MMTA International Minor Metals Conference 2023 Report

25-26 April 2023 Charlotte, NC, USA

 

Day 1 – Tuesday, April 25

For delegates who had neither played golf at the Bermuda Run Country Club (kindly sponsored by ICD Alloys & Metals, LLC and ICD Europe Ltd) on the Sunday, nor, following the association’s AGM, enjoyed the delicious food and drink at the welcoming reception on the hotel roof on Monday evening (kindly sponsored by CCMA LLC), the conference kicked off first thing on Tuesday morning.

Rachel Carnac’s opening remarks and a kind, warm, welcome, acknowledgements were followed by thanks from the MMTA’s newly elected chair, Stephen Hall of Advanced Alloy Services Ltd.—both of whom reminded us that this was the MMTA’s fiftieth year (and there were baseball hats on the table in the lobby with which to celebrate the fact).
Session 1: Global outlook and metal supply chains was opened by Ed Meir, President and Senior Commodity Analyst of Marex here in the USA.

In The global macro-economic outlook and impact on metals markets and supply chains Ed noted that we are, now, finally seeing some convergence between base and minor metals. But, in base metals, production w s very strained. Problems with reshoring continue, and base metals’ inventories are very low. When looking at EVs, the issue is: What happens when the deadlines come around and the car companies don’t see the demand materialising to the scale that is expected? And, in the USA in particular: Where will all the battery inputs come from? With supply constraints out there, Ed sees there being a “ferocious” response to try to change battery technology and find substitute materials. Ed sees the USA versus China as being the biggest headwind as they move away from each other, politically and economically. The USA needs to work with Chi-na and reach a kind of détente, he suggested.

In 2023 he sees an upside for copper and nickel prices with-in $7,800-9,600/t and $21,700-29,000/t ranges respectively, and other exchange-traded base metals stable, e.g. $2,200-2,800/t for aluminium and $2,500-3,200 for zinc.

Ed was followed by Dan Pickard, Elected Chair of the Indus-try Trade Advisory Committee on Critical Minerals and Non-ferrous metals who shared with us his thoughts on The im-pact of geopolitics on critical minerals supply chains and its effect on energy security. Dan emphasised the need to fully understand the important dictum that “personnel are policy”. Then, in a juxtaposition of the Trump and Biden administrations, he took us through the different players in the trade “space” and showed the important differences in their approaches and focus: a pro-domestic industry stance in Trump’s case and a pro-“worker centric”, environment and labour one in Biden’s. He then walked us through the importance of Section 301 of the Trade Act and, essentially, the views shared by both administrations of it, the WTO and, debatably, also free trade agreements. 

When it comes to critical minerals, the current administration issued their first Executive Order (14017) in February ’21 on America’s supply chains, amongst other things, identifying the need for investment and designating the DoD as the lead agency. Probably of more consequence, has been the use of the Defense Production Act and the significant funding it has made available for critical mineral issues. There remains, too, an insistence on the need to diversify supply chains. The line taken by the Biden administration, however is not decoupling from China or trying to prevent the rise of China, but taking actions in the interest of national security and human rights e.g. over the use of forced labour.

Supply chains remain the strongest concern for the Commerce Department. In June ‘22 the US government allowed solar cells from Vietnam, Malaysia, Cambodia and Thailand to enter the US for 2 years without paying antidumping and countervailing duties, despite ongoing circumvention inquiries into these products – in response to concern about availability of solar cells.

The US has signed an agreement with Japan on strengthening critical minerals supply chains, especially for EV batteries. In the midst of negotiations with the EU, Europeans are clear that this agreement should contain at least all the provisions of the Japan agreement. More agreements were expected including with the UK—and indeed a US-UK framework agreement on critical raw materials followed.

Going forward, we are going to see a continuing protection of domestic industries by the current administration, Dan said. The worker-centric trade policy is not going to change.

 

After a restorative coffee (or cup of tea) kindly sponsored by Exotech, the day’s second session—Developments in key metal markets—kicked off with Chris Gnan, Vice President, Sales & Marketing at Climax Molybdenum, with a Molybdenum market update: toward a sustainable world. To set the scene, Chris took us through four market themes: 1) “Supply/Demand”: we are seeing constricted Western supply, but continuing buoyant demand; 2) “Energy: Challenge & Opportunity”: with geopolitical upheaval and sustainability driving the push to renewables and more efficiency; 3) “China”: where there is a drive to self-sufficiency and massive infrastructure projects and there are net moly imports; and, 4) “Moly’s More Critical”: it’s a driver of sustainable development, promoting long-life, low-lifecycle-cost projects and goods, clean energy. In addition, however, defence is foremost in age of uncertainty.

With demand in the next 20 years projected to grow at  3.3% a year on average, molybdenum is set to be in deficit in five years’ time, New mines are projected to make 20mlb of moly a year; but at this growth rate, one of these is needed each year for supply and demand to stay balanced, while grades at older mines continue to decline.

At a higher molybdenum price, many copper miners would have tried to recover more moly in their ore – but this is borrowing from the future, Chris said. We need substantial investment in copper mining to put it back into balance, and sustained prices of $15/lb to finance new molybdenum mines, he added.

Among growth drivers Chris set out were not only the part moly can play as critical to “green electrons”—renewable energy (wind, solar, etc.) and “green molecules”— biofuels and hydrogen, but also its role in geothermal energy production. Two other areas were also particularly interesting: the potential use of moly in therapeutics and its use in “new powerful semiconductors.” He ended on a very optimistic note with the statement that “Molybdenum will power the future.”

 

From moly we moved on to tantalum with a presentation from Andrew O’Donovan, CEO, Global Advanced Metals entitled Tantalum: Stable, Sustainable, Superior. The central message was that we are now seeing a “new era in reliable and sustainable tantalum supply”. Andrew described to us the current market drivers, including AI, advanced driver assistance systems (ADAS) and data/5G and some of the directions in which he sees tantalum use (and growth) headed, for example, additive manufacturing and medical devices.

In contrast with a number of other minor metals, however, while tantalum demand is growing, so, too, is supply—and it is diversifying. After a number of years of stasis, it appears that supply is now transitioning. As Andrew described it to us, as a lithium co-product and with a rebalancing in geographic origin, tantalum supply is now stable. Nearly half of primary supply is now lithium co-product, while at least 25% of tantalum supply comes from recycling. From 2010 mining had shifted from primary mining in Western Australia to 50% to 60% artisanal mining, mostly in the DRC. It is now shifting again — by 2025 about 50% of tantalum produced will be lithium co-product, outpacing artisanal mining, while under 20% will come from WA primary tantalum mines.

Because of recycling and as a co-product, tantalum is sustainable, Andrew said. And, finally, it is “traceable” because of “the most mature of all conflict mineral programmes”. Altogether, a very encouraging narrative—for a change!

 

Stephen Hall, md of Advanced Alloy Services, in his presentation The Development of Superalloys and use of Critical Metals, took a refreshingly new approach to his subject.

Stephen educated us by taking us through the history of the jet engine, the brainchild of the amazing Frank Whittle, from his first patent, filed on 16 January, 1930 to the present day. This showed how, over the years, the rise in turbine input temperatures has driven the development of the ever-increasingly complex superalloys used in turbine blades.

In the past 60 years, here has been a 700°C increase  in temperatures that superalloys can withstand. Compared with NiMoNic80 of the 1940s, which could handle up to 815°C  through additions of metals such as titanium and chromium, development of titanium aluminides , and single crystal alloys such as  CMSX-10 that feature rhenium, tantalum, moly, higher cobalt, we have progressed to nickel alloys that are able to perform at around 1300°C.

Perhaps one of the most important of the 10 key points and conclusions with which Stephen provided us at the end of his presentation was the urgent demand for better recycling and improved recovery of minor (almost universally “critical”) metals from superalloys and other streams. And that, when it comes to environmental concerns, this should, in many cases, be quicker and easier than mining.

 

The final presentation before lunch came from Andrew Matheson, President of OnG Commodities LLC here in the USA. Andrew took us through Hafnium: on loan from the nuclear industry, starting with the “basics” : where  it comes from and why we have it—essentially because the zirconium fuel rods used in nuclear power generation need to be “de-hafniated.” Post-Fukushima disaster, the realisation that zirconium is not an ideal fuel rod material can lead to it being phased as next generation small modular reactors replace older ones. No nuclear zirconium means no hafnium supply.

Hafnium is used, amongst other things, in superalloys, plasma cutting inserts, rocket nozzles, semiconductors, optical coatings, thermal barrier coatings and catalysts, The semiconductor industry, that began to use  hafnium in high-k dielectrics for memory devices, disrupted demand in the past 18 months, Hafnium prices have risen “to the point that producers are (reported to be) doing unusual things”, Andrew said. While “short term outlook is positive”, long term, it is “decidedly negative given current supply chain.” This means that hafnium users will need “to look hard at their supply chain and start to think about alternatives.” Alternatives are easier to find for catalysts, thermobaric coatings that use hafnium or plasma cutting, but is harder in superalloys (although on the fringes of the conference, the MMTA was told reliably that Rolls-Royce is shifting to a hafnium-free superalloy for its turbines). It is hardest of all now to design hafnium out of semiconductors, Andrew said.

 

 

After an excellent buffet lunch, in Session 3, there was lively debate in a Panel discussion: evolving minor metal sectors and key issues. From the UK, there was Dan Bowman, Director, Avon Specialty Metals. And, from the USA: Melvin Hill, Business Manager at Rare Earths, GE Chaplin; Joel Nields, Director Sales, Exotech; Brian O’Neil, Business Unit Manager Indium, AIM; and, John Porter, Vice President, CCMA LLC.

 

Following briefings on what is happening with various of their metals—hafnium & rhenium, rare earths, tantalum & niobium, indium and cobalt & moly respectively—in terms of projects, developing applications, supply etc., the panel fielded questions from the audience. These included ones around: the effects of higher interest rates on business; recycling; the often-blinkered approaches of OEMs to developments in other industries; demand; the categorization of metals as “critical”; the need for education; EU strategies; and, supply constraints on de-carbonisation efforts.

Before dispersing for an early dinner (or not!), at the deliciously early hour of three thirty, UK’s Advanced Alloys kindly hosted a tasting of famous North Carolina ale and snacks in the hotel’s garden. If the expressions of concern were anything to go by when the event was drawn to a close, everybody had a fine time.

 

Day 2 – Wednesday, April 26

The conferences Session 4—Transport markets and minor metals—opened with Scott Yarham, Regional Pricing Director – Metals, EMEA at S&P Global Commodity Insights in the UK telling us about Battery markets and bottlenecks in the supply chain. In the context of electrification, Scott reviewed the changing uses of cobalt, lithium and nickel —especially in existing and emerging battery technologies — and their impact on demand and prices . He sees lithium in structural deficit, 200,000t short of the 2m t/yr expected demand in 2030, and cobalt shifting  from surplus into deficit by 2026. Nickel surplus is set to peak in 2024, turning to deficit. By early 2030s nickel consumption in EV batteries is set to more than double from 5% to 13.5% of supply. This is leading to a disconnect in the LME price dictated by stainless steel demand for nickel metal and the price of nickel sulphate required by the batteries market.. Scott addressed the critical issue of recycling, particularly of black mass¹, and explained that recycling alone will not fill supply gaps.

 

Hot on Scott’s heels was Nils Backeberg, Founder & Director, Project Blue in South Africa who provided us with insight into Aerospace and minor metals: the challenges and outlook for cobalt, scandium and titanium. Nils’ description of the aerospace industry as being “turbulent” came, perhaps, as no surprise. He then posed the question When will global air travel (and therefore aircraft maintenance) get back to “normal” levels? Using the metrics “Revenue Passenger Kilometres” (RPK) and “Firm Orders”, air travel is expected to be back to the long-term trend by 2024. Vis-à-vis the former, RPKs have ramped up as travel has increased from a slump in early 2020 amid global travel restrictions. As to firm orders for aircraft, with a near-term rapid rebound, orders and deliveries are already happening. Factors that are going to change the current landscape and material demand include: the quest for greater sustainability (SAF² etc.); policy changes on carbon emissions (short haul vs. long haul) and new technologies (e.g. around electrification of air travel). 

 

Taking us up to coffee (again kindly sponsored by Exotech), was Robert Burrell, Anode & Cathode Analyst with Benchmark Materials in the UK with his presentation Solid state batteries –the how, why and where. Robert explained that, while “lithium ion batteries are moving from start up to scale up”, battery end-users will have to keep reassessing the optimal technology selection for each application. The most important difference between the two types of battery is that, in solid state batteries (SSBs), graphite (the anode) is swapped for graphite-lithium or lithium and the separator and liquid electrolyte is swapped for solid electrolyte.

 

Drivers to SSB adoption include: improved energy density, higher levels of safety and faster charging. If the cost can be reduced, by next decade we could see SSBs used in mass scale EV production, which could lead to demand outpacing supply for their raw materials by 2035. Robert concluded by showing us the significant effect of scaling lithium metal anodes on raw materials: not only lithium, but also cobalt and nickel, with many more mines needed for every metal. 

 

The last speakers after coffee, and rounding off the conference with Session 5, entitled Innovation in minor metal markets, were Brian O’Neil, President, AIM in the USA and Paul Tancell, Executive Vice President, Performance Materials, 5N Plus of Canada speaking, respectively, about Indium: what a long, strange trip it’s been and Critical metals at the heart of modern technology. Brian provided a detailed rundown of indium demand, a market in which the majority of demand goes into flat panel displays. Whilst, in the near term, LCD (they have a significant scale/cost/yield advantage) are dominant, in the long term, OLED (organic light emitting diodes) will gain market share—they consume much less power—and this could lead to a potential cut in demand for indium. As for supply, however, it is, and has remained, in excess of around 100t/year since before the pandemic. Not least because of decreasing demand, significant recycling volumes and the continuing Fanya “overhang”. Could the new Zhonglianjin Exchange in China establish new “demand”, and will it be fundamental? Who knows? And, as for the indium price, it has been “adrift since Fanya”.

 

Finally, Paul took us through the reasons why some minerals are designated as “critical” and explained how, despite the the list of “Critical Minerals” having expanded over the years, only a small portion is considered very critical. In this context, he took us through two specific metals: tellurium and germanium. Looking, first, at which countries designated them as critical, he described supply, demand and application development dynamics, together with his “take-aways” for each metal. Of note for tellurium, was the fact that “the current rate of tellurium production is sufficient to support the medium term growth in downstream industries such as thin film photovoltaics. Paul questioned the US Geological Survey assessment of around 700t/yr of tellurium supply—5N Plus believes that there are  additional 400-600t/year of tellurium in the market, with some 20% of supply going into inventory to act as a buffer for the future. And, for germanium, in contrast “he concentration of both reserves and refining capacity is perceived to increase supply chain challenges.”

 

The MMTA and Metal Events would like to thank the sponsors and all the speakers who made this event such a resounding success. And for those registered conference delegates who have not yet done so, all the excellent presentations can be downloaded from the conference app.

Conference sponsors and organisers

Report by Tom Butcher with Polina Sparks