Prices for vanadium — a minor metal traditionally used to strengthen steel and more recently a key component in a new generation of battery technology that could potentially store electricity from solar and wind generation — are expected to rise in coming years, Christopher Ecclestone of Hallgarten & Co. forecasts.

Vanadium pentoxide (V2O5) prices moved from around US$5 per lb. at the end of December 2016 to US$12.50 per lb. at the end of July 2017, before closing the year at US$9.50 per lb., and the U.K.-based analyst predicts the price will reach US$13.20 per lb. by the end of 2018, US$15.00 per lb. by the end of 2019, and US$19 per lb. by the end of 2020.

“Last decade vanadium surfaced as a subject of interest primarily tied to the fortunes of the then-booming steel industry,” he writes in a Jan. 3 research note. “Now vanadium is coming back with a vengeance for its potential in mass electricity storage devices, namely the vanadium redox battery, or VRB.”

Vanadium pentoxide (98.5% pure) at the Rentian processing plant in China’s Jiangxi province. Credit: Sparton Resources.

The surge in vanadium prices in the second half of 2017, he says, can be chalked up to “a combination of perceptions of changing Chinese policies on vanadium content in steel alloys and the fervor relating to alternative battery metals.”China has been ruminating about increasing the vanadium content in steel to make it stronger, while vanadium’s potential in mass electricity storage devices, or vanadium redox batteries (VRB), have also made it appealing to investors.

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