Potash shipments surge; Japan targets erbium use; China’s nuclear industry in breakthrough
Spot prices (free on board or FOB, Vancouver) rose slightly in May to $417.50/tonne, up from $405 in April. Canpotex concluded a sale in Asia, moving 15,000 tonnes at $470 (cost and freight, or delivered – but even compared with the FOB price, this would suggest that buoyancy is easing back into the market).
But Scotiabank says buyers in Asia and Brazil continue to resist higher prices, with China seeking a roll-over of its first half cfr contract at $400/tonne instead of the higher prices being asked by producers. Scotiabank says India’s present contract price is $427/tonne cfr.
So here’s the bottom line: prices may still be struggling, but there are again signs of life on that front; meanwhile, shipments have picked up markedly. The bank says China’s imports jumped by almost 19% between January and April – 2.67 million tonnes over that period, compared with 2.25 million in the first four months of 2012. Brazilian imports are doing better – up 53% year on year to 2.2 million tonnes so far this year.
RARE EARTHS: It seems the Japanese will leave no stone unturned in their quest to lessen their dependence on rare earths. The latest item involves the “reduce” part of their “recycle, reduce, replace” strategy.
The Nikkei news service reports that the University of Tokyo and Sumitomo Electric Industries are looking at ways to maintain amplification levels in optical fibres after reducing the amount of rare earths involved. The scientists have come with a new technology to make it possible to observe rare earth metals in optical fibres, which should make it possible for researchers to discover how they can get away with using lower quantities of these rare earths.
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As the report explains, amplifiers have to be installed at about every 100km along an optical fibre, and they are doped with about 0.2% of rare earths, mostly erbium. The REE metals, when electrified, help amplify the signals. The research team has now been able to observe individual atoms of erbium with their new technology – making it possible to figure out how these are diffused.
URANIUM and NUCLEAR ENERGY: China has now achieved enrichment of uranium for the first time. As China Central Television reports, this is a vital step for the country’s nuclear power push as natural uranium contains only 0.7% of the key Uranium-235, most of it consisting of Uranium-238. The report said China’s nuclear power stations need uranium containing up to 5% of Uranium-235.
The China Daily newspaper reports that journalists at the weekend were allowed into the enrichment plant, located in Lanzhou, Gansu province. It added that all the equipment, including the centrifuges, was developed by the China National Nuclear Corporation, which announced the enrichment technology is now ready for industrialisation.
The enriched fuel will be transported to every nuclear power station in China.
And here’s a point made by analysts at Canaccord Genuity in Sydney: there are not many commodity sectors which have not been influenced by ‘hot’ money as speculators looked for quick returns. Indeed, spot uranium dropped slightly again this week, down 20c to $39.65/lb.
As the report states, “if anyone wants to bother with fundamentals they will be (aware) that the uranium market is marching towards a serious supply shortage, though there is nothing new in that equation.
“We know that the conversion of weapons-grade to power-station uranium is ending this year. We know that China is continuing with its aggressive increase in nuclear power activity, and Japan is moving to bring reactors back on stream.
“The only thing lacking is the reaction of investors – they have not yet embraced the thematic.”
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