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Saturday, July 19, 2014
Keep up with news http://www.proactiveinvestors.co.uk/LON:WLFE/Wolf-Minerals-Limited/ Encouraging article on new mine http://www.dailymail.co.uk/money/investing/article-3141720/MIDAS-SHARE-TIPS-UPDATE-Wolf-shares-bounce-tungsten-moves-closer-production.html http://www.iii.co.uk/investment/detail?code=cotn:WLFE.L&display=discussion http://wlf.live.irmau.com/IRM/Company/ShowPage.aspx/PDFs/1254-43222193/BreakawayResearchUpdate tungsten article http://www.forbes.com/sites/halahtouryalai/2012/04/02/a-rare-metal-youve-never-heard-of-is-on-a-tear/ Tuesday, July 15, 2014
FT
March 24, 2014 4:25 pm
Demand for tungsten shifts focus to Europe
Europe could be set to reduce its dependence on Chinese tungsten, a vital metal for many industrial applications, after higher prices and steady demand sparked renewed interest in mining closer to home.
Plans to open new mines or reopen abandoned ones are advancing and several companies look set to start tungsten production in the next three or four years. Ireland’s Ormonde Mining plans to reopen a mine in Spain to produce 2,270 tonnes of tungsten trioxide a year, and on Monday secured a buyer for 100 per cent of the mine’s output for five years.
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According to Ormonde, the project’s capital expenditure will be €48.5m and the mine will be profitable so long as the tungsten price continues to be sold for more than $129 per metric tonne unit, a level far below the current price of $367.50 per mtu.
Other companies could also go into production within the next few years. If that happens, it could potentially offer tungsten consumers in Europe and elsewhere greater protection against disrupted supplies.
Being able to secure tungsten, which is used for the tips of drill bits and metal cutters, is critical for many European industries. It is one of 14 raw materials identified by the European Commission as “critical” and subject to a higher risk of supply interruption.
China is the world’s largest consumer of tungsten and is also by far the world’s largest supplier, accounting for 85 per cent of production in 2013, according to US Geological Survey estimates. China restricts the export of tungsten concentrates, preferring to ship finished tungsten products, and is stockpiling reserves.
“A number of big producers are looking for security of supply,” says Michael Masterman, founder of W Resources a small UK-listed miner. “There is an acute shortage of reliable reserves in the west. There’s been a lot of interest from advanced economies.”
This renewed interest in mines which have been long abandoned as uneconomic has been sparked by the rising price of the dense metal, which is more than four and a half times higher than a decade ago. The EU is poised to introduce voluntary rules to prevent European tin, tantalum, tungsten and gold companies importing so-called conflict minerals.
W Resources started producing a small amount of tungsten trioxide from tailings, or waste mined material, in February at a Spanish mine that had been abandoned. The company intends to generate enough cash from the tailings to re-open the mine. “Tungsten mining projects have relatively low capital requirements . . . and [it is] a very high value product,” says Mr Masterman.
Wolf Minerals will reopen the first and largest of the upcoming European tungsten mines at a site in Hemerdon near Plymouth. It completed funding for the £123m project on Wednesday. According to the developer, it will be the UK’s first metal mine to open in 45 years and will produce 3,450 tonnes of tungsten trioxide a year for a decade from mid-2015. That is more tungsten than Austria, Canada and Russia each produced last year, according to US Geological Survey estimates.
Expected production in Europe will continue to be overshadowed by China, but new European mines will make a dent in China’s dominance. “China is just about maintaining – not growing – its production levels and Canada’s struggling,” says Mark Seddon, director at Tungsten Market Research. “Around 4,000 [extra] tonnes per year is needed [globally]. That’s one big project per year. In the last two or three years we’ve only had one project, Nui Phao in Vietnam, which isn’t actually at full production at the moment.”
Some tungsten buyers are offering finance for mining operations as part of so-called offtake agreements, where they agree to buy future production. The Nui Phao mine was part-financed in this way. W Resources is keen to secure similar agreements for its La Parilla mine and at another site in Régua in Portugal if drilling results are positive.
New tungsten supply in Europe may not mean that the price of tungsten will fall, however. China can still use its dominant position to determine prices. “The whole mechanism is out the window when you have the largest producer publishing guide prices,” says Lewis Black, chief executive of Almonty which produces tungsten at Los Santos in Spain. “It’s in nobody’s interest to see the price collapse – including China’s.”
http://www.ft.com/cms/s/0/314e8206-b049-11e3-8efc-00144feab7de.html?siteedition=uk#axzz386TLUV5p
http://www.theaureport.com/pub/na/mark-seddons-catch-22-we-need-more-tungsten-but-projects-cant-find-funding http://tungsteninvestingnews.com/ sponsored by some companies 1955 history of tumgsten use http://www.tungsten.com/Tungsten%20-%20The%20Story%20of%20an%20Indispensable%20Metal.pdf 2013 update on W https://media.argusmedia.com/~/media/Files/PDFs/Samples/WorldTungsten_201311.pdf Tungsten market set to undergo further changes to 2018 David Merriman – Roskill Senior Analyst Demand for tungsten filaments continues to fade. Global tungsten demand has increased on average by 2.7%py since 2008, although Roskill estimates this will slow to 2.6%py in the years to 2018 as its direct use in lighting applications diminishes. Representing 12% of total demand in 2013, tungsten used in lighting applications is forecast to decline by around 5%py in the years to 2018. The drop-off in demand is caused by the replacement of incandescent bulbs by fluorescent and LED bulbs in both industrial and domestic applications. On a positive note, however, these new lighting products require greater volumes of refractory tungsten alloys indirectly in their manufacture, boosting demand in the alloy sector. Tungsten consumption from other electronic and electrical applications, including electrical contacts, electron emitters and lead-in wires, is forecast to grow at 5.4%py through to 2018, more than double the overall trend. The resistance of tungsten to wear and corrosion and its ability to withstand arcing make it a suitable metal for use in contacts and voltage regulators. Demand from these applications however is minor in terms of volume, meaning by 2018 their share of demand would only be 2%. Hardmetal production in China will continue to drive demand growth Greater automotive production, particularly in North America, China and Europe, in addition to increasing demand in mining and wear resistant applications is forecast to increase demand for cemented carbide products by 3.6%py to 2018 and increase its share of overall tungsten demand to around 63%. Growth in tungsten demand will be led by the Asian market, particularly China which accounted for 48% of consumption in 2013. China is forecast to further increase its share of global tungsten demand to 52% by 2018, outpacing both European and North American demand growth. Recycling has reduced China’s influence in the export market Chinese production accounted for 80% of global mine production in 2013, falling from a peak of 84% in 2010. The main production centres in China are in Jiangxi and Hunan provinces, extracting both wolframite and scheelite bearing ores. China’s share of global production is expected to reduce going forward, although it is forecast to remain the dominant producer at 78% of global mine supply in 2018. Secondary production of tungsten has become an increasingly important source of tungsten for processors such as Plansee Group, H.C. Starck and the newly expanded Kennametal, as the technology and the capacity to recycle tungsten containing products have become more widespread. Europe and the USA are the main centres for tungsten recycling with approximately 45% of tungsten demand met by recycled materials in 2013. In Asia, Japan sourced around 20-30% of domestic tungsten demand from recycled material in 2013,
compared to approximately 15% in China. The rise in recycling outside China has
significantly reduced China’s influence on the global market and diminished the effects of its
export restrictions. Secondary tungsten formed 22% of global supply in 2014, and it is
forecast to increase to 26% by 2018, driven predominantly by more widespread recycling of
cemented carbide scrap in China.
Non-Chinese tungsten mine producers are forecast to become more significant suppliers
with a number of large-scale tungsten projects scheduled to begin production by 2018. Wolf
Minerals’ Hemerdon project in the UK is under construction, while Ormonde’s Barruecopardo
project in Spain and Thor Mining’s Molyhil project in Australia could also enter production
over the forecast period, with a combined capacity of 5,500tpy W. New producers would
increase supply diversity and volume, further reducing China’s dominance of mine output.
Roskill forecasts additional production from mines entering production post-2012, including
recently opened operations in Australia and Vietnam, could represent 9% of total tungsten
supply by 2018.
Mines currently on care and maintanence in Brazil and Peru Mines may also reenter.
The introduction of the Dodd-Frank act in the USA during 2010, along with EU Conflict
Minerals Regulation in 2014, has seen a shift in the flow of tungsten materials from central
Africa. Historically, the EU and USA had been significant markets for central African
sourced tungsten, with it forming around a quarter of exports in 2009. Exports to the USA
and EU in 2013, however, had fallen to around 1%, with Russia and China becoming the
largest markets.
After peaking in 2011 and spiking again in 2013, tungsten prices are forecast to fall
throughout 2014 and early 2015. Improving availability of raw materials from new mine
projects is increasing oversupply pressure in the market. As tungsten demand increases in
subsequent years, and with little new additional production expected to come online, the
market balance will be pushed closer to equilibrium towards 2018, potentially catalysing an
increase tungsten prices. In the meantime, focus may shift to the cost position and viability
of specific mining operations, including in China where lower costs have previously insulated
suppliers from lower prices.
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