Weekly Metals News Digest – June 10-14
Albemarle's Efforts to Strengthen U.S. Lithium Sovereignty
Kings Mountain Lithium Mine Project
Albemarle Corporation held public hearings on the Kings Mountain lithium mine project, located at one of the largest pegmatite deposits in the United States. The project aims to produce approximately 420,000 tons of spodumene concentrate annually. The initiative includes utilizing a former mica mine for waste storage and selling feldspar and quartz pieces as construction material.
U.S. Lithium Supply and Government Support
Currently, the U.S. contributes less than 2% of the global lithium supply. The Kings Mountain mine is expected to significantly boost this percentage. To support Albemarle, the U.S. Department of Energy awarded a $150 million grant in 2022, followed by a $90 million grant from the Department of Defense in 2023. Despite being the world's largest lithium producer, Albemarle faced a 47% revenue drop in Q1 2024, reducing its net profit to $2.4 million.
Rusal's Contradictory Plans Amid Financial Instability
New Aluminum Foil Plant
Rusal plans to invest over $300 million to build a new aluminum foil plant in Russia, adjacent to the existing Sayanal foil rolling plant. This decision comes despite Rusal's unstable financial situation, with a 12.6% revenue drop to $12.2 billion and a net profit decline to $282 million in 2023 due to falling global aluminum prices.
Financial Strategies
To manage its financial strain, Rusal is likely to forgo dividend payments to shareholders, redirecting funds to repay its growing debt. Recently, Rusal secured a $450 million loan from Gazprombank for the environmental modernization of the Bratsk and Krasnoyarsk aluminum smelters.
Sohar Aluminium's Integrated Aluminum Cluster Project
Feasibility Study and Collaboration
Oman's Sohar Aluminium has launched a project to create an integrated aluminum cluster. Experts from the Public Authority for Special Economic Zones and Free Zones and other organizations met with Sohar Aluminium's management to discuss key issues and visit production facilities.
Production Capabilities and Future Plans
Sohar Aluminium, Oman's sole primary aluminum producer, has an annual capacity of 395,000 tons. It also owns a 1,000 MW power plant and a terminal for transshipping alumina and loading aluminum. Recently, Sohar Aluminium signed a memorandum with Oman Aluminium Processing Industries to establish a clean aluminum production facility using renewable energy and scrap.
Freeport-McMoRan's New Technology to Boost Copper Production
Innovative Raw Material Processing
Freeport-McMoRan plans to increase copper production over the next five years using new technology that processes raw materials at its existing mines, avoiding significant capital investments in new facilities. This technology is expected to boost copper output by 90.7 thousand tons per year initially, with a total increase reaching 362.9 thousand tons in five years.
Technological Assumptions
While the specifics of the technology are undisclosed, it is likely related to extracting copper from mining and milling waste, potentially involving electric current and ion-exchange resins. There may also be the use of artificial intelligence to optimize raw material processing parameters.
Commerzbank's Outlook on Non-Ferrous Metal Prices
Limited Price Growth Potential
Commerzbank predicts that while non-ferrous metal prices may experience long-term growth due to global economic issues, the increase will not be active. Central banks of major countries might lower interest rates to counter inflation, potentially influencing metal prices.
Positive Aluminum and Nickel Forecasts
Commerzbank is optimistic about aluminum prices, anticipating a rise from the current $2.5 thousand per ton to $2.8 thousand by the end of 2024. Sanctions against Russia, a major aluminum supplier to Europe, and limited export increases from China contribute to this outlook. Similarly, Commerzbank and Macquarie Bank forecast stable or rising nickel prices, expecting them to stabilize around $20,000 per ton this year. Factors include reduced nickel mining permits in Indonesia and increased demand for stainless steel production.
