Argus tungsten market update and outlook – June 2024

05/11/25

Rio Tinto, Hydro Tasmania agree to 12-month power deal

Sydney, 5 November (Argus) — UK-Australian producer Rio Tinto and Australian state-owned utility Hydro Tasmania have agreed to a 12-month electricity deal to support production at the 190,000 t/yr Bell Bay Aluminium smelter in Tasmania. The in-principle deal will ensure continued safe and stable production as negotiations continue with Hydro Tasmania and the Tasmanian government towards a decade-long agreement, a Rio Tinto spokesperson told Argus on 5 November. Rio Tinto's deal with Hydro Tasmania provides Bell Bay Aluminium with an extra year of exceptionally affordable power, Tasmania's premier Jeremy Rockliff said. The specifics of the agreement remain private. The UK-Australian producer's current electricity contract with Hydro Tasmania will expire in late December . The two companies have been locked in talks over a long-term power deal for 18 months, Bell Bay Aluminium general manager Richard Curtis told staff on 8 October. They have not been able to agree on suitable terms, creating significant risks for the smelter, Curtis added. Tasmanian spot electricity prices averaged A$109.26/MWh ($70.70/MWh) over the July 2024-June 2025 financial year, up from A$69.07/MWh a year earlier and just A$37.16/MWh a decade earlier, data from the Australian Energy Market Operator (AEMO) show. Tasmania's government has been supportive of Rio Tinto. But the price gap between what Hydro Tasmania is offering and what the smelter needs is too wide for it to cover alone, the state's energy minister Nick Duigan said on 9 October. The Tasmanian government repeated its call for Australian federal support for Bell Bay Aluminium on 5 November. In October, it asked federal officials to confirm the plant's eligibility for Australia's A$2bn low-emissions aluminium production credit scheme, which will offer tax incentives to producers from 2028-29. Bell Bay Aluminium mostly relies on hydroelectric power and could be eligible for production credits. But Australia's government has not finalised the scheme's design yet. Rio Tinto's year-long deal with Hydro Tasmania allows time for the outcome of the Australian government's credit scheme to be known, a company spokesperson told Argus today. Rio Tinto is also facing electricity cost pressures at its 600,000 t/yr Tomago aluminium smelter in New South Wales (NSW). The company may need to close the plant at the end of 2028 over high energy costs, but has not made a decision about its future, Rio Tinto said on 28 October. Spot electricity price levels in NSW are even higher than those in Tasmania. They averaged A$128.16/MWh in 2024-25, up from A$101.57 a year earlier and A$35.18/MWh a decade earlier, AEMO data show. The Australian federal and NSW state government have been in talks with Rio Tinto about energy cost support since June. They have not been able to reach an agreement, Australia's minister for industry and innovation Tim Ayres said at a press conference on 28 October. By Avinash Govind Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Q&A: LatAm Li juniors likelier to be producers

Q&A: LatAm Li juniors likelier to be producers

Sao Paulo, 4 November (Argus) — With hundreds of possible greenfield resources, especially in Brazil and Argentina, Latin America has emerged as a new frontier for junior miners seeking to capitalize on strong lithium and base metals demand. The Toronto Stock Exchange lists 1,097 miners, with at least 910 it classifies as juniors that focus on exploration and early development. About 19pc of those have at least one asset in Latin America, compared with 6pc in Africa, 2pc in Asia and 3pc in Australia. The 15 largest juniors who have their main asset in Brazil have a total market capitalization of R75bn ($13.8bn), underscoring the region's potential for exploration companies. Argus spoke with Koby Kushner , chief executive of Libra Energy Materials — a junior miner — about why lithium offers unique opportunities for smaller players to become bigger producers. Edited highlights follow. Why are junior miners so predominant in Latin America? Brazil has great geological potential and it is relatively a new frontier, so there are a lot of low-hanging fruits still out there waiting to be discovered. It also has such a long history of mining that people are familiar with it and the permitting regime is very well defined and efficient in comparison to other places in the world. Elsewhere in Latin America, you have several untapped assets that need to be explored and discovered, which is the job of junior miners. You are also looking at relatively stable, friendly jurisdictions where there is less chance of the government coming in take your mine after you've built it — unlike in some African countries, where higher political risk can make it harder to attract investment. Are junior miners likelier to become producers in lithium than in other commodities? It probably happens more in lithium than in most other commodities because the capital requirement and the cost of capital are the major hurdles for a lot of juniors. Juniors, because they're smaller and don't have existing cash flow to fund their own costs, have a much higher cost of capital. With lithium, however, the capital intensity — especially for spodumene projects — is much smaller than what you see in other commodities. And this is even more true in Latin America. Sigma Lithium, for example, is sitting in the bottom of the cost curve for hard-rock lithium. You could argue that if that same deposit was in Australia, it would not be there. Conversely, some of the great deposits in Australia would be more profitable if they were located in Brazil. Even if a deposit in Latin America is not as attractive as one elsewhere, the lower production and project costs often makes the economics better. In Argentina, it is tougher. The brines are more capital-intensive than spodumene, so it is harder for a $50mn market cap company to fund a $1bn in costs. Even Lithium Argentina, one of the bigger juniors, needed a joint-venture partner to finance its project . Miners like Galan are taking a unique approach, trying to produce lithium chloride — a lower-capital path, though still higher than a typical spodumene project on average. How do junior miners finance exploration and early development? If you become a producer, you can take on debt. Early-stage miners without cash flow, however, should avoid debt and rely on equity, royalties or joint ventures. Issuing equity is the most common for junior exploration companies. They issue equity, sell shares to investors and use the money they raise to move the needle on the company and hopefully their share price. Royalty financing usually happens further down the line, with project funding. The joint venture model makes sense when you feel your equity is undervalued and you're getting better terms at the project level. Someone else spends their money to de-risk the project. You own a smaller piece, but it saves you dilution at the corporate level. What are the main exit strategies for junior miners? The main one would be to get bought by someone bigger. The alternative is to sell off assets to a larger party. So instead of getting acquired, you transact at the project level and keep royalties. By Pedro Consoli Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Chile allows 545,000t Li quota for Rio Tinto

Chile allows 545,000t Li quota for Rio Tinto

Sao Paulo, 4 November (Argus) — The Chilean nuclear energy commission (CChEN) authorized a joint venture between state-owned miner Enami and Rio Tinto to extract up to 1.2mn metric tonnes (t) of lithium metal from its Salares Altoandinos project by 2060. CChEN — the governing body for Chilean lithium — approved an initial quota of 545,000 metric tonnes (t) of lithium metal equivalent (LME) for the Salares Altoandinos project, awarded through a concession to a joint venture between state-owned miner Enami and Anglo-Australian mining giant Rio Tinto. The quota is valid until 2060 and can be expanded to a maximum of 1.22mn t. According to Enami, this represents the largest lithium mining extraction permit ever granted outside the Atacama region. The state-owned miner also said that the economic viability study for the project is complete, confirming a production capacity of 75,000t/yr and a mine life of 28 years. With just over 3mn t of LCE resources, Altoandinos is the largest greenfield lithium project in Chile, with production scheduled to begin in 2032. The project — a 51:49pc split with Rio Tinto holding the majority stake — is projected to cost $3.2bn. By Pedro Consoli Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Cliffs touts trial to swap out aluminum in autos

Cliffs touts trial to swap out aluminum in autos

Houston, 30 October (Argus) — US steelmaker Cleveland-Cliffs completed a trial run to produce "exposed steel parts" from an automotive original equipment manufacturer's (OEM) aluminum stamping equipment, as it pushes for automakers to return to making steel-intensive vehicles. The company has sought to capitalize on a three-alarm fire at aluminum roller Novelis' facility in Oswego, New York, which has caused supply disruptions for the broader automotive industry. That plant produced the majority of automotive-body sheet used by major US automakers, including Ford. Cleveland-Cliffs noted that the pilot project produced stampings with "no defects", demonstrating that steel can replace aluminum in critical applications "without the need for costly retooling." The company said it had shifted to "routine production and delivery of regular orders" to the OEM, adding that it had "received inquiries" from other customers. It remains to be seen if automakers will fully transition back to using corrosion-resistant steel in automotive bodies, given the limitations on fuel efficiency that prompted those companies to shift to aluminum for light-weighing purposes a decade ago. Cleveland-Cliffs said the blaze would cause "presumably long-lasting" upheaval for aluminum supply chains, but Novelis expects to have its hot-rolling mill back online in December and other aluminum rollers have accelerated product qualifications and shifted manufacturing lines to help fill the void left by Oswego's lost output. Cleveland-Cliffs did not respond to a request for comment. By Alex Nicoll Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Lynas rare earth output rises in 3Q