Date: Apr 18, 2018
In 2013, Neometals Ltd. (ASX: NMT) (“Neometals”) completed a mineral resource estimate that featured in the company’s 2015 preliminary feasibility study. The block model revealed indicated and inferred tonnages and grades for V2O5, TiO2, Fe2O3, Al2O3, and SiO2 using cut-off grades for vanadium pentoxide (V2O5) as the key constituent. But now, the titaniumresource has been revealed as 2.4x larger than first thought, and the vanadium resource a massive 4x larger.
Titanium has been making a gentle and considerable recovery since its lowest-of-lows at the end of 2016, and while we expect this to continue, the real star metal of today is vanadium. We have followed good old V2O5 for years, but last year, vanadium outperformed every battery metal including cobalt and lithium to rise 130%. Chinese vanadium pentoxide increased from $9/lb at the start of December 2017 to $13/lb at the end of January, and by the third week of March registered a whopping $15.5/lb for 98% min vanadium pentoxide.
Core Consultants investigated the current rally in order to clarify the cause and ascertain its longevity. We found that the V2O5 price has been supported by a series of increasingly stringent rebar standards introduced in China in response to the 2010 Sichuan earthquake that collapsed several buildings, taking the lives of around 68,000 people.
According to our research, yet more new steel regulations introduced in 2018 will provide further significant improvement to vanadium specific consumption rates. Furthermore, the China Iron and Steel Research institute (CISRI) expect that these new rebar standards should see China’s vanadium metal consumption increase by 30% over 2016 for the next two years.
