Home » Tertiary Minerals (TYM) » Industrial Minerals: Strong fluorspar pricing to continue into 2019 – producers

Industrial Minerals: Strong fluorspar pricing to continue into 2019 – producers

Article by Michael Greenfield, Industrial Minerals 

Tight supply and strong demand has given fluorspar producers confidence that strong prices will continue into 2019.

Restricted fluorspar supply from China has pushed prices higher over 2018 and with strong end-market demand, producers believe market conditions will carry on supporting high prices.

One producer told Industrial Minerals that “consumers stocks are depleted which means they have no space to trial different producers – they must stick with material they are used to processing.”

“This puts an emphasis on quality material and consistent supply and with supply tight due to environmental controls in China, consumers are requesting advance shipments,” the producer added. “This is something I haven’t seen for many, many years.”

The producer source told Industrial Minerals he anticipates the current market conditions to support strong pricing into 2019.

Another producer said its mining operation is running at full capacity as a result of positive demand.

Industrial Minerals’ acidspar,97% CaF2, wet filtercake, prices were assessed at $450-530 per tonne fob, China on Thursday June 21. This is up from $400-420 per tonne at the beginning of 2018.

Supply tightness in China

Strong demand in the fluorspar end markets, such as refrigerants, has met with reduced volumes of fluorspar available on the international market from China – the world’s largest producing market – to provide the perfect conditions for higher spot prices.

Environment controls from the Chinese government have hit the fluorspar mining sector, with the second producer source believing “illegal” mines have been taken off the market following inspections.

The fluorspar mining sector in China is extremely fragmented with the largest 30 mines accounting for 1 million tonnes per year of production, and the smallest of those 30 producing just 5,000 tpy.

By comparison the world’s largest producer, Mexichem, produces over 1 million tpy of the 6.5 million tpy global supply.

With mines coming offline due to inspections and no large-volume producers to supply the demand, European consumers have described difficulty in filling order books.

While it is unsurprising that producers are commenting on strong prices while the market approaches contract negotiation stages, typically around September, other market participants have been echoing the sentiment.

One trader told Industrial Minerals he had received inquiries from high-volume European consumers, which he had never experienced before.

The same source said consumers were looking to settle contracts earlier in the year to secure supply, but also on estimations that prices would rise in the second half of 2018.

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