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What is Niobium
• Niobium (Nb) is a grey, rare and soft transition metal with a white lustre.
• Nb is most commonly found in the minerals pyrochlore and columbite, which also contains tantalum in various proportions.
• More than 90% of Nb is transformed in standard grade Ferro-Niobium (FeNb) by adding iron and aluminum. FeNb contains ~66% Nb.
• FeNb is an alloying agent, mainly used in the production of High-Strength Low-Alloy Steels (HSLA):
• Vehicles, Structural, Pipelines, Bridges, Long Products
• Using Niobium to enhance steel has many benefits: • Adds strength, Lightens weight, Improves flexibility/weldability, Increases durability, Reduces
costs
© MDN Inc
• USA • National Defense Stockpile (NDS).
• National Strategic and Critical Policy Act of 2011. Funding for studies on Nb resources.
• EU • Report on Critical raw materials for the EU.
Nb part of 20 critical materials.
Nb demand growth to 2020 identified at >8%/year.
• Republic of Korea • KORES Stockpile of 60 days of supply or 360t of
FeNb (worth ~$9.5M).
• Japan & China • Known warehouses to hold several tonnes.
For several countries, Niobium is a strategic metal because it is essential for high-performance applications. It is also a critical metal because it is at supply risk owing to the oligopoly nature of the Nb market.
American Resources Risk Pyramid
Critical assessments for the EU
Hyperlinks
Niobium a Critical & Strategic Metal
Niobium Products & Uses
Source: Roskill, Camet Metallurgy
Cutting tools Jet engines Particle accelerators MRI machine Well casing Optical Electronics Jewellery Chemicals
Other
Stainless steels
Pipeline steels
Structural steels Automotive
steels
1: Vacuum Grade
Nb Chemicals VG1 FeNb, NiNb
Nb Alloys Nb Metal
Standard FeNb
High strength steels accounts for about 90% of global niobium consumption.
Nb is used in nickel-, cobalt-, and iron-based superalloys for applications such as jet engine components, gas turbines and heat resisting equipment. Nb is also used for superconducting magnets found in magnetic resonance imaging as well as in nuclear particle accelerators.
Superalloys Superconductors Electronics
Pure Niobium Oxide Demand Drivers
R&D in high-tech industries
= Increase in niobium consumption
Niobium demand growth is mainly driven by two factors: i. Increase in global steel output and ii. Increase in the amount of niobium used in steel. Growth in each major niobium consuming segment obviously contribute to overall niobium demand.
Oil & Gas Pipeline Automotive Structural Stainless
Increase in steel quality
Increase in global steel output
= Increase in niobium consumption
+
Ferro-Niobium Demand Drivers
Company Headquarters Tonnage1 Company Headquarters Tonnage1
ArcelorMittal Luxembourg 96.1 U. S. Steel Corporation USA 20.4
Nippon Steel & Sumitomo Metal Corp.2
Japan 50.1 Nucor Corporation USA 20.2
Hebei Steel Group China 45.8 Tianjin Bohai Steel China 19.3
Baosteel Group 2 China 43.9 Gerdau Brazil 19.0
Wuhan Steel Group China 39.3 Maanshan Steel China 18.8
POSCO2 South Korea 38.4 Hyundai Steel South Korea 17.2
Shagang Group China 35.1 Benxi Steel China 16.8
Ansteel Group China 33.7 Evraz Group Russia 16.1
Shougang Group 2 China 31.5 ThyssenKrupp Germany 15.9
JFE 2 Japan 31.2 Severstal Russia 15.7
Tata Steel Group India 25.3 NLMK Russia 15.5
Shandong Steel Group China 22.8 Valin Group China 15.0
High-strength steels are manufactured by large steelmakers and therefore constitute major FeNb customers.
1: Million tonnes crude steel production 2013 2: Bought stake in CBMM in 2011 Source: Worldsteel Association
Top Steelmakers/Biggest End-Users
FeNb Apparent Consumption
0
10 000
20 000
30 000
40 000
50 000
60 000
70 000
80 000
90 000
100 000
0
200
400
600
800
1 000
1 200
1 400
1 600
1 800
2 000
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
ROW China FeNb
FeN
b C
on
sum
tion
(mt)
Cru
de
Ste
el O
utp
ut
(Mt)
FeNb demand growth picked up in 2014, with over 7% year-on-year growth. The demand almost reached the 2007 historic high of 84,000 t. Over the last 10 years it has grown on average by 6.2% per annum whereas steel output has grown on average by 4.7%.
Source: Worldsteel Association, Camet Metallurgy
FeNb CAGR 2001-2007: 15,7% 2008-2014: 0,3%
North America
South America
Europe & CIS
China
Japan
South Korea India
Africa & Middle East
North America
South America
Europe & CIS China
Japan
South Korea
India Africa &
Middle East
2014 FeNb Consumption
shares
2014 Crude steel output
shares
Global Picture
Source: Camet Metallurgy
0
25
50
75
100
125
Americas Europe Japan China Other Asia
The disparity in niobium usage between China and the Americas is well displayed here. Overall, Europe, USA and developing countries, in particular India, are offsetting China’s lower consumption.
FeN
b (
g /
t st
ee
l)
108
84 82
56
23
2014
FeNb Intensity of Usage
Source: Camet Metallurgy
• Prices are essentially determined by the market leader rather than purely driven by supply and demand.
• FeNb is sold directly to steelmakers, generally under one year term contracts. Prices are fixed for the year, bi-yearly or on a quarterly basis.
• There is a very small secondary market where trading firms usually sell on spot basis and where prices can increase up to 20% on smaller quantities.
• Quoted prices by major indexes are often based on trading transactions.
• FeNb is sold in USD, EURO and JPY and on the Nb content, on a delivered basis.
• USA imposes a 5% import duty on Brazilian FeNb.
The Ferro-Niobium market is an oligopoly controlled by the only three producing firms. The leader has about 85% of the market shares and sets the prices.
FeNb Pricing
$10
$15
$20
$25
$30
$35
$40
$45
$50
2007 2008 2009 2010 2011 2012 2013 2014
Source: MDIC, Camet Metallurgy
Overall, FeNb price were very stable over the last five years. If converted in local market currencies, the average price would be over the $40/kg mark. Market trends and sources indicate that price is heading north in medium term. However, steel profitability and niobium usage, in China, still need to improve to allow price increases.
USD
/kg
Nb
World Average Exports Price
Source: Companies’ websites
There are currently only three significant producers of Ferro-Niobium: the Brazilian companies CBMM and Anglo American, and Niobec in Canada. Artisanal small scale mining is also taking place, notably in Africa, but represent only about 1% of total output.
Company Resources Capacity 2015 Comments
440 M t @ 2.5%-3.0% Nb2O5 (weathered ore)
+700 M t @ 1.50% Nb2O5
(fresh ore)
~ 110,000 tpa FeNb • Expansion planned
for 2017: ~150,000 tpa FeNb.
636 Mt1 @ 0.42% Nb2O5
+84 Mt Inferred @ 0.31% Nb2O5
~ 8,300 tpa FeNb
• Bought by Magris Resources for $500mm.
• No expansion announced.
31.1 Mt @ 0.97% Nb2O5
+53 Mt Inferred @ 1.12% Nb2O5
+14.5 Mt Taillings @ 0.69% Nb2O5
~ 10,000 tpa FeNb • Just finished their
expansion.
1: From 2013 NI 43-101 technical report using block caving method
Producer Trio
0
25 000
50 000
75 000
100 000
125 000
150 000
175 000
200 000
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Catalao
Niobec
CBMM
Demand @ 8 % CAGR
Demand @ 5 % CAGR
Demand @ 3,5 % CAGR
Actual capacity
Source: Camet Metallurgy
FeNb market has always been in surplus with CBMM’s capacity to supply the entire demand. Worldwide inventory levels are generally fairly low. Camet reviewed its medium term demand growth downward due to China’s lower growth rate.
FeN
b (
t)
: Steel production growth
: Anticipated scenario
: Upside scenario supported by China
Actual Capacity
0
25 000
50 000
75 000
100 000
125 000
150 000
175 000
200 000
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Catalao
CBMM
Demand @ 8 % CAGR
Demand @ 5 % CAGR2
Demand @ 3,5 % CAGR
Brownfield expansions
Source: Camet Metallurgy
Brownfield expansions by the Brazilian producers will be more than sufficient to cover the increase in demand. The Catalao expansion was completed by the end of 2014. New projects are welcomed by end-users in order to broaden source of supply.
FeN
b (
t)
Expansions
Contact
1693 St-Patrick Street, Suite 106, Montreal (Quebec), Canada, H3K 3G9
Claude Dufresne President & CEO
Tel: (514) 866-6500 x 221
Cell: (514)-996-5728
developing two of the world’s most critical metals