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Evraz Vametco is reopening a mine in South Africa that produces the alloy used in steelmaking.
Metal-Pages reported that Chinese vanadium-nitrogen alloy prices have “soared” in the last few days on “tight spot availability and high production costs.”
Nitrogen added to vanadium gives strength to the alloy, allowing steelmakers to use less vanadium, thus reducing their input costs.
The price of the alloy, which contains 77-percent vanadium and 16-percent nitrogen, is now trading on the spot market in a range between RMB 125,000 (US$20,305) and 127,000 ($20,630) per tonne, compared to the previous RMB 120,000 ($19,493) to 123,000 ($19,980). Prices began rebounding about three weeks ago due to tightening supply combined with higher prices for the raw vanadium pentoxide that is used to produce the alloy, according to Metal-Pages.
“We have been carrying out previous contracts with downstream buyers at RMB125,000/tonne at the start of May when prices increased sharply because of limited material on the spot market,” said Metal-Pages, quoting a Hunan-based producer.
One vanadium mine is poised to take advantage of the price increase as its main output, Nitrovan®, is a vanadium-nitrogen product. Mining Weekly reported that South Africa’s Department of Mineral Resources has converted an old mining right to a new mining right at Evraz Vametco’s vanadium mine. The new mining right grants the company uninterrupted production for the next 25 years, said Mining Weekly.
In addition to Nitrovan® the mine also produces vanadium trioxide and ammonium metavanadate.
Nearly all (98 percent) of the world’s vanadium is mined in China, Russia and South Africa. The vanadium is recovered from titanium-bearing magnetite ore that is made into pig iron. The slag from that process contains 20- to 40-percent vanadium pentoxide, which is then processed into ferrovanadium, a steel strengthener.
Securities Disclosure: I, Andrew Topf, hold no direct investment interest in any company mentioned in this article.