News

February 09, 2010

Tertiary Minerals Benefits From Renewed Strength In The Fluorspar Market

By Alastair Ford

Demand for fluorspar tailed off in 2009, according to Patrick Cheetham, as consumers cut back on discretionary spending, and the automotive sector and air conditioning manufacturers sucked in less supply. But that easing off in demand looks like it might just have been a blip. The market had showed some significant tightening in 2008, at least before the credit crunch really hit home, and with the global economy beginning to pull itself up by the bootstraps, it’s tightening once more. The key to this dynamic, as to so much else, is China. But in the case of fluorspar, China’s role as a market participant isn’t just as a major consumer. It’s also the major supplier. Or at least it has been, until now.

At the moment China produces 50 per cent of the world’s fluorspar. Until recently much of that production was off-loaded around the world, putting a downward pressure on prices and meaning that customers didn’t have to think too much about where they were sourcing supply from. But China’s been growing twitchy about its own consumption. Not so long ago the Chinese authorities imposed a hefty export tax on fluorspar, making it much cheaper to buy inside than outside the country. But that, it...