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- Is Investing Offshore Legal and Ethical?
- The Pitfalls and Dangers of Investing in Silver
- The Value of Gold as a Hedge Against Inflation
- Why the Future of Precious Metals Look Bright
- What Are the Strategic Metals Offered by Swiss Metal Assets
- The Financial Crisis Began Five Years Ago
- China to Cut Rare Earth and Strategic Metal Production
Recently molybdenum has been in the news. China Molybdenum has announced that it will be launching an IPO on the Shanghai exchange later in the year. Swiss Metal Assets has also decided to add Molybdenum to its, ¨Construction and Engineering¨, basket of metals joining tantalum, tungsten, chromium, zirconium and cobalt.
Molybdenum is a refractory metal with the symbol of Mo on the periodic table of the elements and an atomic number of 42. This rare strategic metal was discovered in 1778 by a Swedish scientist Carl Wilhelm Scheele. Molybdenum has the sixth highest melting point of all elements. With a melting point of 2,623°C (4,753°F) only tungsten, rhenium, carbon, osmium and tantalum boast a higher melting point.
The largest producer of molybdenum is China followed by Chile, United States, Peru and Canada. Molybdenum is primarily a bi-product of copper and tungsten mining with a few mines producing it as a principal ore. Total world production is approximately 230,000 metric tons per year according to the USGS (United States Geological Survey).
The use of molybdenum is extensive. There are very few substitutes for the metal. This keeps the demand high. Molybdenum has an extensive list of uses. The top use is in alloys which uses about 70% of all the metal available each year.
Here is a list of the uses of Molybdenum:
- Alloys in construction
- Superalloys in aviation and rocketry
- Lubricants for high temperature applications
- Alloy with steel to make stainless steel
- X-ray tube components
- Applications to protect against heat
- Nuclear industry
- Solar industry as an electrode material in CIGS (Copper, Indium, Gallium and Selenide) Panels
The future of Molybdenum looks bright with the continued expansion of the green economy around the world. The solar industry growth will continue to use significantly more of the rare metal in CdTe (Cadmium Telluride) panels and the CIGS panels. The market for CIGS solar panels are projected to double by 2015. This will put significant pressure on the molybdenum market as well as the rest of the rare strategic metals.
Chromium is a topic that you rarely hear about, but in today´s environment of uncertainty and the, ¨Great Worldwide Resource Grab¨, chromium gets more attention. Recently we have the EU and USA going into Libya (oil, lithium), Iraq (oil), Afghanistan (oil pipeline, rare earths), West Africa (cobalt, tungsten, oil, gold, timber and many more). Let us not forget China and the contracts that they are signing all over the world for their natural resource needs. This all makes for some very interesting times for nations and investors alike. Rare industrial metals are no different. Chromium has been in the news so it is time to explain its uses and background.
Chromium was discovered by Louis Vauqelin in 1797. Chromium is a blue-white metal with great corrosion resistance. It has the symbol Cr with an atomic number of 24. Chromium can be polished to form a very shiny surface and is used to plate other metals to form a protective layer.
The main use of chromium is in the production of steel where it is used as a hardener, corrosion resister and helps fight decolorization. Iron and chromium form Stainless Steel which is strong and has a high resistance to heat and decomposition. The two form one of the most versatile and durable metals known in the world. Stainless steel contains approximately 10% chromium. Chromium is also used in paints, coloring in glass, and as a plating agent.
According to the USGS the top producers are South Africa, Kazakhstan and India. South Africa produces almost 50% of all chrome ore. The three countries account for 80% of all chrome ore mined. Approximately 95% of all known reserves are located in Kazakhstan and the southern tip of Africa to include Zimbabwe and South Africa.
The background of chromium is interesting, but today we have a hot topic. India is thinking about a ban on exportation of chrome ore. This is after news out of South Africa that the, ¨National Union of Mineworkers¨, called for restrictions of chrome ore exports to China. It has been speculated that China has been stockpiling chrome ore in order to control future prices. Does this sound familiar? We currently have to deal with the manipulation of the rare earths and rare industrial metals by China. As of October 2011 India and South Africa have not followed through with the plans. The next few weeks and months will be quite interesting, we are seeing an increase in the need for chromium, with a possible decrease in available supply.
Today our world is full of uncertainty. Every day brings us news of something amazing. Governments are under pressure, people are suffering, companies are folding, wonderful inventions, worldwide internet connectivity, and resources are becoming scarce. I have learned that in times like this you can either complain or build a grand future. Many fortunes were made during the US Great Depression. We are living through a worldwide recession, when we come out on the other side natural resources will be needed like never before. Where are you putting your money and future?
By: Randy Hilarski - The Rare Metals Guy
Cobalt was discovered around 1736 by Georg Brandt a Swedish chemist. The element was found to give glass a hint of blue. For centuries cobalt has been used as a pigment in glass and porcelain. Chinese artisans used it to color their vases and other ceramics. Over the last few decades cobalt has had a grand resurgence. In the late 1970′s Zaire, now Democratic Republic of Congo had a bloody civil war which cut off the world from much of the production of cobalt. During this time alternatives had to be found because the price of the rare industrial metal accelerated beyond what industry was willing to pay. Since then the amount of uses for Cobalt have expanded to the point where the US Department of Energy added cobalt to its, “Critical Materials”, list.
This metal has found its way into many of our technological applications used today. Cobalt’s uses include aerospace, green tech, pigments, dyes, batteries, wireless technology, computers, magnets, desulfurization of crude oil, orthopedic implants and high-strength superalloys. The use of cobalt in superalloys is mainly due to its corrosion resistance, temperature stability, and wear resistance. These attributes make it highly suitable to aircraft engines and gas turbines. The US Department of Energy predicts that electric powered vehicles (PHEVs and EVs) will need an estimated 9.4 kg each of cobalt. By 2012 the estimated sales of hybrid and electric vehicles worldwide is approximately 2.2 Million, and by 2015 to be at least 10% of the world auto market. Wind energy also uses large amounts of cobalt within its turbine blades and samarium-cobalt magnets.
The US Department of Energy has made it clear that any rare industrial metal used in clean energy technology such as electric vehicles, solar cells, wind turbines and energy efficient lighting will be deemed critical. The problem for the USA lies in its supply of cobalt. Still today over 40% of global production is from The Democratic Republic of Congo. China has an agreement with the DRC to export all of the cobalt to China where it is refined. Once again China has a stranglehold on rare industrial metals similar to what is happening in the rare earth market. The big difference is with rare industrial metals it is much more difficult to expand supply. There are very few known deposits of cobalt, most production is a by-product of copper production. The USA has been recycling 15% of its cobalt and importing 85% from foreign sources. The bad news for the USA is that China needs cobalt as well. Currently the USA has only one mine that is being prepped for production in Idaho. This mine will primarily produce cobalt totaling 3% of the global supply. The main players in cobalt refining are China, Finland and Canada. According to the USGS in 2010 the total world production of cobalt was around 88,000t.
If a person is looking for a way to profit from cobalt there are a few options. A person could buy stocks of mining companies that have rights to cobalt mines, which is the traditional method. Recently the London Metals Exchange (LME) launched a cobalt contract traded in 1 metric ton lots of 99.3% pure cobalt. The other option is buying cobalt in Germany and having it stored 100% allocated in Switzerland. A company that offers the option of buying cobalt in smaller quantities is Swiss Metal Assets. Although cobalt is only one of the various rare industrial metals they offer.
By: Randy Hilarski - The Rare Metals Guy
Much has been made, maybe too much, of the dire straits the world will shortly be in when the Chinese finally choke off supplies of rare earth metals, or elements (REE) to the outside world. No one would deny REEs have many critical uses, but you can’t help wondering if there aren’t a lot of vested interests behind some of the clamor.
In the process, the supply side constraints on many other metals (with a few exceptions) are overlooked, until now, that is. The British Geological Survey has produced an intriguing report called the Risk List 2011. The analysis is, in their own words, intended to give a quick and simple indication of the relative risk to the supply of 52 chemical elements or element groups which we need to maintain our economy and lifestyle.
The list is much more than a simple list of rarity, REEs being a case in point; they are not rare, but the combination of relative abundance, location of deposits and concentration of production in certain countries makes them a much higher risk than metals that are rarer, but whose production is more widely distributed among politically reliable sources. Each element is given a score from 1.0 to 5.0 for each of the following criteria:
A score of 1 indicates a low risk, a score of 5 a high risk. The scores for each criterion are summed to give an overall risk to supply score, obviously the larger the score, the greater the risk.
The lowest scores are (from the bottom up):
- Titanium 2.5
- Aluminium 3.5
- Chromium 3.5
- Iron 3.5
- Thorium 7.0
- Bismuth 7.0
- Rare Earth’s 8.0
- Tungsten 8.5
- PGM’s 8.5
- Antimony 8.5
No major surprises there. Occurrence is plentiful and widely distributed, as is production. One may have expected to see titanium and chrome, both of which rely in part on supplies from Russia and South Africa, to have scored a little higher, but the report lists Australia and Canada as the leading producers for the first three and although China is listed as the leading producer for iron ore, they are also the leading consumer and a net importer.
Unfortunately, not so at the other end of the list. China comes out as the leading producer of 27 of the elements listed and ranks as the leading producer in six of the top nine most at-risk elements, all of which are metals. The reason we chose nine instead of the top 10 is because items 10 and 11 are bromine and graphite respectively, but following these, the list promptly gets back into metals through the middle orders.
Extract from BGS Risk List 2011:
*PGM’s include the Platinum Group Metals: Ruthenium, Palladium, Osmium, Iridium and of course Platinum, but interestingly Rhodium is not mentioned. Source: British Geological Survey.
How often do we hear of supply risks to antimony, mercury or tungsten? Yet these metals are used in a bewildering array of applications. China produces nearly 90 percent of the world’s mined antimony and 85 percent of the world’s mined tungsten, according to the USGS. Arguably, tungsten is as critical as REEs, used as it is in a huge array of metal alloys for electrical, strength and wear resistant applications. Like REEs, China is restricting exports of tungsten and the BGS ranks the supply risks as even higher than REEs.
The purpose of the Risk List is not to cause alarm, but to alert policy makers and consumers to possible supply disruption in the future. As competition for resources grows, these metals currently present the highest risk due to geopolitics, resource nationalism (state control of production), strikes and natural disasters impacting a highly concentrated supply base. Metals buyers and product designers could do worse than spend a few minutes perusing this list and reflecting on their own raw material supply arrangements.
By Stuart Burns
September 15th, 2011
These elements are the building blocks of a modern society, and China has all of them. Until now. The U.S. mining industry is starting to catch up.
You may not know what rare earth metals are, but they probably feature prominently in your life: These 17 chemical elements, which are buried in the Earth’s crust, are found in common electronics (lithium-ion batteries, laser pointers), and many clean technologies (electric car motors, solar panels, wind turbines). It’s not surprising, then, to learn that our demand for dysprosium, neodymium, terbium, and the like have increased in recent years. As it stands, the Western hemisphere is almost entirely beholden to China for its supply of rare earths. And China is willing to play hardball with its mineral deposits, putting the U.S. in a dangerous position where a key part of our economy and society is controlled by a not altogether friendly country. But that may be about to change.
Rare earth metals, paradoxically, are actually not that rare at all-in fact, many rare earths are more common than gold. But up until now, the economic incentives to mine them just haven’t been there. Recently, however, China started to curb exports and raise prices of these previously cheap metals, realizing both that they need a large domestic supply and that much of the world is dependent on them. Outside of China, rare earth metals are seen in high concentrations in select sites in the U.S., Canada, Australia, and elsewhere. And that’s creating a burgeoning rare earth industry in the U.S.
In the 1960s and 1970s, the USGS flew over the U.S., using airborne magnetometers to find anomalies in the Earth’s magnetic field that could signify big rare earth deposits. In recent years, mining companies have taken it upon themselves to confirm the presence of these deposits. They use everything from satellite technology to “almost old-fashioned prospecting. They go out in the field looking for interesting rocks and minerals, and indications of spots of interest,” says Gareth Hatch, Founding Principal of Technology Metals Research.
There are hurdles for ambitious companies to jump through. The U.S. used to produce rare earth metals at the Mountain Pass Mine in California, but it was shut down in 2002 largely because of lack of demand and environmental issues (the mine spilled a large amount of radioactive water into a neighboring lake). In 2008, Chevron sold the site to Molycorp, a company interested in reviving the old mine. Molycorp is currently expanding and modernizing the mine-a process that will yield 40,000 metric tons of rare earths by 2013, or 25% of the world’s supply.
The company, which is spending $2.4 million a year on environmental compliance and monitoring, says it plans to keep the process as clean as possible. “If what they say is what they do, you’re looking at a much more environmentally friendly process than in China, with the recycling of water and reducing effluent into the environment,” says Hatch. “But at the end of the day, you’re still messing around with some pretty nasty chemicals, and you still have waste piles of rock and radioactive material.” Fast Company’s calls to Molycorp have not been returned.
In China, rare earth mines are often responsible for egregious environmental violations, including air pollution and the production of wastewater that contains large amounts of radioactive material and acid. The pollution makes people sick, and it destroys local farmland and waterways.
California’s Mountain Pass is huge, but it isn’t enough to supply all of America’s rare earth metals. This is partially because it will produce mainly light rare earths instead of heavy rare earths, a group of chemicals that are often found in smaller concentrations. We need both types to manufacture the electronics and gadgets we enjoy so much.
There is hope for American independence in the heavy rare earth arena, however. The Pea Ridge iron mine in Missouri has a known deposit, and Quest Rare Minerals is exploring some major heavy rare earth mines in Quebec, a place that probably isn’t as likely as China to cut off the U.S. from imports or jack up prices impossibly high.
And the U.S. may soon have another major rare earth mine to count on in Nebraska, where Quantum Rare Earths is working on what may be the biggest untapped rare earths deposit in the world. But there’s a catch: Actually mining this deposit may not happen for a while. “It needs to be further explored and defined,” says Scott Wescott, a corporate communications representative for Quantum Rare Earths. That means it will take at least two to three years just to figure out the economics of mining and work on gathering permits for construction.
The permitting process is a major hurdle for U.S. companies. “The time it takes to get through the red tape is mind-boggling,” says Hatch. One DOE report claims that it will take 15 years to break dependence on Chinese rare earth metals (Hatch believes it’s more like eight to 10 years).
But we don’t necessarily have to wait for companies outside of China to get moving on their rare earth projects. In the meantime, it’s worth paying attention to companies like Nanosys, which manufactures more sustainable replacements for some of the rare earths found in LED backlighting.
Even with multiple mines and creative companies working on replacements, the U.S. will likely remain at least partially dependent on China for rare earths. It’s the classic problem of competing with China: Multiple layers of red tape may do some good in protecting the environment, but they really slow things down.
Ariel SchwartzTue Aug 16, 2011