Hafnium rally accelerates as supply crunch tightens

  • Market: Metals
  • 04/11/21

Global hafnium prices continue to rally amid a shortage of spot availability and replacement supply coupled with increased demand.

European prices for 99pc-grade hafnium with 1pc maximum zirconium rose to a more than two-year high of $875-925/kg duty unpaid Rotterdam in early November, their highest level since prices were assessed at the same level on 17 April 2019, according to Argus data.

Multiple sellers are now unwilling to sell commercial volumes of hafnium with 0.5pc zirconium content for less than $950/kg, while sales for smaller volumes were quoted at about $1,000/kg in Rotterdam, market sources said. Deals for volumes of 100-500kg were recently concluded in a range of $950-1,050/kg in Europe.

"Supply is not flexible. Most producers are sold out and end-user demand is definitely active," a trading firm in Europe said this week.

Although some market participants expect trading companies to withhold stocks to meet demand, another supplier said finding "replacement material is difficult and there is no horizon as to when to buy more".

He also warned of the uncertainty over the longevity of price spikes amid low liquidity. Typically, hafnium volumes are locked into long-term contracts with consumers, which could dent spot liquidity.

The US market is showing similar price strength as producers face supply chain constraints, with sellers continuing to test higher offers.

A slight deficit in the hafnium scrap availability "imbalanced" the market, one market participant said. Hafnium scrap is used to produce hafnium tetrachloride, a key compound in the production of crystal bar. Strong and steady demand from the industrial gas turbine and electronics sectors absorbed most of the hafnium compounds last year, during an unprecedented period of low demand from aerospace, the main hafnium-consuming industry.

And with increasing nuclear plants under construction, there is likely to be a boost in demand for metals such as hafnium and zirconium sponge, particularly from the Asia-Pacific region.

At the same time, major producers have committed to supplying significant volumes under long-term contracts, leaving less material available for extra spot deals, market participants said.

Bids of $700/kg for off-specification hafnium — typically containing certain impurities and of a varied form that may need further processing — were declined in the past week and sales were concluded at at least $100/kg higher, indicating tight availability and higher demand, a trading firm said.


Sharelinkedin-sharetwitter-sharefacebook-shareemail-share

Related news posts

Argus illuminates the markets by putting a lens on the areas that matter most to you. The market news and commentary we publish reveals vital insights that enable you to make stronger, well-informed decisions. Explore a selection of news stories related to this one.

News
27/03/24

Chile outlines plan to double lithium production

Chile outlines plan to double lithium production

Santiago, 27 March (Argus) — Chile will use three different business models to expand its lithium production that it estimates could increase by 70pc by 2030 and 100pc over the next decade, finance minister Mario Marcel said. Chile is the world's second-largest lithium producer with an estimated output in 2023 of 234,000 tonnes of lithium carbonate equivalent (LCE), according to US Geological Survey data. The first model announced late on Tuesday envisages public-private alliances, with the state holding a majority share, in two salt lakes that have been defined as strategic: Atacama in the Antofagasta region and Maricunga in the Atacama region. Public-private alliances will also be promoted in five other salt lakes — including Alto Andino and Pedernales — where the state will seek the "best agreement" to develop projects with private partners, giving it either a majority or minority role. The third model gives the private sector leadership in the development of 26 other salt lakes in which associations may be formed with state companies but will not be a requisite, said Marcel. Private investors will be asked to submit Requests for Information (RFI) to express interest in these salt lakes in April and the RFI results announced in July. Successful applications will lead to special lithium operating contracts (CEOL). "During this government, we will sign a group of CEOLs in which the private sector will lead production in which the state will not be a major partner," said economy minster Nicolas Grau. Another 38 salt lakes will be defined as protected areas where development cannot take place to meet Chile's commitments under the Convention of Biological Diversity. Chile has the world's largest proven reserves of lithium but laws passed in the 1970s and 1980s restricted its access to private developers. Chilean SQM and US Albemarle, the country's only producers, operate in the Atacama salt lake under leases with state development agency Corfo. The plan comes almost a year after President Gabriel Boric announced Chile's intention to open lithium mining to private investment in April 2023 as part of its national lithium strategy. By Emily Russell Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Read more
News

Baltimore bridge collapse forces freight changes


26/03/24
News
26/03/24

Baltimore bridge collapse forces freight changes

Washington, 26 March (Argus) — Vessel traffic in and out of the Port of Baltimore, Maryland, has been suspended indefinitely in the wake of a container ship collision early today that brought down the Francis Scott Key Bridge, an accident that will force the rerouting of coal, car and light truck shipments. The prolonged closure of one of the largest ports on the US east coast could have a ripple effect on trade flows across much of the US, as shippers grapple for alternatives in the absence of a certain reopening timeline. Search and rescue efforts are still ongoing in the Patapsco River, after the 116,851dwt Dali headed to Colombo, Sri Lanka, slammed into a bridge support. The crew had lost control of the vessel. The Dali is owned by Grace Ocean and managed by Synergy Marine Group. The Maryland Port Administration said it does not know how long it will take for the shipping channel to be cleared and for traffic to resume. Shipping companies are bracing for a closure of at least two weeks, but many expect the clean-up effort could take significantly longer. President Joe Biden vowed the federal government will provide whatever resources are needed to get the port "up and running again as soon as possible." The port is a major trade hub for steam and coking coal, automobiles and scrap metal. Many market sources are still trying to determine whether the disruption will be dramatic enough to move prices. But coal markets were already being affected today. Baltimore is home to two key coal export terminals: eastern US railroad CSX's Curtis Bay Coal Piers and coal producer Consol Energy's Consol Marine Terminal. The facilities are upstream of the bridge, meaning ships will not be able to serve them until the route reopens. The terminals handle thermal and coking coal from Northern and Central Appalachia. They have a combined export capacity of 34mn short tons (30.8mn metric tonnes). The two terminals loaded 2.4mn t of coal in February, up from 2.1mn t a year earlier, according to analytics firm Kpler, mostly exports to India and China. An India-based trader said that the suspension of coal exports will probably raise prices in India, as brick kilns enter the peak production season in the summer. Buyers could look to petroleum coke as a substitute, but the higher sulphur content may not be appealing to some users despite the higher calorific value. Prices for deliveries to northern Europe are also likely to rise given that the Netherlands, Germany and Belgium combined are the second-largest market for North Appalachian coal. April API 2 futures rose by $2/t to $113.30/t. The incident has added a "level of volatility [which] could have big implications," a European paper broker said. The lack of information has prompted some coal producers to hold off on activating force majeure clauses in their contracts. Curtis Bay is served only by CSX, while CSX and fellow eastern carrier Norfolk Southern serve Consol. CSX said it is in contact with existing coal customers and contingency plans are being implemented. The railroad at this point intends to keep Curtis Bay open but will continue to assess the circumstances moving forward. Norfolk Southern did not respond to questions. Some scheduled Baltimore coal exports may be redirected to the other three eastern US coal export terminals in Hampton Roads, Virginia, but such reroutings likely will entail increased costs. Not all coal mines will be able to shift terminals. Such decisions will depend on available capacity in Hampton Roads. Exports from the three terminals in January reached a five-year high , signaling somewhat limited capacity. Mine location and railroad access may also determine whether coal can be rerouted, an industry source said. But some producers do not have much of a choice about trying to send coal to Hampton Roads. They may need the cash so will be forced into a decision. The producers most vulnerable to delays may be Consol and Arch Resources. Arch's Leer coking coal mine may be in the best position because it co-owns Dominion Terminal Associates in Hampton Roads with Alpha Metallurgical Coal Resources. The sudden lack of export capacity could put a floor under US coal prices, which have mostly been falling since last year amid low domestic demand. The competition to replace Baltimore coal exports could prevent further cuts, another coal trading source said. Metals sources say the accident will have only isolated effects on the global ferrous scrap market, but many market participants are still assessing the situation. The port is the 10th largest ferrous scrap export port in the US, and over the last five years an average of 44,000 metric tonnes/month of ferrous scrap was exported from Baltimore, according to US Department of Commerce data. But the port closure is likely to affect other freight. Baltimore is the nation's top handler of automobile traffic. Motor vehicles and parts accounted for about 42pc of all Baltimore port imports and 27pc of all exports, according to state data. The Port of Baltimore handled 847,158 cars and light trucks in 2023. "It's too early to say what impact this incident will have on the auto business — but there will certainly be a disruption," said John Bozzella, chief executive of industry trade group Alliance for Automotive Innovation. Dry bulk freight rates likely unaffected Several sources told Argus Baltimore's closure is unlikely to have a major impact on dry freight rates despite short-term interruptions to coal transports. "We are in the shoulder months with less demand for thermal coal," a shipbroker said, suggesting mild global temperatures means the collapse "may not have too much of an impact" on freight markets overall. Vessel traffic in ports such as Charleston, South Carolina, and Savannah, Georgia, may increase on diversions from Baltimore. Kpler identified 17 vessels that will likely be impacted because they are either in the Port of Baltimore or were expected to load there in the coming days. By Abby Caplan, Gabriel Squitieri, Luis Gronda, Evan Millard and Brad MacAulay Port of Baltimore coal terminals Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

News

Global scrap impact limited after US bridge collapse


26/03/24
News
26/03/24

Global scrap impact limited after US bridge collapse

Pittsburgh, 26 March (Argus) — The collapse of a major bridge in Baltimore, Maryland, this morning should have isolated effects on the global ferrous scrap market, but market participants are still assessing the situation. A container vessel hit the Francis Scott Key bridge, an artery for the Port of Baltimore. The bridge subsequently collapsed, blocking all vessel traffic in and out of the port and triggering major rescue and recovery efforts. The Port of Baltimore told Argus that the port is still operating and processing trucks inside its terminals but that all incoming and outgoing vessel traffic is suspended until further notice. Market participants said a resumption of activity could take up to a few weeks as rescue efforts, cleanup, investigations and draft assessments take place. As a result, it is unclear how long the port will be able to keep taking inbound truck traffic in the short-term because of space limitations. The collapse and temporary suspension of vessels so far will likely have an isolated effect on the ferrous scrap market. The Port of Baltimore is the 10th largest ferrous scrap export port in the US and over the last five years a monthly average 44,000 metric tonnes (t) of ferrous scrap were exported from the Port, according to US Department of Commerce data. In 2023, the port shipped 486,000t of ferrous scrap with bulk shipments to Turkey accounting for most of the volumes at 314,000t or 67pc of total shipments. One bulk vessel was shipped to Mexico in November. The remaining ferrous scrap exports from the port are containerized exports with south Asia the major destination. In 2023, the shipments to India represented 16pc of the volumes, while Pakistan was 6pc. There are currently no bulk vessels loading at the Port, according to Argus vessel tracking. Maryland-based Baltimore Scrap, which was acquired by global metal recycler Sims Metal in 2023 is the primary bulk exporter from the port. Smith Industries also ships bulk vessels from Sparrows Point, Maryland, which is a few miles south of the Francis Scott Key bridge. Although the global market effect is somewhat limited, market participants said that with the indefinite loss of the Francis Scott Key bridge trucking logistics moving scrap metal to the Port will be severely affected until the corridor is reestablished. Others noted congestion concerns at other major mid-Atlantic ports as inbound vessels are likely to be diverted and any inland container depot shipments scheduled to ship out of Baltimore are rerouted to other ports. This could cause congestion at surrounding ports including, but not limited to: Norfolk, Virginia; Newark, New Jersey; and Philadelphia, Pennsylvania. By Brad MacAulay Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

News

Chinese Cisa steel mills cut output in mid-March


26/03/24
News
26/03/24

Chinese Cisa steel mills cut output in mid-March

Beijing, 26 March (Argus) — China Iron and Steel Association (Cisa) member mills cut crude steel output by 0.51pc from 1-10 March to 2.048mn t/d over 11-20 March because of weaker steel demand and rising inventories. Output fell by 9.12pc from a year earlier during 11-20 March. Daily pig iron output fell by 0.42pc from 1-10 March to 1.836mn t/d for 11-20 March and was down by 6.56pc from a year earlier. Daily finished steel output rose by 1.95pc from 1-10 March to 1.965mn t/d for 11-20 March but was down by 8.05pc from a year earlier. Cisa reported its members' steel inventories at 19.533mn t over 11-20 March, rising by 0.05pc from 1-10 March and up by 3.04pc on the previous year. Cisa data include information from more than 100 of the country's largest steel mills. China's spring season demand was weaker than market participants' expectation with inventories continuing to rise after the lunar new year in late February. Market participants estimate that Chinese trading firms and mills' steel inventories rose by around 2mn t from early March to mid-March because of weaker consumption from the construction industry. Steel prices showed a downwards trend in early March and mid-March. Shanghai rebar ex-warehouse price assessed by Argus fell by 200 yuan/t ($28/t) or 5.4pc from 1 March to Yn3,530/t on 20 March. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

News

Q&A: Battery recycling gets competitive: Clarification


26/03/24
News
26/03/24

Q&A: Battery recycling gets competitive: Clarification

Clarifies temporary facility's processing capacity under first question Singapore, 26 March (Argus) — Singapore-based lithium-ion battery recycling firm EcoNiLi Battery will launch a 24,000 t/yr battery recycling plant in Malaysia's Perak state in May. Argus spoke to Jayden Goh, chief executive officer and founder of EcoNiLi, about upcoming developments and the battery recycling industry. Edited highlights follow: Could you share more about the plant? We are relying on domestic used battery supply and some domestic firms that have imported battery scraps, including in shredded form, from regions such as Europe and even the US, which we are collecting and buying for processing. But we are bringing the issue up to the federal level and want the creation of a policy that will allow us to import used batteries from all regions. We are also in negotiation with the trade ministry to obtain a green channel to directly import used battery scraps, which is currently not allowed. We currently have a temporary facility that processes 3,000 t/yr of used batteries to produce black mass. We are going to produce industrial-grade lithium carbonate and have stopped producing mixed hydroxide precipitate (MHP). We are looking at producing cobalt, nickel electrolytes for phase two and plan to begin construction by next year. We [have] exported our black mass mainly to Hong Kong customers, who will take them back to China, as well as South Korea. But we will be exporting to Chinese customers on an offtake basis, [for] which we have four buying contracts. Battery treatment costs for black mass in Singapore are [at] about 5,800 yuan/t, but it is about Yn1,500/t in Malaysia. As I see it, if we want to be competitive in the region, we would need to be competitive in terms of production costs, capital expenditure and scale. What are your thoughts on the lithium market volatility and how does that factor into the company's strategy? I think lithium is a very risky business. The market is not driven by supply and demand but by expectations and assumptions. Therefore, whenever we handle large quantities of lithium materials, we prefer to do it in the form of offtake. Whatever we produce we would like to ship it out immediately. We do not want to be a gambler. The market has not been performing too well in the first two months this year, but [the] price is slowly rising in March. We extract lithium and make MHP at a treatment fee of around less than $1,000/t of black mass for black mass producers, who will sell them themselves. We shift our business model to that during unfavourable market conditions. What is your view on the battery recycling industry in Asia? I think only a few big players will remain [in Malaysia] in the next 3-5 years. But whether they will be [granted] license[s], that's another story. We obtained the fastest environmental impact assessment approval in Malaysia's record in just three weeks. I think we will also be the first to obtain the permission to directly import used batteries, in four to five months' time, which will put us in a better position. It is also getting competitive elsewhere in the region. We were the first black mass producing factory in Indonesia back in 2019 and only managed to collect 150t of used batteries per month as imports are not allowed. Several black mass factories have also failed over there as they did not manage to collect sufficient quantities. The Indian government is also quite supportive because circular economy creates indirect jobs. But domestic collection is currently unsustainable in India. We are seeing rapid breakthroughs in battery technologies such as sodium-ion batteries. How would that affect the lithium-ion battery market? The situation is similar to hydrogen vehicles. Just look at how long it took to promote and get the market to believe in the technology. Sodium-ion batteries are still in their infancy phase. Maybe we do need to process sodium-ion batteries 10 years later. But now it's too early for that. By Joseph Ho Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Business intelligence reports

Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.

Learn more