Niobium and its properties aren’t known to many investors, however, it is a mighty mineral with powerful qualities.
The majority of niobium — about 90 percent of world production — is used in the making of high-strength, low alloy steel (HSLA).
Ferroniobium — a blend of iron and niobium and the key agent used for HSLA steel — is currently in high demand.
The addition of ferroniobium to steel has performance and cost benefits and is only a minor contributor to cost.
“Demand for ferroniobium is not going to fall over time; it can only increase,” stock market specialist, Rocksil noted.
The ferroniobium price does not generally move sharply and Roskill does not expect it to rise above $US40 ($52) per kilogram before 2024. However, steelmakers are anticipating an increase this year.
Shortage of production
Niobium is currently only mined in two locations in the world Brazil & Canada. About 20 other mines source niobium among other minerals, mostly lithium and tantalum.
The US wants more
Niobium is classified as a critical metal by the US, with usage growth estimated to be 25 percent over the next six years.
The US is the largest user of ferroniobium in steel, followed by Europe and Japan.
“It is reasonable to expect HSLA usage to grow, particularly in countries where the intensity of ferroniobium use is well below the world average,” Roskill noted.
The current global market is worth around $3 billion per annum, or three times the graphite market.
Niobium is good for electric vehicles
Niobium also has a role to play in the electric cars market.
Toshiba revealed in October last year that niobium-titanium used in lithium rechargeable batteries increases the driving capacity of electric vehicles to 320km on 6-minute, ultra-rapid recharge.
According to the Japanese heavyweight, that is triple than what’s currently possible with lithium-ion batteries.
Car makers are approaching mass-market production of electric cars, according to experts.
More than 100 new electric vehicle types are presumed to be launched by 2024, which means 30 to 35 percent of passenger vehicle sales in major markets like China, Europe and the US will increase by 2030. Electric vehicles only accounted for about 1 percent of the market in 2017.
Increasing the range of electric vehicles is the main reason Niobium is gaining market share.