Price recovery in strategic raw materials

Hasso Bergmann

After Beijing, having overturned the export quotas beginning of the year, to fall, the export tax under the WTO ruling in early May. These moves depending on the metal between 15 and 25%. Such a measure may well put downward pressure on prices, the Frankfurter Tradium GmbH in its latest market report. However, Beijing plans in exchange for the introduction of a resource tax of up to 35%. This is to counteract the depletion of strategically important resources and bring the market back into balance.

Prices for Rare earth have significantly tightened again in part. This is remarkable, mostly because a contrary price development was observed in the weeks before the Chinese New Year celebrations. But this year is hardly reported liquidity-driven sales. One could derive a certain sustainability. The reasons are complex. Firstly, many factories have been closed prior to the start of the New Year celebrations. There are also rumors, that Beijing wants to buy various rare earths for state reserves on a large scale again. But the increasing success in the fight against illegal mining and smuggling have led many producers, to raise prices.

Price increases are currently strongest in the so-called magnetic metals neodymium, Dysprosium, To observe terbium and praseodymium. The prices of hafnium have risen significantly in recent months. It is obvious, that the two leaders currently have problems, to keep up with the demand for high quality hafnium step. At the same high levels have been reduced massively in countries such as Ukraine, also, because demand quantities exceed the new production significantly.

Hafnium is considered a strategic metal, which has to face an increasing number of new applications and markets. Increasing demand from the aerospace industry – reflected by a full order book – is only one example of the current challenges. There are a number of alloys for both aircraft and gas turbines, the hafnium consider indispensable.

The specialist service "Metal-Pages" reported, that the draft budget of the United States for 2016 provides for a return to higher defense spending. After six years of regular cuts, the US government is planning additional expenditure of 4%, to counteract the rising global threats. Reveal details, that a significant part of the expenditure in the modernization of monitoring- and reconnaissance systems to go. These include u.a. Satellite, Telecommunications and electro-optical devices, represent a major application for the metal germanium.

Stricter trade conditions in the Chinese platform Fanya have led to, have sold more indium quantities and ensure a relaxation in the global markets that investors. As a result, the prices are clearly under pressure. But preparations for the New Year celebrations have also led to Indium, wait that both producers and distributors for the time being.

Reference: The contents of the columns are for information only and do not constitute investment advice or a recommendation within the meaning of the Securities Trading Act represents nor are they to be considered a warranty of any currency developments. The views expressed are strictly the opinion of the respective author. Each author is solely responsible for the content of the column responsible.
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