![]() “Against that, the good thing is there’s been an underinvestment. So pointed out that these issues are likely to present some headwinds for any industry that’s housing-related – like mineral sands. “I think around the OECD countries we’re going to see similar weakness in the housing market with high inflation and cost of living eating into people’s spending power.” ![]() “Your major consumers are still countries like China, which is predominantly driven by the construction industry and there’s a lot of weakness there in the real estate sector. “In the meantime, I think there’s probably going to have weakness in a renovation market, whether it is for paints, for pigmentation, which is what your rutile and ilmenite is for, and zircon for ceramics,” he added. Even if countries like Japan or the UK restarted older reactors and/or built new ones, they would take significant time to come on stream. However, he noted that while zircon was considered a critical mineral because of its use in nuclear power, demand from that sector was unlikely to increase in the short-term. “We’ve seen mines like Thunderbird getting the final investment decision to go ahead, but obviously this takes a bit of time and there are some other major projects drumming along in the background, but they’re not near being funded anyway.” “Prices have obviously risen significantly in the past two years and that is driven by underinvestment in the industry, tight supply and difficult logistics in the past two years especially out of China and Europe, and there’s not a lot of major mines coming on,” he noted. Speaking to Stockhead, VP Capital co-founder and portfolio manager John So noted that the outlook for mineral sands might be a little mixed in the near-term. However, there might be some headwinds ahead for the sector in the near-term. This was supported by Image Resources (ASX:IMA) reporting a much higher average realised sale price for its heavy mineral concentrate of $929/t in the first half of 2022, compared to $480/t in the same period the previous year. Rutile prices in the first half of 2022 have climbed by 23% from the same period the previous year to US$1,506/t. ![]() The other pillar of mineral sands – namely titanium feedstocks such as rutile that are used to produce titanium metal and pigments – have also benefitted from strong demand with Iluka noting that customers are prioritising security of supply. It attributed this price growth to robust European tile production, strong demand from the Brazilian and Mexican ceramics industry, and high demand for foundry and fused zirconia in the US.ĭata from industry analyst Ruidow shows Iluka’s 66% zircon sand hitting US$2,252/t as of 30 September 2022. This is best highlighted by Iluka Resources noting in its half yearly presentation in August that the weighted average price of zircon in the second quarter of 2022 had hit US$1,910/t, a 45% increase from the first half of 2021. Supplies of zircon have become increasingly tight as demand for high-tech uses such as additive manufacturing and semiconductors piles on top of demand for more traditional uses such as ceramics, tiles and foundry material. While zircon and titanium feedstocks like ilmenite aren’t quite in the everyday vernacular – like, say, lithium – just yet, they are every bit in as high demand as many of the other critical minerals which we are all scrambling to secure supplies for. Sheffield Resources’ move to press the big green ‘Develop’ button on its monster Thunderbird project could be shoving Australia’s often unnoticed mineral sands sector into the limelight.
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