Specialty Commodity Sector

por | Ago 4, 2016

specialtyMost of us are aware of the ubiquity of lithium batteries and rare earth magnets but many other applications for specialty industrial minerals and the rare or minor metals are not particularly obvious. And even the lithium batteries and rare earth magnets also contain a number of other metals and minerals that are critical to their function, but which are hardly ever mentioned in general conversation.

The markets for these minerals and metals are low in volume compared to the base and precious metals or the bulk industrial minerals but, per kilogram, their values are higher, in some cases much higher. However, except for cobalt and molybdenum, specialty markets are not transparent – trade is bilateral between seller and buyer, rather than through recognized exchanges, and actual transaction prices are rarely published.

Added to this lack of transparency is the rapidity of technological advances in the performance and reliability of products which use these specialty minerals and metals. To take the example of batteries again, manufacturers of electric cars and their suppliers have been working hard to improve performance, the mileage between charges and the speed of recharging. But rapid technological advances have sometimes resulted in the loss or diminution of a market which had seemed very promising. For example, nickel-metal-hydride batteries – which use light rare earths in the anode – were once expected to find steady consumer and industrial applications, but these have been largely overtaken by lithium-based batteries. Of course, keeping up with technology and the impact on demand is important in the bulk metals and industrial minerals sector, too, but the pace of technological change is not as challenging as for a prospective new entrant into one of the specialty markets.

The opportunity to make sense of the specialty commodity sector for clients, be they operators or investors, is why Micon is pleased to partner with Anzaplan GmbH in the establishment of our joint venture company, M.Plan International Limited.

The applications of specialty minerals and metals are all about performance, whether the application is in bio-ceramic hip joints, batteries for electric vehicles or energy efficient lighting systems. Because the amounts used per unit are quite small, cost is generally a secondary consideration after conformance to the end-user’s specifications, coupled with reliability of supply. But it is the geology and mineralogy of the raw material source that ultimately provide the consumer with a secure, consistent supply of a processed mineral or metal product to meet his specifications, hence M.Plan’s integrated suite of consulting services is designed to link the geology and mineralogy of a deposit with potential end use markets in the specialty sector.

Applications and Markets

So, as well as lithium and rare earths, what are these specialty minerals and metals and how are they used?

Among the minerals are graphite, high purity quartz, diatomite and high purity kaolin, and among the metals are lithium, silicon, tungsten, niobium, molybdenum, zirconium, tantalum, gallium and the rare earth elements. It is convenient to think in broad terms of non-metallurgical applications for specialty mineral products, which are valued in microelectronics, semiconductors, bio-ceramics, and optical and communication systems, and the applications for rare metals in renewable energy generation and storage components.

It must be borne in mind, however, that some minerals have specialty applications while also being the source of a rare or minor metal. For example, the lithium minerals, spodumene, petalite and lepidolite are used as specialty mineral concentrates, for their lithium content, in glass-ceramics, porcelain enamels and glazes. But they are also used as the feedstock for production of lithium carbonate or lithium hydroxide for batteries. Diatomite, on the other hand, is valued less for its silica content than for the structure and shape of the microscopic fossilized siliceous skeletons of diatoms which affect its filtration properties for edible oils, wines and beer, and in the pharmaceutical industry.

Applications for specialty metals are equally wide ranging: for silicon, they include wafers/semiconductor substrates and solar cells; rare earth elements are used in high intensity magnets and phosphors; tantalum and gallium are used in capacitors for smart phones and tablet PCs; indium and gallium compounds are used in light emitting diodes (LEDs); and a variety of rare metals are used in aerospace alloys.

Early Stage Testwork and Resource Estimation

It is because tolerances in the final product are often very fine – single silicon crystals for semiconductors are pure to nine nines – that the mineral raw material must be highly processed, and must be amenable to such processing. So testwork will focus as much on mineralogy as on assays for grade and impurities, even when required purity levels are more modest.

Processing testwork undertaken at an early stage in the exploration program for a specialty mineral or rare metal project is critical to the identification of one or more potential end markets. Information on potential markets obtained from testwork on surface trenching samples will then guide the design of the next phase of an exploration program, or determine the drill spacing needed for resource estimation when scout drilling has already been carried out.

Then, as exploration proceeds, the information on potential end-use markets can be integrated into the initial mineral resource estimate since it will provide the necessary support that the deposit is potentially economic at a suitable product price.

Integrated Approach to Project Development

While both Micon and Anzaplan will continue to offer their respective well-established services, the formation of M.Plan allows us to offer a fully integrated suite of services to the specialty commodity sector for project development studies and due diligence assessment.

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