Summary of Lara Smith’s 2014 Mining Indaba Presentation: An Outlook for Dysprosium, Tantalum, Tungsten

The Core Consultants Mining Indaba presentation always considers three commodities which are pertinent to Africa and discusses the market outlook for each of them. This year we will focus on the markets for dysprosium, tantalum and tungsten.

With respect to tantalum, we note the tendency of the market to be characterised by periods of vast over and undersupply. This is evidenced by the volatile nature of its prices. More recently the price is elevated due to the requirements of end-users to purchase only conflict-free minerals. Consequently companies were reluctant to purchase material from artisanal miners in Africa. This coupled with the burgeoning demand for portable electronic consumer goods, a key use for tantalum, is causing prices to again spike.

With respect to the tungsten market, Africa is not the largest producer, but around 16% of Chinese purchases are consumed from Rwanda. In recent years demand has outpaced supply, necessitating the sale of government stockpiles from China, Russia and American governments. In the US, the tungsten national stockpile fell by 78% to 7,500 from 2000-2011 and now stands at less than 5,800 tonnes. Potential projects underway are minimal and in general are only replacing closing mines which is why we believe that Tungsten is facing a critical supply shortage.

Finally in the dysprosium market, we show that dysprosium only constitutes around 4% of Chinese rare earth oxide resources. Outside of China, dysprosium is even scarcer and accounts for less than 1% of all rare earth oxide reserves

Lara Smith

Lara is the CEO and founder of Core Consultants. She has been an analyst for over thirteen years and has focused on commodity markets for just over a decade. She began her career as a buy-side analyst at Foord Asset Management in Cape Town, before taking a Head of Research role at a mining corporate finance and investment firm.

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