»- - HF104O ..D46 no. 1980-3 c.2 ,Hilmy, Joseph. Minor non-fuel minerals : a prelimin3ry market r'eview/ HF 1040 .D46 no. 1980-3 c.2 SLC008722 DWC-8003 iVIU1I N UIIV' 11U1 iVIIIICIiUI* A "---I * - --LTA- -- T'- 1 - t-l--* -- A Preuminary iviarKe Review Joseph Hilmy, Kenji Takeuchi SSECTOROL LIRK FOR DEVLOPMENT RECONSTRUCTIO AND h\PR97 '989 Division Working Paper No. 1980.3 June 1980 (ommoditipe and Fvnrt Prni"tinnt Iivi-inn Economic Analysis and Projections Department Deveinnment Pnlirv Staff The World Bank Division Working Papers report on work in progress and are circulated for Bank staff use to stimulate discussion and comment. The views and interpretations in a Working Paper are those of the author(s) and may not be attributed to the World Bank or its affiliated organizations. 82C -O&OAC>r t 8 4 9 MINOR NON-FUEL MINERALS A PRELIMINARY MARKET REVIEW June 1980 Prepared by: Joseph-HiLmy, Miriarn Schneidman and Kenji Takeuchi Commodities and- pift Projections Division Economic Analysisa-aid Projections Department Development Policy Staff  TABLE OF CONTENTS Page No. I. OVERVIEW Introduction ...................................... 1 Main Findings ..................................... 3 Trends and Characteristics ........................ 6 Prospects ......................................... 14 II. TUNGSTEN Investment Opportunities .......................... 18 Tungsten Ores and Their Processing ................ 18 Intermediate and End Uses ......................... 19 Demand ............................................ 23 Supply ............................................ 26 US Strategic Stockpile ............................ 28 Trade ............................................. 28 Prices and Market Structure ...................... 31 Reserves and Future Supply Potential .............. 34 New Technology .................................... 34 Tungsten Mining Firms in the Developing World ..... 36 III. SILVER Investment Opportunities ......................... 38 Prospects in Summary .............................. 38 Trends in Demand ................................ 39 Trends in Supply .................................. 42 Trade ....................... ................ 46 Overall Supply/Demand Balance ................. 46 Prospects ................ ... 49 Industry Structure and Price Formation ............ 51 New Technology ................................ 53 Some Silver Mining Firms in the Developing World .. 54 IV. FLUORSPAR Investment Opportunities .......................... 56 Technical Characteristics ......................... 57 Consumption ............. . ...... ........... 58 Fluorspar in Steel-Making ......................... 58 Fluorspar in the Aluminum Industry ................ 61 Fluorspar in the Manufacturing of Chemicals ....... .62 Mine Production .................................. 63 Prices ................... ............. .......... 67 Some Fluorspar Firms in the Developing World ...... 67 ANNEX I: SUMMARY NOTES ON SELECTED NON-FUEL MINERALS ....... 70 ANNEX II: SELECTED MINERALS DATA -........................ 121 - ii - LIST OF TEXT TABLES Table No. Page No. 1. MINOR MINERALS 1 Summary Fact Sheet .................................. 2 2 The Estimated Value of World Production in 1976 ..... 7 3 Average Production Unit Values of Selected Minor Minerals in 1976 .................................... 8 4 Exports of Minor Minerals, 1975 ..................... 10 5 Principal Types of Chemical and Physical Minerals ... 11 6 Current World Production and Reserves ............... 13 II. TUNGSTEN 7 World Consumption of Tungsten Products by Intermediate and End Uses, 1974 .................................. 20 8 Consumption of Ores and Concentrates by Principal Counties ............................................ 24 9 Production of Ores and Concentrates ........ 27 10 Volume and Value of Exports of Ores and Concentrates * 29 11 Volume of Imports of Ores and Concentrates .......... 30 12 Tungsten Concentrate Prices ........ ..... 33 13 Estimated World Reserves, 1979 ...................... 35 III. SILVER 14 World Consumption by Country ........................ 41 15 World Production .................................... 43 16 Estimated World Reserves ................. ...... 44 17 World Exports ............................. 47 18 World Balance Sheet of Supply and Demand ............ 48 19 Hypothetical Estimates of World Silver Demand/Supply Under Stable Price Assumptions ....... ...... 49 20 Silver Prices ....................................... 52 iii - LIST OF TEXT TABLES (CONTINUED) Table No. Page No. IV. FLUORSPAR 21. World Consumption .................................... 59 22. World Production ..................................... 64 23. Estimated World Reserves, 1979 ....................... 66 24. Fluorspar Prices .................................... 68  MINOR NON-FUEL MINERALS A PRELIMINARY MARKET REVIEW I. OVERVIEW Introduction 1. The purpose of this paper is to present a preliminary assessment of the market prospects for selected groups of non-fuel minerals for project staff who may wish to take a harder look at investment opportunities in this group. 2. The paper covers only the following "minor" non-fuel minerals: (a) Nonmetallic Minerals (i) Physical minerals Asbestos, barite, vermiculite, industrial diamonds; (ii) Chemical minerals Boron, fluorospar; (b) Metallic Minerals (i) Ferrous and alloying metals Columbium, molybdenum, tantalum, tungsten, vanadium; (ii) Platinui group, rare earths, silicon, silver, titanium. The main characteristics of these minerals are summarized in Table 1. 3. These minerals were selected following a cursory examination of some 60 minerals in terms of their potential mining investment opportunities. The major considerations relevant to the selection process were: 幼 2 - Tahl, I: MNOR M~ S pACI SRE1 f- V-ld F-d-ti- uS Dr-rd G-- L~ ~ ~lux. 1976 A- 1 ~ ?kl. ýd U... P ... ihl- 8.b.IIIII. C.. P d-t -i. ý P-d- ~ I-~bl. Drb~bl. klil-) 19Yý76 1976-2000 ..-Lji- (C-~ ý --L.o WN ZIAT.LIC M~ 111 1 24, ~ re, chry-tile 3~il, 5.-ilxtd, ~ -, Chil. ~d-. 23% Frictim ~-. 14% R..ft.g p-d-i. 9% 127 3.3 -0.4 Ox:Sr 90, ,,, %rlnll', symb.u.. 3r-il, 2.-, Mra~., X.d(. jt i . .1 8 ~11 dtlIll.x -d. IN 1.3 1-1 Igry 32% sprh.,1.. 51~ L... ,,lp~ 211% Sh.pl., of pmd~. 10% vermiclittl- M .1 3.1 pl,.tyr- K-y., T_~1.1 Ars~ L- r_ 20% gs-g- 10% Gl-, prod=ta 50% ýÄey. Chil,, Pem '..p 2-;E- . 12% ChýI I de L-ti~ 10% 71~ p- x 434 4.3 4.9 steci indu.try 4n HY% C-b- ',liq.Ld i-,- Q-r.,,h ri-, Maxi-, ".y.. 3~ , TIl.II..d Ch -1. 32%, f. _Id.p. Ld-tri- 14% wrýlc mnmRAIS F-~ -d AII,i,ý C.I-bi- 50 8.6 5.9 A- -1.1. & .11". 1. f.bri-t.d di-, rir-i- Br-il. U£-, NL8.ý., Th.Il-d ft.ril. 36% rlltl- 11% x .11 z ... 17% Dy- ~pp-, r-plen. Chil., p- . r. 111 1.1 4.1 'r-- &.5t3-1 .b. r 4 By =i, appli-ii... -h!;._.14'1 ri- "% ii & 4.. 15% T..1.1- 4 48% Tt. , Thil-d, C-bid.. (1ý ~ 1 -rki.E -hil ... ... th Chmica I - El-~" --- _,nly CIP:ryi) 1'6% 70 3.5 4.6 "rtId11 1-thl- n ýlybdx-x -L.1y Lr..1f, 6.11.1., F- . Th.~ . llý , p- mi, 21% ..pp -Lybd.- t7:;i" 2l 2'2.-" ) 65 V-di- 141 1.2 C-t- , ..-i- ~~=~ 3ýhiý,ý & i,dutrial Iqll~t 10 ~1 wtkiýg mehillry 10% MtLwny K 162 2.3 2.6 F17e;et rdatt, 42% Mxl~~ gr.. b-exi.. By-lmdjsilver m Tu~ " ~ ."- (i-l.di,g batt~~) 24% Plarin= Grmp x 411 4.1 l.l 37% -ly b.- c- ..~r .1.1.1 M-d, -b- ~91t-, R,- E-th Oxid- x 20 4.1, 3.3 retral 1- 4 -lti-, fl-rid.. By-~. g-.1, r" Kxlly.i." tavt. M1~ 7. i ý rcel 381: Tllylto 38% P.,1.di- Egrp, Th C--ý & 91... 19% sill~. 1,629 3.0 2.9 Mx1. 3~11. Y,go,Lxxl., 1,~ Y1-d.7- ~ .11ý- .11ýy p,~«,.; B r~rt.ti- 37% ch -1 cal, 8% sil..t 1,321 -3 2,1 FI-x,.,hl, 11-, upp~..1- 1-d P... ullta, nil. , 1~1" 33% 25% Tit~. 50 3.5 4.3 fr-x., Ul~il t..1, By-,1. Indt., 5,1 111,= thmi-l, P..- S-~Clo, 20% st.Ii & rh,, .11,y. 20% P-b L11 9 Cý ý1 D.. r U-b- 1973. B---- 1979 ý1,~ Y 7,-d, -7,1 L-L 一 ｀唱 k。 - 3 - (a) the size of current world production; (b) the rate of world market growth; (c) the size of reserves in developing countries; (d) price trends; (e) transport cost constraint on exportability; (f) market structure; (g) by product, co-product relationships. 4. There are a large number of other minor minerals whose charac- teristics and prospects are nbt examined in this paper. However, compara- tive statistical data on these are shown in Annex II. Some of these are rather important in international trade (cobalt, chromite, gemstones, gold, mercury, magnesite). Also excluded are "major" non-fuel minerals that are regularlarly reported on through World Bank commodity staff studies. Main findings 5. Among the 17 minor non-fuel minerals covered in this report, tungsten, silver, and fluorspar seem to be the most attractive in terms of mining investment opportunities for the World Bank group. Their market prospects are examined in more detail as case studies. If the list of candidates is to be expanded columbium and molybdenum have particular potential. 6. Market prospects for tungsten are considered brighter than those for most minerals and metals. Successful substitution of tungsten by other materials in the past, particularly by molybdenum, has largely eliminated the use of tungsten in the applications where those tungsten substitutes offered technological and/or price advantages, and have therefore adversely affected the growth of tungsten demand. However potential technological substitution seems now to have been exhausted, and tungsten consumption today is already concentrated primarily in the uses where the unique properties of tungsten are essential to the final product it enters; hence consumption growth is expected to rise significantly higher than in the past. Prices have averaged about 7 % per annum in real terms since 1973 and are expected to remain at high levels. 7. Large proven reserves of tungsten exist in five developing countries; Mexico, Korea, Portugal and Rwanda. While one-half of current production is associated with other minerals, in these prospective develop- ing countries, tungsten is either the only or the main mineral in the ores. 8. Silver prices are expected to rise by 5% annually in real terms during the 1980s from the 1979 level. Not only is there no substitutes for silver in the main end uses (photography and electrical applications), but for geological factors, silver is one of the rarest minerals found in the earth. In the past supply from mine production and scrap has been running far behind industrial consumption and coinage-related demand, with the gap having been filled by releases from governments' stocks and private hoardings. Government stockpiles have been rapidly declining and are insig- nificant at present. The supply-demand gap has been widening recently and is expected to continue to worsen. 9. Two further factors contribute to silver's chronic scarcity. Unlike other minerals, supply from secondary sources does not necessarily increase when silver prices rise as the "silver" coins, the main potential source for reclaimed silver, continue to command a 'numismatic' premium over the value of its silver content. Furthermore, the demand for silver as a hedge against inflation is stimulated during times of the slowdown of - 5 - economic activities and thus compensate for the below-trend growth of silver industrial consumption. 10. Several developing countries are in a position to take advantage of silver's bright prospects. Bolivia, Chile, Mexico, Peru and Honduras have reserves deemed mineable at prevailing prices. 11. Fluorspar contributed over 250 million dollars to the export earnings of developing countries in 1978. Developing countries account for 70% of market economies' output of fluorspar, or slightly under 50% of world production. 12. Fluorspar is valued for its fluxing properties and is a major source of fluorine. It is an essential input in the steel and aluminum industries, and many chemical products. From 1960 to the mid-1970s, con- sumption of fluorspar increased by an average of over 5% per annum, but is pro- jected to rise in the 1980s at a very slightly lower rate than in the past. 13. Some factors would increase the demand for fluorspar in the future. These include the development of many new fluorine products, the expected growth in non-traditional fuels (mainly nuclear) in which fluorspar enters, and the need for a larger amount of fluorspar per ton of steel output as the impurities of iron ore used in steel making are expected to increase. 14. Such factors are likely to offset the adverse effects of develop- ments that were responsible for a fairly high rate of growth in fluorspar consumption in the past but are now coming to an end. In steel-making there seems to be only a limited scope for further shift from open hearth furnaces to electric furnace and basic oxygen processes which use twice as much fluorspar per ton of steel than open hearth processes. In the - 6 - aluminum industry, drier methods requiring less fluorine (derived from fluorspar) are increasingly adopted, and in-house recycling methods of fluorine have been improved substantially. Furthermore, environmental concern about the use of fluorspar derivatives in aerosol propellants, and the recent success in the technique of obtaining fluorine from fluosilicic acid (FSA), a byproduct recovered by the phosphoric acid industry, could slow down the growth in demand for fluorspar acids in the future. 15. Despite all this, however, the growth rate of demand for fluorspar, while likely to be below the historical rate, is expected to remain at a higher rate than those for most other minerals. Another factor which makes fluorspar mining still an attractive investment area is the existence of mineable proven reserves in many developing countries (notably Mexico, Kenya, Spain and Thailand). 16. Columbium and molybdenum may rank below the above three selected minerals. In columbiUM, 90% of world reserves are found in developing countries, consumption has been growing at 7-8% a year, and prices have been rising in real terms. Molybdenum consumption growth has been rather modest (2.5-3.0% per annum) but developing countries account for one-third of world reserves and prices have been rising in real terms. Trends and Characteristics 17. Historical data on world production, trade, consumption and prices of most "minor" minerals are incomplete and sorting them out would require considerable additional effort. This has constrained rigorous analysis. Data on the volume and value of world production in 1976 are shown in Table 2. The associated production unit values are shown in Table 3. - 7 - Table 2: MINOR MINERALS: THE ESTIMATED VALUE OF WORLD PRODUCTION IN 1976 Volume Value Mineral unit quantity (million US$) Nonmetallic Minerals Physical Minerals Asbestos '000 S.T. 5,566 1,149 Barite '000 S.T. 5,457 127 Industrial Diamonds million carats 29.5 106 Vermiculite '000 S.T. 566 Ia 26 Subtotal 1,408 Chemical Minerals Boron '000 S.T. 2,591 /b 384 Fluorspar '000 S.T. 5,088 484 Subtotal 868 Subtotal Nonmetallic Minerals 2.276 Metallic Minerals Ferrous and Alloying Metals Columbium '000 lb /c 19,648 /a 50 Molybdenum '000 lb /d 191,287 557 Tantalum '000 lb 77 855 /a,e 14 Tungsten '000 lb 77 89,843 570 Vanadium '000 lb /c 62,482 344 Subtotal 1,535 Nonferrous Metals Antimony S.T. /d 76,286 162 Platinum Group '000 troy oz. 6,003 456 Rare Earth Oxides '000 S.T. 24 If 28 Silicon '000 S.T. 2,432 1,629 Silver million troy oz. 305 1,326 Titanium S.T. g 9,095 ah 50 Subtotal 3.651 Subtotal Metallic Minerals 1 GRAND TOTAL 7,462 S.T. w short ton. /a Excludes centrally planned economies. b Excludes centrally planned economies except USSR. c Metal content. d Metal 7e Concentrates only. 7 Excludes US except California; concentrated ore production, value based on estimated average prices. Sponge metal. h Excludes US. Note: World production values are based on US production unit values and the world production volumes shown. US production volume and value figures for the various minerals were drawn from the Minerals Yearbook 1976 (Volume 1), published by the US Bureau of Mines. Unit values were derived from the above and applied to world production figures taken from Mineral Commodity Summaries 1978, also published by the US Bureau of Mines. For some of the minerals the average US producer price as stated in the individual commodity chapters in the Minerals Yearbook 1976 were used. Source: Mineral Commodity Summaries 1978, US Department of the Interior, Bureau of Mines; Mineral Yearbook 1976, Volume 1, US Department of the Interior, Bureau of Mines (Washington, D.C. 1978). - 8 - Table 3: AVERAGE PRODUCTION UNIT VALUES OF SELECTED MINOR MINERALS IN 1976 /a Mineral Unit Average Value (US$)--- Nonmetallic Minerals Physical Minerals Asbestos $/S.T. 206.37 Barite $/S.T. 23.26 Industrial Diamonds $/carat 3.58 Vermiculite $/S.T. 46.05 Chemical Minerals Boron $/S.T. 148.31 Fluorspar $/S.T. 95.08 Metallic Minerals Ferrous and Alloying Metals Columbium $/lb. 2.55 /b Molybdenum $/lb. 2.91 Tantalum $/lb. 16.00 /c Tungsten $/lb. 6.35 Vanadium $/lb. 5.51 Nonferrous Metals Antimony $/lb. 1.06 Platinum Group $/troy oz. 75.20 Rare Earth Oxides $/lb. 0.58 /d Silicon $/lb. 0.34 Silver $/troy oz. 4.35 Titanium $/lb. 2.72 /b,f S.T. = short ton. /a Average US producer price; see note on Table 2. 7b Average of a range of prices. 77 Ore. 7d Leached bastnaesite, price of contained REO. 7- Ferrosilicon, 50% silicon. 7? Domestic sponge. Source: Minerals Yearbook 1976, Volume 1, US Department of the Interior, Bureau of Mines. For industrial diamonds: Mineral Commodity Summaries 1978, US Department of the Interior, Bureau of Mines. - 9 - 18. The total value of world production in 1976 for the 17 minerals covered in this report is estimated at $7.5 billion. The value of exports for 1975 is estimated at $4.6 billion (Table 4). In terms of value, important metallic minerals are molybdenum, tungsten, platinum group, silver and silicon. 19. Nonmetallic Minerals. Nonmetallic minerals (or industrial minerals) are in some respects the forgotten segment of the mining industry. One reason for their relative obscurity is that it is a very diverse group in terms of location, production, technique, range of uses and value per unit weight. Also, the markets involved have been more stable, especially in prices, than those for metals and metallic minerals. 20. A useful way of classifying nonmetallic minerals is to classify them into two groups based on end-uses -- physical minerals and chemical minerals.X/ Physical minerals are those used without any chemical reaction or firing. Unlike chemical minerals, they are valuable for what they do, rather than for what they contain. A breakdown by main end-uses -- struc- tural, extender/filler, process aids -- is shown in Table 5. 21. There are only a few companies producing structural minerals (asbestos, vermiculite) because deposits are rare. The fillers and extenders have mainly a cost-reduction role, although they are sometimes used as valuable functional pigments, e.g. titanium dioxide. Elaborate processing is often necessary and adds much value to the final product; the number of grades produced is also very large. These products require 1/ This division is far from perfect, as some minerals are multipurpose. For example, gypsum and kaolin (not covered in this report) have both physical and chemical uses. - 10 - Table 4: EXPORTS OF MINOR MINERALS, 1975 (million US$) Centrally Developing Industrialized Planned World Countries/a Countries Economies Total Nonmetallic Minerals Asbestos 227 376 338 941 Falspar, Fluorspar,etc. 100 47 20 167 Industrial Diamonds 94 94 6 194 Sub-total 421 517 364 1,302 Metallic Minerals Molybdenum - 32 1 33 Ores & cons. of moly.,etc. 110 220 - 330 Ores & cons. of tungsten 93 45 20 158 Platinum 268 459 226 953 Silver, unwrought 724 917 92 1,733 Tantalum - 16 - 16 Tungsten 2 72 - 74 Sub-total 1,197 1,761 339 3,296 Total above 1,617 2,278 703 4,598 /a Includes Capital Surplus Oil Exporters. - = no exports Source: Annex II, Table 11.8 Table 5: PRINCIPAL TYPES OF CHEMICAL AND PHYSICAL MINERALS Chemical Ceramic Metallur- Raw Raw gical Structural Extender and Materials Materials Flupes Minerals Filler Pigments Process Aids Chemical Minerals Boron X X Fluorospar X X X Physical Minerals Asbestos X X Barite X X Industrial Diamonds X Vermiculite X Source: Annex II, Table 11.2 - 12 - high-technology and considerable research and management support. Process aids are used in industry as filter aids, absorbants, thickeners, and weighting agents; barite is used as a drilling mud. Except for industrial diamonds, synthetic abrasives have largely replaced natural products. Man- made diamonds are also gaining in market share. 22. Chemical minerals are used for what they contain, and are usually sold at specific compositions. They rarely appear in the end product in their original form, having been fired or chemically reacted in processing. Because chemical minerals are vital and are usually required in large volumes, many vertically integrated companies produce them for a "captive" market. Hence, it is a difficult business to enter the-market, except as part of an integrated complex. 23. Metallic Minerals. Data on production and reserves of metallic minerals are shown in Table 6. As with all "major" metallic minerals, adequate resources exist for the minor metallic minerals to satisfy expected growth at current uses foz some time. Developing countries are rarely predominant producers, and in some cases their share of the market has been falling. 24. Currently, only one-third of world exports (value) of minor metallic minerals is accounted for by developing countries. Developing countries are not an important source of world exports in any of these minerals. In 1975, developing countries' exports of these minerals amounted to $1.62 billion, or 35% of world exports; silver is by far the most important. - 13 - Table 6: METALLIC MINERALS: CURRENT WORLD PRODUCTION AND RESERVES /a Ratio of Annual Identified Reserves Present Re- Unit Production Perceived % Increase serves to Pro- (Col. A & B) 1974/75 Av. for 1975 over 1973 /b duction (B/A) (A) (B) (C) (D) Iron and Alloying Metals Minor Minerals "Vitamin" Minerals Columbium '000 lbs.metal 24,753 22,000,000 +94% 889 Molybdenum " 181,137 13,200,000 +40% 73 Tantalum " 1,100 110,000 +22% 100 Tungsten " 82,979 3,900,000 +42% 47 Vanadium " 45,749 21,400,000 +6% 468 Nonferrous Metals Minor Minerals "Vitamin" Minerals Platinum Group '000 troy oz.metal 5,775 561,000 -10% 97 Silver million troy oz. metal 291.35 6,100 +11% 21 /a This gives present US estimates for world production and identified reserves of the 21 metallic minerals. Column C illustrates the erratic but generally persistent in- crease in reserves. Column D, while providing a static view of the adequacy of pre- sently identified world reserves, is far less meaningful than any estimates to the year 2000 which take account of growing demand. /b Column C compares the estimates for identified reserves in 1975, from the source cited, with those for 1973 in the comparable publication two years previously (in some cases this.required reconciling different units). The increase reflects in part new dis- coveries in hitherto hypothetical resources; but, it should be recognized that, since the definition of reserves at any given time assumes the economic feasibility of their extraction at current prices, the prospect of higher prices alone will promote some identified but hitherto subeconomic resources into the status of reserves. Source: Annex II, Table 11.7 - 14 - 25. Marketing and Processing. With few exceptions (silver, platinum), organized commodity markets do not exist for the minor minerals. They are marketed either through specialized traders or through transnational companies which are often vertically integrated, in effect selling from one branch to another. This makes producer country involvement or entry very difficult. Given the narrowness of these markets, there is little likelihood for this pattern to change in the-foreseeable future. 26. There is increased awareness of the need to ensure that processing operations are shifted to the primary producing countries. The rationale is that local processing can generate employment, increase export earnings and government revenue and provide meaningful linkages between the mining sector and the rest of the economy. 27. The scale of operations in minor metallic minerals is typically small, so that, while there may be relatively little value to be gained by more processing, it would also require relatively small capital costs. Standard cost-benefit calculations have to be made on a case-by-case basis. Prospects 28. In general, estimated demand growth for nonmetallic minerals exceeds that for minor metals. This is particularly true of minerals with insulating, energy-saving properties (vermiculite). Demand prospects are also encouraging for electrical and coastruction materials. Although hardly conclusive, Citibank has reported that since 1973, profit rates in the non- metallic mineral business have exceeded those in metal mining. 29. Carefully prepared demand projections are not available for most of the minor metallic minerals, except from the US Bureau of Mines. The data point to continued growth in demand as these minerals are closely - 15 - linked either to the steel industry or to well-established, metals-products industries. The question is not one of whether demand will grow, but where production will be located. 30. Despite their secondary position at present, developing countries are apt to play a more important role in the future. Their known reserves are large and they are less well explored than the indus- trialized regions. It is likely that further exploration would prove fruitful. 31. Tungsten, silver and fluorspar provide the three most attractive minor minerals in terms of market prospects. These are analysed in more detail in Sections II, III, & IV respectively. A summary of their market outlook is found in paragraphs 6-15. 32. A more limited review of the market for fourteen other minor minerals, largely based on studies by the US Bureau of Mines, is presented in Annex I. 33. In nonmetallic minerals, asbestos is presently faced with short- ages and there appears to be a good scope for exploration and development. Consumption is strong in developing countries, but there is some uncertainty over health hazards (cancer-related). Barite resources are widely distributed among the developing countries. Short-term prospects look rather good but the long-term outlook seems uncertain due to potential substitution. Chances of finding new deposits of industrial diamonds are not so bright although small scale mining projects could increase supplies if assistance is provided. It appears that commercial expansion of synthetics is likely to fill the supply gap. Demand prospects for vermiculite are good because - 16 - of its insulating properties. However, transportation cost considerations may be the critical factor for investment decisions in vermiculite projects. The cost of shipping crude ore to exfoliation plants can sometimes be higher than the value of the mined product. Concern for energy conservation is likely to escalate the demand for insulating glass fibers which are the major end-use of boron. The US, which is the leading producer and consumer of boron, is constrained by lack of new reserves and Turkey could expand its share of world production. 34. In ferrous and alloying metals, ninety percent of world reserves of columbium are located in the developing countries. There is a growing demand for columbium in land and water transportation equipment and in the oil and gas industries. However, world production in 1976 was worth only $50 million. A continued strong growth is anticipated in the demand for molybdenum. The developing countries account for one-third of world reserves. There is some apprehension in the market that production capacity may not be able to keep pace with projected demand after the early 1980s. According to the US Bureau of Mines, shortfalls in supply of tantalum are likely to occur in the next two decades. An upward pressure on prices is expected to continue unless new reserves are exploited. Vanadium is merely found in sufficient amounts to be mined by itself. As a co-product, vanadium is considered to be in adequate supply to meet future demand. 35. Among nonferrous metals, antimony is faced with continuing problems in maintaining its technical and economic advantages in competition with other metals. Depletion of high-grade ore is likely to lead to an increase in production costs and prices. There are potential sites for - 17 - platinum group in Ethiopia and Columbia, although the developed countries are the predominant producers. The high value of these metals provides attractive opportunities for exploration. Resources of rare-earths are known to be plen- tiful and offer developing countries favorable prospects for expansion although total value of world production is small. In silicon, developing countries enjoy cost advantages for future production and export. In the industrialized countries, costs are rising due to pollution control requirements on smelters and refineries. In the case of titanium, developing countries' production is rather modest. There is considerable scope for expanding production of ilmenite, especially where environmental controls are not rigid. - 18 - II. TUNGSTEN Investment Opportunities 36. Prospects for tungsten mining projects in developing countries are among the best of the minor nonfuel minerals. The size of the market is fairly large with the estimated value of world production exceeding half a billion dollars in 1976. World production has grown at 3.6% per year since 1965. 37. It is generally accepted that potential technological substitution has been exhausted and that tungsten consumption is now concentrated pri- marily in the uses where its unique properties are essential to the final product it enters. A significant increase in the consumption growth rate than in the past has been forecast by various authorities.-L 38. Prices have averaged about 7% per annum in real terms since 1973 and are expected to remain at high levels, with the London Metal Bulletin price for tungsten concentrates projected to average at around $120 per metric ton unit (in 1978 dollars). Although centrally planned economies are the major sources of supply, several developing countries have sizeable reserves -- e.g. Mexico, Burma, Korea, Portugal and Rwanda. While one-half of current production is associated with other minerals, in these developing countries tungsten is either the only or the main mineral in mixed ores. Tungsten Ores and Their Processing 39. Tungsten has the highest melting points of all metals: 3400*C, three times that of copper and twice that of steel. It is one of the 1/ US Bureau of Mines, UNCTAD and other authorities; details of sources are given later. - 19 - heaviest elements, about equal to gold. For example, at about 1650*C, tungsten outranks all metals in tensile strength. In addition, it has good corrosion resistance, electrical and thermal conductivity, and a low thermal expansion coefficient. 40. Tungsten (chemical symbol:W) occurs in nature as wolframite - (Fe. Mn) W04; Scheelite-CaWO4; and less commonly as Ferbeite-Fe W04; and Heubenite-MnWO4. About one-half of tungsten production is obtained from ores containing tungsten only, one-quarter from tungsten-tin ores (Thailand), 9% from tungsten-copper ores (Canada), 10% from the tungsten-bismuth ores (Korea), and 5% from tungsten-molybdenum ores (USA). 41. Technical processes for treating tungsten ores vary with the source mineral. Initial treatment usually involves concentration by gravity because of the mineral's high density. Tungsten concentrates are then upgraded further to tungstate salts known as ammonium para-tungsten (APT). APT or concentrates are further processed into ferrotungsten, metal powder, carbide powder or chemical compounds. Ferrotungsten is used for alloying with steel. Tungsten metal is recovered in powder form through thermal decomposition with carbon or hydrogen. Tungsten carbide is made by heating tungsten powder and carbon to 1500*C. Intermediate and End-Uses 42. Because of its desirable properties, tungsten is used in a number of rapidly expanding advanced technology industries. Intermediate and end-uses of tungsten in the main consuming countries for 1974, the latest year for which such data are available, are summarized in Table 7. - 20 - Table 7: WORLD CONSUMPTION OF TUNGSTEN PRODUCTS BY INTERMEDIATE AND END USES, 1974 (metric tons of tungsten content) ------- -End Uses-- ------- ------ Intermediate Uses----- Ferro Metal Carbide Chemicals total Tungsten Powder Powder & Others Tungsten Carbides 9,274 65% 43 3,639 5,375 217 Alloy Steels 2,942 21% 2,388 31 - 523 Tungsten Metal 1,330 9% 110 1,220 - - Non-Ferrous Alloys 382 3% 58 169 - 155 Chemicals 312 2% 6 60 158 88 14,240 100% 2,604 5,119 5,534 984 % share of inter- mediate uses in total consumption 100% 18% 36% 39% 7% Source: Charles River Associates Inc., Mechanisms for Stabilizing The International Tungsten Market, September 1978. Based on data in pp. 2-41 to 2-49 as reported to UNCTAD from 12 major consuming countries. - 21 - 43. Carbides (two-thirds of world tungsten consumption), enjoy notably high heat and wear resistence qualities in the form of cemented tungsten carbide and to a lesser extent, cast tungsten carbide. They are used as cutting edges on numerically controlled machine tools, as metal shaping and forming dyes in metal working machinery, and as inserts in rock bits for mining and construction. Other uses of carbides include ball point pen tips, gas turbines and steel jacketed tire studs with carbide centers. There are no satisfactory substitutes for tungsten carbides at present, except for titanium carbide and alumium oxide which have some degree of market acceptance. 44. The second important use of tungsten is in alloy steels (one- fifth of world tungsten consumption) where hardness at elevated temperatures is imparted by tungsten to high speed steels, and dye and hot work steels. These steels are used primarily in the metal working tools for high speed drilling, cutting and shaping of metal, but also find numerous applications in rocket nozzles and other aerospace equipment. Lesser quantities are used in high strength applications in automotive and railroad equipment and ships. Molybdenum, to a large extent, can be substituted for tungsten in tool steels. Molybdenum forms the same type of double carbide with iron and carbon as does tungsten. However, the molybdenum steels have a lower melting point, less red-hardness, and a tendency to decarburize. 45. The most visible use of tungsten metal is the filament in incandescent electric lamps. Although this use is well known and important, it represents less than 6% of tungsten consumption. Improved technology has reduced filament thickness over time, although tungsten accounts for - 22 - less than 0.1% of the average price of a light bulb. While there is no satisfactory substitute for tungsten in lamps, fluorescent lighting has reduced the importance of this use over time. -46. Tungsten metal (9% of overall tungsten consumption), alone or in alloys with copper or silver, has high wear resistence qualities and adequate electrical conductivity. It is used in the manufacture of electrical contact points in electrical circuits, automotive electrical distributor points, and the manufacture of electrical tubes, such as X-Ray, transmitter, receiver & cathode ray tubes. Tungsten wire is used to form cathodes for electron tubes. Tungsten rod is also used for inert-arc welding of iron and steel, and other metals. The heavy weight of tungsten is utilized in counter-weights and balances in the horizontal and vertical stabilizers of aircraft. 47. Non-ferrous tungsten alloys, only 3% of total tungsten consumption, are used where the desirable characteristics of tungsten and other metals are jointly required. For example, tungsten-copper - silver alloys find application where high electrical conductivity is needed. Contacts in telephones, electric clocks and remote control devices are typical uses. Copper infiltrated tungsten is used in po4er tubes. 48. Tungsten chemicals, accounting for only 2% of overall tungsten consumption, are used in textile dyes, paints, enamels and glass manufacture. Sodium tungsten enters into the manufacture of other tungsten compounds for pigments, chemical analyses, and fireproofing textiles. Tungsten trioxide and some other compounds, being luminescent, are indispensable for X-Ray screens, television picture tubes and fluorescent lighting. - 23 - Demand 49. Tungsten consumption data should be treated with caution. In many instances, published figures refer to apparent consumption (i.e., production + imports - exports, but not accounting for changes in stocks). While major consumers report to UNCTAD, the coverage is not complete. Centrally planned economies' consumption data are particularly unreliable. Figures used here are those reported to UNCTAD Committee on Tungsten with some estimates made by that Committee (Table 8 ). 50. Among market economies, the developing countries consumed in 1977 only 7% of the total, the US 37%, Japan 10% and the European Communities (26%) (Table 8 ). During 1960-1973, market economies' consumption of tungsten increased at an average annual rate of about 2.6% (3.1% from 1965 to 1973). Since 1974, the rate of growth in consumption has declined in line with the economic downturn. Clearly, growth in tungsten consumption has lagged behind many other minerals. However, there were divergent trends among individual tungsten-using sectors. During the 1960s, a decline in the use of tungsten in steel manufacturing was partially offset by increased requirements for tungsten metal powder, particularly for use in high temperature alloys and in sectors such as nuclear and space industries. Progress in technology of carbide manufacture, which in the past has resulted in the replacement of steel tools by tungsten carbide tools in many industrial operations, is expected to expand future demand markedly. This applies also to carbide powders, particularly in applications requiring hardness and wear resistance combined with high melting point or high density. -24 - Table 8: TUNGSTEN - CONSUMPTION OF ORES AND CONCENTRATES BY PRINCIPAL COUNTRIES (Metric Tons of Tungsten Content) 1960 1965 1970 1975 1977 Developing Countries Argentina 20 53 39 55 57 Brazil n.a. n.a. 200 278 250 India n.a. n.a. 154 130 271 Others - - - 788 865 Sub-total 20 53 393 1.251 1,443 Developed Countries Australia 1,658 1,810 1,990 911 1,444 France n.a. n.a. 1,448 1,442 1,001 Germany, F.R. of 2,411 2,848 3,226 1,157 1,335 Japan 1,591 1,471 4,065 2,165 2,117 Netherlands 206 145 225 1,118 1,200 Sweden 694 983 1,492 1,646 1,699 UK 3,509 3,416 3,942 2,253 1,835 US 5,264 6,290 7,575 6,356 7,757 Others 2/ 1,885 1,765 838 934 832 Sub-total 17,218 18,728 24,801 17,982 19,220 Centrally Planned Economies Czechoslovakia n.a. n.a. n.a. 1,200 1,300 Hungary n.a. n.a. 430 600 600 Poland 425 1,237 1,780 1,610 1,785 USSR n.a. n.a. 6,650 6,950 7,400 China, People's Dem. Rep. of n.a. n.a. 650 2,100 2,300 Korea, People's Dem. Rep. of n.a. n.a. n.a. 1,600 1,600 East Germany n.a. n.a. n.a. 250 270 Sub-total 425 1.237 9.510 14,310 1,5 Total World Excluding CPE's 17 _238 18,781 2 14 93__ Including CPE's 17,663 20,018 34j704 33 543 35,918 n.a. - Not available I/ Mexico, Spain and South Korea. However, not every country shows up in every year. 2/ Australia, Belgium, Luxemburg, Canada, Italy, Portugal. However, not every country shows up in every year. Notes: (1) Based on member countries' replies to UNCTAD Committee on Tungsten. Some data we calculated as "apparent consumption." (2) Bolivia, Gabon, Mexico, Peru, Republic of Korea, Rwanda, Thailand and Turkey report their consumption to UNCTAD as nil. (3) No consumption is shown for the following countries or territories, since it is assumed that virtually their entire production is exported: Burma, Guatemala, Hong Kong, Malaysia, New Zealand, Nigeria, Southern Rhodesia, Uganda, United Republic of Tanzania and Zaire. (4) Apparent consumption has not been calculated for the USSR since, although some trade data are available, production data are estimated. Only estimates of production and partial trade data, obtained from statistics supplied by trading partners are available for China, the Democratic People's Republic of Korea and Czechoslovakia: apparent consumption has, therefore, not been calculated for these countries. Source: UNCTAD, Tungsten Statistics, various issues. - 25 - Molybdenum, the main competitor to tungsten, has replaced tungsten in the manufacture of tool steels. This was due to mainly two factors: (a) the relative stability of molybdenum prices (being producer prices) compared with widely fluctuating prices for tungsten, and (b) the technical advantages of molybdenum over tungsten, except in the highest grades of tool steels where tungsten continues to be irreplaceable. Currently in the US, e.g., over 90% of high speed steels are of the molybdenum type. 52. In the past, tungsten was substituted by a number of other materials where such alternatives offered technological and/or price advantages. It is believed that potential technological substitution has now been exhausted and that recent levels of tungsten consumption are based firmly on the unique or desirable properties of tungsten. In addition, the value of tungsten is usually a minor item in the cost of producing final products, and as a result, price-induced substitution for tungsten is not likely to be a significant factor in future consumption pattern. Future expansion of demand is, therefore, expected to be more in line with the growth of economic activities, provided no new materials are developed which could offer similar properties. Accordingly, income elasticity of demand for tungsten 1/ is expected to average about 1.0 compared with historical 0.5 to 0.6. This is recognized in some forecasts. For example, the US Bureau of Mines projects US demand for tungsten to rise at an annual rate of 4.5%, in 1974-2000, compared to 2.6% experienced in 1960-1974. Such a 1/ Defined as the percentage change in tungsten consumption related to (rather than as a result of) the percentage change in GDP growth. - 26 - future growth rate is exceeded only by that of aluminum and gold among the minerals with a world market value higher than tungsten. A number of other authorities hold similar opinions. 1/ Supply 53. At present three centrally planned economies account for 45% of world tungsten production: China 21%, USSR 19% and North Korea 5% (Table 9 ). China also has half the world reserves, as well as half the world resources of tungsten. CPE's production exceeds their consumption, and they supply about 20% of market economies' tungsten consumption requirements. Among market economies, tungsten production is divided roughly equally between the developing and the developed countries. Bolivia, Republic of Korea and Thailand produce approximately equal amounts and together contribute two- thirds of LDC's production, while the US and Australia account for 27% and 20% of total developed countries' 54. Secondary sources (scrap) provide an estimated 10% to 15% of total supply worldwide. 2/ New scrap, which originates in the fabrication process from alloy steels and tool steels, is reused directly in the processing plants without separation of the constituent elements. Old scrap comes mainly in the form of tungsten carbide and is collected from metal scraping, cutting tools and rock bits, or in the form of tungsten rods discarded from inert-arc welding. The market for its collection is well organized, although accurate data are not available. 1/ For instance, UNCTAD Report on the Feasibility of Price Stabilization Measures, June 1971; C. Barbier, The Economics of Tungsten; US National Materials Advisory Board, Trends in Usage of Tungsten, 1973. 2/ Data are available only for the US where the percentage of secondary tungsten to total tungsten industrial demand averaged 8.8% in 1970-72 and rose to 14.6% in 1975-1977, the latest years for which data was published. See US Bureau of Mines: Tungsten, September 1978, page 11. - 27 - Table 9 : TUNGSTEN - PRODUCTION OF ORES AND CONCENTRATES (Metric Tons of Tungsten Concentrate) 1960 1965 1970 1975 1977 1978 Developing Countries Bolivia 1,120 856 1,964 2,693 2,963 2,944 Brazil 806 177 1,073 1,395 1,000 1,134 Burma 449 160 277 330 446 454 Korea, Republic of 2,637 2,289 1,907 2,553 2,590 2,495 Mexico 88 87 '228 220 152 227 Peru 200 341 826 602 528 Rwanda 218 120 297 307 Thailand 136 171 710 1,773 2,204 2,268 Zaire 274 102 164 255 171 n.a. Turkey - - - 10 1,200 1,361 Other 570 177 567 694 628 802 Sub-total 4,480 8.013 10,832 12,182 12,485 Developed Countries Australia 892 848 1,265 1,497 2,358 2,495 Austria - - - 362 1,116 454 Canada - 1,344 1,341 1,172 1,812 1,814 France 373 - 58 867 654 Japan 459 327 665 811 776 Portugal 790 1,475 1,467 997 998 USA 3,025 3,432 4,224 2,535 2,725 3,266 Other 697 179 513 812 429 Sub-total 6,802 7,020 99,623 10807 11,101 Centrally Planned Economies China, People's Dem.Rep.of 10,800 8,000 6,000 8,980 n.a. n.a. Korea, People's Dem.Rep.of 2,400 1,900 2,150 2,150 n.a. n.a. USSR 4,500 5,700 6,700 7,800 n.a. n.a. Other - - 75 80 n.a. n.a. Sub-total 17,700 15,600 14,925 19.010 19,421 19,504 Total World Excluding CPE's 13,300 11,500 17,575 23,049 23,586 Including CPE's 31.000 27,100 32.500 39.465 42.470 43.090 Notes: Based on official replies to UNCTAD questionnaires, supplemented by published national statistics and UNCTAD estimates for China, Democratic Republic of Korea and USSR; World totals are rounded as published in Tungsten Statistics. Source: UNCTAD - Tungsten statistics, various issues - for 1960-1975 data. Bureau of Mines - Mineral Commodity Summaries, 1979 - for 1977 and 1978 data. - 28 - US Strategic Stockpile 55. In the US, tungsten is considered a strategic and critical material because of its use in nuclear and space equipment components, and military applications. The US Government built up a large inventory of tungsten in various forms from the early 1950s. These stocks reached their peak of about 89,000 tons in 1963, i.e., five times total consumption in market economies. Since then, changes in US policy led to the disposal of a major part of these stocks, and in September 1979 they stood at 39,000 tons. While the stockpile objective is only 4,000 tons, it is unlikely that Congress authorization will be given for disposal of more than 2,500 tons a year (annual disposal averaged 1,825 tons between 1973 and 1977). Trade 56. Exports from the developing countries increased rapidly during 1965-76 with their share of the demand in market economies rising to 58% in 1976. The major exporters include Bolivia, Thailand and Korea, with their respective shares of 33%, 24% and 20% of developing countries' exports in 1976 (Table 10). There were sharp fluctuations in developed countries' exports mainly due to stockpile sales. 57. Among the principal consuming countries, only the United States and the USSR possess substantial domestic supplies. Japan and Western Europe rely mainly on imports. Western Europe's share in imports of market economies is roughly 75% with the United States accounting for 12-15% (Table 11). Table 10: TUNGSTEN - VOLUME AND VALUE OF EXPORTS OF ORES AND CONCENTRATES (Metric tons of Tungsten Content) 1960 1965 1970 1975 1976 Volume Value Volume Value Volume Value Volume Value Volume Value (m.t.) (000 US$) (m.t.) (000 US$) (m.t.) (000 US$) (m.t.) (000 US$) (m.t.) (000 US$) Argentina 18 473 13 38 110 790 n.a. n.a. n.a. n.a. Bolivia 1,023 1,484 882 2,230 1,932 16,360 2,621 20,663 3,278 31,360 Brazil 872 2,282 236 744 913 7,555 855 9,480 550 7,058 Mexico 88 210 87 236 212 1,390 300 3,050 165 1,893 Peru 224 564 359 1,164 759 4,198 630 6,400 737 8,824 Korea, Rep. of 2,442 4,671 2,165 6,642 1,796 17,168 2,389 24,445 2,027 28,473 Rwanda 6 - 120 94 409 3,753 350 1,900 384 1,812 Thailand 226 950 177 978 792 7,844 1,729 16,925 2,074 25,510 Uganda - - - - 115 649 120 1,200 418 Zaire - - - - 146 976 254 1,113 240 2,750 Burma - - - - 147 1,325 244 2,500 420 5,652 Guatemala - - - - 40 318 1 10 - - Malaysia - - - - 87 737 120 1,250 64 773 Rhodesia - - - - 102 811 38 390 25 302 Other Developing n.a. 1,366 n.a. 274 40 n.a. 49 424 - 25 Total Developing 4,900 12,000 4,040 12,400 7,600 63,870 9,700 89,750 9,965 114,850 Total Market Economies 8,840 20,800 9,520 2 4 2,370 164,570 16,400 167,350 17,280 205,650 Totals were rounded by UNCTAD. Source: UNCTAD, Tungsten Statistics, various issues. Table 11: TUNGSTEN - VOLUME OF IMPORTS OF ORES AND CONCENTRATES (Metric tons of Tungsten Content) 1960 1965 1970 1975 1976 Developing Countries Brazil - - - - - India - - 136 130 266 Others - - - 20 53 SUB-TOTAL - - 136 150 319 Developed Countries Austria 1,700 1,811 1,997 926 1,470 France 1,015 1,204 1,471 1,206 1,299 0 Germany, F.R. 2,476 2,935 3,330 1,405 2,040 Japan 1,586 826 3,388 1,115 1,543 Netherlands 206 145 225 1,118 1,659 Sweden 534 1,016 1,909 1,987 1,729 UK 3,453 4,088 5,162 1,812 2,094 USA 1,599 1,635 582 2,952 2,405 Others 438 319 582 485 437 SUB-TOTAL 13,007 1 1 6 130 Total Market Economies 13,007 13,979 18,782 13,156 14,995 Source: UNCTAD, Tungsten Statistics, various issues. - 31 - Prices and Market Structure 58. Primary tungsten concentrate production is commonly sold in pound sterling per metric ton unit (MTU) of 65% W03 content.1/- US market prices are quoted in US dollars per short ton unit (STU) of 65% W03 content. 59. A significant portion of international trade is often conducted on the basis of prices published in the London Metal Bulletin (LMB). The LMB quotation is presented in terms of a range, with the high and low prices being usually $2 to $5 apart, i.e., about 2% to 4% of the median price level. 60. There are no universally accepted standard specifications for tungsten concentrates. The 65% W03 content serves as a reference point. Particular sales or contracts usually establish the price basis through negotiation. Desirable concentrates with high grade and low impurities, command a price at the high end of the range, or even at a premium over the high end of the LMB quotation. On the other hand, lower grade concentrates with high impurities sell at a discount to the low end of the price range. 61. Prices historically have shown rather erratic and violent move- ments. 2/ Fluctuations of one hundred percent or more in a year have not been uncommon. However, such fluctuations have been significantly reduced since the establishment of a producers' association (Primary Tungsten Association) in 1975. 1/ Metric ton unit (MTU) = 1/100 metric ton or 10 kg, i.e. 22.04 lbs. 2/ This may be a reflection of the very lengthy series of operations involved in processing so that supplies in the short run tend to be rather inelastic. - 32 - 62. Tungsten prices, experienced a generally softening trend in 1955-63, rose steadily and sharply in 1964-70 reaching an all time peak. Prices fell equally sharply in 1971 to 1973 as demand weakened under the influence of slowdown in global economic activity. Prices bounced back as economic activity boomed, but the price momentum was maintained until 1978 in spite of decline in economic activity. (Table 12). 63. The continued rise in prices in recent years could partly be attributed to the establishment of the Primary Tungsten Association (PTA) in 1975. The founding producing companies of the PTA included Mineroperu, Beralt Tin and Wolfram of Portugal, Peko-Walls of Australia, the Societe Miniere d'Anglade of France, and Comibol and private sector companies of Bolivia. Members of PTA now account for about one quarter of world tungsten mna output. China, the largest producing country, was a participant in the preparatory meetings convened by Bolivia in 1974, and although not officially a member, is believed to be giving PTA a strong backing by controlling its exports of tungsten to market economies. 64. The long run price prospects are good. As has already been dis- cussed, future substitution away from tungsten is likely to be less than in the past, and demand for tungsten would grow more in line with GDP, or almost twice as fast as consumption growth in the past. About one-half of world exports is controlled by the members of the PTA and China. So long as China and PTA members collaborate, future prices of tungsten could be assumed to be maintained in real terms at about the currently prevailing level of $120 /MTU. - 33 - Table 12: TUNGSTEN CONCENTRATE PRICES /a ($/MTU) Year Current In 1978 Constant Dollars Actual 1955 34.33 114.4 1956 34.50 110.9 1957 19.24 59.8 1958 11.28 35.0 1959 15.09 46.7 1960 21.28 64.5 1961 16.94 50.9 1962 11.73 35.7 1963 9.69 29.3 1964 16.34 48.6 1965 28.77 82.9 1966 41.00 117.1 1967 48.68 137.1 1968 45.25 135.9 1969 51.40 153.0 1970 77.60 207.5 1971 54.63 134.9 1972 39.00 87.1 1973 44.00 81.5 1974 88.32 130.8 1975 91.89 118.0 1976 114.82 145.0 1977 170.67 196.6 1978 144.10 144.1 1979 114.00 127.2 /a Average of the monthly midpoints of the quoted range. Commodity Specifications: Basis 65% W03 c.i.f. European Ports. Source: Metal Bulletin, London; various issues; and World Bank Projections. - 34 - Reserves and Future Supply Potential 65. Based on proven reserves that are minable at 1979 prices, Mexico, Burma, Republic of Korea and Portugal seem to have good prospects for tungsten mining projects (Table 13). Mexico's reserves have been recently proven. Portugal is a recent entrant to the scene, while Rwanda's resources are currently being proven and hence not shown separately in Table 13. It is believed that significant quantities exist in Reanda. 66. Bolivia, currently the largest developing country producer of tungsten, has ample reserves of tungsten and could increase production in the long run: COMIBOL, a state enterprise, has the largest operations. Turkey has significant reserves which are only recently proven and could increase production in the long run. The current tungsten operations in Turkey are in the hands of the public sector and are encountering serious technical difficulties. New Technology 67. There have been some new techniques in mining and processing which should be kept in mind in considering investment proposals. Among new mining techniques are the portable ultraviolet (black light) detectors. These are used to explore scheelite ores; such ores emit light when subjected to ultraviolet radiation. A cost saving technique, involving two phase molten "halide-silicate" for extracting W03 from wolframite and scheelite by electrolysis, has been recently introduced. - 35 - Table 13 TUNGSTEN - ESTIMATED WORLD RESERVES, 1979 Thousand Metric Tons Percentage of of Tungsten Content World Total United States 124 6 Canada 216 0 Australia 77 4 Austria 18 435 1 21 Bolivia 39 2 Mexico 20 1 Brazil 18 1 Turkey 77 4 Burma, Republic 32 2 Malaysia 15 1 Thailand 18 1 South Korea 46 2 Portugal 25 290 1 15 China, Prople's Republic 953 47 USSR 215 10 North Korea 113 1,281 6 63 Others 24 1 2,030 100 Source: U.S. Bureau of Mines, Commodities Data Summaries, 1979, p.173 and updating to August 1979 obtained through discussion with relevant staff in the Bureau of Mines. - 36 - Tungsten Mining Firms in the Developing World % Share in Bolivia National Output 1. International Mining Company 35% 2. Corporation Minera de Bolivia (COMIBOL) 34% Brazil 1. Mineracao Tomas Salustino, SA 40% 2. Tungstenio do Brazil Minerios e Metals Ltd 40% 3. Brasimet Comerico e Industria 20% South Korea Korean Tungsten Mining Co. Ltd. 92% Turkey Etibank Portugal Beralt Tin and Wolfram (Portugal) SARL Thailand Various small private firms Major Tungsten Mining Firms in the Developed Countries USA 1. Union Carbide Corp. (the largest W producer in market economies) 2. Climax M. Co. 3. China x molybdenum 6 - 37 - Canada Canada Tungsten Mining Corporation Ltd. (second largest W producer in market economies) Austria Wolfram-Bergbau-und Huttengesellshaft (a major market economy producer) France 1. Societe Miniere D'Anglade 2. Societe Miniere Du'Chatelet Australia Worman International (Peko-Wallsend) - 38 - III. SILVER Investment Opportunities 68. Silver is a commodity that has been chronically "scarce". For a number of years, supply from mine production and scrap has been falling grossly short of industrial consumption and coinage-related demand, with the gap having been filled by releases from government stockpiles and private dishoarding (mainly in India and Pakistan). 69. The market is expected to experience an everwidening "gap", and prices are projected to rise in real terms at a trend of about 5% per annum from the 1979 level. Several developing countries are in a position to take advantage of this situation -- e.g., Bolivia, Chile, Mexico, Peru, Honduras -- because they have reserves deemed mineable at prevailing prices. Finally, silver mining in developing countries is carried out principally by indigenous small corporations which have the technology but lack finances. Prospects in Summary 70. Fundamental supply and demand factors are likely to result in a rising trend in silver prices in the medium to long term. Silver is relatively rare. For an example, it is estimated that in every million pound of the earth's crust, there are approximately 50,000 pounds of iron, 80,000 pounds of alumina, but less than 2 ounces of silver. Furthermore, silver was subject to a phenomenon called "epithermal desposition", i.e., silver condensed near the surface of the earth when the latter was cooling from its molten stage. Hence the richest silver deposits are believed to have already been discovered and exploited. Supply of secondary silver is not necessarily so responsive to higher silver prices as most other minerals. The reason is that as the price of silver goes up, its numismatic value (particularly in silver coins - 39 - which are the major source of secondary silver) also tends to rise. There- fore, higher silver prices do not necessarily mean greater availability of silver coins for melting down. 71. On the demand side, the cost of silver represents only a minute percentage of total cost in many industrial uses, and substitution is likely to be limited even at higher prices. In most industrial uses, there is no good substitute for silver. Furthermore, in the past two decades, silver consumption has grown faster than production, with output substantially falling short of consumption. The gap has been made up by depletion of non-commercial stocks, especially US Treasury silver, and by dishoarding by private individuals. As the non-commercial stocks have been run down, the gap is likely to drive up the price in the future. Trends in Demand 72. Silver has unique properties: high electrical and thermal conduc- tivity, high resistance to corrosion, extreme photo-sensitivity and of course, its decorative quality. Its main uses are in photographic applications (35%), electrical components (25%), silverware and jewelry (33%) and coinage (7%). In photography, it is used in two forms: silver salts and silver nitrates. Silver salts serve as photographic receptors, while silver nitrates provide the starting chemical compound required for photographic preparations. While silverless electro-copying processes (for example, xerogrephy and thermofax) have contributed to the slowing down of photographic silver consumption, silver is still essential for conventional photography and X-ray films. - 40 - 73. The use of silver in electrical components takes up 25% of total silver consumption. Silver not only has the highest electrical conductivity, but it is also able to resist oxidation, even at high temperatures. Copper provides adequate conductivity for maay electrical uses; but once oxida- zation starts on copper, resistance increases causing it to heat, which accelerates further oxidization until complete destruction results. Hence, silver is particularly essential in high current applications as contact surfaces that make and break electric current. There are very limited alternative materials that can achieve the same performance. It is possible to combine smaller amounts of silver with relatively greater quantities of copper, tungsten, molybdenum or carbon. Many of these alternatives require technical modifications in use which would make them significantly costlier. Also, some noble metals (gold, platinum, poladium) could substitute for silver in electrical circuits carrying only very low voltages, but they are substantially more expensive. 74. Silver use in silverware and jewelry takes up about 33% of silver consumption. Since 1975, the amount of silver used in plated ware and silverware has declined, losing market to stainless steel. The latter is not only cheaper, but also avoids the disadvantages in silverware's tendency to tarnish and to retain certain flavors (mainly seafood). However, silver used in jewelry has maintained its volume since 1960. 75. The principal consuming countries are the US (41%), Japan (15%), W. Germany (15%), UK (8%), Italy (7%) and France (5%) (Table 14). World industrial consumption increased at 5.8% a year between 1960 and 1973 when Table 14: SILVER - WORLD CONSUMPTION BY COUNTRY-/ (Million Troy Ounces) 1960 1965 1970 1975 1977 1978 I. INDUSTRIAL USES U.S. 100.0 137.0 128.4 157.7 161.0 159.5 U.K. 16.5 25.0 25.0 28.0 32.0 29.0 West Germany 40.2 54.6 48.2 38.9 33.8 26.4 Japan 21.6 25.0 46.0 46.4 62.7 64.3 Others 46.3 95.0 91.3 105.8 102.9 108.8 Total Industrial 224.6 336.6 338.9 376.8 392.4 388.0 II.COINAGE U.S. 46.0 320.3 0.7 2.7 0.4 0.1 Canada 7.5 20.4 - 10.4 0.3 0.3 France 12.2 7.2 3.7 5.2 6.9 11.1 . Others 38.2 33.2 22.5 20.5 15.4 23.5 Total Coinage 103.9 381.1 26.9 38.8 23.0 35.0 TOTAL WORLD CONSUMPTION 328.5 717.7 365.8 415.6 410.1 423.0 1/ Excluding Centrally Planned Economies. Source: Handy and Harman, Annual Review of the Silver Market, various issues. - 42 - it reached a peak of 471 million ounces. Since 1974 industrial consumption has declined and is now running around 400 million ounces a year. World usage of silver in coinage, which peaked in 1965 at a level of 381 million ounces, has fallen sharply in the past ten years and is now at a level of about 25 million to 30 million ounces a year. Overall consumption in 1978 amounted to about 425 million ounces. Trends in Supply 76. In recent years, the demand for silver has been met by mine pro- duction (62%), recovery operations - which includes old scrap and coins - (22%) and depletion of government and private stocks (16%). Mine production has shown little growth over the past 18 years rising from 205 million ounces in 1960 to an estimated 248 million ounces in 1977, an annual growth rate of just over 1% (Table 13 ). Available data indicate that total reserves of silver ore are particularly tight, and only equivalent to about fourteen years of current demand. Approximately 90% of the market economies' reserves are"in four countries - US (37%), Canada (17%), Mexico (21%), and Peru (15%) (Table 1. Two-thirds of silver is produced in association with lead, zinc or copper and only one-third as the main product. But with the steady rise in silver prices, silver is increasingly being mined as the main product. 77. Scraps are recovered from electrical components, photographic materials and silver coins. Overall, secondary silver accounts for about 18% of total silver consumption. Silver in electrical components -- principally contacts in batteries, wires, and brazing alloys used in home appliances and refrigerating equipment -- is reclaimed in conjunction with - 43 - Table 15: SILVER - WORLD PRODUCTION (Million Troy Ounces) 1960 1965 1970 1975 1977 1978 Developing Countries 101.2 99.4 107.9 114.0 146.2 152.5 Latin America 87.9 90.7 98.6 101.0 132.2 137.5 of which: Bolivia 4.9 4.1 6.8 6.0 5.9 6.0 Chile 1.4 3.0 2.4 6.5 Mexico 44.5 40.3 42.8 38.0 47.0 53.4 Peru 30.8 36.5 39.8 37.5 30.1 31.0 Honduras 2.9 3.7 3.8 3.4 2.8 2.5 Africa 8.4 5.0 4.6 7.0 7.2 7.4 of which: Morocco 1.1 0.6 0.7 1.0 2.1 2.2 Asia 4.0 3.6 4.6 6.0 6.8 7.6 Industrialized Countries 106.3 117.6 149.6 126.3 113.4 112.5 of which: Australia 15.2 17.3 26.0 23.5 27.4 27.5 Canada 34.0 32.3 44.3 39.7 42.8 39.9 U.S. 36.8 39.8 45.0 34.9 38.2 38.0 Centrally Planned Economies 33.5 40.4 46.4 53.0 70.4 72.8 of which: USSR 25.0 31.0 38.0 40.0 45.0 46.0 TOTAL WORLD PRODUCTION 241.0 257.4 303.9 293.3 330.0 337.8 1/ Preliminary estimate. Source: U.S. Bureau of Mines, Minerals Yearbook, various issues. Handy and Harman, Annual Review of the Silver Market, various issues, The Silver Institute, data obtained privately. -44 - Table 16: SILVER - ESTIMATED WORLD RESERVES,-/ 1979 (Millions of Troy Ounces) United States 1,510 - Canada 710 Mexico 850 Peru 610 Bolivia 30 Other Market Economies 390 Centrally Planned Economies 2,000 TOTAL WORLD RESERVES 6,100 1/ Measured and indicated - includes silver recoverable as a by-product of base metal ores. 2/ In currently operating mines Source: US Bureau of Mines: Commodity Data Summaries, 1979, and updating to August 1979 through discussion with relevant staff in the Bureau of Mines. - 45 - the recovery of other valuable metals or components. As copper in such products is more important than silver by weight and value, the price of copper, and costs of its recovery, are two important factors affecting silver recovery. Silver in photographic industry is reclaimed from x-ray and movie films. The process is, however, lengthy and expensive and a large amount of silver used in photography is washed into the developing solution. During the 1960s, an improvement in the recovery technology raised the ratio of silver recycled from photographic consumption in the US from 20% in 1960 to 40% in 1970. However, recently environmental controls restricted the burning of old films which is the first step in the recovery process. No precise data are available to quantify these effects. However, as more clean-air incinerating equipment for used film are built, a gain in the silver recovery ratio in this sector is expected to materialize. 78. Recovery of silver from old silver coins was possible in the US particularly in the period directly following the passage of the 1965 Coinage Act which reduced significantly the content of silver in future coins. It was then an important source of supply as silver prices were high enough to justify melting coins. The situation has changed significantly. Silver coins are more and more in demand as collector items. Their "numismatic" value is rising with the passage of time. At present they command a price in excess of the value of their silver content. This premium is likely to increase in the future; the role of old coins as a source of secondary silver is rapidly declining. - 46 - Trade 79. Most of silver exports are in the form of refined metal, although some undetermined but significant, amount of silver is exported in concentrates of zinc, lead and copper. Available data for 1974 (Table 17) indicate that the developing countries accounted for about 30% of total market economies' exports of silver in metal. The main developing country exporters are Mexico and Peru, 1/ responsible for about 85% of all developing countries' exports--. The United States is the largest importer accounting for 25%, with Japan, the UK, Belgium and the Federal Republic of Germany together accounting for another 55%. Overall Supply/Demand Balance 80. Since 1960, silver mine production in market economies has consistently been running behind silver consumption in industrial uses and coinage. The annual gap, running at about 100 million ounces in the latter years of the 1960s, has been widening to average about 200 million ounces for 1973-75, and has slackened off to 165 million ounces for 1976-78 (Table 18). Silver reclaimed from scrap has risen rapidly in recent years to currently account for about 40% to 45% of the difference between consumption and produc- tion. Releases from government stocks, mainly US, dishoarding in India and Pakistan, and imports from the USSR, helped make up the balance. Government releases, however, have diminished substantially as stocks have been run down. US Government silver stocks, for instance, have fallen from 1,800 million ounces in 1960 to about 180 million ounces in 1977. Privately-held stocks, excluding silverhoards in India and Pakistan, are currently estimated at about 700 million ounces. 1/ It is very difficult to obtain accurate data for silver exports. Silver metal exports are generally reported within the "Silver and Platinum" Group. - 47 - Table 17: SILVER - WORLD EXPORTS (Millions of Troy Ounces) 1960 1965 1970 1974 Developin 79.7 77.1 68.7 91.0 Latin America 74.2 73.6 65.9 88.0 Of which: Bolivia 4.9 4.1 6.0 6.0 Chile 1.3 2.5 2.9 3.0 Honduras 2.6 4.0 4.0 2.0 Mexico 34.4 29.5 17.3 37.0 Peru 29.8 33.0 38.5 40.0 Africa 0.7 0.1 0.7 1.0 Asia 4.8 3.4 2.1 2.0 Developed 97.5 148.8 186.8 220.0 Of which: Australia 9.7 7.6 24.0 28.0 Belgium-Luxembourg, E.V. 11.4 8.1 37.7 45.0 Canada 21.7 23.6 45.2 53.0 Germany 14.9 15.8 14.2 16.0 UK 6.3 38.1 22.6 25.0 Us 26.6 39.6 18.2 30.0 TOTAL WORLD EXPORTS 177.2 225.9 255.5 311.0 Notes: 1. In bullion and refined form. 2. Data of centrally planned economies' exports is not available. 3. For the rest of the countries published data cover the years to 1970. Incomplete and scattered data are available for only a limited number of countries for 1974 from UN Trade Tapes (Series D and IMF Financial Statistics). Those were used as the basis for estimating exports in 1974. Source: Great Britain - Institute of Geological Studies, Mineral Resources Division, Statistical Summary of the Mineral Industry, vols. 1960/65, 1963/68 and 1967/71. 22 18 SILVER - WORLD BALMCE SET OF SUPPLY ND DEIND (millio. Troy Ou.ces) 1960 1961 1962 1963 1964 1965 1966 1,67 1968 1969 1970 1971 1972 1973 1974 1975 1976 1977 1978 DEHAND 1. ndustrial Co.s.&ptton 224.6 239.5 247.8 260.7 299.2 336.6 388 7 346 8 349 6 364.4 338.9 351.4 398.3 471 5 424.0 376.8 399.2 392 4 388 0 2. Coin.. 103.9 137.1 127.6 166.4 267.1 381.1 129.5 105.3 89.3 55 7 26.9 27.2 36.0 21.0 27.9 38.6 29 7 23 0 35 0 Total D~ad M28.1 376. j B 17.7 S18.2 452 1 438.9 420.1 365.8 378.6 424.3 492.5 451.9 45.6 428.9 415 4 423 0 SUPPL.Y 1. .. HA.. nProducKlon 207.5 203.2 206.1 212.1 210.1 217.0 224.1 214.6 232.0 250.3 257.5 247.2 245.4 254 0 237.4 240.3 246.3 259.6 265 0 2. Sal.v.& (Scr.p) 21.5 29.0 14.7 10.6 36.6 7.2 59.4 65.4 82.5 49.0 35.2 41.7 56.3 64.8 65.7 73.2 76 1 80.2 84 0 To.al Supply 229,0 232. 220 223.3 246.7 224.2 283.5 280.0 314.5 299.3 292,7 788.9 301.7 318 8 303 1 313.5 322 4 339,8 349 0 GAP9 jÉd 1jÉ 203,8 3.6Lå 493.5 234l 1t- 124,4 120.6 73 1 89.7 122.6 173 7 146.8 102.1 i06 5 75 6 _714.0 m* by 2/ 1. Het U.S. Tr.ammry Release - 21.5 62.6 0.9 25.2 151.0 80.4 142.5 191.2 179.5 89.0 67.7 2.5 2.3 0.9 1.0 2.7 1.3 0.4 0 l 2. Cångas in other Gov't Stockm 12.0 15.8 4.5 10.0 20.0 17.0 10.0 5 0 15 0 0.0 10.0 5.0 10.0 50.0 10.8 16.4 7 0 5 0 8 4 3. D-aotai.d Coin. 10.0 30.0 20.0 15.0 20.0 30.0 28.0 35.0 50.0 50.0 25.0 20 0 15.0 15.0 47 0 35.0 55 0 23 0 14 0 4. Sal.e fro- U.S.S.8. n... c.*. D.a. a.a. n.. 9.4 9.6 6.0 10.0 11.3 11.4 0.0 0.0 0 0 0.0 0.0 0.0 0 0 0 0 5. Chang. in Privata Stuck. 1 56.0 36.0 129.2 153.6 128.6 356.7 44.6 -71.1 -130.1 -29.5 -41.0 62.2 95 3 107.8 90.0 46.0 43.2 47 2 51 5 Kl EcludIng Centrally Planned Econoces. u Including @Ilver tor coinag., aechanges for silver certificate (1963-67) and U.S. Censel Services Adk.n5etr.Ion (0 £ A ) aales. j/ Including lIquidation of (+), or dditions ta (-), opeculativa holdagas and Inventory changea, plus silver q.-cites avol&4ble fruc Indi.. Pakistaa, and other countri. Sourcen; 1andy 6 Har~n, Annual Review of Kb Silver Mark9t, vartous issuesl U.S. - ?!mea of Hinas Minrets ysarboo. vario issueg; and IBRD .stimates. -49- Prospects 81. Future silver supply/demand in market economies is likely to be significantly different from the past. The following scenario is proposed. Assuming that the 1977-78 price of silver will continue unchanged in real terms in the future (Table 19) industrial demand for silver would probably rise by about 5% annually from 1979 onward (lower than the 5.8% historical annual growth rate achieved during 1960-1973). Silver used in coinage is likely to remain at the level prevailing during 1977-78. On the supply side, mine production is expected to rise by 3% annually in 1979-90, a rate higher than the past, reflecting known investment plans, firmed up in response to the silver price increases in the last two years. This would leave an annual deficit between total demand and new mine production, to be filled from secondary sources and stocks of about 270 million ounces. Table 19: HYPOTHETICAL ESTIMATES OF WORLD SILVER DEMAND/SUPPLY /a UNDER STABLE-PRICE ASSUMPTIONS (million troy ounces) Average 1976-78 1980 1985 Industrial Consumption 393 555 710 Coinage 29 30 30 Total Consumption 422 585 740 Mine Production 257 315 365 Balance 165 270 375 Secondary silver supply 80 125 185 Deficit to be met by Stock Depletion 85 145 190 Cumulative Deficit from 1976 740 1690 /a Excluding centrally planned economies Source: World Bank estimates. - 50 - 82. Secondary silver output is expected to grow by about 8% a year to 1985. This is a faster rate than that projected for industrial silver consumption and would reflect more efficient recovery techniques. Scrap recovery as a percentage of industrial silver consumption would then rise from 20% in 1976-78 to 23% in 1985 and 26% in 1990. 33. The ensuing annual gap (Table 19), to be met by stock depletion under such hypothetical stable-price assumptions, would thus reach 145 million ounces by mid-1980s, widening further to 190 million ounces by 1990; these gaps are equivalent to 25% and 27% of total consumption in 1985 and 1990 respectively. 84. Existing stocks are very low. The US Treasury silver inventory is insignificant. Russian exports of silver to the market economies have been stopped since 1970. These were traditional sources of supply filling the gaps in the past. Even the total hypothetical cumulative gap under our assumption of constant silver prices at 1977-78 levels would be equal to total world known stocks (excluding hoards in India, Pakistan, etc.) by mid-1980s and twice the level of such stocks at the end of the next decade. On the other hand, potential future outflow of silver from India and Pakistan at higher silver prices is unkown. In 1973 to 1975, when the price of silver rose from about $2 to $4.70 per ounce, the India subcontinent's dishoarding was estimated to have amounted to between 40 and 50 million ounces a year, showing only a modest increase. Dishoarding of silver in these countries seems to be linked more to periods of food shortages, and less to the level of silver prices. The higher such outflow, and the higher the actual overall stocks, the longer the period of stock depletion. - 51 - 85. It appears thus that the price of silver would have to rise to maintain a balance between supply and demand by the mid-1980s; discouraging industrial demand and increasing output. Silver demand is price inelastic with no suitable substitute in sight for many silver end-uses. On the supply side, the existence of silver in the earth crust is very rare compared with other minerals and metals. Any expansion of silver production would involve sharply higher cost of production at the margin. The shortage is likely to be further accentuated by the speculative demand to hold wealth in the form of silver in face of persistent world inflation. Future long term silver prices are, therefore, expected to rise on average by about 5% annually in real terms from the 1979 annual average of $11.09/oz. (Table 20). Accordingly, actual silver consumption would be adjusted downward to the level of available supplies. Growth in the use of silver in photography is the most likely candidate to be scaled down. The search for substitutes would undoubtedly by intensified, but it is unlikely to affect silver consumption significantly before the 1990s. Industry Structure & Price Formation 86. Market economies' silver production facilities are privately owned. The exceptions are Burma and some public sector operations in Peru. In Peru, Centromin, the state owned company, produces about 22% of output. There is limited integration in the industry; generally the smelting, trading and consuming companies are separate entities. In the developing countries, there are a number of domestic firms engaged in mining of silver on a small scale. In Mexico small mining concerns co-exist with large silver mining operations. A selected listing of silver mining companies in developing countries is attached at the end of this chapter. - 52 - Table 20: SILVER PRICES ($/Troy Ounce) In 1978 Year Current Constant Dollars Actual 1955 .89 2.96 1956 .91 2.92 1957 .91 2.82 1958 .89 2.76 1959 .91 2.81 1960 .91 2.75 1961 .92 2.76 1962 1.09 3.31 1963 1.28 3.86 1964 1.29 3.83 1965 1.29 3.71 1966 1.29 3.68 1967 1.55 4.36 1968 2.15 6.45 1969 1.79 5.32 1970 1.77 4.73 1971 1.55 3.82 1972 1.68 3.75 1973 2.26 4.18 1974 4.71 6.97 1975 4.42 5.67 1976 4.35 5.49 1977 4.62 5.32 1978 5.40 5.40 1979 11.09 9.80 Commodity Specifications: Refined, 0.999 grade, delivered New York. Source: Engineering and Mining Journal, various issues; and IBRD projections. - 53 - 87. Three firms account for two-thirds of domestic consumption in the US, the largest silver consuming country in the world. These are Eastman Kodak Co., Handy & Harman, and Engelhard Minerals and Chemicals Corp. A Aaron & Co. of New York handles most of the silver trade for industrial purposes. 88. Silver is traded on a number of commodity exchanges, the principal ones being the New York Commodity Exchange and the London Metal Exchange. In addition Handy & Harman (H & H), a major dealer, publishes the lowest daily price at which offers can be obtained for refined silver. The H & H price often forms the basis for settlement by custom smelters. New Technology 89. Among recent developments in mining exploration technology are the silver snooper and other new analytical instruments for rapidly testing mineralized areas. These could lead to firmer evaluation of silver metal content and distribution in deposits. They would also make possible exploitation of currently marginal deposits. A recent Canadian technology system, which is now being introduced worldw de, would enable the production of 999 fine silver by electrolytic processes (recovering silver from mixed sulfide ores and concentrates) which would eliminate a number of intermediate steps in traditional methods. 90. Technological development in progress could lead to new end uses for silver. Ford Motor Company has developed soft silver solder to joint aluminum alloys to copper, brass and other noble metals. Silver aerosol spray, recently introduced commercially, would cure diseases in baby chicks. Also recently developed are an antifouling system for ships which utilizes a lead alloy and silver, oxygen electrothodes for more efficient fuel cells made of carbon and silver, and special metallic silver for use in semi-conductors and nuclear applications. - 54 - Some Silver Mining Firt n the Developine World Mexico 1. Campana de Plata S.A., Zacualp'n, Máxico 2. Comision de Fomento Minero, Parral, Chihuahua 3. Compania Fresnillo r.A., Mexico, D.F. 4. Compania Minera La Cýapaia S.A., Reforma, Chihuahua 5. Compania Minera La Negra y Anexas S.A. Maconi, Quéretaro 6. Compañia de Real del Monte y Pachuca, Pachuca, Hidalgo 7. García y Cisneros, Mexico, D.F. 8. Industrial Minera México S.A., Mexico, D.F. 9. Industrias Penoles S.A., México, D.F. 10. La Encantada S.A., Ocampo, Coahuilla 11. Macocozac S.A., Saltillo, Coahuilla 12. Minas de Huruapa S.A., Palmorejo, Chihuahua 13. Minas de San Luis S.A., Mazatlan, Sinaloa 14. Minera Guadalupe S.A., Real de Guadalupe, Guerrero 15. Minera Lampazos, S.A. de C.V., México, D.F. 16. Minera Mexicana Penoles S.A., Topia, Durango 17. Minera Mexicana Sombrerete S.A., Sombrerete, Zacatecas 18. Minera San Francisco del Oro S.A. de C.V., Máxico, D.F. 19. Minera Victoria Eugenia S.A., Chalchihuites, Zacatecas 20. Minerales de Bolanos S.A. de C.V., Guadalajara, Jalisco 21. Restauradora de las Minas de Catorce S.A., San Luis Potosí 22. Rosario Mexico S.A. de C.V., Mexico, D.F. 23. Unidad El Bote México, D.F. 24. Unidad Guanacevi, Mexico, D.F. 25. Unidad Minero Metalurgica el Bote, Zacatecas, Mixico 26. Unidad Parilla, M¿xico, D.F. - 55 - Peru 27. Castrovirreyna Compania Minera S.A., Lima, Peru 28. Cia. de Minas Buenaventura S.A., Lima 29. Cia. Minera Chungar S.A., Lima 30. Cia. Minera Huampar S.A., Lima 31. Cia. Minera Katanga S.A., Lima 32. Cia. Minera del Madrigal, Lima 33. Cia. Minera Milpo, S.A., Lima 34. CIa. Minera Santa Luisa, S.A., Lima 35. Cia. Minerales Santander Inc., Lima 36. Empresa Minera del Centro del Peru, Lima 37. Empresa Explotadora de Vinchos Ltda., S.A., Lima 38. Northern Peru,Mining Corp., Quiruvilca 39. Sindicato Minero Pacococha S.A., Lima 40. Southern Perú Copper Corp., New York, New York, U.S.A. 41. Volcan Compañia Minera S.A., Lima Chile 42. Cía. Minera y Commercial Salí Hochschild S.A., Santiago, 43. Compania Minera Disputada de las Condes S.A., Santiago, 44. Corporaci6n Nacional del Cobre, Santiago 45. empresa Nacional de Mineria, Santiago, Bolivia 46. Corporacion Minera de Bolivia La Paz - 56 - IV. FLUORSPAR Investment Opportunities 91. With an estimated world production in 1978 valued at over half a billion dollars, fluorspar is the only minor nonmetallic mineral in which developing countries account for as much as 50% of world exports. 92. Fluorspar is valued for its fluxing properties and is a major source of fluorine. It is an essential input in the steel and aluminum industries, and many chemical products. From 1960 to the mid 1970s, consumption of fluorspar increased by an average of over 5% per annum, but is projected to rise in the 1980s at a very slightly lower rate than in the past. 93. Some factors would increase the demand for fluorspar in the future. These include the development of many new fluorine products, the expected growth in non-traditional fuels (mainly nuclear) in which fluorspar enters, and the need for a larger amount of fluorspar per ton of steel output as the impurities of iron ore, used in steel making, are expected to increase. 94. Such factors are likely to offset the adverse effects of develop- ments that were responsible for a fairly high rate of growth in fluorspar consumption in the past but are now coming to an end. There seems to be only a limited scope for further shift from open hearth furnaces to electric furnace and basic oxygen processes in steel-making; the latter processes use twice as much fluorspar per ton of steel compared with the open hearth process. In the aluminum industry, drier methods requiring less fluorine (derived from fluorspar) are being increasingly introduced, and in-house recycling methods of fluorine have been improved substantially. Furthermore, environmental concern about the use of fluorspar derivatives in aerosol propellants and the recent success in the tecnhique of obtaining fluorine from fluosilicic acid (FSA, - 57 - a by-product recovered by the phosphoric acid industry, could lower the growth in demand for fluorspar acids in the future. 95. Despite all this, however, future growth of demand for fluorspar, while being below historical rates, is likely to remain at a higher rate than those for most other minerals. Another factor which makes fluorspar mining an attractive investment area is the existence of good mineable proven reserves in many developing countries (notably Mexico, Kenya, Spain and Thailand). Technical Characteristics 96. Fluorspar (CaF2) is an important industrial nonmetallic mineral widely distributed around the world. It is usually found in association with smaller amounts of quartz, barite, calcite and other minerals. Because there are same metallurgical difficulties in extracting barite, fluorspar ores with high percentages of barite (perhaps 30%) are usually not mined. 97. Fluorspar is valued for its fluxing properties and is a major source of fluorine. Different types of fluorspar are required for various uses; it is usually traded in three grades. The acid-grade (known as acidspar) contains more than 97% CaF2. About ninety percent of world total of acidspar is used for manufacturing of hydrofluoric acid: a key ingredient in the aluminum and fluorochemical industries. The remainder is used- directly, in its concentrate form, in the aluminum and ceramic industries and, to a lesser extent, in the smelting of nonferrous metals. Acidspar briquets (a product similar to pelletized iron ore) serve as a flux in steel-making and also, in a minor way, in the cement industry. - 58 - 98. Ceramic grade (85%-to 97% CaF2) enters as a flux in the production of various kinds of glass: fiber glass, tableware, opal and container glasses, and enamels. Metallurgical grade fluorspar, known as met-spar, contains between 60% to 85% CaF2; impurities should not include more than 2.5% to 3% of silica, the remainder being a mixture of lead, arsenic and zinc. It is used almost exclusively in the iron and steel industries as a flux to promote rapid formation of fluid slag to accomplish desulfurization and dephosphori- zation. While 70% CaF2 was traditionally considered the minimum grade for use in steel furnaces, the advent of briquets has made lower grade materials acceptable. Consumption 99, -Industrialized countries are the main consumers (62% of world total), while centrally planned economies account for 28%, and the developing coun- tries for 10%. Among the market economies, the US is a major consumer (24%), followed by Japan (8%) and the European Communities (19%) (Table 21). 100. The steel industry takes about 47% of total world fluorspar consump- tion, the aluminum industry 14%, chemicals (fluorocarbons and other fluorine chemicals, not used in the aluminum industries) 32%, and various minor uses (in the cement, ceramic and special metallurgical and welding rod industries) account for the remaining 7%. Fluorspar in Steel-Making 101. The basic oxygen furnace process in making steel currently requires about twice as much fluorspar per ton of steel produced by the open hearth process. In the past, a major changeover to the basic oxygen furnace took - 59 - Table 21: FLUORSPAR - WORLD CONSUMPTION ('000 short tons) 1962 1965 1970 1975 1976 Industrialized Countries 1,3. 1,925.6 3 2,7.1 2219.6 Germany 173.1 201.7 412.3 237.9 248.6 Belgium Luxemburg 6.6 7.7 18.7 76.0 78.3 Denmark 1.1 1.1 4.4 - - Finland 5.5 6.6 8.8 7.6 7.7 France 105.9 121.3 172.0 128.3 136.4 U.K. 77.2 104.7 152.1 116.7 128.3 Italy 131.2 117.9 243.6 109.8 124.6 Netherlands 12.1 20.9 40.0 41.2 42.5 Norway 2.2 3.3 27.6 47.0 47.8 Austria 8.8 15.4 15.4 25.5 27.4 Sweden 18.7 23.1 17.6 31.8 30.0 Japan 115.7 194.0 554.5 298.2 302.5 Canada 123.5 167.6 212.7 124.6 106 4 U.S. 652.6 930.4 1,372.4 758.2 868.4 Australia 3.3 9.9 22.0 52.0 53.0 Switzerland - - - 5.7 5.6 OthersL - - - 11.6 12.1 Developing Countries 184.0 188.5 434.3 349.8 385.2 Southern Europe 72.7 77.2 196.2 97.9 99.9 Spain 68.3 72.8 188.5 67.3 66.4 Yugoslavia 4.4 4.4 7.7 22.6 24.2 Turkey 8.0 9.3 Latin America 54.0 63.9 137.9 107.2 113.5 Argentina 13.2 12.1 32.0 12.3 14.6 Brazil 3.3 4.4 27.6 47.6 52.8 Mexico 37.5 47.4 78.3 27.6 27.9 Venezuela 9.2 8.0 Surinam - - - 3.2 3.3 Others /a 7.3 6.9 Africa 33.1 27.6 69.4 55.2 63.0 South Africa 33.1 27.6 69.4 35.9 38.8 Cameroons - - - 3.7 4.0 Ghana - - - 10.3 10.5 Others Lb - - - 5.3 9.7 Asia 24.2 19.8 30.8 89.5 108.8 India 8.8 4.4 15.4 45.2 59.5 South Korea 11.0 11.0 11.0 10.7 13.8 Thailand 4.4 4.4 4.4 Others - - - 33.6 35.5 Centrally Planned Economies /d 646.0 825.6 IL.!..i 972.7 996.0 World Consumption of Fluorspar - - - 996.0 952.0 in the Chemical and other Sectors TOTAL WORLD 2g267.5 2,939.7 4,776.5 4,390.6 If 4,552.8 /g /a Includes Cuba, Chile, Colombia, El Salvador, Peru and Uruguay. b Includes Algeria, Egypt, Morocco, Southern Rhodesia, Tunisia, and Uganda. In Includes Bahrain, Bangladesh, Burma, Hong Kong, Iran, Indonesia, Israel, Lebanon, Malaysia, Philippines, Singapore, Taiwan, Thailand and New Zealand. /d Includes Peoples' Republic of China, Czechoslovakia, East Germany, Hungary, Poland, Romania and USSR. Ia Includes Denmark, Greece, Ireland, Portugal and Switzerland. /f & Fluorspar consumption for chemical and other uses is not available on a country-by country basis. Source: US Bureau of Mines, Mineral Yearbook, various issues. - 60 - place, and this was responsible for the rapid expansion of the use of fluorspar in steel making. For example, in the United States, the share of steel produced by open hearth operations in the total steel output declined from 88% to 18% between 1951 and 1976. In contrast, production of steel by basic oxygen furnaces, introduced in the late 1950s, accounted for over 63% of the total in 1976, while the share of steel produced by electric furnaces showed a slight rise over the same period. 102. Future use of fluorspar in the steel industry is likely to be influenced by several factors. Growth of steel consumption averaged 4.1% per annum between 1960 to 1977, but is projected to slowdown to 3.6% per annum in 1979-1990. 103. There is little prospect for further changeover to the basic oxygen furnace process of steel making, as currently about 85% of steel is already being made by this process. On the other hand, two factors may partly modify this picture. First, there is much less scope now for increasing the efficiency of using fluorspar than in the past. Second, as the grade of iron ore used in steel making is likely to experience a relative decline in the future, a larger amount of fluorspar would be required to offset the increased level of impurities in iron ore. 104. It is unlikely that substitutes for fluorspar in steel making would have a significant impact in the near future. A recent assessment by the Steel Company of Canada is that 18 potential substitutes (ranging from synthetic oxide mixtures containing fluorspar, to other fluxing ingredients) have so far proved unpracticable, except for colemanite (calcium borate). Colemanite has similar fluxing properties to fluorspar, but its cost and - 61 - availability present major problems. It also has been recently reported that Japanese steel makers have been replacing fluorspar by dolomite, but only with certain steels made in specific furnaces. By and large the steel industry, accounting for perhaps 95% of total output, finds fluorspar indispensible. 105. The rising concern for pollution controls would result in the increased recovery of some of the fluorine emitted from waste gas exhaust systems, thus reducing the demand for primary metspar. Fluorspar in the Aluminum Industry 106. Fluorspar is not consumed directly in aluminum smelting, but is used to produce aluminum fluoride and artificial cryolite, two essential ingredients to the electrolysis process in the making of aluminum. These reduce the melting point without lowering the electrical conductivity. 107. World production of aluminum, which increased at 7.9% per annum between 1960 and 1977, is expected to grow more slowly, at 6.3% annually, in 1979-1990. Future demand for fluorspar in the aluminum industry may be influenced by the following factors: (a) increasing use of lithum carbonate pellets which would improve efficiency over operations, but reduce the fluorine emission loss; (b) better pollution controls recovering more fluorine in a usable form; (c) as pots and pans are replaced, some artificial cryolite and aluminum fluoride may be recovered; (d) since the mid-1980s, it has become possible to produce aluminum fluoride and aritficial cryolite as a byproduct of phosphate fertilizer plants, and recovery from this source is likely to grow in the future; and (e) a new method developed by Alcoa to produce primary aluminum from aluminum chloride is claimed to be less energy intensive than traditional methods, and is likely to result in recycling of more chlorine - 62 - and to require smaller convertors, affecting the amount of fluorspar needed. This process, however, is at an early stage of development. Fluorspar in the Manufacturing of Chemicals 108. Fluorspar is converted to hydrofluoric acid, and used either directly in the production of a number of fluorocarbon compounds, or processed further to salts. Such compounds include refrigerants, aerosol propellants, plastic films, solvents, degreasing agents and lubricants. Hydrofluoric acid also finds applications in petroleum alkylation, enrichment of uranium, glass etching and pickling of stainless steel. Fluorid salts are used in the making of rocket propellant and water fluoridation. 109. World demand for fluorocarbon chemicals is estimated to have been growing by about 15% annually between 1960 to mid-1970s, and would probably have a similar rapid growth in the future as many new fluorine products are con- tinuously being developed and marketed. If the petroleum shortage leads to a rapid growth of nuclear fuels, demand for fluorspar in the production and enrichment of such fuels could be expanded. 110. On the other hand, the use of fluorspar in chemicals may be reduced by the development of some substitutes such as hydrocarbons (alternatives to aerosol propellants which are thought to adversely affect stratophic ozone), or liquid nitrogen (alternative to fluorocarbon refrigerants). Furthermore, a new source for producing fluorocarbon chemicals is emerging. Hydrofluric acid - the first stage in producing other fluorine compounds - has been successfully produced from gluosilicic acid, which is a waste by-product of phosphate fertilizers. It is too early to assess fully the implications of these developments. Nevertheless, this could be a potential commercial source, along with other processes for producing artificial fluorspar in the future. - 63 - 111. Taking into account the technical developments in the various uses of fluorspar which may unfluence its future demand, and the expectation that world GDP growth in the next decade is likely to be at a lower rate than that acehived in the 1960s and early 1970s, growth of demand for fluorspar in all applications is expected to slowdown substantially in the future - perhaps to about 6%, compared with 9.3% per annum in 1962-1971. 1/ Fluorspar is likely to still experience one of the highest growth rates compared with other minerals. Mine Production 112. Mine production of fluorspar in the developing countries has been rising rapidly. Their share rose from 31% of total world output in 1960 to 45% in 1978. While the share of centrally planned economies also rose from 29% to 34%, the share of industrialized countries was halved to 19% during that same period. Mexico is the largest producer, currently contributing almost one-fifth of world output (or one-third of the total for market economies). It is followed by USSR (10% of world output), Spain (8%), China, Mongolia and France (each with 7%). (Table 22). 113. The rising share of the developing countries in total output reflects the effects of significant growth of demand during the early seventies (with higher fluorspar prices), which induced the exploitation of relatively 1/ US Bureau of Mines projections made in 1976 project a rise in the per capita primary demand of fluorine from 2.3 lb. in 1960, and 6.3 lb in1974 to 13.2 lb in 1985 and 14.6 lb by 2000. US Bureau of Mines, Minerals - Facts and Problems, 1976, p. 25. - 64 - Table 22: FLUORSPAR - WORLD PRODUCTION ('000 short tons) 1960 1965 1970 1975 1977 1978 Industrialized Countries 901.1 975.8 13.8 1,156.3 1.125.0 ,05 of which: France 149.3 215.6 320.0 351.0 408.0 400.0 UK 109.2 128.7 213.0 254.4 220.0 250.0 Italy 179.0 169.0 319.1 254.9 205.0 200.0 Developing Countries 679.2 1 248.1 2,1667 2 370.0 2,501.8 2 489.8 Southern Europe 122.8 244.4 378.4 370.2 442.3 452.3 of which: Spain 122.4 243.2 376.6 369.1 440.0 450.0 Latin America 418.2 823.5 1,149.9 1,312.7 1,163.0 1,110.0 of which: Mexico 404.5 810.6 1,078.6 1,200.2 1,053.0 1,000.0 Argentina 13.7 12.9 32.7 41.9 40.0 40.0 Brazil 38.6 70.5 70.0 70.0 Africa 113.6 79.3 229.0 375.2 618.5 644.5 of which: Kenya - - 4.3 60.2 137.0 150.0 Tunisia - 3.3 33.8 37.8 38.0 38.0 South Africa 113.6 72.5 190.7 223.3 387.0 400.0 Asia 24.6 100.9 409.4 311.9 278.0 283.0 of which: Korea, People's Rep. 20.8 43.2 52.7 31.2 22.0 22.0 Thailand 3.8 57.1 350.8 269.4 245.0 250.0 Centrally Planned Economies 639.6 829.0 0 1,488.00 .90.20 of which: USSR 210.0 385.0 450.0 520.0 552.0 550.0 China, People's Rep. 275.0 240.0 300.0 385.0 385.0 400.0 Mongolia 44.4 83.0 88.0 333.0 353.0 400.0 TOTAL WORLD 3.052.9 4014-3 5,466-8 5.448.8 Source: U.S. Bureau of Mines, Minerals Yearbook, various issues. - 65 - abundant reserves in a number of developing countries, notably Kenya and Thailand. A significant volume of output from these projects came on stream in the early to mid-1970s, coinciding with the slowdown of demand for fluorspar caused by the world recession. The result was the accumulation of large stocks in excess of trade requirements (no data available). 114. After such stocks are liquidated probably by 1981, the expected growth of demand for fluorspar, even though lower than the historical trend, would necessitate new sources of supply. Among the developing countries, Kenya, Thailand, Spain and Mexico have a potential for expansion. Their proven reserves are equivalent to about 39, 17, 10 and 15 years of the current annual levels of production in these countires respectively (table 23 ). - 66 - Table 23: FLUORSPAR - ESTIMATED WORLD RESERVES, 1979 /a Thousand Short Tons Percentage of (35% CaF2 or equivalent) World Total Mexico 39,000 13 Kenya 15,000 5 Spain 11,000 4 Thailand 11,000 4 South Africa, Republic of 78,000 154,000 26 52 United States 16,000 5 Canada 6,000 2 France 9,000 3 Italy 7,000 2 United Kingdom 22,000 60,000 8 20 Other Market Economies 50,000 17 China, People's Republic of 6,000 2 Mongolia 5,000 2 U.S.S.R. 15,000 5 Other Central Economy Countries 5,000 31,000 2 11 WORLD TOTAL 295,000 100 /a Measured and indicated. Source: US Bureau of Mines: Commodity Data Summaries, 1979. - 67 - Prices 115. There seem to be a considerable regional variation in fluorspar prices although available data are scanty. The US price of the acid-grade concentrate, dry basis 97% CaF2, FOB, is considered as a rough indicator of price trends (Table 24). 116. In 1978 constant dollar terms, the price rose from about $95/short ton in 1963-1965 to a record high of about $150 in 1971, reflecting the sig- nificant increase in consumption. The price then declined gradually to about $102 in 1974, when the coming on stream of a number of new projects coincided with an economic slowdown. 117. Industry sources do not consider the quality of ore of the additional mining required to meet the projected increment in the demand for fluorspar to be necessarily higher than that found in the current mines; and it is believed that future fluorspar prices are unlikely to be below $110/short ton in 1978 constant dollars. Some Fluorspar Firms in the Developing World Kenya 118. "Fluorspar Companies of Kenya" (FCK) established in 1972; 51% is owned by the Kenya government with 24.5% each owned by the "Bamburi Portland Cement Co." and the "Continental Ore Corp.", the latter acting as managing operator. - 68 - Table 24 : FLUORSPAR PRICES ($/short ton) Year Current dollars In 1978 Constant dollars 1963 45.00 99.80 1964 45.00 99.55 1965 45.00 97.40 1966 49.00 102.70 1967 51.00 106.70 1968 54.00 110.20 1969 57.50 113.00 1970 68.50 134.60 1971 81.75 150.30 1972 82.75 145.40 1973 82.75 128.50 1974 94.25 123.20 1975 105.00 125.60 1976 105.00 120.15 1977 * 105.00 113.15 1978 113.00 113.00 1979 115.67 102.00 Commodity Specification: Acid grade concentrates, dry basis 97% Ca F2, Carloads, f.o.b. Willimington and Illinois. Note: (1) Yearend prices; and the mid-range of published price quotations since 1970. (2) US wholesale price index used. as a deflator. Source: Engineering and Mining Journal, Yearend prices. - 69 - Tunisia "'Societe Tunisieune d'Expansion Miniere" (Sotemi) operates the main site at Hammam Zriba. Morocco "Societe Anonyme des Enterprises Minieres" (Samine). Mozambique 1. Companhia Minera do Lobito 2. Companhia de C1raniode Mccambique. Mexico Minera Frisco. - 70 - ANNEX I SUMMARY NOTES ON SELECTED NON-FUEL MINERALS 1. Antimony 2. Asbestos 3. Barite 4. Boron 5. Columbium 6. Diamonds, Industrial 7. Molybdenum 8. Platinum Group 9. Rare Earths 10. Silicon 11. Tantalum 12. Titanium 13. Vanadium 14. Vermiculite - 71 - 1. ANTIMONY 119. Antimony is one of the oldest metals used by man. The natural sulfide of the metal, stibnite, was used as a medicine and mascara in ancient times. Its name is derived from the Greek and means "a metal seldom found alone". In the Middle Ages, antimony alloys were used for printer's type, mirrors and bells. Modern industry utilizes antimony in many ways for its metallurgical and chemical properties. The most important current uses are as a metal hardener in lead storage batteries and as a fire retardant (Table 1.5). 120. Over 80% of the total production of metal comes from Bolivia, China, South Africa, USSR, Thailand, Turkey and Mexico. (Table 1.1). Although reserves are adequate for the next generation (Tables 1.1 -and 1.2), depletion of high-grade ore in Mexico and South Africa will lead to an increase in production costs and necessitate adjustments in smelting practices. 121. Antimony is marketed by international traders in a complex pattern of pricing, currency and transportation. Prices tend to fluctuate widely (Table 1.3). 122. The metal is faced with continuing problems in maintaining its technical and economic advantages in competition with other metals. The introduction of maintenance-free batteries, which use other minerals (selenium, copper, cadmium and sulfur) has led to significant reductions in US antimony demand. Secondary sources play a very important role, as about 50% of US supply comes from recycling mainly batteries (Table 1.4). Also, reliance on lower grade ore might cause an increase in prices. - 72 - Tabla 1.1: WORLD ANTIMONY CAPAC:TY VND PRODUCTION, 1977 - -Table 1.2: WORLD ANTINCNY RESOURCES (Short Ions) Mine Smelter Ctl'M. non unrs 01 antriny conimrt) Capacity Product,on Capacity Production Ce.er a. r0. North America SpCeS sotrE3 Total" United States .. ........ 4500 1 208 20000 12827 Canada ...... . ...... 3.500 2.340 2,500 1.100 North America. Mey,co . ................ 4000 3000 1,600 900 United States ...... ................ 120 20 140 Other .1.500 1,27 .... Caoada ..... .. ..... ... ... 70 '0 so Mex:co .. ....... ...... . 240 Is 260 Total ................. 13,500 7,875 24,100 148 27 Total .....................430 45 480 South America. Bolivia ................... 20.000 16.707 10,000 4,400 South Ameica Peru ..................... 2.000 712 1,500 S00 Bod-via .... .... ......... . . . 400 30 430 Peru ..... ... .. .... ... . ... . . . 70 5 75 Total .................. 22,000 17419 11.500 4 9000 To 47 _______________________________ Ttal....... .................... 470 35 500 Europe 80lgiim-Luxembourg .. ..... .... 15,000 12,100 Europe. Czpchoslovakia . ..... t.500 830 1.000 700 Czechoslovakia .. .. ........... ... so .... so Franc . . .............. .... .... 5.000 4000 ita? d R ..-.-- ....- ......--.-.....* ..- . 130 10 140 Germany, West ....... .... .... 4.000 3 '50 U L ... . ... ..... . . ...... 300 20 320 Italy .................... 3.000 C09 2 500 2 000 Yugoslovia ......... ....... . . ... 100 10 110 United Kingdom .. ..... .... .... 5000 3000 USSA ...............10,000 8,700 8000 7000 Total . ........ .......... 580 40 620 Yugoslavia .............3.500 2.300 3.000 2.900 Africa. South Africa. Republic of ....... 350 30 380 Other .................... 2,000 921 1 000 348 Asia Total .................. 20.000 13.660 44.500 35.548 Malaysa ........................... 130 .... 130 Ch ra Mamiand .......... ..... ... 2.400 700 3.100 Afrca Thailand . .........................' . 100 to 110 .A gena ... .... Turky ........................... 120 .... 120 Morocco ..... .......... 3,000 1.553 .... .... South Africa, Aepubicof 20.000 13.260 .... .... a urai.... ................ 2800 70 3.50 TOalceania....3.0 14879a........... 5O 2 7 Total ---.----....---.-- 23.500 14879 .... -.. World total .... .......... .... 4,801 880 5.7no ap0 Denved in collaboration with U S. Geological Survey. China Mainla. . 19,000 13.000 20,000 12,000 Includes on'y measLred na rndraled or aemonstrated quantities. Thailand..8.......... .000 5.238 1.000 2O ircluos interred reserves hypolercI economic resources , .nown di Tukla 5. ... 000 4.900 1.000 F00 tnTs. and some identified subecOnomc resources Omke . . .t... .. . ..1 5000 .00 .... ... Data may not add to total shown because of *ndependent roundilg. Total ................ 33.500 24.192 37.000 24.300 Oceania Australia . .... .. 4,000 1 550 .. World total ........... 116.500 79.575 117.100 79.575 'Includes Oxide. Trfle 1.31 TT-:E PRICE RELATTONSTiPl FOR AMTIRL.A Average aniual prce. cents Der pound Actual Year prices I95 318 19',9 31 3 1960 3t3 1961 3.19 1962 348 1963 348 1964 422 1965 458 1966 458 1967 458 1968 458 1969 576 1970 1442 1971 71 2 1972 590 1973 685 1974 181 8 1975 176 6 1976 1653 1977 '780 1978 *1750 Est"mate - 73 - Tablel.4;Summary of forecasts of U.S. and rest-of-world antimony demand. 1977-2000 iSmort tons) 200) Probable aver Forecast range Probable aoe an rual 1977 gruwth rate 197i-i000. Low High 1985 2000 percent United States Primary . . ....... 20.366 27000 45000 26 000 34 000 22 Second.uy ........ .. .. 30601 20 000 40000 31 000 3, VX) 02 Total - 50 967 47 000 85 000 57.000 66 000 I I CumuItive (pr.mary) ..... .... 542 000 726 000 187 000 614 000 Rest of world Primary .. .... .. ....... .56133 60000 95000 66000 92000 22 Secondary ..... ...... 45000 50000 70000 53 000 74060 22 Total ... .... .............. .. . 101,133 '10000 165 000 119 000 166000 22 Cumulative (primary) ....... .. .... 1.322,000 1 715 000 494 000 1 673000 - World' Pnmary ...... .. .... ...... ...... 76.499 87 000 140000 92000 126000 22 Seconrary ..... .... ...... .. 75.601 70 X0 110000 84000 106 000 1 5 Total ............ ........ ....... 152.100 157000 250000 176 000 232000 18 Cumulative (pnimary) .... 1.864000 2,441.000 681.000 2.287.000 .... Tablel.5:Projectlons and forecasts for U.S. antimony demand by end. use for year 2000 (Short tons) 2000 Conlinqerc forecasts for United States Statistrcal Forecast range Croject,ons' LOw High Probable Transpolalw,n 30.580 60 463* 16000 32.000 22.000 Flam'e retardams 9.... ... ....9.684 39.156 10,000 22000 17 000 Rubber pro-d6c!S 1.019 5.599' 3000 6000 500I Chemicals 5 606 0 7,000 9.000 8.000 Ceramcs and glass 2.040 5961' 6000 8000 6,000 Machinery 1.019 1.020, 3.000 5.000 5 000 Other ... 1.019 0 * 2000 3.000 3OO Total 50967 -. 47 000 85.000 66.000 'Statistical proections are denved from regression analysis based on historical time Snes data and forecasts of economic indicators such as GNP and FR8 Index Projection eq-,ations with a coelficient 01 determination (R-squared) less than 0 70 are indicated by an astenisk (*) Source (Tables 1.1 through 1.5); United States Department of the interior, Bureau of Mines, Antimony, Mineral Ccmmodity Profiles, June 1979. - 74 - 2. ASBESTOS 123. Asbestos is a fibrous mineral with many uses as a processed fiber. It is mainly used in asbestos-cement pipes (for water transport), flooring products, cement sheets, and friction and paper products (Table 2.5). There are no substitutes available for asbestos in many of its applications. There is a possibility that glass fibers can be made alkali-compatible and if so replace asbestos in some asbestos cement products. 124. The USSR, Canada, South Africa, the People's Republic of China, Italy and the United States together produce over 90% of the world supply (Table 2.1). The asbestos produced in the Peoples' Republic of China and the USSR is used domestically. In the rest of the world, for 1973-75, Canada had 59% of the export market, South Africa 14.5%, Italy 6.5%, and the United States 4.5%. Table 2.2 shows world resources. 125. In recent years the asbestos market has been characterized by strong demand. Consumption has been growing particularly rapidly in the developing countries with a rapidly rising trend in construction activity. The present shortages and projected demand (Table 2.4) point to serious depleti6tr- of present reserves by the end of the century. Thus exploration and .development are increasing throughout the world. It may be pointed out that the industry has been faced with concern with health hazards of asbestos (cancer-related) and higher unit capital expenditures in order to meet environmental standards. - 75 - Tabl* 2.1: WORLD ASBESTOS PRODUCTION. 1975, AND CAPACITY, 1976 AND 1980 Table 2.2: IDENTIFIED WORLD ASBESTOS RESOURCES (Thousad aom) (ilatn snort o~ pr~ Capaaty Omer 1975 1976 %W Resenrvm' m~cm Total North Arnac Chmaria: Unted Sta k. North Arnica: Oter -------6 65 130 Canada ------------------ 1.140 2.000 2.00 Mexico ......... __.... ........ 50 Total............. 65 65 130 Uned Stats.............. .99 125 130 Soun Anenca ... 5 4 9 Europ.................. 52 20 72 To -.........--.- 1.239 2,125 2.780 Arnca ..........----------22 14 36 Tata ........... .r..a.. 1 o Eou ___ .. __ _42 213 h rena ....... __...... . 2 17 10 awii......................72 75 9w Wömit~ ..... 160 115 275 E Tokial --- ------.... ... ... 73 76 9 l ' 4 ao - Pw gU S. Pnc adsu ~ ain 17 5 t 44 p erorw Yugoaia................. 14 19 40 O --t . ................. 3 __ 4 5 Toa..... _ ......... 2.293 2.421 2.855 Tablå 2.3: TIME-PRICE RELATIONSHIP FOR ASBESTS AMm Averag anual ~pnc. dolak pr short ton Rthoda -........... .180 180 200 ye -u South Afdm Cpu -l 162 90 100 Acat Swaland ..._.........-- 41 48 55 p"ce Other .................... 1 1 1 __ __ _ __ __ _ 1 968 8976 Tota ................. . 384 319 358 1957 8809 ____ ___ ___ ___1968 9050 Amtmi 1959 9117 China. Peopl@'s R@pu~ cf 165 160 200 1960 9462 O r .......- ...- ....- 35 36 40 1961 9560 Incka ------------------- 23 25 30 1962 9485 Japan ....... 5 26 25 1963 92.44 KorMa a9Wo 4 7 7 19154 9870 Taiwan ------------------ . 2 4 4 1965 9792 Tudk@¥ ~~----~-~~ - 17 18 25 1968 10063 _____________________1967 10191 Total --------------- 251 298 331 1968 9 w o..na:a~:............ 40 73 100 1969 110.60 _____________________1970 11584 Wodd Chryso-e-total 4,280 5.310 8.513 1971 11754 ___________________len97 11663 1973 12222 Souh Atrica. Reub~o 01 .._ 149 194 200 1974 122.27 Austraha...................... .._- - 21 21 1975 14414 __________________im7 20631 Wodd c~9do rd -otat..-. 149 215 221 Arnwste South Aftca. Republcof.. 80 120 130 , 1975 produc~n, wiot C1 excepoon of Canada an 1e Uitd 1Sma was e capaaty. - 76 - Table 2.4-Summary of forecasts of U.S. and rest-of-world asbestos demand, 1975-2000 (Thousand short tons) 2000 Poal Foroast ange Probable av g anual 1975 growth rate Low High 1985 2000 percn United Slatesr Total ---------------- 608 1.026 2.000 880 1038 1 1 Cumulative' ....... .... 22,600 33.300 8.400 22.900 .... Rest of Workdf Total ................ 3.904 8 578 14,177 5.740 11,040 4 5 Cumulative 2 ----------.. 147.000 200,000 47.500 172.000' World. Totil ................ 4.512 9.604 16,177 6.620 12,078 40 Cumulative .......... .... 169,600 233.300 55.900 194.900 .... Calculated from a 20-year U S demand trend of 791 for 1975 'Calculated trom a 10-year resta-o-word demand trand of 3.698 tor 1975. Table 2.5 -Projections and forecasts for U.S. asbestos demand by and use, 1975 and 1000 (Thousand shart tons) 2000 Contragency forecasts for United States End Use; 1975 Fprs"M Forecast range barobal" LeW High Asbestos 00cemenl pe ........ 153 244 270 527 274 Asbestosoment sheet ...... 44 95 tis 224 111 Floorng produtas -....-.--.. 136 323 187 364 189 Roong produc ............ 48 120 92 ISO 93 Pacsing and gasketa ........ t? 38 35 a8 35 FncDon products .....-...... $6 124 97 189 9 tIsulatio................... 6 39 17 33 17 pawer--------------------- -8- 6 28 76 q49 77 T411111114's .-.------------------6 29 24 47 24 opwe------------------------ as 256 113 219 115 Tl---------- 608 ---1,026 2.000 1,038 The lorec base for finlian Products s derived trom astical analya an data Idr 1960-7M AN ather 2000 forecat bae iguese are based an data for 1960-73 Source (Tables 2.1 through 2.5): US Department of the Interior, US Bureau of Mines, Asbestos, Mlineral Commodity Profiles, Septcnber 1977. - 77 - 3. BARITE 126. The term "barite" is the mineralogical name for barium sulfate (BaS04) and is derived from the Greek "barys" meaning heavy. The principal use for barite is as a weighted mud in oil and gas well drilling to suppress high formation pressures and prevent blow-outs (Table 3.5). While this accounts for up to 90% of consumption, barite is also used as a raw material in chemical manufacturing, paints, plastics, and synthetic rubber. 127. Barite resources are widely distributed, but only 6% are classified as economic reserves (Table 3.2). The developing countries, mainly Peru, Mexico and India, account for about one-third of world production and exports (Table 3.1), 128. Essentially, barite's future depends on oil and gas drilling. This may remain at peak levels in the 1980s (Table 3.5). In the short- and medium- term there is a scope for upward price movements. Historical price movements are shown in-Table 3.3. This potential, however, is limited by the development of a barium substitute called FER-0-BAR by a West Germany company and the possible use of iron ore or celestite as well. While some new uses, such as the product called "Rubarite", which uses barium to blend synthetic rubber with asphalt, appear promising, these uses are unlikely to be important in quantitative terms. Future demand growth is likely to be modest (Table 3.4). 129. In summary, the short-run market prospects appear to be moderately good, but in the long run, barium may have to face potential competitors. - 78 - Table 3.1: WORLD BARITE PRODUCTION, 1977, AND CAPACITY, 1977, 1978, AND 1980 Table 3.2: TOTAL BARITE RESOURCES (Thousand r tonsl ITriousani snort tonsi Capacay ote Production Re. le- in 1977 1977 1978 1980 seves sources Totals North Amnerca America Unied States... I 494 1.600 1.700 1 800 Oi UniedStaes----- t 94 .60 .no i oo niedStLes ------------------- 25.OD0 250 000 275 0O0 Other .............. 48 450 500 500 Canada------------------------3000 10000 130 South America ........ 436 550 600 6.. 4000 20560 209 000 Europe -------------- 1.990 2.100 2.200 2400 Arica ---------------- 248 300 350 500 TotalL-----------------------32.000 465000 497000 Asia ------------------ 1.273 1300 1.300 1.500 Oceants .............. 13 20 20 50 South Amenca Pruil------------------------- 4000 Workd totl4.... 5.902 6.300 6.700 7.00 ~,- - - - 40 2 0 3.0 - stil.Other------------------------- 3.000 85000 88000 'Estimate. Data may not add to tntals snownPecause a edepener oung. Total----------------------- 1.000 213000 224000 Europe- Table 3.3: -Time-price relationship for barite France------------------------z2o0 Tabe -imeprie rlatonsipGem any et---------------2000 1 Avage annual pce doars er s Greece----------------- Auer9.anua pic dllispe hort toll Ireland ------------------------- 300 81.000 Pmary bae Crushed and ground ba---------------------------20 Primary_bard_Crushed_andground_barit USSR ------------------------ 4000 75000 79000 Other------------------------- 10,000 130000 140.000 Total----------------------- 25.000 305.000 330 000 Actual Actual Arca Year price pnee Ageria------------------------:.0.0 1957 ...... 1126 Moocco - -----------2 1957 i 262888 southern Rhoei--------20 1958 ...--- 1240 2761 1959 --.... 1142 2515 1960 ...... 1200 2479 Told ---------------------900 205,000 214,000 1961 ...... 1167 2431 1962 ...-.- 1142 2374 Asia. 1963 ...... 1141 2476 Algha78aw------------------14,00 1964 -..... 1180 2503 1965 ..---- 1196 2520 Pndia----------------------i 0 12 0 1000 1966 ..--.. 1189 2535 Thailand--------------------5.000 10 12000 1967 ...... 1206 2187 Turky------------------------5000 50000 55000 1968 ----- 1479 2219 1969 ------ 1463 2324 1970 ...... 1499 2435 Total--------------------29000 393.000 426.000 1971 ------ 1635 2547 1972 ----.. 1643 3119 Oceam ---------------------------2000 40.000 42000 1973 -.-... 1511 3462 1974 -..... 1521 3941 1975 ...... 1608 4039 1976 -.-..- 2325 4255 1977 ...... 2026 4260 19781 --- 2080 4300 'Data maynotI add towtils ghown becausec oe o ft aepna roundlng. NA Not avTilable. UtEseimade. based od ISI .w. . o. d20. - 79 - Table 3.4: SUMMARY OF FORECASTS OF U.S. AND REST-OF-WOILD BARITE DEMAND, 1977-2000 11housand short tons) Forecast range Probaol average 2000 Probabte annua growth rate 1977-2000 1977 Low High 1985 2000 (perer)l United States Total .................. 2,592 2.170 3 30 3500 2 800 03 Cumiabve ............ .... 50000 68000 25000 62000 .... Rest of worid Total ------------------ 3.310 3.750 4500 5.500 4500 1 4 Cumulatv ---------------. 81.000 90000 36000 90.000 -.-- World Total .................. 5.902 5925 7 80 8000 7300 09 Cumulave ----- ------- -- . 131.000 158000 61.000 152000 .... Table 3.5: PROJECTIONS AND FORECASTS FOR U.S. BARITE DEMAND BY END USE, 1977 AND 2000 .(Thousand short tons) 2000 Contingency forecasts for United States Statslcal Forecast range proeCbongl End Use 1977 Low High Probable We atg ----------------------- 2.371 4.675* 2.000 3.000 2.580 Pant .----------------------------50 1 43 40 so 40 Glass --------------.. . . -- ..... ...W 10' 40 70 60 Rubber -------------------------- W I1 20 50 30 Banun dhmcalis.------------------ 1 0 s0 120 70 Oer ..---------------------------- 90 204* 10 40 20 Total ---------------------- 2.592 2.170 3.360 2.800 W Wftheld to avoid disclosures of individual company conwidential data, included in ter " I Statistical propectons are derved frot regression analysis based on hstoncal timn genes data and forecasts 0 economic inicators such as GNP. FAB hIdesl Proection equabons wes a cofficient of deterwiation (R squared) less than 0 70 are nicated by an astersk (*) Source (Tables 3,1 through 3,5)t US Department of the Interior, Bureau of Mines, Barite, Mineral Commodity profiles, February 1979. - 80 - 4. BORON 130. Boron is a metalloid element used in metallurgy and nucleonics. While the glass industry (insulating and textile glass fibers) is the major consumer, other uses of boron compounds include coating and plating (deco- ration purposes), agricultural herbicides, and the manufacture of soaps and detergents (Table 4.5). 131. The United States is the leading world producer and consumer of boron-containing minerals and chemicals. The US industry is constrained by lack of large new reserves (Table 4.2). Turkey, with its sizeable reserves and currently the second largest producer, is likely to surpass the US in the next few decades. The USSR, which produces mainly for domestic consump- tion has reserves comparable to those of the US. 132. In 1977, the US, Turkey and the USSR represented respectively 53%, 33% and 9% of total world production (Table 4.1). The current world boron mineral reserves are estimated to be approximately 1 billion tons of ore (Table 4.2). 133. The Rio Tinto Zinc Corporation has control over-most ;major international boron operations in the market economy countries, with sub- sidiaries in the US, France, Argentina, and Spain. In Turkey, the plants are being operated by a state enterprise. 134. A study by the US Bureau of Mines concludes that world reserves of boron will be more than adequate to satisfy cumulative world demand to 2000 (Table 4.4). The future of the boron minerals industry will be highly dependent on the glass industry. Energy conservation programs are likely to escalate the demand for insulating glass fibers. While the demand in the US is forecast to grow at 3.9% per year till 2000, consumption in the rest of the world is expected to grow at an average annual rate of 3.5%. - 81 - Table 4.1 World boron production. 1977, and capacity, 1977, 1978, and 1980' F (Thousand short tons of boron contenti Production Capacity in 1377 1977 1978 1980 Table4.3-Tlme-price relationship for borax North America United States ........ 228 230 230 290 pentahydrae South America Armentina ......................... 15 30 30 30 Average annual crice dollars per short ton Ch'ie ............................. (2) 5 5 Peru .............................. 3 5 10 10 Acual Total ........................... 18 40 45 45 Year ppce 1 958 57 Europe USSA .................... 40 40 40 45 1959 58 Asia 1960 sa fnd-a ........................... 2 5 5 6 1961 58 China Mainlandi 5......... 5 5 1962 5a Turkey......................... 140 140 140 200 1963 58 ' 964 58 Total ........................... 147 ISO 150 210 1965 58 1966 62 World total ...................... 433 460 465 590 1967 62 1968 87 ' Exceat for the United States production estimates denote only a general order 1969 67 of magnitude. 1970 75 2 Less than % UML 1971 75 1972 75 1973 s Table 4.2 World boron reserves 1974 98 1975 t05 (Million short tons of boron content) '970 1977 118 Reserves 1978 128 North AmeTraea United Stales Cal.'o3o,a 20 n pstimated South America 'Borax Pentahydrate. tecnical. granular, 99 5 percent. bulk, carlots worpas AAtinan o................................. Roliv-al...................................... Chile.................................. ............. 10 Peru .........................................) Europe U SS A.............................. ..... 20 Asia Chiral.............................................. 10 Turkey......................................... 40 World Ml j.............. ........................ 100 'Order of magnitude ol Table 4.4 -Sumnmary of forecasts of U.S. and rest-of-world boron demand, 1977-2000 (Thousand snort tons of boron coetent) 2000 Probable average Forecast range Probable annual ~os r958 57XM 1977 Low H,g 9 1985 2000 percent) United States Totwa.......................... ... 121 200 400 160 290 3.9 Cumultive......................... ... .... 3700 5.500) 1.200 4.500 .. Reoo of world Total................................. 312 600 700 410 690 35 Cumltne,ve............................ .... 10.300 11,300 2.900 11.100 .. World. Total ........................... 433 800 1.100 570 980 36 Cumulat . ......... ............... .... 14000 18800 4.100 15.600 rabte: 4.5-Projections and forecasts for U.S. boron demand by end use for tf'e year 2M0 4 housand sthot tons of boron cor"ent) 2000 Contingency forecast for United Slates Slatisticat Forecast range End usa 197? projections LOW High Probable Ceramircs and glass........ ................... 55 122 122 258 200 coating and pliting laenarriell ................... 5 1 5 10 5 Aqriculture ... ... ........... ............... S 1. 5 10 S Soaps and detergent. ... .................... 14 23 23 33 23 Fabricated metal Products (fluxs)................. 1 51 2 20 3 omeir uses.................................. 41 69 43 69 54 Total ..................................... 121 ---- 200 400 290 Statisftial protect"ofae derrved from" relressiom analySs basad on historiCAl tie $sries data anid forecasts of economic 'idiciators such as GNP FRO index. etM Projection equations wilth a coefficient of determninaionl Irsquared) less than 0 70 are indicated by an astenisk V) Source (Tables 4.1 through 4.5): US Dlepartmet of the Interior, Burea2u of Mines, 1oro . Mtineral Cocu=odity Profiles. '4av, 1979. - 82 - 5. COLUMBIUM 135. Columbium metal is used in the manufacture of specialty steels and superalloys. It is used in construction (beams and girders), offshore drilling towers, oil and gas pipelines, industrial machinery, and trans- portation (railway equipment and automobiles) (Table 5.5). Columbium is faced with strong competition from vanadium, manganese, molybdenum and tita- nium as micro-alloying agents in the production of HSLA steel (high-strength, low alloy). 136. The major producers include Brazil, Canada, Nigeria, Zaire, Thailand, Malaysia and the USSR (Table 5.1). The first three produced 97% of the columbium ore and concentrate from market economy countries in 1976. The major consuming countries, which are dependent on foreign sources, include the US, Germany, Japan, Austria, UK and France. The US has no domestic ore reserves but does have a processing industry. 137. According to the US Bureau of Mines the columbium market is pro- jected to be in balance until 2000. World demand grew rapidly during the 1965-76 period and the trend is expected to continue (Table 5.4). At the same time, columbium supplies are expected to grow adequately to meet the projected demand. In terms of individual end uses, the Bureau expects a weakening of demand in aircraft/space equipment, but it is likely to be off- set by growing demand in land and water transportation equipment and in the oil and gas industries (Table 5.5). - 83 - Table 5. -World columblum production, 1976 and capacity, 1976, 1977, and 1980 Table S dentilfied world columblum resources (Thousand pounds) tM01,on pountis c0umbium Contnl) 1976 Capacity Reso r c r c Capac. Produc- 1977 1900 North Amesncig, fly tion United S1aes ........... .. 300 300 Canada .................. 1,300 700 2000 United States................. .... Ote -------------------- .... .... ....___ Canaca ------------ 7,689 2.591 8,00 10,000 Total.................... 1.300 1.000 2300 Total ............ 7.689 2.591 8,000 10.000 Soth America: South America. arp .------- 18.000 1,600 19600 Brazil-------------- 20.000 16.139 26,000 360 Total---.-..-....--...--11000 1.600 19600 tt -------- 2 1 2 2 Tnt_ _-------------- inco_ _.0019bo Total ------------ 20,002 16,140 26,002 33,002 Eumpes U__ _ _ _r .................. 1.500 5500 7000 E'WTS ------- 190 1150 195 .0 Uthor---------------------- 200 100 500 O t SR----------19 * 1.500 1.950 2.0 Total..--...-.1.700 5,800 7,500 Total ------------ 1.980 *1.580 1.980 2.030 A ica- Zate -----------------.900 .... .00 AfiaKonya ---------------------------1.000 1,000 Zaire --- ------------2M 48 260 260 t,grI_--------- 700 ... 0 ,isi------- 1.000 '63 2000 1.000 Uganda ---------- 70 ... 70 Cvwir ------------------100 57 l0o 100 Other --------------_--_20_600_So Total ------------ 1.360 *737 1.360 1.360 To*al--------------------- 2500 1.600 4.100 World total (rounded) ... 23.000 10.000 33,000 Mataysts---------------10 53 150 200 Thaiiand ------------ 400 355 400 400 Deived in collaboration with US Geological Survey To.tl ------------ 500 408 550 600 Oceaniae Australia------------ 100 *70 100 100 "VIsm total (rouded) ...... 31.600 '21.500 38,000 50,100 *Estimated Table 5.3 Time-price relationship for columblumI Merage a.-rual prce dollaiS per pound of contained c.y.r:ncii,rr, in conzvitrate Year Aclual pries 1954 486 1955 1 93 195 1 79 1957 1 68 1958 1 54 1959 154 1960 1 73 1961 1 43 1962 136 963 1 38 1964 1 36 1965 134 19Se 1.43 1967 142 1968 142 1969 142 1970 1 65 1971 1 65 1972 1 87 1973 1 97 1974 223 1975 223 - 1976 2 73 Price changes (dollars par pound contained Cb) 1977Jan 1, $3 22; May 13. $3 65. - 84 - Table 5.4 Summary of forecasts of U.S. and rest-of-world columblum demand, 1976-2000 (Thousand pourds. Columbtum content) 2000 Probable Forecast range Probable average annual 1976 growrn-rate Low High 1985 2000 (percent) United Stales ........ 6 14.100 29800 10.300 23.600 '56 Cumulat've ...... .. - 237 000 37e c00 75.600 322 000 test of wnd ..----- 22.030 47000 91.000 33.000 65 000 4 Cumu'uve ...... .... 80000 1.214 000 250000 972.000 Total wC.Id .......... 28.0CO 61 100 120 800 43000 88.600 Cumulative ............. 1.047,000 1,592 000 325.600 1.294.000 ..-- I Ceiate on a 20-year primary demand Irerd of 6.336 for 1976 rable 5.5: -Projections and forecasts for U.S. columbium demand by end use, 1976 and 2000 (Thousand pounds) 2000 Contingencv forecasts for U S End use 1976 Statistical proleViots Forecast range Low High Constiuctuon ................ 2.401 5,100 5.000 10.000 8.300 Machinery Mealworking ------------ 300 900 900 1,000 1.300 Spackl ind-stry ---------- 600 1,900 2 000 4.300 3.400 Total ................... 900 .... 2.900 5,900 4.700 01 and ga: ,rdus!nes -------- 1.201 2,500 2.500 4.500 4,000 Transportation .............. 1,201 3.600 3.100 5.000 4.100 Other ...................... 300 800 600 4.400 2.500 Total.................. 6.003 ..-. 14.100 29,800 23.600 I Statisbcal prolections are derived from regression analysts based on historical time series data. and forecasts of ecoratc indicators such as GNP. FRB index. etc Source (Tables 5.1 through 5.5): US Department of the Interior, Bureau of Mines, Colutium, Mineral Commodity Profiles, January 1978. - 85 - 6. INDUSTRIAL DIAMONDS 138. Diamonds which do not meet the criteria for a gem stone are used for cutting, grinding and drilling in industrial processes. End use data are shown in Table 6.5. 139. Most of the important world deposits of natural diamonds are in Africa (Zaire followed by S. Africa, Botswana, Ghana and Sierra Leone), and in the Soviet Union (east of the Urals) (Table 6.1). The total world output of natural industrial diamond was 31.1 million carats in 1977. South Africa is the largest producer of good quality industrial diamond stones, Zaire is the best source of natural crushing bort (diamond fragments). Other principal producers are Ghana, Botswana and Sierra Leone. The USSR is a key producer but the data are very scanty. The US is the largest consumer (Table 6.3 and 6.4). It does not have any domestic resources, but it is the largest producer of synthetic diamonds, having an extensive network of commercial plants. De Beers Consolidated Mines Ltd., the major conglomerate which handles production and marketing of industrial diamonds (from mines in South Africa, Tanzania, Botswana and Namibia) represents over 1/2 of world production. 140. The average unit value for crushing bort, powder and synthetic grit has declined considerably in,the last decade due to competition from large scale production of synthetic grit (Table 6.2). It is projected that the market will be kept in balance through the year 2000 since no problems are anticipated in the US production of synthetics. On the other hand, the prices of industrial stones have been on an upward trend and are expected to continue. - 86 - 141. World reserves of natural diamonds are not sufficient to meet demand for industrial diamond through 2000. Also, some industrial stones may be upgraded to gem stones. Chances of dinging new deposits of sufficient quantity are not bright. The commercial expansion of synthetics is likely to fill the gap. - 87 - Table 6.1-World Industrial diamond resources Resources Country (mi,on caraisi Botswana .-- - - --............................. 50 Ghana...................................... :'-25 Reulcof Soumh Afica...................... 5 Other free world ................................ 30 U.S SR .......................... ............ 25 Za ote -......... - ....-........ 500 Estimated breadW.. Industrial stones .............................. 170 Crushing bot ............................... 510 Table 6.2: -Time-price relationships for industrial diamond, 1954-78 Average annual pnce. dollars oer carat Bort and powder Stones Based on Actual constant Actal Year prices 1977 dollars prices 1954 314 743 977 1955 3 18 737 8lt 1956 308 692 924 1957 330 717 750 1958 3.28 702 664 1959 342 716 751 1960 311 640 685 1961 305 622 739 1962 306 613 726 1963 297 586 705 1964 230 544 638 1965 279 531 700 1966 257 473 578 1967 238 426 613 1968 2.18 373 865 1969 2 18 355 620 1970 2.14 331 5.62 1971 223 328 578 1972 214 302 580 1973 2.10 281 590 1974 207 2.52 595 1975 210 2.33 654 1976 2.11 223 659 1977 208 208 6.20 1978 220 .... 778 .... Table 6.3: -Summary of forecasts of U.S. and rest-of-world Industrial diamond demand, 1977-2000* (Thousand caratsf 2000 Probablfe average Forecast range Probable annual growth rate 1977-2000 1977 LOw High 1985 2000 (percent) Unted States ............ 34.600 44.900 204 600 37 000 69.500 '42 Cumulative .......(') 870 000 2.320 000 304 000 t 141 000 Rest of world ............ 66.000 97000 443.000 80000 150000 Cumulathve ......... .874 000 4.996 000 654 000 2 457.000 .... Wold ................. 100.600 141 900 647600 117,000 219.500 4.2 Cumulative .......... .... 2 744.000 7.316.000 958.000 3,596.000 .... * Estimated 'Calculated from te 1958-1977 prinmary demand trend a 27,300.000 carets in 1977 rable 6.4: -Projections and forecasts for U.S. Industrial diamond demand by end use, for year 2000 (Thousand carats) 2000 Contingency forecasts for United States Forecast range End use 1977 Staistical prolections' Low High Probable Transportation equipment ..................... 5.900 10,700 7.300 14.200 12.600 Electrtcal machinery ........................... 4.700 8.500 5.500 10 000 9.000 Machinery except electncal .................... 4.500 8.000 5.300 9.000 8.500 Contract construction .......................... 4.500 5.600 5.900 14.800 9.600 Mineral sevceas .............................. 2.300 2.900' 1.900 3,000 2.500 Abrasives .................................... 5,800 580 10000 131,000 12.600 Dimension stone .............................. 2.800 5.300 3.900 11.800 6.300 Stone. clay, glass ............................ 1.400 2.400 1 800 4500 2900 Other ......................................... 2.700 5,200* 3.300 6.300 5.500 Total ..................................... 34 6W .... 44.900 204.600 69.50o 'Statistcal proections are dered from regressIon analyses based on histoncal time series data and the forecasts of economO CndicatorS Such as GNP FRO index, etc. Protection equations with a coefficent of determination (A-squared) less than 0 70 are indicated with an asteni () Source (Tables 6.1 through 6.4): US Departrent of the Interior, Bureau of Mir2s, Indui%trial DiAnrds, Miner3l Coximodity Profiles. - 88 - 7 . MOLYBDENUM 142. Molybdenum is a refractory metallic element used primarily for metallurgical functions, as an alloying agent in steels, cast irons and superalloys to enhance strength, toughness and corrosion resistance. Its versatile nature (due to its resistance under high stresses and temperature ranges) makes it particularly attractive in industrial processes. Molyb- denum has a variety of applications and few economically feasible substitutes (Table 7,5). 143. Approximately half of the world output is mined primarily for molybdenum, while the rest is obtained as a byproduct of mining of low grade copper porphyry-deposits. In 1977 world mine output amounted to 206 million pounds of molybdenum in concentrates; the US, Canada, and Chile produced 89% while the USSR represented 10% (Table 7.1). These four coun- tries also contain 90% of world reserves which are estimated to be 17.3 billion pounds; the US (7.5 billion) and Chile (5.4 billion) hold the largest reserves (Table 7.2). The western mountainous regions of North and South America from Alaska and British Columbia through US and Central America are regarded as the most promising for future discoveries. Most reserves in Central and South America are in large copper porphyry deposits. Mexico and Peru have substantial'reserves, 144. Countries that are the major producers of steel and other metal- lurgical materials are the principal consumers of molybdenum. The major importers are Western Europe and Japan, while the US supplies over 55%cof the molybdenum consumed in other market economies, The oligopolistic - 89 - American industry is comprised of four large corporations which have ac- counted for 89-94% of domestic mine output in recent years. 145. The molybdenum market has been characterized by strong demand in recent years. The tightness in the supply/demand balance has led to a threefold price increase, from $1.72 in 1974 to $5.19 by January 1979 (price data in Table 7.3). Some of the reasons cited for this price esca- lation have been higher operating costs, the need to recover cost of expanding production capacity and demand growth. The strength in demand has led to a continual decline in stocks during the last six years. The buoyancy in molybdenum prices, has triggered some substitution. However, there are no substitutes which will fulfill all the functions performed so efficiently by molybdenum. For example, there are no acceptable substitutes in metal- lurgical and chemical uses, The cost of molybdenum would have to increase substantially to affect the cost of the finished product and so stimulate substitution. 146. In terms of the long range outlook, demand is expected to continue to grow due primarily to increased applications of molybdenum as an alloy- ing agent (Table 7.4). On the supply side, the need for new output has been underscored by the recent tightness. It is expected that new supplies will come from additional exploration and development of new reserves rather than increased exploitation of existing ones. The real test for the molybdenum market will be whether production capacity will be able to meet projected demand after the early 1980s, Deposits are currently being evaluated but the potential output from these sources is not expected before the mid-80s. - 90 - Table 7.1 World molybdenum mine production for 1977 Table 7.2 Identified world molybdenum resources ana capacity for 1977, 1978, and 1980 i%on PoundSl (Thousand pounds) Reserves Other' T&N Production Capacity North America in17 97 17 90Uneed Slates ... 7500 8100 15600 in1977 1977 1978 1980 1300 2100 3400 North America Mex.. . 300 800 1 103 United States ......... 122 408 146 000 156 000 170 000 hr .... 1 300 I 300 Canada ................ 236,225 40 000 41 000 42 000 Mexaico ................. .40 200 200 200 Total 3100 12300 21400 Total . ............. 158673 186,200 197 200 212200 South Amenca. Chile................. 5400 6600 12000 South Amerca Per . . .I 1.500 Chile .................. 24250 26 000 28,000 30.000 Other ............. .... 600 600 Peru .................. 1 021 1 500 3000 5000 Total............. 5 QW 8200 14100 Total ............... 25,271 27 5CO 31.000 35000 Euron Sulgana ...... '0 20 30 Europe USSR .............. *21 400 22000 24 000 26000 OSSr ..500 1 1400 Bulgaria ............... .. ) 500 500 500 Norway ................. 0 500 500 500 Total............. 1510 2 20 143 Total .............. 21.400 23000 25 000 27000 Asia China .................. (3) 5.000 5,oGO 5000 Asia Japan --.. --....... 3 330 500 500 500300 V Reoublic of Korea ---.-. 222 500 500 500 Iran .................... 0 0 0 4000 Philippines .............. .20 200 200 Total 810200.. 802000 Total ................ 502 6200 6200 10200 25 20 20 20Australia ------ .... 50 so Oceania .................... *25 200 200 200.......................---- 400 400 World total ........... 205 931 243 100 259 600 284 600 Total............... -- 450 450 *Estinated Capacity data are estimations based on recent or anticipated output 2 Shipments Derved in Consuitation with U S. Geologicz Suvey. 3 Unnowninciuces Green-and Central America and Putirto Rima Iniciudesc Anlar,f,ca Data do riot add to totals shown because ol round,ip. Table 7.3TTime-prIce relationship for molybdenum In concentrate,' 1954-77 Average annual price. dollars Wr pound Actual Year price 1954 lOS 1955 1 10 1956 1 18 1957 118s 1958 1 25 1959 I125 1960 1 25 1961 1 40 1962 140 1963 140 1964 55 1965 1r55 1966 1 55 1967 1 62 1968 1 62 1969 1 72 1970 72 1971 1 72 1972 1l72 1973 1 72 1974 202 1975 248 1976 294 1977 368 19780452 O Preliminary 'Prices are weighted averages for each year Price changes in 1977 and 1978. Aug 1,1977,401 March?7 1978 S4A41 Sut 1 1978.4.95 De 29 1978. 55 19 ncalculated based on 4 75wercent increase oronG previous price) - 91 - Table 7,4 Summary of forecasts of U.S. and rest-of-world molybdenum demand, 1977-2000 (Thousand pounds) 2000 Probable average Forecast range Probable annual growth rate 1977-2000' 1977 Low High 1985 2000 (percent) United States Total .. ...... ... ... 61 350 150.000 200 000 93000 170000 45 Comulaiive - ... .... .... 2,300.000 2 800 000 620 000 2.500.010 Rost of i. e wd Total .............. 2155000 400 000 520000 243.000 460 000 4 8 Cumulative -... ..... .... 6.100 000 7.100 000 1 600.000 6.600 000 Wor"i To31 . ................ 2216350 550000 720 000 336 000 630000 4 8 Currisaive . 8400 000 9900 000 2 200 00 91t0000 Calculated from demand in 1977 Estimated Table 7.5-Projections and forecasts for U.S. molybdenum demand by end use, 1977 and 2000 (Thousand pounds) 2000 Contirgenry forecasts for the United States Statistical Forecast range End use 1977 projections' Low High P, obable Transportation ........................ 12966 28 491' 42000 53000 16000 Machinery ............................ 20 998 48.927' 3 000 49 000 42 000 Oil and gas industnes ................. 9.121 20 329' 29000 41 000 34000 Chemicais ............................ 7.118 23850 21 003 28000 24000 Electrical. ............................. 5,234 12.157* 10000 14 000 12 000 Other ................................. 5913 11.319* 10000 15 000 12000 Total ............................... 61.350 150 000 200 000 170000 1 Statistical orojections are derived from regression analysis based on histoncal time senes data and forecasts of economic indicators such as gross national product. Federal Reserve Board index, etc Projection equations with a coefficient of determination (R-squafed) less than 0 70 are indicated by an asterisk ( Source (Tables 7.1 through 7.5): US Depa:tment of the Interior, Bureau of Nines, Molybdenum - Mineral Commodity Profiles, Fay 1979 - 92 - 8. PLATINUM-GROUP 147. The platinum group consists of six closely related metals which commonly occur together: platinum, palladium, rhodium, iridium, ruthenium, and osmium. They are very scarce and their cost is correspondingly high. Nearly all the world's production comes from the USSR, South Africa, and to a lesser degree Canada (Table 8.1). 148. While jewelery was once the principal use, the group has become very important in many industrial uses, serving as catalysts or as corrosion- resistant materials (Table 8.5). Since 1974, platinum-palladium exhaust catalysts have been used in the US to reduce air pollution in automobiles, now the largest single use. The platinum group is widely used in the chemical industry, petroleum refining, glass making, electronics, medicine, and dentistry. World demand forecasts are shown in Table 8.4. 149. Three companies dominate the industry outside the USSR. Most marketing is through special metal-sales companies at negotiated prices, although the metal is also traded on several exchanges. In general, producers' prices apply to large, long-term purchases, while dealers and exchange prices pertain to smaller contracts and spot purchases. The South African producers effectively control platinum prices and the USSR controls the palladium prices. 150. Platinum-group metals are by-products of nickel and copper mining and in most countries the platinum refining capacity is essentially a function of nickel-copper refining capacity. Being highly oligopolistic, the major producing countries can and do control price to a large degree - 93 - (8.3). Since these metals are so valuable, any deposits are worth careful attention and may yield high profit rates. There are potential sites in Ethiopia and Colombia. World resources are shown in Table 8.2. - 94 - Table 8.1 World platinum-group metals production, 1977, and capacity 1977, 1978, and 1980 (Thousand troy ounces) Produc* Capacty ticn in 1977* 1977 1978 1980 North America United Stales 5 25 25 25 Canada .... 469 500 500 650 South America Colombe...... 26 50 50 40 Europe Finland (') (') (') 1 USSR ... 2.900 2.950 3.000 3.200 Africa E!hopta ... (') () (.) (') Reoublic of South At- rica ...... 2.90 3.800 3.600 4,300 Asia Japan .--.-- 23 30 30 35 Phil,ppines .. (') 2 2 2 Australia -..... 2 2 2 2 Worldtotals 6,400 7.400 7,400 8.300 * Prehmmry () Less than 1 unit SCapacity totls are rounded Table 8.2-World platinum-group metals resources 1 . (Mition roy ounces) Reserves Other Total platinum- platnr.- Platinum Pailadium Rhodium Platinto. group group group resources resources Norh Amenca Unted States ............ ..... NA NA NA 1 299 300 Canada--------------------- 4 4 (2)9 7 .16 Sot maieClobm------------- (2 2 As;a USSR ......................120 4 200 200 400 Alnca Reoubic of South Atnce ........ 350 150 20 50 1.400 2,000 Rhode"a ----------------..... NA NA NA NA 100 100 World total (rounded).......... 420 280 25 800 2.000 2.800 NA Not available SResources are known to exist in Australia. Ettiopia. Finland. and the Phidappines but have not been estmated ' Derved in collaboratian with U S Geological Survey SLes thantu Table 8.3-Time-price relationship for platinum-group metals - Avergge annual producers price (dollars per troy ounces Platimum Palladium Rhodun Indium Osm"um Ruthenium YewBase or Based on cua stant AActual Acual Actual constant Actual Actual pce 1976 Price price price 1976 price price dolr d0llars 1956 ------------ 105 223 24 121 105 223 90 50 1957 ............. 90 1as 24 121 105 216 90 50 1958 ..-... . 6 134 17 121 77 156 80 50 1959 ........... 72 143 19 123 77 153 80 so 1960 ............. 83 152 25 139 78 138 80 55 1961----------------83 160 25 139 72 139 85 57 1962----------------3 157 25 139 72 136 65 57 1963 ............ 82 153 25 139 73 136 65 57 1964 ------------ 90 166 31 155 85 156 95 57 1965 ............ 100 10 33 183 100 180 236 57 1968 ............ 100 174 34 198 145 253 350 57 1967...............III Ise 38 225 188 318 400 58 1968---------------117 190 45 247 188 30S 400 so 1969 ------------ 124 191 42 240 185 285 335 SO 1970 ------------ 133 195 38 215 156 218 215 53 1971 ............ 121 169 37 200 152 212 210 52 1972 ............ 121 162 42 197 162 217 212 52 1973 ............ 150 190 78 222 223 282 200 59 1974 ------------ 181 208 133 329 391 449 200 60 1975 ............ 164 172 93 338 477 50 200 60 1978 ............ 162 162 51 348 325 325 200 60 1977 ............ 162 153 60 441 298 282 175 60 I Pn as at JuMy 3, 197, Iillow Platitn. $220; palladum. $70 rhodium., 500. indium. 5300; osmium. $150 and ruheniun. 30 - 95 - Tablø 8. 4 -Summary of forecats of U.S. and rest-of-world platinum-group metals demand, 1976-2000 (Thousand troy ouncs)- 2000 Probable Forecas r Probate average 1976 annual Lo* High 1965 2000 1976-000 Unted Statøs: Prmy ----- ........... 1,388 1.353 4.223 1,960 -2.55M '30 SoUndary . .- ......- 215 300 700 370 500 3 1 Tt--...............- 1.60 .53 4.923 2.330 3.058 13.0 C,rnu~ae(nMy) I -_-.. ..- 31,000 60,000 15.000 49.000 Rst he wrld PnMary.---. ......... 4,604 5.925 10,540 5.130 8.080 2,4 Secdy -..- ...__ 650 1.350 1,750 975 1.650 40 TOa --...........-...... 5.254 7.275 12.290 6.105 9.730 2.6 Cumulatir(ri ma(Pry)......-.125.000 175.000 44.000 143.000 Pny--..........-......- 5.992 7.278 14.763 7.090 10.38 12.5 Second-y 865 1,650 2.450 1.345 2.150 '37 ToW --................... 68.57 8.928 17.213 8.435 12.78 2.6 Cumuatv (m )ry- ...... .... 156.000 235.000 59.000 192.000 Cacu~ated m the 12-yew U S, dernand trn d valuo of 1,250.000 troy ouc for 1976. C4d~ trar the I1 -ye U.S. gm~ produ trend value 0f 240.000 roy u fM 1976. Tahjl .L-Projectioa and forecasts for U.S. platinum. palladium, rhodlum, and platinum-group metals demand by .end use, 1976 and 2000 (Thousand troy oVn s 2000 Contingency forecat for End use 1976 Statista the United States prolecnons' Foreca range , Proba- LOW High Plaefnm-goup Chemica-s................. . 238 1.611 718 1,592 1,266 Petroleum rutning 6. 7 523 77 490 280 Ceramca and glasm 49 142° 71 187 156 Electna . ----------------- 287 1,076* 350 1,025 595 Døna] supøie 167 414 191 474 332 Jwery and ula 33 40° 66 250 139 Mator veh~ ca y - - 676 617 .. 550 30 01hr ---------------------- 81 403 182 355 260 T~ -.. 1.603 1.653 4.923 3.058 Platinuin: Chemals- ............... 84 617 700 600 PetroleumrefiNng 59 4611 60 400 230 Ceramcs and glas 42 100* 50 140 120 Elecc ------------------89 6 100 250 150 Deitai supplue - 27 65 30 70 60 Jewelry and art ... 23 8. 30 125 75 Motor ve~ calysis .. 481 583 5M 25 Other..........__........ 46 21M 175 130 TOta ................. 851 665 2.360 1.390 Paiadu: Chømca1111 ------------------ 12 718* 350 700 550 Petroleum r -r-ng -.... 7 0 15 80 45 Eiei ------------------ 152 839 200 600 350 Dena su nes _ _- ..- 139 36r 160 400 270 Jewelry and arte _- __ 6 31* 20 70 40 Motor vle catal-s . 195 233. ... ... -- Other. ..............._ _ 30 1887 TOt -----------....... . 657 820 1.990 1.365 Rhodwu: Chømil~_ ------------------ 19 59 45 75 60 Coramc and -ass ____ 4 20r 15 30 25 Ee~nc . 9 25 15 30 20 Jewety and arts -___- 5 21' 10 40 15 othr ---.- ..-.--- 4 ir 10 80 20 TOa .-------------------- 41 95 255 140 'Stathst"aW pro,ecoins are danved from rngresson analyims based on hist~nc tiame senes dat,. and forcasts of ocnome wdca,o such as the GNP and hh FRB mdex Pro~ecton equahans with a co~ aefcef dqtrminat«o (R-squared) l*a than 0.70 are indc~ated by an asansk (). includs ~ore vicle catyts Source (Tables 8.1 throtgh 8.5): US Department of the Interior, Bureau of Mines, PlatinuM-Groun - iineral Co=rmodity Profiles, September 1978. - 96 - 9. RARE-EARTHS AND YTTRIUM 151. The mining of rare-earth minerals for industrial use began in Brazil in the 1990s and until after World War II, Brazil and India dominat- ed production. At that time, and until recently, rare-earths came from concentrates of the ore monazite. Since 1965, bastnaesite has become more important as a result of development of a large deposit in California (Table 9.1). 152. The traditional uses of rare-earth elements and yttrium include lighter flints, are carbons, polishing compounds, and glass-ceramic ad- ditives. While still important, the major uses today are as catalysts for petroleum refining and use in ductile iron and steel (Table 9.8). High parity europium and yttrium oxides are used in color television picture tubes, flourescent lamps, and X-ray intensifiers (Table 9.2). 153. The US is now the dominant producer, but there is considerable production (largely from monozite) from Australia, Brazil, India, Malaysia, and the USSR. Some elements of the group are relatively abundant. For example, cerium, neodymium, and lanthium are collectively more abundant than copper or nickel in the earth's crust (Table 9.3). Others are very rare; promethium was not-known in nature before 1965. In addition to the existing producing countries, resources are known in Malawi, Malagasy Republic, Egypt, Thailand, Korea, Sri Lanka, and Indonesia (Tables 9.4 and 9.5). 154. Prices vary widely according to quantity, quality, source and purity (price data in Table 9.6). Bastnaesite sells at a premium because - 97 - of its superior advantages in processing. The general outlook is for continued expansion, at perhaps 6% a year (Table 9.7). Since resources are known to be plentiful, supply should be no problem. The issue will be the location of new investment. - 98 - Table 9.1 World rare-earth elements (including yttrium) capacity and production 1977 (Short-tons of rare-earin oxides REO) MonaZte-Xenotime Bastnaesite Other Total Capacity Production Capacity Proouction Capacity P-oduction Capacity Production North America United States ............... 1,500 W 30000 16930 . .. 31 500 216 930 Canada ......................--. ---- - .... ... 200 40 200 40 Total n..... :::::::::::.. 1 500 W 30.000 16930 200 40 31 700 216970 South Amrica Brazil............. I B00 1 200 --.-- .... 500 ---- 2,300 1.200 Europe USSR........ s...... 1 Soo 1.500 -- - 1.500 1.000 3000 2.500 Finland. Norway, Sweden .. .. .... .... ... Soo0 .... So00.. Total-..................... 1.500 1500 --- .... 2000 1000 3.500 2.500 Afnc, Burundi" .....................1 . 141 105 .... ... 500 105 Other........................ 1 100 .... -... .... 1.100 141 Total .................... 1.000 141 600 105 .... ... 1,600 246 Asia* Malaysia .................... 1 500 1.320 ... .... .... .... 1,500 1.320 India ........................ 3 1 960 ---- .... ---- ..-- 3500 1 900 Otler............... .....1.000 37 ---- ---- .... .... 1 000 37 Total---------------------- 6000 3337 ---- . ..... 6 CO0 3337 Oceania Australia---------------- 7,000 5.790 .... --- --7500 57 - ~ so 90 World total ............... 18.800 211.958 30600 17035 3200 1.040 52,600 230.043 Estimated W Withheld to avoid disclosing marvidual company confidential data Byproduct of uranium thorium columroum. and phosphate ores * Excludes U S production of monazite Tal ._ Assessment of wor!d rire-earth e!ement Tablh 9.2 -Uses of rare-earth elements and yttrium resoUrtes - (Thousand short tons 01 tare earth oxides RE601 Metallurgy ...... Alloying oilant- in iron and steel ScioerallovS and pyro- phonc al'cys Ighter Vits Pure meta's for research Drier Total Glass ............ Piish nq derlurizinc coloring ftillers optical and photo- Reserves resourcesi -,Qwces' chronic gla%s (camera lensest Ceramics ......... Coor,nt- for enamels and glases. coatings. refractores North America and stabilizers United States.......... 26000 31 COO Illumination ...... Carbon ,rcq t.rers fluorescent and mercury vapor lamps. C O03 piosphors tX ray ntensifiers o.siclay and color television) - Electronic ........ Capacitors. ca:modes electrodes semiconductors. ther- TotA2......................5250 27000 32 000 mistors magnts computer components (garnets and ter- South Aernca Brazil.............. 350 ISO 530 rtes) and memories Nuclear ........... Control rods burnable poisons diulants shielding, radio- Europe active heat and power sources detLctors a. J counters U ...... Chemical Catalysts, crarmaceutcal water treatment chemicalproc- . S.eden.... S20 10 esing and analysis Other ............. Jewelry photography. lubrication thermometers paintand Total2................ 0 ink dryers textiles, hydrogen adsorption . 50 - .~-Africa, Malaoasy Republic ...............20 40 6 Repuitfic of South Africa .... 5 i5 20 Egypt.......................... 10 100 110 Table 9.3-Rare-earth and yttrium contents of major Oaher .........................I3 5 5 miea ore oter.........................27 0 315 - - - mmneral sources 7 4 1 (Percent of total lanthanon oxide) Asia: Bastnaesite Monazsite Xenotrme Malaysia..................... 30 so so lCatornia) (Australia) (Malaysial India........................ ooo 20o0 3 oLa Republic of Korea ................ 100 .SO Lu,O, 320 23.0 0.5 S. . Lanka. ................. 0 10 20 CeO2 .. . 490 455 50 Other.......................... o 20 30 ir . . 44 50 7 N* ., ..... 13 5 ISO 22 Total2......................t1.too 2200 3300 Sm203 ... . 35 19 Australia..........................400 250 650 EU3 . . 1 1 2 G2O3 ... . 3 18 40 World total2................7730 40000 47000 DY70, ----- Base on rare-earth resource data developed by the U S Geological Survey H0203 ---------.j 21 and'Bureau of Mines Er2O3 ...... 1 0 5 4 2 Data may not adid to totals because of independent rounding Tm2..........---( Lu 2. 1 508 Total 1000 1000 1000 - 99 - Table 9.5: ASSESSMENT OF WORLD YTTRIUM RESOURCES (Short tont of yttsum) Other Total Reserves resources' resources' North America United States ............ . 3500 42000 45000 Canada .............. .... 2 4JO 26000 28 000 Total, .... .. ....... . .. 5900 67000 73 000 South America Brazil 2 500 8 500 I1 000 Europe USSR ........ .. . 1...1600 13000 15000 Finland, Norway Sweden 200 800 '000 Total 2............... ... 1 200 14 000 16000 Asia Malaysia ................... 600 1 900 2 500 Sr Lanka ............ .. 200 300 500 India ......... ....... . .... 20 000 40 000 60 000 Republic of Korea ............1 000 3 000 4 000 Other .................... .. 200 800 1 000 Total ..................... 22000 46000 e8 00 Australia .. ................ .... 6 000 20000 26 000 World total2 ....... .... 38 200 160 000 190 000 Based on rare-earth resource data develooed by the U S Geological Survey and Bureau of Mines 2 Data may not add to totals shown because of independent rounding Table 9.6: TME-PRICE Rn-.ATIONSHIPS FOR ?ARE-EARTH1 ELMCZ-TS (Dollars oer pound of rare eari oxide REOI Monazite concetra:Ps Bastnaes-to concentrates 55 to 60 percent REO 70 percent REO Based cn Actual constant ActUdl Year prices 1977 ciars prices 1954 ............... 032 0 76 038 - 1955 .............. 27 63 35 1956 -. ..... .... ... 25 56 30 1957 ....... ...... 25 54 25 1958 .............. 25 54 22 1959 ...... .... 18 38 22 160 ... ... ... .. 16 33 22 1961 .............. 15 31 22 1962 .............. Is 30 22 1963 ............... 15 30 22 1964 .............. is 29 22 1965 .............. is 29 25 1966 .............. 16 30 35 1967 .............. 18 32 35 1968 .............. 18 31 35 1969 .............. 18 29 35 1970 ............... 18 28 35 1971 .............. 18 27 35 1972 .............. 18 25 35 1973 .............. is 24 35 1974 ............. 18 22 41 1975 .............. Is 20 50 1976 .............. is 19 58 1977 .............. 15 15 70 1978 .............. 20 19 76 - 100 - Tz'ble 9.7: SI!M!ARY OF F0kE,-A'T1 OF U.:>. AND REST-0F-140.D PARE-EARTH ELEMTTS (INCLUDING YTT1,21UM) DEMAND TOP. YEAR 2000 (Short tons REO and YjO3) 2000 Probable aver- Forecast range Probablo aie annuat orowth rate 1977-2000 1977 Low High 1985 2000 (percelt) United States Annual demand ......... 18500 33000 72000 30000 57000 so Cumulative .............. ... 580 000 934 000 196 000 805 000 Rest of world Annual demand ......... 12500 35000 72000 25000 63000 73 Cumulative .............. .... StS 000 811 000 151.000 745000 .... World Annual demand ........ 31000 68000 144000 55000 120000 61 Cumulative .............. .... 1 095 000 1 745 000 347 000 1 550 000 .... Table 9.8: PROJECTIONS AND FORECASTS P0. U.S. RARE-EARTH EL1,MEXTS (IMCUDING YTTRIUM) DE1AND BY END tS3 FOR YEAR 2000 (Short tons AEO and Y2O3) 2000 Cont,ngency forecasts for United States Statislical Forecast range End use 1977 projections' Low High Probable Petroleum retining ... 7600 26370 10,000 26 000 18 000 Ccramics .. .............. 3300 6 784* 5000 8 000 7000 Iron and steel ............. 6900 29248 15 000 29.000 25000 Other ................ ... 700 1 555' 3.000 9 000 7 000 Total ................... .. 18500 .. . 33000 72 000 57000 Statistical projections are derived from reqrevsion analysis based on historical time series data and forecasts of economic indicators such as GNP FAB index. etc Projection equatons with a coefficent of determination (R-squareds less than 0 70 are inoicated by an asterisk( Source (Tables 9.1 through 9.8): US Department of the Interior, Bureau of Hines, Rare-Earths - M,ineral Commodity Profiles, May 1979. - 101 - 10. SILICON 155. Silicon, which comprises a large part of the earth's crust (about 60%) has been used since antiquity. Flint tools and weapons were among man's first; silicates have been used in pottery and glass since at least 12,000 BC. The principal use of silicon nowadays is as a de- oxidizing agent and alloying material in the production of iron, steel, aluminum, and other non-ferrous metals. Several non-metallurgical uses are growing rapidly; in particular, silicon is the basic material in the manufacture of most semi-conductor devices and is used in all commercial photovoltaic cells (Table 10.4). 156. The supply and production of silicon are related mainly to the metal industries. World production is shown in Table 10.1. Price is largely determined by transportation and energy costs. (price data in Table 10.2). The location of smelters for ferrosilicon and the pure metal is determined by balancing these. Globally, smelters are located near iron and steel industries, along trade routes, or where cheap power is available. The latter cost factor explains Norway's emergence as a significant exporter. This pattern could be repeated elsewhere, where cheap power and deep harbors are available, remembering that deposits are vast and widely distributed. 157. The silicon industry, from mining through smelting and refining to manufacturing, includes many companies both large and small, atomistic and integrated. Prices are set by an internal market, with producers and consumers negotiating 3 and 6-month contracts in most cases. Since 1974 prices have changed little in nominal terms. International trade oppor- tunities are growing since technical problems associated with safe packaging - 102 - have recently been resolved. Costs in the industrialized countries are seen rising significantly due to pollution control requirements on smelters and refineries. This may provide some additional cost advantage to future production for export from the developing countries. Given its bulk, trans- portation costs will play a major role in identifying trade opportunities. Table 10.3 shows forecast demand for silicon. - 103 - rable 10.1: WORLD SLICN PRODUCTION, 1977, 'AiD CAPACITY, 1977 AND 1980 (Thousand Short tons of contained sa.con Produc- Capacity bon 1977 1977 1980 North Aierca Canada ........................ 82 t25 125 Meaco ........................ is to 33 United States -------------------- S36 60 680 Total ........................ 635 823 838 South Amerca Braz -------------------------- 35 63 75 Venezuela ...................... 20 30 50 Other .......................... 9 14 Io Total ........................ 64 107 143 Eto-ance ........................ o80 210 210 Germany. Federal Republic of .. 70 90 90 Italy ............................ 75 80 80 Norway ------------------------ 270 320 350 'Spain -------------------------- 38 60 60 Sweden ------------------------ 40 60 60 USSR ....................... 520 570 600 Yugoslavia ---------------------- 40 50 50 Other -------------------------- 14 74 Total ------------------------ 1.241 1454 1.574 Repubic of South Aftca .......... 115 125 125 Egypt -------------------------- 5 7 7 Total .....-.-..--.-..-....... 120 132 132 Asis: Chna, Peoples Republic of -.... 120 130 130 India -------------------------- 30 37 37 Japan -------------------------- 235 395 360 Philppnes ---------------------- 9 15 15 Other -------------------------- 30 42 42 Total ----------------------- 424 6t9 584 Oceama Austada ------------------ 12 19 19 World total .................... 2.496 3.154 3.290 includes terrosdaon and other silicon additives. Table 10.2: TME-PRICE RELATIONSHIP FOR SIL:CON (Aveage annual fcrus in conts oe poundi 50 percent terrosdicon Metal (s,itcon comentl Sixed on comitani Actual 1977 Actual Year pres doans prces 1957 . ...... 21 5 468 139 1958 ........ 219 469 141 1959-...... . 214 449 145 1960 ........ 21 4 4A 1 145 1961 ........ 214 437 145 1962 ........ 214 429 145 1963 ........ 195 3816 145 1964 ........ 182 354 145 1965 . ...... 185 .152 120 1966 -------- 80 332 126 19G7 ..... .. 81 324 126 1968 .. ...-183 31 4 130 1909 ........ 201 328 135 1970 ........ 215 333 136 1971 ........ 229 338 153 1972 ........ 254 360 150 1973 ........ 284 380 185 1974 -------- 470 574 330 1975 -------- 430 479 325 1976-------- 425 450 335 1977 ........ 440 440 335 1978, ---.-. 455 422 355 - Estimated - 104 - Table 10.3: SUMMARY OF FORECAST OF U.S. AND REST-OF-WORLD SILICON DEMAND, 1977-2000 (Thousand short tons) 2000 Probable forecast range Probable average annual grcwth rat.e 1977-2000 1977 Low Hgh 1985 2000 percent Lned States P-nmary ------------------ 638 1070 1 540 820 1300 3 1 Cumulabivir....-----------. . 19500 24000 5900 21 600 .... Re,t o1 world Pr mry ----------------- 1 858 3 670 4.680 * 2480 4280 3 7 Cumulatve .............. .... 62.100 71 700 17.600 68000 .... World Pmary --------------.---. 2.496 4 740 6 220 3.300 5.580 3 6 Cumulative- -------------- .... 81.600 95 700 23 500 89 600 .... Table 10.4! PROJECTIONS AND FORECASTS FOR U.S. SILICON DEMAND BY END USE FOR YEAR 2000 (Thousand short tons) 2000 Cont-ngency forecasts for United States Statisocal Forecast range End use 1977 project.ons' Low Hign Probable Trans;ortation -------------------- 238 817 460 580 520 Cor*strucion -------------------- 82 47' 110 ISO 130 kach-nery --------------------- 137 359 190 270 230 E:eircal . ...................... 39 85* 70 110 90 Oil and gas rdustries ..-..--...- 21 93* 20 40 20 App;ianc,s and equ;,ment ...-...- 29 75' 40 70 60 C.em cals ---------------------- 52 211 150 270 210 Other ------------------ --------- 40 0. 30 50 40 Total ---------------------- 638 ... 1,070 1.540 1.300 Statistical projections are derived from regression analysis based on iistoncal time senes data, and forecasts of economic tndcators such as GNP, FRS inaex, etc Projecton equaions with a coefficient of determination (R-squared) less than 0 70 are indicated by an asterisk (*) Sodrce (Tables 10.1 through 10.4): US Department of the Interior, Bureau of Mines, Silicon - Mineral Conodity Profiles, February 1979. - 105 - 11. TANTALUM 158& Tantalum is a refractory metal with special electrical, chemical and physical properties. End uses for tantalum include electronic com- ponents (capacitors), metalworking machinery (used in mixtures of carbides of such metals as tungsten and columbium), transportation and chemical equipment (Table 11.5). 159. The major countries producing tantalum mineral concentrates are Canada, Australia, Brazil, Nigeria, Mozambique and the USSR while Thailand and Malaysia are the key sources for tin slags (that contain tantalum) (Table 11.1), World reserves are estimated to be 144 million pounds (Table 11.2). In the last two decades the United States has been a key importer of tantalum; Japan, Germany, U.K., France, and the USSR have been the other major consumers. 160. Economic exploitation of tantalum is dependent on prices of as- sociated minerals, (tin and columbium). Research-is presently underway to improve the extractive methods. This should lead to the adoption of new techniques which will permit the extraction from presently uneconomical sources, Substitution (aluminum and ceramic capacitors) has occurred but at an economic or performance loss. 161. Real prices have remained constant from the 1950s to the 1960s but they have more than doubled since 1974. (Nominal price data given in Table 11.3). This upward pressure on prices is expected to continue unless new reserves enter the market. - 106 - 162. Factors influencing the supply perspective include: improvements in methods for recovering tantalum from tin slags and more efficient min- eral benefication techniques, According to the US Bureau of Mines, supply shortfalls are likely to occur in the next two decades. Consumption fore- casts are given in Table 11,4. - 107 - Table 11.1 -World tantium production. 1977, and capacity, 1.77. 1078. and 11O (ThousaMd o3unds, ProluelCaoarii, Product un Capr' l in 1977 1977 1978 1980 NortP America United States ............. 0 0 0 0 Canada ... . ........... . 220 400 400 400 Total ......... ........ 220 400 400 400 South Amerca Braril ... .................. 200 220 220 220 Otter ...................... 0 2 2 2 Total................. .. 200 222 ?22 222 Europe uSS R. ...... ............ 300 350 350 350 Otiner ................. . 72 175 175 175 Total .................... 372 525 525 525 Afnca Zave .. ........ ..... .... 86 155 155 155 Morambiqje ...... ..... .. 85 102 100 100 Ngerna .. .................. 207 400 400 400 Otrer ........ ............. e9 140 140 140 Total .................... 467 795 - 795 795 Ama, 1/alays,a .................. 275 520 520 520 Thailand ................... 428 50 500 550 Total ... .. ............ 703 1020 1 020 1 070 Oceania Austra.a ......... .... 198 330 330 440 World total (rounded) ... 2200 3300 3.300 3500 Includes estimated byproduct recovery as in slag Table 11.3 -Identlfied world tantalum resources Table 11.2-TIme-price relationship for tantalum (Mlhi pojnds of fantaum content) Averago annual prce dtllrs oer onuru Of contained Rese" Orthar To.l tantalum in cunentrates base resources resoirces' North A,riarca Actual AculUnited Stalin .... .............0 3 3 Year prices Canada 0 2 1954 977 lotal................ 2 3 5 1955 991 1956 7 96 1957 Sout Amerca 197763 Brazil...... .. ......... ......7 0 7 1053 5t8 Other...................... 0 1 1959 4 92 1960 728 Total.....................2B 0 8 1S61 11 11 1962 7 29 1963 793urope 1964 731SA.............. 10 415 425 1965 10 Other.......1 0 1 1966 14 72 1-71242 Total......................It1 415 426 1987 12 24 - 1968 9t13 1969 915A 1970 915 Zaire.................... 82 0 82 1971 826 2 0 2 1972 8 09 ........... 1973 8 00 1974 14 13 Total.....................100 0 .00 1975 1832 1976 2031 Asia 1977 2564 Malaysia................... 8 0 8 19780 3358 Thaland....................10 0 10 Premilinary Total. . . 0 18 60-percenrt basia. combined tantalum and columblum pentoxdes; Oceania AustralIa;............ 0 5 World total roundenifie 144 t 20 r 6c That pet ot the iden! led in place resource ceetg mnt) um 0!ys-ai an chypmical reqinsremcr*s as rela*ed!to current m-m g anc orr%ci7on :,j~cce DOerivedRn part troo U l Geoogical Survey P,clesscnaf Nine, 823 d) whch does not quantify resources bv country Za re Mgeria and Mozamb aue are known to possess resources that bave not been evaruaeed - 108 - Tablell 4Summary of forecasts of U.S. and rest-of-world tantalum demand, 1977-2000 (Thousand pounds) 2000 Probable average Forecast range Probable annual growth rate 1977 -2000 1977 Low Hign 1985 2000 percent' United Swaei Pnma, ................. . 1 707 2280 5630 1.760 2980 35 Seconda - .. .. . 44 60 150 50 80 3 7 Total .................. 1.751 2.340 5780 1 830 3 060 3 5 Cumularie mur .. . 41 30 71 100 12700 !8 2C0 Rest f Noerd pRriay .......... .. 1 025 1.370 3380 1.070 1.790 3 5 Seconcary - - . - 25 30 90 40 50 4 Total .... ... *100 1 400 2470 1 110 1 840 35 Cumulative Ipmaryi .. 24,800 42600 7.590 2 3900 World Prrmary .... 2 732 3550 9010 2.850 4.770 3 5 Seconuary................... .69 90 240 90 130 38 Total .......................2,801 3740 9 250 2.40 4900 3 5 Cumulative (primary) .... 66100 113700 20300 77100 Estimate 'Calcuated from the 13-year trend value of 1 386 for the United States for 1977 and as estimated for rest of world Table 11.5 -Projections and forecasts for U S. tantalum dannd by and use, 2000 (Thousaid pounds) 2000 Contingency forecasts for United Stmies Statistical Forecast range End use 1977 orojections' Low High Probable E:ectronic componelts 1... 1... .......... 1159 5 157' 1 560 4350 2025 Transportation ................................. 96 0 45 120 110 Machircry C-io,'kai eq,-c1l . ........ 161 575 310 540 375 Metalworking maschinery.................... 312 1 030' 390 s10 49A) Total ................................. 473 1.605* 700 1 150 865 Oter .................................... 23 85* 35 160 00 Total ................................... 1 751 ... 2.340 5,780 3060 Statistical projections are aeoved from regression analysis based on historical time series data and from forecasts of economic indicators such as GNP and FRE ndex A statistical cc.ection of zero indicates tfat demand wal vanish at of before yead 2000 based on the histoncal relationship Projection equations withacost. ficient of determrnalon iR squareaj less than 0 70 are nuncated by an asterisk (1 Source (Table 11.1 through 11.5): US Department of the Interior, Bureau of Mines, Tantalum - Mineral Commodity Profiles, June 1979. - 109 - 12. TITANIUM 163. Titanium is derived from two minerals called rutile and ilmenite. Rutile is the less common, production coming almost exclusively from the east coast of Australia. It is also the most versatile and easy to use material in most uses of the metal. The major use of titanium is in the manufacture of titanium dioxide pigment which is used in surface coatings. Because of its high refractive index, it imparts whiteness, opacity, and brightness to paints, and is suitable for usage in lacquers and varnishes. The pigment is also used widely as a paper coating, in the plastic industry to reduce degradation by ultraviolet light, and many miscellaneous applica- tions. Titanium metal is mainly used by the aerospace industry (Table 12.6). 164. The titanium industry is characterized by a moderately high degree of vertical integration. Production is mainly in the US, Canada, Norway and Australia (Table 12.1). Developing countries' production is low, centered in India, Sri Lanka, and Malaysia (as a tin by-product). Reserves also exist in Brazil, Mexico, Sierra Leone (Tables 12.2 and 12.3). While resources exist widely, economic viability depends on liberation size of the mineral in addition to its relative metal content. Since most end uses are dissipative, there is little recycling, except within mills. While other materials could be substituted for titanium, they are not of equivalent quality or cost. 165. It is estimated that demand will grow relatively rapidly, at about 5% per annum, through 2000 (Table 12.5). In principle, reserves are adequate to meet this with only modest price increases. There is considerable scope for expanded ilmenite production in the developing countries, especially where environmental control problems are not severe, e.g. Mozambique, Tanzania, Sri Lanka and Somalia. Price data are shown in Table 12.4. -110 - Table 12.1 -World titanium capacity and production, 19770 (Thousand smort tons ot titarum content) limenate Rutble Rutle. synthetic Sponge Pigment Caoac. Pro. Capac. Pro. Capac- Pro. Capac. Pro. Capac- Pro. ity duction ity duction sty ducton dy ductiin fty duction North America United States -------------------- 430 238 12 W 60 36 21 '14 600 406 Canada ....................... $25 333 .. . ... .... .... ...- 42 NA Mexuco ..-------------------- ----- .---.. .... .... .... .... 23 NA Total.......................... 955 569 12 W 60 36 21 '14 665 NA South Amenca: Brazil ............ 6 5 (') (1) --.. .... -.. .... 20 NA Europe, France ---.------...-----..-..-.. . .- .... .... . .. . --- 116 NA Germany, West -------------.---. ---- ----.. . .... --- .... ---- 192 NA Norway -------------------------- 280 248 .... .... -..- .... .. 13 NA United Kngdon .1----- - 4 3 165 NA USSR--------------- :----------2 1 0 i * . 42 39 30 NA Other -----------------...-.. -.. -51 37 .... ... .... . ... ---. 296 NA Total ------------------------ 455 402 20 17 .... . 46 41 812 NA Attica RepuDic of South Afnca ..... ..... ... .... ---- ---- ---- 14 NA Asla. India ...------------------------- 80 53 5 4 17 10 ... . 16 NA Japan ---- ----------------- 2 1 .. 32 20 11 7 143 103 Malaysia ---------------..... . 75 55 10 2 .... .... -... .... Sn Lanka------------------------ 45 23 2 1 ---- ---- ---- Other ----------------------------- --- --1 -- - -- - Total -------------- ------------202 132 7 5 76 42 11 7 165 NA Oeer . ................. -.... .540 400 410 206 26 24 .. .... 36 NA World total -------------------- 2.156 1.500 409 228 162 102 78 .62 1.712 NA - * Estimate NA Not evaiable W Withheld to avoid reveaing company confidentai data. Calculated Production consumptian - imports a stock changes * LeS then 'i unlL Table 12.2 -Estimate of identified world ilmenite - resources' ,Milaoan snort ons of contand titaneuil Reserves Oher Total identified resources resources North America Canada...................... 49 37 as Costa R ca ................ 1... 1 United States ................ s18 3 77 95 Total --------------------- 7 Ito 180 South America Argentina.-.-.-.-.--------- ... I 1 Brazil.---------------- 1 2 3 Uruguay .- - - -. ---------- ----- -... 2 2 Total.--------------- 1 5 6 Europie Finland ---------------------- 3 1 4 Norway ..-------------------- 40 5 45 USSR -------------------- 4 16 20 Total ---------------------- 47 22 69 Africa: Mozambque ------------------- 13 13 Senegal--------------------------- 2 2 South Ala. RepuMlC at---- 10 117 127 Tanzana-------------------- ---------4 4 United AractRepublic (Egypt) __ 1 9 10' Upper Vorta ---------------------- 4 4 Other.-------------------------... ... 1 Total ----------------------... 150 160 Asia India ------------------------ 38 97 130 Indonesia------------------------ 1 Malaysia -------------------- .... 1 1 Sn Lanka -------------------- 1 1 2 Other------------------------ .... I I Total ---------------------- 39 100 140 Oceania Australia ------------------- 16 27 Now Zealand--------------------- 7 7 Total ----------------------... 18 34 World total (rounded)........ 10 410 590 Resource data derived in consultation with the U S Geological Survey Oata may not add to totais oecause of inaependent rounding. t includes perovskite deposits in Colorado - 111 - Table 12.3 -Estimate of Identified world rutile resources' (Thousand short tons of contained titantum Reserves Other Total dentified resources resourcos North America Canada... ... .......... ... 200 200 Mexico .. ............... .... 2.900 2.900 United States ............ 1.500 1.800 3300 Total .................. 1,500 4.900 6.400 South Amenc Brari .................. 60.000 60.000 120.000 Uruguay ................ ...... . () ) Total ................ 60.000 60000 120.000 Europe .U ................... 2.700 4.500 .0 USR....,.... I600 1.500 3.100 Total .................. 4.300 6 000 .0.000 Afca Mozambique ............ -... 1.200 1.200 Senegal ....... ........ .........100 100 Sierra Leone............. 1.800 16,000 18.000 RepubliC of South Alnca . 1 400 300 1 700 South-West Africa ........ ..... () (1) Total.................. 3.200 18,000 21.000 Asia India .................... 4.800 12.000 17.000 Sn Lana ................. 200 100 300 Total .................. 5.000 12.000 17,000 Oceania. Austra-a............8 .100 1.600 7,700 World total (rounded).... 80000 100.000 180,000 Resource data derived in consultation mith the U S Geological Survey 'Data may not add to totals because of independet rounding. *Mainly anatase deposits * Lesa than 50.000 tons - 112 - Table 12.4: -Time-price relationship for titanium e Yearend once. dollars per pound Rutle pigment (Ti content) Sponge metal Actual on Actual pnces 1976 dollars 1954 041 092 480 1955 - 41 90 390 1956 44 94 320 1957 46 95 250 1958 46 93 205 1959 46 91 1 66 1960 46 90 160 1961 48 89 160 1962 46 87 160 1963 46 86 160 1964 46 85 132 1965 46 83 132 1966 46 80 132 1967 46 78 1 32 1968 48 78 1 32 1969 48 74 132 1970 45 68 132 1971 45 63 1 32 1972 .45 60 132 1973 50 63 1 42 1974 72 83 225 1975 73 77 270 1976 78 78 270 1977 81 77 296 Table 12.5: -Summary of forecasts of U.S."and rest-of-world primary titanium demand, 1976-2000 - Thousand short tons of totanium content) 2000 Proobable average 1976 Forecast range annual owth rate 19752000 Low High 1985 2000 (percent) United States Nonmetal Primary ---------- 504 1.000 1.855 735 1.370 * 43 Metal - Pnmaryt-------------- 8 30 60 22 40 '42 Secondary------------ 0 1 3 7 1 4 16.6 Total United Stales Pnmary.------------- 512 1.030 1.915 757 1,410 4 3 Primary + secondary..... . 512 1.033 1.922 758 1.414 43 Cumulative (prmary) ---- . 18.000 26.000 6.000 22.000 -- Rest of world I Nonmetal Primary. ---------- 1.189 2.130 4.800 1.880 4.020 52 Metal Primary -------------- 46 100 180 70 150 so Secondary ------------ 0S 11 20 4 17 15.8 Total ragl o1 woold: Prmary. ------------- 1.235 2.230 4,980 1.950 4.170 52 Pnmary + secondary...... 1,236 2.241 5,000 1.954 4.187 52 Cumulative (pnmary).--- .-- 41,000 67.000 14.000 59.000 World Nonmeta Pnamay---------- 1,693 3.130 6.655 2.615 5.390 5.0 Metal Primary. - -- - S4 130 240 92 190 5 4 Secondary ------------ 0.6 14 27 5 21 16.0 Total worid: Primary.-------------- 1,747 3.260 8.895 2.707 5.580 So Primary + secandary...... 1,748 3.274 0.922 2.712 5.601 5 Cumulatbve (primary) 59.000 93.000 20.000 81.000 .- Calculated from a 20-year primary demand trend value of 15.000 tons for 1976 iAssuming that world production was equal to world consumption. including U S SR. - 113 - Table 12.6-Projections and forecasts for U.S. titanium demand by end use, 1976-2000 (Thousand at otons of titatum conterl) 2000 Contingency forecasts for United States End use 1976 Slatistcal Forecast range projections, oeas ag Probable Low High Nonmetal Paints ........................ 259 570* 500 .000 700 Paper products . ....... 109 315 300 500 400 Plastics and synthetic products 55 14r 100 200 140 Rubber products ... .......... 14 26 * 10 20 12 Ceramics and glass ............ 10 49 30 60 50 Flux . ............................ 0 5 Is 10 Other........................... 49 t69' 55 60 so Total ...................... 504 1.000 1.855 1.370 Metal Aerospace :::::::: 4 28 22 45 28 Industrial equipmient ------- 2 9. 6 12 9 Steel and other alloys .......... 2 8. 5 10 7 Total ...................... 8 33 67 44 Grand total.................. . 512 1.033 1.922 1.414 Stalisical projections are derived from regression analysis based on histoical trime senes data. and forecasts of econoiC indicators such as gross national product and* vieral Reserve Bank rinde Propec*ion equations with a Coefiflent of determination (R-squared) less than 0 70 are indicated by an asterisk (*) Source (Tables 12.1 through 12.6): US Department of the Interior, Bureau of Mines, Titanium - Mineral Commodity Profiles, August 1978. - 114 - 13. VANADIUM 166. Vanadium is a common trace element which is usually produced as a byproduct or coproduct of another element such as uranium, phosphorous or steel. It is used as an alloying ingredient in steel and as a catalyst in chemical reactions. The amount consumed for chemical purposes is re- latively small; it includes sulfuric acid production and petroleum refining. Some of the end uses of vanadium are in the transportation and construction industries, metal working iachinery/tools, industrial equipment and chemicals. HSLA steel are the largest consumers of vanadium (Table 13.5). 167. Due to the fashion in which mineralization occurs, vanadium is rarely found in sufficient amounts to be mined for individually. It is mined simultaneously with other minerals (iron, phosphorous, uranium). 168. The principal producers of vanadium are Chile, Finland, Norway, South Africa, S.W. Africa, US and the USSR (Table 13.1). The industry is comprised of a relatively small number of firms: international conglomerates (South Africa) or state owned corporations (Findland, Norway and USSR). World reserves are estimated to be about 10.7 million tons, while total world resources are 62.0 million tons of contained vanadium (Table 13.2). Excluding the USSR, it is expected that South Africa will be the major country expanding production in the short run. 169. At projected rates of growth world supply of vanadium will be more than sufficient to fulfill total demand (Table 13.4 shows forecast demand). Given the close mineralogical association of vanadium with iron, uranium and phosphorous, the technological and economic considerations involved in the production of these minerals will also affect vanadium. Price data are shown in Table 13.3. - 115 - Table 13.1 -World vanadium production and capacity, 1976, 1977, and 1980 (Srort 10rM) Produc- Capaaty tan in 1976 1976 1977 1980 North Aneca Unfted States ........ 6.197 7.600 7,600 9,600 Canada------------ - 0 100 100 100 Total .............. 6.197 1,700 7.700 9.700 South Arntea Cha --.. 1.199 1200 1200 1200 Eur.and .............. 1.59e 3.450 3.450 3.450 NW" ............. 580 1 00 1.300 1300 USS1 ............ 10.000 16.000 16.000 19,050 Total ------------- 12.178 20.750 20.750 23800 A!nr Republ of South Af- nca o .S..h.. 10885 11.800 11,800 14100 Souh,West Afca .. . 782 OO 600 800 Total ------------- 11,667 12.600 12600 14.900 World total ........ 31.241 42250 42250 49.600 Table 13.2-identified world vanadium resources' (Thousaid s&AI tons of vanadiur conient) Reserves Other Total North Arnona Caarla .................... ... 11,000 11.000 UrlIed States Jablka .................... ---- 2.000 2.000 /Akansas .............. 30 .... 30 ctakxado Plateau ...... 40 40 80 tal .................... -45 2.000 2.045 M Wota ................. 0. 100 100 N(.w Yor%(-- ----------- - ---- 280 280 Swedmrg -----------------1---- 3.00 3,000 Other -------------------- --- 2.500 2.500 Total --------------------.. $15 20920 21.035 South Ane.ca ot..e.- . . -----------l........00 100 250 Vneela ------------- 100 1.400 1,500 Ttal.--------------------- 250 1.500 1,750 urcr .---------------------- ---- 1.500 1.5w FNo and -----------------------8 .5 140 Norway------------------------20 Igo 200 Tatal --....--...-.....-1- 1.000 1.000 USSR -----------------8,000 4.000 12.000 Tota --------------------- 8.075 6.765 14.840 Anmublic of Southlin ca .... .000 18,000 20,000 Otherl- tota..(..undd....... ---- 1.000 1,000 TOWa-------------------- 2.000 19.000 21,000 Will--------------------- 100 300 400 Oter------------------------- ... 1.000 1.000 Tctal------------------------ 100 1.300 1.400 AL.Araha 150 1.350 1,500 N,ow zealw--------- -- 5W0 500 Total ---------------------- 1ISO 1.850 2.000 Wftrb total (rounded) ---- 10.700 51,300 62Z0W Resource data denved i coaboration with te U S Geological Survey Ontly donstbc source of vanadsumn not dependent on coprodct operalban - 116 - Table 13.3-Ti:n-prce relationship for vanadium contained in vanadium pentoxide, 1954-77 Average annu,d prce Jollars per pound Year Actual paces 1954 238 1955 238 1956 238 1957 246 1958 246 1959 246 1960 246 1961 246 1962 246 1963 214 1964 179 1965 196 1966 217 1967 241 1968 170 1969 268 1970 437 1971 300 1972 270 1973 270 1974 378 1975 493 1976 518 1977 (10 months) 5 18 - Table 13.t -Summary of forecasts of U.S. and rest-of-world vanadium demand, 1976-2000 Og oProrbble average 1976 Foec"I rargie Probable annual gro%w" rae 176- i9:tn-000 Low H.gh 1985 2000 (percent) United States Toial .. .... .... 1.779 19000 59000 15.400 3 X000 52 umutate39v000 65000 114,000 470000 .... rctai .......... 21462 41000 St000 31.300 57000 * 40 C4,mulative.......... .... 740.000 933 000 2420(0 395000 .--- Worid Total .............. 31 241 60.000 120000 48700 90000 44 CuMulatAve ---------- .. - 078 000 1 618.000 356 000 1 365000 .... Table 13.5-Projections and forecasts for U.S. vanadium demand by end use. 1976 and 2000 (Shor bns) 2000 Eirs use 197 tngCo ency forecasts for United States Forecas Forecast rag base Low NMrgh C --.-- .......- ........-.590 4.900 4.100 12,500 6,800 crucboC machorery and equipmnt........... 1.345 3.500 2.000 5.500 3.500 MeqMworI^g macNvery and tools -------------- 1,520 4,000 2.300 6.500 4.000 TII a-...................................... 2.815 .. 4.300 12 000 7.500 Truportans.................................... 2.800 8,900 5,800 21.000 9.500 OeWds - -................................... 540 1,100 800 1,500 1.100 e . . ............. 1.964 8,800 4.030 12.000 8.100 Total -................................... 9.779 ... 19,000 59.000 33.000 Source (Tables 13.1 throught 13.5): US Department of the Interior, 3ureau of Mines, Vanadium - Mineral Cor:nodity Profiles, December 1977. - 117 - 14. VERMICULITE 170. Vermiculite is a micalike mineral with the unique property of exfoliating (casting off in scales) to a low density, bulky material when heated. It is particularly attractive due to its lightweight, good re- silience and good bonding properties. Vermiculite plasters and cements are used in the construction industry for fireproofing purposes and as a thermal insulator in home heating. Other uses of vermiculite include agri- cultural (as a soil conditioning agent and plant growing medium) and chemical (water purification) applications. (Table 14.5). 171. The US and South Africa are the largest producers having the largest deposits of crude vermiculite (Tables 14.1 and 14.2). Deposits are also being mined in Kenya, Tanzania, Argentina, Brazil, India, Korea and China. However, these represent a small percentage of the total. The bulk is being mined by international conglomerates with extensive interests at all levels of production. In the US, this is performed by W.R. Grace & Co. and in South Africa it is the Palabora Co. (a member of Rio Tinto Zinc Group). The strongest demand for vermiculite has come from the industrialized coun- tries (US, Canada, Australia, Japan, France, Germany, Italy and the U.K.). 172. One major consideration that must be weighed in deciding the pro- fitability of investing in vermiculite is the transportation cost. The cost of shipping (crude ore to exfoliation plants) can sometimes be higher than the value of the mined product. 173. To illustrate the magnitude of the capital costs which are necessary, one can cite some examples of recent investments. A new mill in Montana - 118 - cost approximately $7 million while modernization and increased capacity (by 25%) of the Palabora Mining Co. involved $3.5 million. An exfoliating plant in Florida (5,000-10,000 tons annual capacity) required an investment of approximately $550,000. 174. The price of crude vermiculite has increased 75$ in real terms from 1956 to 1977, while the value of the exfoliated material increased 27%. (Price data in Table 14.3). While no mention made of the world outlook, the US Bureau of Mines projects domestic needs to be in line with production, while the balance is to be met through imports. Increased production may come from sources in East Africa, where vermiculite is found in conjunction with carbonatite, Table 14.4 shows forecast demand for vermiculute. - 119 - Table 14.1: WORLD VERMICULITE PRODUCTION, 1977, AND CAPACITY, 1977, 1978, AND 1980 (Thousand short tons) Produchon CaDacily in 1977 1977 1978 1980 North Amera United States ........ 359 425 430 525 At.ica Repubi. 01 Suth Afica ...... 1250 260 260 300 RestOfworld'............ .......... '20 25 25 50 World total ...... . ...... *623 710 715 875 Estimate. Excluding centrally controlled economies, Table 14.2: WORLD VERMICULITE RESOURCES (Million short 'Ons) Reserves rere re Total Res&vs reourc ,O Olirces ortn Aniwca Unia States .........._ D100 25-100 125-200 Atrca Rep,-bl,c Of South Atica ........ 75 Large Large Re" of world' ......... .......... 15 Large Large World toal- . ............... 190 Large Large Exclusme of centrally controlled economies. Table 14.3: TIM-PRICE RELATIONSHIP FOR VERMICULITE Average annual prices. dollars per short tons Year Actual prices 1958 $13 i7 1957 14 1S 1958 1428 1959 1489 1960) 1562 1961 1676 1962 1606 1963 1581 1964 15 99 1965 1791 1966 1891 1967. 1951 1968 1960 1969 21 95 1970 2278 1971 2391 1972 2401 t9'3 2593 1974 2968 1975 41 70 1976 4618 1977 *176 *Esiated - 120 - Table 14.4: SUMMARY OF FORECASTS OF U.S. AND REST-OF-WORLD VERMILUTE DEMAND, 1976-7000 (ThouSand short tons) 200 Probable Probable aierage 1976 Foreca.t fanoe annu gr r.,e - 1976 -2C0 percenti Low High 19ti5 2000 United St3tes Total . .................. 255 400 850 500 600 36 Caimutlive ..... ........... .... 7.800 12.100 3.400 10.000 .... Res of waidI Total ..................... 200 400 700 500 600 43 cu latNe-------------------- .... 7 30o 10.100 3.220 9:oo . .. WorldI Total- ..................... 475 800 1.550 1.000 1.200 39 Cumulate. ............... .... 5 100 22.200 6.620 19.300 . Excluding contalty controlled economies Table 14.5: PROJECTIONS AND FORECASTS FOR U.S. VERMICULUTE DEMAND BY END USE, 1976 AND 2000 (Thousand short tonts) 2000 Contngency forecasts for United Slates End use 1976 Statistical projct,rocas rang Probable Low Hgh Extofred L-irnNse,ht ag9tojale ...................... 110 267 200 300 225 Theml risuiton ------ ----------------... 79 183' 100 300 175 Agriculture ... ........................... 39 160 50 120 100 Other ------------------------------------- 7 0 10 50 Tot-t ----------------------------------- 235 .. 360 770 550 Unexto,ated ................................. 20 .... 40 80 50 Grardl total .............................. 255 400 850 600 Statistical projections are derived from regression analysis based on histaonca tme series data and forecasts of economic m lcators such as gross national product. and FRB indes Projection equabons with a coefficient of determination (R-squared) less than 0 70 are indicated by an asterisk (*) Source: (Tables 14.1 through 14.5)s US bepartrient of the Interior, Bureau of Mines, Vermiculite - Mineral Cocrdity rrofiles. August 1978. - 121 - ANNEX II SELECTED MINERALS DATA Table 11.1: STANDARD INTERNATIONAL TRADE CLASSIFICATION OF MINOR MINERALS Table II.2: PRINCIPAL TYPES OF CHEMICAL AND PHYSICAL MINERALS. Table 11.3: NON-METALLIC MINERALS: THE ESTIMATED VALUE OF WORLD PRODUCTION IN 1976 Table 11.4: METALLIC MINERALS: THE ESTIMATED VALUE OF WORLD PRODUCTION IN 1976 Table 11.5: ROUGH AVERAGE VALUES OF SELECTED NON-METALLIC MINERALS IN 1976 Table 11.6: ROUGH AVERAGE VALUE OF SELECTED METALLIC MINERALS IN 1976 Table 1I.7: METALLIC MINERALS: CURRENT WORLD PRODUCTION AND RESERVES Table 11.8: EXPORTS OF MINOR MINERALS, 1975 Table I.9: PRODUCTION, RESERVES AND PRICES OF SOME MINOR MINERALS Table II.10:LIST OF NON-FUEL MINERAL SECTOR PROJECTS FINANCED BY IFC - 122 - ANNEX II Table II.1: STANDARD INTERNATIONAL TRADE CLASSIFICATION OF MINOR MINERALS MINOR NON-METALLIC MINERALS Division 27 - Crude Fertilizers and Crude Minerals (excluding coal, petroleum and precious stones) SITC Commodity Description 273 Stone, sand and gravel 273.2 Gypsum, plasters, limestone flux and calcareous stone 274 Sulphur and unroasted iron pyrites 275.1 Industrial diamonds, sorted whether or not worked 275.22 Infusorial earths, etc. (Diatomite, activated) 275.23 Pumice stone; emery ; natural corundum, natural garnet and other natural abrasives 276.21 Clay (e.g. kaolin and bentomite, andalusite, kyanite and sillimanite, whether or not calcined, but not including expanded clays) 276.22 Graphite, natural 276.23 Dolomite, whether or not calcined 276.3 Common salt; pure sodium chloride; salt liquors 276.4 Asbestos 276.5 Quartz, mica, felspar, fluorspar, cryolite and chiolite 276.52 Mica; mica waste 276.54 Felspar, leucite, nepheline and nepheline syenite; fluorspar 276.93 Natural barium sulphate (barytes); natural barium carbonate whether or not calcined 276.95 Natural steatite; tale (natural) 276.99 Mineral substances, n.e.s. [sodium carbonate, natural; sodium sulphate, natural; perlite (excluding activated, expanded or exfoliated perlite); vermiculite (excluding expanded or exfoliated); strontium carbonate, natural] Division 52 - Inorganic Chemicals 513.22 Fluorine, bromine and iodine 513.39 Other inorganic acids and oxygen compounds of non-metals or metalloids (silica, calcined, hydrated, pure, vitreous) 514.15 Bromides, oxybromides, bromates and perbromates and hypobromites Division 66 - Non-Metallic Mineral Manufactures, NES 661.1 Quicklime, slaked lime and hydraulic lime (other than calcium oxide and hydroxide) 661.2 Portland cement, cement fondu, slag cement, supersulphate cement and similar hydraulic cements 667.2 Diamonds, unworked, cut or otherwise worked, but not mounted or set 667.3 Other precious and semi-precious stones, unworked, cut or other- wise worked, but not mounted, set or strung 667.4 Synthetic or reconstructured precious or semi-precious stones. (continued...) - 123 - ANNEX II Tablo_'II.1: (continued) MINOR METALLIC MINERALS Division 28 - Metalliferous Ores and Metal Scrap SITC Commodity Description 283.91 Ores and concentrates of chromium 283.92 Ores and concentrates of tungsten 283.93 Ores and concentrates of molybdenum; niobium; tantalum; titanium; vanadium; zirconium; ilmenite (excluding pigments) and ilmenite sand; and .rutile 283.99 Other ores and concentrates of non-ferrous base metals (anti- mony, bismuth, cobalt, columbium and germanium) 284.05 Magnesium waste and scrap Division 52 - Inorganic Chemicals 513.24 Selenium, tellurium, phosphorous, arsenic, silicon and boron 513.25 Mercury 513.26 Alkali and alkaline earth metals; rare earth metals, yttrium and scandium and intermixtures of interalloys thereof (lithium, cesium, robidium) 514.37 Colloidal precious metals and compounds, organic or inorganic, of precious metals (gold amalgams, phosphates, precious metals) Division 68 - Non-Ferrous Metals 681.1 Silver, unwrought, unworked or semi-manufactured 681.2 Platinum and other metals of the platinum group 689.31 Magnesium, unwrought 689.41 Tungsten (wolfram), unwrought; waste and scrap and tungsten, wrought and articles of tungsten 689.42 Molybdenum, unwrought; waste and scrap and molybdenum, wrought and articles of molybdenum, NES 689.43 Tantalum, unwrought; waste and scrap of tantalum, wrought and articles of tantalum, NES 689.5 Base metals, NES (alloys, unwrought, worked: antimony, bismuth, cadmium, chromium, cobalt, columbium, germanium, rhenium and thallium) - 124 - ANNEX II Table 'II.1: (continued) MAJOR MINERALS Division 27 - Crude Fertilizers and Crude Minerals SITC Commodity Description 271.3 Natural phosphates, NES, whether or not ground (phosphate rock) 271.4 Natural potassic salts, crude (potash salts, natural crude) - 125 - ANNEX Tr Table 11.2: PRINCIPAL TYPES OF CHEMICAL AND PHYSICAL MINERALS 1emiit- Metal- CHEMICAL Chenicl ier Ceramic lurg- PHYSICAL StruLturJl Extender and Process MINERALS Raw Rw Raw cal MINERALS Minerals Failer Pigments Aids Mateials Matcni l Mt rials Flu%es Alunina X li'111 cia x Asbestos X X Biu.ie X X Attapulgite X X Boron X X Baite X X Brominme X Calcium Aluminate X l3entonite X X Chromite X X Calcium Carbonate, Ground X Dolomite X X Feld,pir X Cement X Fireclay X Diatunute X X Fluorspar X X X Dolonite X Gypsum X Ilennaite. Rutile X Gypsum X X Iron Oxides X Industrial Diamonds XX Kaolm X Kyanite X Light-weight Aggregates X Lime, Burnt X X Mica X Limestone X X X. Litmestne X X X Nepheline Syenite X Lithwin S.-lts X X Mtagnesue X X Perlite X X Mullite X Sand and Gravel X Phosphates X X Potash X Silica X Salt X Stone, Crushed X Silica X Sodium Carbonates X X Sodium Sulfate X Talc X altu XVermiculite - X Talc Zircon X Wollastonite X Source: Edia' Kliff, "Industrial Minerals Products, Companies and Opportunitiesj" presented at First Industrial Minerals Inter- national Congress (London, 1974), Metal Bulletini 1975; Boron and 'Industrial Diamdnds, The World Bank, Economic Analysis and Projectioaisz Department, Commodities and Export Projections Division. - 126 - ANNXI Table 11.3 :NONMETALLIC MMNERALS: THE ESTIMATED VALUE OF WORLD PRODUCTION IN 1976 Volume Value unit amount million US$ Asbestos '000 short tons 5,566 1,149 Barite " 5,457 127 Bentonite " 5,906 98 Boron " 2,591 /a 384 Bromite (Bromine and compounds) '000 lb 653,826 160 Diamonds, industrial million carats 29.5 106 Diatomite '000 short tons 1,905 166 Feldspar " 2,850 67 Fluorspar " 5,088 484 Gypsum " 71,199 356 Kaolin " 17,029 786 Lime " 116,291 3,501 Mica " 249 11 Perlite " 1,983 34 Pumice " 17,553 /b 45 Salt " 183,252 1,787 Sodium carbonate (natural) " 5,349 266 Sodium sulfate (natural) " 2,141 105 Sulfur '000 long tons 51,400 2,631 Vermiculite '000 short tons 566 /b 26 Subtotal 12,289 Phosphate rock " 117,748 2,270 Potash " 26,876 2,178 Cumulative subtotal of above 16,737 Diamonds, gem rock '000 carats 9,690 1,766 Cement '000 short tons 765,700 26,111 GRAND TOTAL 44.614 /a Excludes centrally planned economies except USSR. 7- Excludes centrally planned economies. Note: World production values are based on US production unit values and the world production volumes shown. US production volume and value figures for the various minerals were drawn from the Minerals Yearbook 1976 (Volume 1), published by the US Bureau of Mines. Unit values were de- rived from the above and applied to world production figures taken from Mineral Coamodity Summaries 1978, also published by the US Bureau of Mines. World production volumes and US producer unit values for benton- ite and kaolin were taken directly from the Minerals Yearbook 1976; the average US import price per carat for industrial diamonds shown in the Mineral Comodity Summaries 1978 was used as the unit value for the world. Care was taken to ensure consistency in production figures and units. There are some slight discrepancies in volume of US production of cement, mica and sulfur (due to differences in commodity coverage) and potash and perlite. The differences noted would not affect the unit values significantly. Because of data unavailability we were not able to show world production volume and value for clays other than kaolin and bentonite, dolomite, ilmenite, sand, gravel and stone, silica, talc and zircon. Clays and sand, gravel and stone are of significant value due to their large produc- tion volume or price. Bentonite and kaolin represent about one-fifth of the total volume of clays. Source: Mineral Commodity Summaries 1978, US Department of the Interior, Bureau of Mines; Mineral Yearbook 1976,Volume 1, US Department of the Interior, Bureau vf Mines (Washington, D.C., 1978). - 127 - Table II.4; METALLIC MINERALS: THE ESTIMATED ANNEX:r VALUE OF WORLD PRODUCTION IN 1976 VOLUME VALUE Unit Quantity (million US$) Antimony S.T. /a 76,286 162 Arsenic (white) S.T. 39,919 b 17 Bisnth '000 lb. /a 9,262 b 69 Cadmium S.T. /a 18,892 77 Cesium n.a. - Chromium (chromite) '000 S.T. /c 9,492 1,161 Cobalt S.T. /a 28,681 255 Columbium '000 lb. /d 19,648 je 50 Germanium '000 lb. 7a 175 23 Ilmenite '000 S.T.7f 4,283 /e 315 Lithium '000 S.T. d 4,330 ea 115 Magnesium '000 S.T. 5,708 988 Mercury 76 lb.flasks a 243,698 30 Molybdenum '000 lb. /a 191,287 557 Platinum Group '000 troy as. 6,003 456 Rare Earth Oxides '000 S.T. 23.9 /h 28 Rhenium '000 lb. /a 13 7 Rutile '000 S.T. 440 Ai 232 Selenium '000 lb. /a 2,774 55 Sibion '000 S.T.-Ld 2,432 1,629 Silver million troy oz. 304.9 1,326 Tantalum '000 lb. /d 855 /e f 14 Tellurium '000 lb. 7a 220.4 2 Thallium '000 lb. 28.0 - Titanium S.T. Li 9,095 /be 50 Tungsten '000 lb.0d 89,843 570 Vanadium '000 lb. d 62,482 344 Yttrium S.T. /a 173 ab. 52 Zirionium (ziron) '000 S.T. 498 /ea 102 TOTAL ABOVE 8.686 Gold million troy o. 38.7 4,847 S.T. - short ton n.a. - not available -- less than 1/2 unit b Excludes US. 4 Gross. - d Metal content. e Excludes centrally planned economies. f Concentrates only. , Ealudes US metal production. h Eludes US except California; concentrated are production, value based on eastimted sverage prices. / Sponge metal. Note: World production values are based on the average producer prices in the United States. For ten of these minerals, including gold and lver, the unit value of US production was used; the volume and value figures were taken from the Minerals-Yearbook 1976. For most of the other minerals the average US producer price as stated in the individual commdity chapters in the Minerals Yearbook vere used. For chromite, the average Turkish producer price has been used. Because of a lack of data, cesium, rubidium, scandium, phosphates and phosphorus have been excluded. Source: Mineral Commodity Summaries 1978, US Department of the Interior, Bureau of Mines; Mineral Yearbook 1976, Volume I, US Department of the Interior, Bureau of Mines (Washington, D.C. 1978). -- 128 - ANNEXII Table 11.5: ROUGP AVERAGE VALUES OF SELECTED NONMETALLIC MINERALS IN 1976 /a (US$/short ton) /b Nonmetallic mineral Ic Average Value Asbestos 206.37 Barite 23.26 Bentonite 16.61 Boron 148.31 Bromite (Bromine and compounds) 489.60 (Cement -manufactured) 34.10 Clays 10.09 Diamonds, industrial 3.58 /d Diatomite 87.16 Feldspar 23.66 Fluorspar 95.08 Gypsum 5.00 Kaolin 46.17 Lime 30.11 Mica 44.88 Perlite 17.00 (Phosphate rock) 19.28 (Potash) 81.04 Pumice 2.54 Salt 9.75 (Sand and gravel) 2.00 Sodium carbonate (natural) 49.69 Sodium sulfate (natural) 49.17 (Stones) 2.46 Sulfur 51.19 /e Vermiculite 46.05 (Diamonds, gem rock) 182.30 /d /a Average US producer price; see also Table 1. /b Unless noted otherwise. /c Items in parentheses are those excluded from the definition of minor nonmetallic minerals in this report. d US dollars per carat; average US import price. e US dollars per long ton. Source: Minerals Yearbook 1976, Volume 1, US Department of the Interior, Bureau of Mines. -For industrial diamonds: Mineral Commodity Summaries 1978, US Department of the Interior, Bureau of Mines. - 129 - ANNEX II Table II.6:ROUGH AVERAGE VALUE OF SELECTED fETALLIC MINERALS IN 1976 /a Mineral Value (US$/lb) /b Antimony 1.06 Arsenic (white) 0.22 /c Bismuth 7.50 7 Cadmium 2.05 Chromium (chromite) 137.0 /e,e.f Cobalt 4.44 Columbium 2.55 Ic Germainium 132.7 Ilmenita 73.55 Lithium 13.3 Icd Magnesium 130 (magnesia) /I; - 0.895 (metal) Mercury 1.60 Ld Molybdenum 2.91 Platinum Group 75.2 /h Rare Earth Oxides 0.58 1 Rhenium 575.0 Ic Rutile 527.0 Scandium 8.0 - 10.5 Selenium 20.0 Sibion 0.335 /k Silver 4.35 /h Tantalum 16.0 /1 Tellurium 10.33 Thallium 7.50 Titanium 2.72 /cm Tungsten 6.35 Vanadium 5.51 Yttrium, 150.0 ZIrionium (Zircon) 204.0 Gold 125.32 a Average US producer price; metal content or metal. b Unless otherwise noted. L Averge of a range of prices. d Refined. * US dollars per long ton. Chrosite, Turkish ports. US dollars per short ton. h US dollars per troy once. i Leached bastnaesite, price of contained red. US dollars per gram.. fk Ferrosibion, 50% sibion. Ore. m Domestic sponge. Source: Mineral Commodity Summaries 1978, US Department of the Interior, Bureau of Mines; Mineral Yearbook 1976, Volume I, US Department of the Interior, Bureau of Mines (Washington, D.C. 1978). - 130 - ANNEX TI Table 11.7: METALLIC MINERALS: CURRENT WORLD PRODUCTION AND RESERVES La Unit Annual Identified Reserves Ratio of Present (Col. A & B) /b Production Perceived % Increase /c Reserves to Production 1974/75 Av. for 1975 over 1973 (B/A) (A) (B) (C) (D) RON AND ALLOTING METALS Minor Minerals Chromium '000 S.T. gross vt. 7,640 1,900,000 +4% 249 "Vitamin" Minerals Cobalt S.T. metal 32,202 2,700,000 -1% 84 Columbium '000 lbs. metal 24,753 22,000,000 +94% 889 Molybdenum '000 lbs. metal 181,137 13,200,000 +40% 73 Tantalum '000 lbs. metal 1,100 110,000 +22% 100 Tungsten '000 lbs. metal 82,979 3,900,000 +42% 47 Vanadium '000 lbs. metal 45,749 21,400,000 +6% 468 femorandum Items: Malor Minerals Iron Ore million L.T. ore 877 259,000 +4% 295 Manganese '000 S.T. gross wt. 24,488 6,000,000 +308% 245 Nickel S.T. metal 823,612 59,500,000 +29% 72 )NFERROUS METALS 4inor Minerals "Vitamin" Minerals Germanium lbs. metal 250,960 4,000,000 +142% 16 Mercury 76 lb. flasks metal 258,068 5,250,000 -0.9% 20 Platinum Group '000 troy oz. metal 5,775 561,000 -10% 97 Selenium '000 lbs. metal 5,731 370,000 +54% 65 Silver million troy oz. metal 291.35 6,100 +11% 21 lemorandum Items: Malor Minerals and Gold Bauxite '000 long dry tons 73,995 17,000,000 +10% 230 Copper '000 S.T. metal 7,855 450,000 +22% 57 Lead '000 S.T. metal 3,798 160,000 +11% 42 Tin L.T. metal 220,821 10,200,000 +144% 46 Zinc '000 S.T. metal 6,342 150,000 +15% 24 Gold million troy oz, metal 39.25 1,350 +35% 34 i This gives present US estimates for world production and identified reserves of the 21 metallic minerals. Column C illustrates the erratic but generally persistent increase in reserves. Column D, while providing a static view of the adequacy of presently identified world reserves, is far less meaningful than any estimates to the year 2000 which take account of growing demand. S.T. - short ton; L.T. - long ton. : Column C compares the estimates for identified reserves in 1975, from the source cited, with those for 1973 in the comparable publication two years previously (in some cases this required reconciling different units). The increase reflects in part new discoveries in hitherto hypothetical resources; but, it should be recognized that, since the definition of reserves at any given time assumes the economic feasibility of their extraction at current prices, the prospect of higher prices alone will promote some identified but hitherto subeconomic resources into the status of reserves. urce: Commodity Data Summaries, 1974 and 1976 (Bureau of Mines, US Department of the Interior), as cited from.... .3 - 132 -ANNFX 11 Tle 11.9: ~UTDUCTON, ESEMVES AND PICES OF S0M MNOR XINERALS ORserva 1 ooal trowth love of Mineral Prodootion Tio./year % of World World Prodctio on of 09 Priceo Dnit By, Co-prodoct Strocrure o, ke: <1978> PNodoction Total 1965-17/78 1965/601960/70 1970/74 1970 19751 1978 Asaociation (whre availabtc of Country Resrnen AntLeny (in ohort too of meral) Under 1 Bntova 15.000 27 8.5% -2.7 2.1 9.0 11.50 20.40 18.43 ($/Seo) Fond in the slica, ioott 3.000 00 5.1% Lead, Copper oren CPEo 21,000 50.6% World Total 76,000 100.01. Cobalt (In short ton of metal) 6.9 7.9 4.2 9.4 2.20 4.00 10.33 (0/lb) Byproduct of copper, ZItre's African mtals otckel and In s0e Corporation producos Botsaona 200 145 1.8% cases,of ailve/ioad over half ond pro- Morocco 2,000 7 0.8% duction ond tnflun- No Caledonta 4,600 65 18.7% pr~ces. PhIlippin 1,200 175 13.1% Za1re 12,000 , 41.6 13.3% Zamb=a 2,500 50 7.8% CPE. 4.000 World Total 34,00 100.0% Chronåte (in thousand abort too gro-e weight) 4.5 2.7 3.3 22.57 45.40 56.28 ($1on8 too> Tranvaal 44%. Philippine 600 5.5 5.5% 137.00 133.89 ($11ng too) Rhodesia 660 1,666 6.0% Turkt.h 48%. Turkey 700 7.8 6.4% Soth Afria 3,700 675 33.8% CPE. 3,500 World Total 10.960 100.0% Molybdenum (in thouaod poond, of etal) 3.6 6.3 2.8 11.7 1.72 2.62 4.98 (c/lb) Byprodocn of coppr, A producers' fixed tungaten and uranim price Chile 34,000 207 31.5% ores Pern 26,000 500 2.9% CPE, 22,000 orio Toti 215,700 100.0% e~r 0y (in 7 pound fl.ak. of ~otol) FIucuat ing 0.2 1.6 -0.3 418.14 166.82 153.32 ($/F1) Byproduct of Zic, onder 1 told Algorio 25,000 14. 8.07. Mexico 15,000 16.6 6.0% spain 35,000 42.8 35.0% CPE' 85,000 World Total 190.,000 100.0% oIer (in illion troy oneo) 0.9 -7.3 13.9 1.77 4.41 5.40 <0/troy os.) A. Aaron of Nse York t50 17 14.0% .kes Isrer part ef ccr, 35 17 10.0% o2rket eo i cne 70 world Total 334 100.0% !iIrrspar (in thoo.and short tons) 32,2 4.5 T.6 3.7 113.37 188.0 ($/ton) Knya 150 100 5.0% Me-ico 1,000 39 13.0% inilend 250 44 4.0% CPEd 1,650 .orld Total 5.100 100.01 tdustriel Dieanond (in edlion ceara) 7.0 9.6 -5.8 10.2 2.14 2.19 2.20 ($/aeat- Central selling orga- Bort & poder) .tsattn to London 2.5 20 7.0% aret a~bot 801 of ehna 2.0 1 4.0% vorId tedustrIal Zie 11.0 45 74.0% di.ond and r~ugB gna end also form s ba n CPE 8.2 pric u World Total 30.0 100.0% 1u.gsten (in thon-and ponds tungsten conet) 3.6 5.6 3.6 0.2 49.88 78.17 128.32 ($fan) 1. 25% copanis/national agencies in CeR pso- botlvia 6,600 13 2.0% dans over 80% of wrld Brazi 2,500 16 0.0% production. Korea 1,000 70 1.6% Korea 5,500 18 2.3% 2. A predonantly pro- "exio 500 8 1.0% docersassectatton; Thileand 5,000 8 1.0% Piemay tungnsn Asso- Turkey 3,10O 57 3.9% ciation (10 countrie.) ancot fee or 25% CPE. 34,000 ef orld podutten, norId Total 95.000 100.0% ond has China'. backIng (hich pro- dnes er 23% of enrld ontput). Y-O8aMUM (in thougand pound of contained oanadiun) 8.8 7.3 12.2 4.6 4.92 2.75 3.15 ($/lb) Byproduet of (1977) Uranoum Chile 1,900 157 1.4% CPE (USS ) 20,000 norld Total 64,15 100.0% Columbiuo (in thonand pouend c.oubi-m tenoten) 8.7 37.0 7.5 11.4 1.65 2.23 3.18 ($/1b) co-peoduct of mina, taentalitf lratil 18,600 968 82.0% Nigeria 700 1,000 4.0% Zatre 50 .18,000 4.0% tPEt World Total 20.525 100-01 Sonrces: U.S. flrean of Mines .nd World Bonk.  〕’一〕〕叮〕〕〕〕〕〕〕，‘〕！。、  - 133 - Table 11.10: LIST OF NON-FUEL MINERAL SECTOR PROJECTS FINANCED BY IFC ANNEX 1I Date of Investments held for the Country and Name of Project Approval by IPC (including Undisbursed Loans) Nature of Project the Board Loans Equity Total Loans & Equity BRAZIL - -(million US$)- Empresa do Desenvolvimento de Recurson Minerais "CODEMIN", S.A. April 1973 5.0 3.9 8.9 Wining and Refining of Nickel Mineracao Rio do Norte S.A. 1977 15.0 - 15.0 Mining/Bauxite CHILE Empress Miners de Mantoo Feb. 1957 Blancos, S.A. Feb. 1959 - 1.2 1.2 Copper Mine/Mining and Smelting Minera Sagasca, S.A. (Minesa) Feb. 1970 10.9 Copper Mine/Mining and Leaching Facilities )COLOMBIA Minera Las Brisas 1976 6.0 Mining Project - Asbestos GREECE Aluminum do Crece Societe Anonyme Industrialle at Alumin Project/Smelting Commerciale May 1970 8.6 Facilities GUATEMALA Exploraciones y Explotaciones Lateritic Nickel Mining and Mineras Izabal Sociedad 1975 13.5 - 13.5 Metallurgical Processing to Anonima Sulphide Matte MAURITANIA Societe Miniere do Mauritania Copper Project/Minig, Beneficia- (Somina) May 1968 20.0 ting, To.aship and Port MEXICO Minera del Norte Feb. 1970 1.5 Iron Ore Project/Minni NIGERIA Nigerian Aluminum Extrusions Ltd. June 1973 0.77 0.33 1.1 Aluminum Extruding & Anodizing PERU Compania de Minas Buenventura, S.A. 1979 2.0 0.5 2.5 Miig/Silver Southern Peru Copper Corporation Sept.1975 12.0 - 12.0 Copper Project/MiRing, Smelting. Transportation, Townsite & other Infrastructure PHILIPPINES Acoje Mining Company, Inc. 1976 2.2 1.2 3.4 QMiR1) Chromite, Copper and Nickel Marinduque Mining and Industrial July 1971 9.58 - 9.58 Nickel Project/Mining and Smelting Corporation Facilities Source: International Finance Corporation, Annual Report (various issues), financial statements and project files.