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Surging demand for rare metals driven by hi-tech industry, China
London (AFP) Feb 24, 2008 Prices of rare metals like cobalt and magnesium are surging ahead in London, driven by high-end technology and soaring demand from economic powerhouse China, according to commodities experts. Glamorous raw materials such as precious metal gold and oil have long hogged the headlines -- with New York crude at a record high 101.32 dollars per barrel last week on concerns about tight global energy supplies. But analysts say the lesser-known strategic metals, which also include cadmium, mercury and molybdenum, are now making headway. Other rare metals are antimony, ferrochrome, gallium, germanium, indium, manganese and tantalum. "China would be the main market driver for 75 percent" of the 30 most traded rare metals, said Martin Hayes, a senior analyst for specialist website MinorMetals.com. "The price gains reflect a combination of supply worries and demand influences." Germanium is currently trading at the highest level since 1990, ferrochrome is at a historic pinnacle, cobalt is at a 30-year high and magnesium is close to a 13-year peak, according to the site. "Major drivers have been a boom in the aerospace sector, as well as rapid growth in Asia," said analysts at British-based emerging markets bank Standard Chartered. Strategic metals have a wide variety of uses, ranging from the manufacture of flat-screen televisions (indium), mobile phones (gallium) and optical fibres (antimony). Cadmium is used to make batteries, while buoyant demand from the steel and aerospace sectors have bolstered the prices of ferrochrome and cobalt. Hayes said: "Ferrochrome is used in steel-making, and steel prices are currently strong. Demand for cobalt is also robust from the aerospace sector -- the metal is used as a super-alloy in engines." Prices for minor metals are also supported by tight supplies and their unique properties, according to industry experts. "Scarcity, low volumes" and difficulty of substitution are the main characteristics of minor metals, according to Roland Chavasse, of Minor Metal Trade Association (MMTA). China is turning to its own production in an attempt to satisfy the Asian giant's demand for minor metals. "On the supply side, China is a major producer of many metals, such as magnesium, and it is seeking to restrict exports in favor of the domestic market as it industrialises," Hayes added. Minor metals are uniquely traded because their prices are negotiated between consumers, producers and wholesalers, and are published periodically in specialist sector reviews. In contrast, base or industrial metals such as aluminium, copper and zinc are traded on markets, including the London Metals Exchange (LME), and Comex, which is a division of the New York Mercantile Exchange. Precious metals gold and silver are traded on Comex and the London Bullion Market. Related Links Global Trade News
China's Baosteel agrees on 65 percent increase in ore prices
Beijing (AFP) Feb 22, 2008China's top steelmaker said Friday it agreed to a 65 percent rise in ore prices with Brazil's Vale, in a move following agreements by other Asian producers for a global benchmark on the raw material. |
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