| February 22, 2010 London Metal Exchange Expands With Molybdenum, Cobalt Publisher: Bloomberg Author: Claudia Carpenter | |
| Feb. 22 (Bloomberg) -- The London Metal Exchange, the world's biggest metals market, began trading today in cobalt and molybdenum, commodities used in everything from jet engines to stainless steel. The 133-year-old exchange offered futures on the metals on its floor starting at 12:20 p.m. local time. Codelco, the world's second-largest molybdenum producer, wants to support the molybdenum contract, according to Gonzalo Cuadra, a Codelco managing director. The LME is expanding into so-called minor metals as it opens a first overseas office in Singapore and proposes a venture with the London-based Baltic Exchange to bring trading of freight derivatives onto a new exchange. The bourse handled $7.41 trillion of contracts last year, including 49.7 million in aluminum, 26.5 million in copper and about 30,000 in Mediterranean steel billet. Trading in the new contracts may exceed steel "because moly and cobalt have a history of volatility and they have a wide range of industrial applications," said Stephen English, marketing manager of SFP Metals (U.K.) Ltd. in London, who has traded cobalt for more than 30 years. LN Metals International Ltd. traded the first two metric tons of cobalt at $43,650 a ton ($19.80 a pound)[for Grade "B", 99.3% purity], Nigel Dentoom, chairman of the company, said at the LME. He declined to say if LN Metals was the buyer or seller. Molybdenum Traded Molybdenum traded earlier today at $35,000 a ton ($15.88 a pound), exchange spokesman Stephen White said. Total trading volume won't be available until tomorrow, he said. About five companies were involved in trading by midday today, said Chris Evans, head of business development at the LME. Cobalt prices dropped 2.4 percent to $19.52 a pound this year, according to Metal Bulletin. The benchmark molybdenum oxide contract quoted by Metal Bulletin climbed 43 percent to $17.25 a pound. The LME estimates both markets combined at about $7 billion, compared with $5 billion for tin, which the bourse already trades. "While we do not intend to utilize the molybdenum contract upon its launch, we will continue to monitor the activity on the exchange," said Bill Collier, a spokesman for Phoenix-based Freeport-McMoRan Copper & Gold Inc., the world's largest molybdenum producer. Production of molybdenum last year was about 440 million pounds (199,581 tons), while cobalt output was 54,000 tons, according to Eric Taarland, a senior consultant at London research company CRU. Output of both metals exceeded demand, according to CRU estimates. Molybdenum Demand Molybdenum demand has gained because of growth in stainless steel output, while cobalt consumption was driven by sales of rechargeable batteries, according to Taarland. There are 12 cobalt and molybdenum brands registered for delivery against the LME contracts, including Vale SA's Vale Inco unit and Molibdenos y Metales SA. The LME plans to combine its Mediterranean and Far East steel billet futures into a global contract. Volumes reached about 3.3 million metric tons of steel, worth $1.4 billion, since they were introduced in April 2008 to Feb. 12, according to the exchange. --Editors: Dan Weeks, Tony Barrett. | |
| January 12, 2010 Automakers plan for an electrified future, but plenty of hurdles remain Publisher: The Plain Dealer Author: Robert Schoenberger | |
| DETROIT -- The head of BYD Co.'s export division took the stage today at the North American International Auto Show and explained matter-of-factly how China's fourth-largest car company would become No. 1 globally by 2025: by building and selling lots of electric cars. "Electric vehicles have become a mainstream solution for mobility," Henry Li said. Like BYD, plenty of other car companies are also gearing up for an electrified future. But while electric vehicles show a lot of promise, there's a long way to go before they become widely available, affordable, reliable and able to meet consumer expectations. "Until the battery technologies get to the point where batteries are affordable, full-speed electrics are going to be expensive," said Curt Westlake, U.S. marketing director for Korea's CT&T, a company that hopes to sell low-speed electric vehicles in this country by the end of the year. Some of the world's largest car companies are promising electric vehicles and plug-in hybrids for sale within the next year or two. Still, many of the models on display today during a press preview of the Detroit show, which opens to the public Saturday, were either extremely expensive, highly impractical or both. Take the Tango, from Commuter Cars of Spokane, Wash. The two-passenger car looks something like a Chevrolet Aveo after an encounter with a trash compactor. Company founder and president Rick Woodbury said the plan is for consumers to buy the $150,000 car in three parts from different vendors and assemble it themselves -- a way to get around federal safety rules for cars. "It only takes a few hours," Woodbury said. "It's really easy." Myers Motors of Tallmadge, which is not represented at the Detroit show, makes a three-wheeled, single-seat electric vehicle called the NmG, for "no more gas." It plans to have a two-seat model, the DUO -- an acronym for Doesn't Use Oil -- on sale late this year for less than $30,000. The highest-profile electric is General Motors' Chevrolet Volt, a vehicle the company has promised will be available late this year for about $40,000, after a $7,500 federal tax credit. "We are doing a tremendous amount of preparation for this launch," Chevrolet General Manager Jim Campbell said in an interview. The Volt will be capable of driving 40 miles on electric power. When the battery runs low, a small gasoline engine will run the car's electric drive system and recharge the batteries. GM plans to produce about 25,000 Volts per year starting in 2011. Other more mainstream electric vehicles planned include Toyota's plug-in hybrids and battery-powered cars for 2012, and Ford's promised battery-powered Focus by 2012. Ford this week said it would spend $450 million to make battery packs in Michigan, a move that could bring 1,000 jobs to the United States from Mexico. But GM, Ford and Toyota are planning small production runs and limited sales efforts on their electric vehicles. The overwhelming majority of cars coming out of those companies for the next several years will be traditional gasoline-powered cars and trucks, said Erich Merkle, president of consulting firm Autoconomy.com. "They're testing the market," Merkle said. "You've got to have your foot in the water and be prepared for market-changing shifts. But they're not getting ready to shift large portions of their production capacity." Merkle said in the near term, expensive electric cars will appeal to niche customers -- tech fans who want to latest gadgets possible, environmentally minded shoppers willing to pay a huge premium to avoid emissions and commercial customers looking for low-speed vehicles to perform specific tasks. Companies are targeting more mainstream buyers, but Merkle said the prices are still too high to attract legions of buyers. Tesla Motors, the company that makes the $101,500 Roadster sports car, today showed off the latest version of its Model S, a family car it hopes to sell next year. After tax credits, the seven-seat Model S should cost just under $50,000 for the base model, about double the cost of the larger, gasoline-powered Chevrolet Traverse, also a seven-seater. CT&T's Westlake said commercial buyers have already turned to electric vehicles for many uses, such as moving people and equipment across large college campuses and theme parks. He said he believes there is a consumer market for low-speed, inexpensive electric cars, but he acknowledged that other electric car companies have yet to sell similar vehicles in large numbers. Still, there's BYD, the company that believes it will become No. 1 in China by 2015, mostly by selling more plug-in hybrids and electric cars. Li said that company has begun working with consultants to redesign its cars for more-stringent U.S. safety requirements, and he believes the products will be on sale here late this year. "We will be in this market with electric vehicles," Li said. BYD made similar statements last year and in 2008. -END- | |
| January 08, 2010 Cobalt hits highest for 14 months on new year demand surge Publisher: MinorMetals.com Author: Editing by Mark Shaw | |
| London, 08 January 2010 - Cobalt prices climbed to their highest levels since November 2008 in Europe on Friday, with the first full week of 2010 witnessing an upsurge in demand from end-users, traders said. High-grade 99.8 percent metal was quoted at $22.00/23.00 per pound, while 99.3 percent Russian metal stood at $21.00/22.00, both up some $2.00 from prevailing levels at the turn of the year. "There does seem to be an upturn in enquiries at the moment," one trader said. End-users had flocked back to a market that is perennially tight of metal, others said, with many producers unable to offer metal until early in the second quarter. China's Jinchuan has also upped its offer price to $25.50 per pound [from] $23.50. "This market is tighter than salt supplies in West Berkshire... we are looking at a price of $25 next week," another trader said. The move was also exacerbated by some speculative interest ahead of next month's futures contract debut on the LME. The LME will introduce its cobalt futures contract on February 22, just less than two months away. So far, the LME has approved brands from Vale Inco, Votorantim Metais Niquel, Sumitomo Metal Mining and Jinchuan Group for delivery against the contract. Prices are likely to advance further after the LME contract launch, traders said, because very little stock available will be available to be warranted in warehouses, resulting in the potential for technical tightness. "If you look at nickel, there are over 150,000 tonnes of stock, which would cost around $6.5 bullion to buy," the second trader said. "In cobalt, there won't be much more than 1,000 tonnes, which can be bought for $44 million - there are plenty of firms who could snap that up if they wanted to." | |
| December 11, 2009 How B.C. firm won 'greenest mine' rights Publisher: Globe and Mail Author: David Ebner | |
 To build a $140-million cobalt mine in a national forest in Idaho, tiny Vancouver junior miner Formation Metals Inc. (FCO-T2.16-0.03-1.37%) turned to the state's chief rainmaker, Cecil Andrus. Mr. Andrus was Idaho's longest-serving governor, a Democrat who was elected four times. Between two stays at the governor's mansion in Boise he was part of President Jimmy Carter's cabinet as secretary of the interior. During his years in office, Mr. Andrus was known for his environmental passion, and opposition to a proposed mine in the state helped get him elected in 1970 to his first term as governor. He was exactly the man needed by Formation Metals to help open an underground mine in a national forest in federally protected mountainous wilderness. The company wanted to unearth a metal used in turbines for jet engines and batteries, where demand could spike as electric cars become more common. It would be the only cobalt-focused mine in the United States. Now Formation Metals has cleared a major hurdle by passing a nearly decade-long environmental assessment completed by the U.S. government, which this week approved the company's plan of operation. Clearing trees from the site is set to begin in January and work on the main facilities is scheduled for spring, with the mine to open in 2011. The little-known Vancouver upstart had staked a cobalt claim on public land in the mid-1990s in Salmon-Challis National Forest. In 2001, the long process to obtain the required permits began. Though there had been mining in the region in the past, Formation Metals was still fighting through the paperwork in 2007, six years after it started, when chief executive officer Mari-Ann Green convinced Mr. Andrus that the cobalt mine made sense, environmentally and economically. Mr. Andrus, who joined the company's board of directors, went to work, trumpeting the merits of the mine to officials in Idaho, and especially at the Department of Agriculture in Washington, of which the Forest Service first reference is a part. "When you're dealing with the bureaucracy, it always helps to talk to the heads of the various departments, so they understand what you're trying to do," Mr. Andrus, 78, said in an interview from Boise Thursday. "It's easier to do that face to face, eyeball to eyeball, rather than in e-mails that go unread." Before the mine can be built, Formation Metals needs to close deals for debt and equity to finance the project; it officially began that process in November and hopes to conclude before year's end. The company has periodically raised chunks of cash in its two-decade history, including $20-million in 2007 and $9-million this year. The TSX-listed company has already sunk $50-million into the cobalt project and owns a metals refinery in Idaho. "There were some very hard days," Ms. Green said an interview Thursday. "We've gone without paycheques from time to time. When we set out, we set out to find our shareholders a mine and we've done that and we're going to bring that to fruition. We staked the mine at a time people weren't really looking for cobalt. It was difficult to raise money for it. Now everybody's talking rare-earth minerals and lithium and cobalt." Ms. Green was educated far from the mining business. She has a bachelor's degree in education from the University of Manitoba and worked as a school principal in that province, British Columbia and Alberta before moving to Calgary in the early 1980s to join the corporate world. She was hired in a do-everything role at small junior energy company and learned on the job. "I had an entrepreneurial streak," she said. In 1988, she and a trio of geoscientists started Formation Metals, which now has about 50 employees. Ms. Green met Mr. Andrus several years ago and sold the green politician on a mine that would bring jobs without destroying the land. Mr. Andrus was eventually convinced and in turn quelled opposition among environmentalists in the state with the promise of the "greenest mine in America." "He's a statesman," Ms. Green said. "He really helped us." The Idaho Conservation League last year withdrew a threat of a court challenge when Formation Metals said it would put up $30-million in reclamation bonds and spend $150,000 annually on watershed projects when the mine operates. The cobalt mine could product 1,525 tonnes of the high-purity metal annually for at least a decade, the company has said. The volume is about 3 per cent of global production and would be enough to supply more than 10 per cent of the demand in North America. The U.S. is the biggest user of cobalt. Cobalt reserves are most prevalent in Democratic Republic of the Congo and selling is dominated by mining giants Xstrata PLC and Glencore International. The U.S. wants to wean itself off foreign oil, but the same sentiment exists in cobalt, where the country is "captive" to Xstrata, Mr. Andrus said. Local politicians in the Lemhi County, home of the mine, have backed the project from the beginning. "It's good for the country, to produce something for a change," said Robert Cope, a county commissioner. "I'd like to see this country move away from a service-based economy back to manufacturing." | |
| November 03, 2009 Jinchuan raises cobalt prices by Rmb20,000/tonne Publisher: Metal-Pages | |
| BEIJING 03-Nov-09. Jinchuan Group, the number one cobalt metal producer in China, raised its website offer prices for cobalt metal yesterday, supported by the recent increase in overseas cobalt prices. The company is now quoting Rmb 370,000/tonne ($24.63/lb) for 99.8% cobalt metal, in comparison with its previous quotation of Rmb 350,000/tonne ($23.30/lb) which had been in place since 3 August 2009. The producer has also raised its offer price for the plate shaped cobalt to Rmb 368,500/tonne ($24.53/lb) from the previous Rmb 348,500/tonne ($23.20/lb) basis, also representing an increase of Rmb 20,000/tonne. Market sources reported that some Shanghai-based suppliers have already increased their offer prices for 99.8% cobalt metal to about Rmb 370/kg ($24.63/lb) recently, and players suggested that the rise in Jinchuan cobalt prices is likely to prompt a further increase in price from other domestic suppliers. -END- | |
| October 30, 2009 First Quantum must pay Congo $6 mln damages -court Publisher: Reuters Author: Joe Bavier | |
| * Court rules against First Quantum in contract dispute * Orders company to pay $6 million to Congolese defendants KINSHASA, Oct 30 (Reuters) - First Quantum Minerals (FM.TO) must pay Congo $6 million in damages over three failed lawsuits it filed against the government and state agencies after a mining project was cancelled, court documents showed on Friday. Democratic Republic of Congo cancelled the Canadian miner's $500 million Kingamyambo Musonoi Tailings (KMT) copper and cobalt project in August as part of a government review of 61 mining deals. On Aug. 26 and Sept. 3, KMT and Congo Minerals Development (CMD), a wholly owned subsidiary of First Quantum, filed three suits against Congo, state miner Gecamines and the mining regulatory agency, CAMI, in the country's highest civil court. In the decision, which was seen by Reuters on Friday, the court in Congo's capital, Kinshasa, upheld the government's cancellation of the project and ordered KMT and CMD to pay damages for filing the cases. "In consequence, (the court) orders each of the plaintiffs to pay the defendants the equivalant of $3 million in damages and interest," the decision, sent to Congo's President Joseph Kabila and Prime Minister Adolphe Muzito, read. KMT and CMD must also pay court costs, the decision added. Contacted by Reuters about the ruling, First Quantum's president Clive Newall declined to comment. But he said the company would release a statement on the matter. Earlier this month, First Quantum attempted to withdraw the suits and many analysts expect the company to move the dispute to a court of international arbitration to defend its investment. Under Congolese law, however, both the plaintiff and defendant must agree to drop a civil case and the government, CAMI, and Gecamines refused to withdraw from the legal action. First Quantum's KMT operation is so far the only major mining project to be cancelled by the review, set up to boost state revenues from deals signed mostly during the chaos of a 1998-2003 war and the transitional government that followed. Freeport-McMoRan's (FCX.N) giant Tenke Fungurume (TFM) mine, believed to hold the world's largest undeveloped copper and cobalt reserves, has so far failed to clear the review. Officials from the U.S.-based firm have continued to negotiate with the government, and a spokesperson for TFM said on Friday that the company was now waiting for a decision on the contract. -END- | |
| October 26, 2009 Congratulations to Winner of 8oz Silver! Author: Formation Capital Corporation | |
| Congratulations go out to Mr. Orval Barnes of Garibaldi Highlands, BC as the winner of 8oz of silver from Formation Capital's Sunshine Refinery. Mr. Barnes was in attendance at the "Money Talks All Star Trading Super Summit" at the Sheraton Vancouver Wall Center on October 24th where Formation Capital was an exhibitor. The Money Talks Trading Summit was hosted by Michael Campbell and featured expert speakers such as Victor Adair, Tyler Bollhorn, Jack Crooks, Dennis Gartman, Peter Grandich, Mark Leibovit, Steve Todd and Chris Lori. - END - | |
| October 23, 2009 Electric Cars Could Pose a Challenge to Rare Earth Supply in "Nightmare Scenario" Publisher: MetalMiner Author: Sturat Burns | |
| October 23rd, 2009 Dr Irving Mintzer principal of MEG LLC, an energy consulting firm, described a "nightmare scenario" at the Critical & Strategic Metals Summit in Washington DC this week. Driven not by cost advantage but by a combination of government incentives, legislation and taxation, Dr Mintzer painted a picture of a world in 2030 in which a third of the probable 72 million vehicles produced each year by that time are either fully electric or hybrid petrol/electric vehicles. Why is that a nightmare scenario you may ask? Surely that would be a quieter, cleaner altogether better world if the role of the internal combustion engine was reduced? Well indeed it would be a quieter, cleaner world, the nightmare element is the demand it would put on electric power generation and on production of certain key metals needed to make such vehicles. True 2030 is a quite a long way off. Twenty years is probably a reasonable timescale to design and build a smart grid capable of handling the power demands such a switch would make. It is also just about long enough to build the mix of nuclear and renewable energy sources that would be required to meet the power demands without increasing our carbon emission even more than they currently are. It would hopefully be long enough to improve renewable technologies sufficiently that they are economical without the subsidies they need now to achieve project funding. But metal demands look challenging; by Dr Mintzer's estimations at current Cobalt (Co) and Neodymium (Nd) content levels in a typical Lithium ion battery (everyone agrees there is enough Lithium, it's the minor metals needed for the cathodes and for the braking regeneration units that will be the challenge) it's hard to see where the metal will come from. In current cars some 5kgs of Co and 2 kgs of Nd are needed in every car. Even if improved technology reduced this to 0.5kgs of cobalt and 1 kg of Nd the world would need an additional 12,000 tons of cobalt and worse some 24,000 tons of Nd. According to an informative presentation given by David Weight of the Cobalt Development Institute, the world currently produces about 55,000 tons of cobalt and is broadly in supply/demand balance. Some 50% of supply comes from the politically unstable Democratic Republic of the Congo (DRC), the world's richest source of cobalt. The rest mostly comes as a by product of nickel and copper production and is hence somewhat price inelastic, meaning the primary economics of the mine are driven by nickel and copper demand not cobalt. Cobalt demand has risen at a steady 5.6% for the last ten years which if extrapolated forward would see demand in the region of 163,500 tons, before we add in additional demands for electric cars. Extrapolating figures back from a separate presentation given at the conference by Dudley Kingsnorth, Neodymium production is currently around 17,000 tons and typically represents about 16.3% of Rare Earth deposits. Pretty much all of it currently comes from China but several new potential mines were promoted at the conference, all looking for funding. In reality no more than two of these are likely to come to fruition with a probable production capacity of less than 30,000 tons, at the above Nd content guide that would yield just 5,000 tons of Nd, somewhat short of the additional 24,000 tons required. As Dudley Kingsnorth explained in a video interview on MetalMiner earlier today these Rare Earth mines and processing facilities take at least 10 years to go through environmental, feasibility and funding stages before a kg of metal is produced. In reality, Dr. Mintzer's scenario is unlikely to become reality but the above projections illustrate the dramatic effect a new technology can potentially have on metal demand when supply is finite. -- END - | |
| October 23, 2009 Growth in electric vehicle sector to boost demand for cobalt and neodymium Publisher: Metal-Pages.com | |
| WASHINGTON D.C. (Metal-Pages) 23-Oct-09. Demand for cobalt and neodymium is set to surge as automakers are expected to ramp up production of electric and hybrid vehicles, according to Dr Irving Mintzer, principal at Meg LLC. Based on a high demand scenario for vehicles powered by electric drive chains, Mintzer forecasted that additional demand for cobalt could double from current levels to 120,000 tonnes a year worldwide and 48,000 tonnes a year for neodymium by 2030. The rise in demand for cobalt will be twice the current overall rate of global production, he told the Managing Supply Chain Risks for Critical and Strategic Metals conference in Washington D.C. In the U.S. alone, Minzter forecasted that demand for cobalt could rise by an additional 25,000 tonnes a year and 10,000 tonnes for neodymium if demand for electric vehicles gathers pace in line with some analysts' projections. "Where in the world is the production going to increase rapidly enough to meet the additional levels in annual demand?" he said. "As we promote these technologies we need to think a little bit further ahead and look at what it means to lower dependence on imported oil from countries maybe considered unstable or unfriendly and increase our demand for these essential components." Under a low demand scenario for vehicles containing cobalt and neodymium components, Mintzer forecasted additional demand for cobalt to hit 12,000 tonnes a year and 24,000 tonnes a year for neodymium by 2030. The forecast comes as automakers produce more electric vehicles using materials such as samarium-cobalt and neodymium magnets for electric motors in hybrid cars such as the Toyota Prius, Honda Insight and Ford Foucs. Concerns over the dependence on foreign oil and environmental issues are expected to boost sales of hybrid and electric vehicles. With the U.S. government also now pledging funds to spur investment in cleaner and more efficient vehicles, cars containing electric drive chains could account for about one third of the U.S market by 2030, according to Mintzer. He also suggested that about one third of the 72 million vehicles sold worldwide could contain electric drive chains. Other industry participants believe the market penetration of electric and hybrid vehicles may be lower than some forecasts as the technology is slow to develop. Lux Resources has forecasted that electric and hybrid cars will only account for about 6 million vehicles of the total auto market by 2020. -END- | |
| October 08, 2009 Around 25 Congo mining deals risk cancellation Publisher: Reuters Author: Thomas Hubert | |
| * Projects at risk invole "second tier" assets * Tenke Fungurume negotiation deadline Oct. 12 KINSHASA, Oct 8 (Reuters) - Some 25 mining contracts in Congo involving "second tier" copper, diamond, and gold assets could be scrapped if companies fail to present the results of feasibility studies by a December dealine, the Ministry of Mines said on Thursday. "We will see if the studies were done. They will be able to present their reasons, and the cabinet will decide whether to extend (the deadline) or withdraw the permits. The goal is to have these assets in capable hands," Deputy Mines Minister Victor Kasongo told Reuters. Congo completed a review of 61 mining contracts in August as part of an effort to boost state revenues from agreements signed mostly during the chaos and corruption of a 1998-2003 war and the transitional government that followed. However, many companies that saw their partnerships approved by the review panel have yet to present required feasibility study results, Mines Minister Martin Kabwelulu told an investor conference in Kinshasa on Wednesday. "Certain partners started work without finalising their feasibility studies," he said. The companies were initially asked to present the results among documents submitted at the start of the long-delayed review process. But the government extended the deadline when it became clear that the majority of companies had not yet completed their studies. "Eleven companies were either in production or gave feasibility studies. The rest gave nothing. So far we've still received nothing, and we've asked," Kasongo said Thursday. He said around 25 projects in possession of what he described as "second tier assets" in the copper, diamond, and gold sectors were subject to the December deadline. He did not name the projects. Congo cancelled a copper and cobalt mining contract with Kingamyambo Musonoi Tailings, a unit of First Quantum (FM.TO) (FQM.L) in August on the grounds that it had failed to enter into commercial production within an agreed timeframe. Freeport McMoran (FCX.N) and Lundin Mining (LUN.TO), parnters in the giant Tenke Fungurume Mining copper and cobalt project, have been given until October 12 to complete negotiations with the government or risk losing their permit. But despite lingering doubts over the fate of the country's largest foreign-owned projects, analysts had expected completion of the review to boost investor confidence in Congo's high-risk but potentially lucrative mining sector. (Additional reporting by Joe Bavier in Lubumbashi, Congo; Editing by Richard Valdmanis). -END- | |
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