Weekly Metals News Digest – June 24-28
Stellantis Plans to Become a Nickel Producer
Investment in Indonesian Nickel Production
European automobile giant Stellantis is negotiating with Brazilian corporation Vale and Chinese company Huayou Cobalt to invest in nickel production facilities in Indonesia. Vale plans to establish two metallurgical plants in partnership with Western car manufacturers, one with Ford and the other with Stellantis. These plants will use high-pressure acid leaching technology to process laterite ores with low nickel concentrations into pure metal. Huayou Cobalt will act as an investor in these projects.
Strategic Benefits
The collaboration offers significant benefits for all parties:
- Vale: Ensures sales of products from the new plants.
- Ford and Stellantis: Secure nickel supply for lithium-ion batteries used in electric cars.
- Huayou Cobalt: Strengthens its position in the global market.
- Indonesian Government: Reduces dependence on Chinese players and diversifies international cooperation through investments by Western automobile companies.
Long-Term Nickel Demand
Demand for pure nickel is expected to grow faster than for ferronickel and nickel pig iron, potentially driving up global nickel prices. Despite current low nickel prices at the London Metal Exchange due to increased Indonesian exports, future supply constraints could lead to a price rebound, benefiting key suppliers like Nornickel.
Heraeus Strengthens Iridium Market Position
Acquisition of McCol Metals
Germany's Heraeus Group has acquired McCol Metals, a Canadian company specializing in precious metals processing technologies. McCol Metals is known for developing technologies to recover iridium from various types of waste. Iridium, part of the platinum group metals, is used in electrochemical processes, including chlorine production, lithium-ion battery components, and water disinfection.
Strategic Fit
The acquisition aligns with Heraeus Group's strategy to enhance its precious metals recycling capabilities and reduce the carbon footprint of its products.
Russia Buys Aluminum from India
Aluminum Imports
For the first time since 2009, India has supplied Russia with nearly 49,000 tons of aluminum, valued at $16.8 million, or about $368 per ton, significantly lower than the current London Metal Exchange price of around $2,500 per ton. This aluminum could be of interest to Russian rolling or foundry enterprises.
Market Dynamics
Russian aluminum consumers are typically dependent on Rusal, a primary metal producer, and smaller secondary smelters. Occasionally, these consumers purchase aluminum from outside Russia, as seen in 2017 when Rusal bought 18,000 tons of metal from Kazakhstan's Eurasian Resources Group.
Lynas Rare Earths Aims to Weaken China's Market Dominance
Expansion of Rare Earth Product Line
Australia's Lynas Rare Earths plans to expand its product line at its Malaysian plant next year as part of a modernization program. Currently producing concentrates of samarium, europium, gadolinium, and holmium, Lynas will add dysprosium and terbium, which are currently sold as oxide mixtures to Chinese customers. The raw material comes from the Australian Mount Weld deposit, known for its high rare earth content and large reserves.
U.S. Plant Development
Lynas is also preparing to build a new plant in the U.S. to extract rare earth metals from third-party raw materials. These initiatives aim to reduce China's dominant position in the global rare earth metals market.
VSMPO-AVISMA Launches New Titanium Complex
New Forging Complex
VSMPO-AVISMA Corporation has launched a new forging complex for titanium semi-finished products with a force of 4,000 tons. The complex will produce slabs and bars for the automotive, aerospace, shipbuilding, and medical industries. This project, started in 2019, involved a $30 million capital investment.
Market Adjustments
Despite the termination of cooperation with Boeing and Airbus, VSMPO-AVISMA has shifted its focus to the domestic market and potentially increased sales to Asian countries, particularly China. The company also plans to build a complex for titanium alloy long products, with construction starting in 2025 and completion expected in 2028.
Forecast: Rare Earth Market Redistribution
Global Market Trends
Rare earth metals are critical for manufacturing magnets used in smartphones, household appliances, wind turbines, electric vehicles, and defense systems. In 2023, increased exports from China led to a decline in rare earth prices, a trend that continues.
New Developments
Projects aimed at developing rare earth deposits and processing ores are underway, driven by the desire to reduce China's market dominance. Companies like Lynas Rare Earths and Rare Earths Norway are leading these efforts. The upcoming years may see new rare earth production plants in North America, Australia, and Europe, leading to a significant redistribution of the global market.
