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Titanium feedstocks market up despite pandemic onset

5th March 2021

     

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The titanium feedstocks market enjoyed a strong year in 2020, according to mineral sands miner Kenmare Resource’s fourth quarter financial statement, issued in January. Despite the onset of the Covid-19 pandemic in the first quarter of last year, Kenmare achieved higher average prices for its ilmenite and rutile products compared with the 2019 financial year.

Kenmare MD Michael Carvill noted that significant ilmenite price increases were achieved because global demand outstripped supply in the fourth quarter.

Despite the global Covid-19 pandemic disruption, demand for ilmenite remained strong in the first half of last year, the company stated.

“There was a marginal softening in the third quarter, but market conditions tightened strongly in the fourth quarter, delivering a 5% increase in average received prices over the prior quarter. This momentum has continued into 2021.”

Kenmare cited low supply chain inventories, combined with global stimulus efforts, as factors that supported a downstream pigment recovery during the second half of the year. This recovery was most pronounced in China, which saw pigment production increase by more than 10% last year compared to 2019 – a record high. This was supported by high use rates at existing plants and the ramp-up of new chloride pigment plants, driving strong demand for imported ilmenite.

“Global ilmenite supply constraints remained in place owing to depleting ore bodies in Africa and mine closures in Australia, as well as continued government restrictions in Vietnam and India”, the company said.

Conversely, ilmenite production in China, and global production of low-quality ilmenite and ilmenite concentrates, increased, which offset the reduced supply from other mines. Kenmare claims there is little new ilmenite supply forecast to enter the market in the near term, with existing demand levels expected to comfortably absorb the company’s increased production this year.  

Meanwhile, the company said that zircon prices decreased for the second consecutive year, owing to continued oversupply in the market.

It said that the zircon market continued to weaken last year owing to the impact of the pandemic on global demand, particularly in Europe and China. When coupled with a market already in oversupply, this resulted in sequentially softer pricing through the first nine months of the year.

However, Kenmare noted that demand for zircon showed signs of recovery in the fourth quarter, with the company seeing prices beginning to stabilise.

Capital Projects

Kenmare’s ilmenite production increase is attributed to three previously announced development projects that, together, had the objective of increasing ilmenite production to 1.2-million tonnes a year, plus co-products, on a sustainable basis.

The first of these development projects was a 20% expansion of its wet concentrator plant (WCP) B, which was commissioned successfully in late 2018 at the company’s Moma Titanium Minerals Mine in northern Mozambique.

The second project involved the development of WCP C, which started production in late February last year.

“Although Kenmare is in discussions with the contractor for the concentrator plant in relation to a number of outstanding matters, such as acceptance and performance testing and defect remediation, the project has been operating at expected throughput levels and remains on track to be completed within the original budget of $45-million,” the company stated.

The third development project, the relocation of WCP B from the Namalope to the Pilivili ore zone, was successfully undertaken in the third quarter of last year. The ramp-up began in the fourth quarter, with production in line with expectations and ore grades significantly higher than in Namalope.

The company announced that operations at Pilivili were connected to grid power in mid-December, as planned, while the temporary trucking of heavy minerals concentrate from Pilivili to the minerals separation plant continues.

The final parts of the heavy minerals concentrate pumping pipeline were expected to arrive on site in early February, with commissioning and ramp-up expected to start during the first quarter.

The total capital cost of the WCP B move was estimated at $124-million.

Kenmare also noted that several community development initiatives in Pilivili and in the surrounding area were under construction, including a new community health centre and water supply systems. The Kenmare Moma Development Association had also approved financial support for six income-generating projects in the area, including grocery stores and a small-scale flour mill.

Edited by Nadine James
Features Deputy Editor

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