strong links to
the sector in Mongolia.
Although Delgerkhaan’s capacity is
unknown, such figures are often merely indicative for Mongolian
plants because winter in the East Asian country often halts
mining altogether or stymies efforts at transportation of the
material, which contains as much as 10% moisture and freezes in
the harsh winter temperatures.
Mongolian export volumes to China have grown
significantly, rising to 550,000 tonnes in 2018 from 319,000
tonnes in the previous year. That figure was itself up from
248,800 tonnes in 2016.
Mongolia’s only other customer for
fluorspar exports in 2018 was Russia, which took less than
200,000 tonnes. This means China takes almost three quarters of
Mongolia’s current output.
Acidspar material accounted for 164,000 tonnes of
the 2018 total, which was up from 69,400 tonnes in 2017 and
46,800 tonnes in 2016.
This suggests China has raised its downstream
consumption, given that its own export volumes appear to have
been flat for the past few years. But speculation that Chinese
companies bring in fluorspar and then reprocess it to a desired
purity for later re-export blurs the picture.
Reprocessing in this way was common when Mongolian
companies lacked the technology to produce acidspar through the
flotation process although they now have the technology and
On the sidelines of the Fastmarkets event, a
trader questioned the acid- and met-grade split of material
because import receipts may be misleading. There are different
import tariffs on the two products - China has a 3% import duty
on acid-grade material while metallurgical grade material is
subject to a duty of 1.5%.
Queries are commonplace in the market about the
true quality of Mongolia-origin material. What is claimed to be
acidspar, 97% CaF2 content, can be of lower grade - more akin
to 95% CaF2.
Market sources in China have already warned that
any crackdown on exporters which avoid payment of the 13% VAT
that applies to fluorspar exports would risk disrupting the
Mongolia, which relies heavily on its mining
industry to bring in foreign direct investment, is looking to
enhance its downstream technologies.
An unnamed company is also developing a copper
smelter and oil refinery in Mongolia, Tsotsgerel said. This
will also produce the sulfur needed to create hydrofluoric
acid, which is the feedstock for fluorochemicals.