Thursday , 22 February 2024

Tantalum: How Tantalizing (+3K Views)

You know all about gold, silver, platinum, palladium, uranium and perhaps even molybdenum but what about tantalum?

By: Lorimer Wilson

What is Tantalum?
Tantalum is a rare metal found in Australia (56%), Africa (19%), Brazil (16%), China (5%) and Canada (4%). This high performance metal has a high melting point, high strength, high ductility, high reliability, high resistance to corrosion and high thermal conductivity making it a highly efficient, highly reliable and environmentally versatile component for use in a wide variety of applications that contribute significantly to our economy and way of life.

What is the Market for Tantalum?
– 68% of tantalum is used in the electronics capacitor industry in such products as cell phones, DVD players, personal computers, digital cameras, gaming platforms, LCD monitors, wireless devices, telephone switch boards and computer networks because of its unequaled capacity to store and release electrical charges.

– 11% is used in other electronics applications such as PC memory chips, igniter chips for car air bags and other automotive electronics.

– 8% is used in the manufacture of super alloys for jet engines, turbines, space vehicles, nuclear reactors, power plants and chemical equipment due to its extreme hardness.

– 5% is used in the manufacture of carbides (5%) for cutting tools, drill bits, excavator and bulldozer teeth and the forming of dies.

– 2% is for use as optical coatings, memory chips and silicon wafers for use in microcompressors.

– 1% is used in military and recreational ammunition and

– 3% is used in the manufacture of a variety of other products such as rayon fibers, heat shields, ink jet printers, x-ray film, hip and knee replacement systems (because of its non-corrosive nature) and in the manufacture of surgical instruments and appliances.

What is the Demand for Tantalum?
According to the US Geological Survey Mineral Commodity Summaries report and the Tantalum-Niobium International Study Center:
a) world-wide demand for tantalum was 6 million pounds per year in 2006
b) consumption has been increasing approx. 7% per annum over the past 20 years
c) primary mine production has increased 38% since 2004 to 2.84 million pounds in 2006
d) the USA imports 87% of its 1.5 million pounds annual requirement (the balance reclaimed from recycling) and, according to the US Defense Logistics Agency,
e) the US’s current stockpile of tantalum will be depleted by the end of 2007 at current disposal rates.

The above facts add up to an impending major imbalance in supply and demand starting in 2008 and quite possibly a major escalation in the price per pound of tantalum in the years ahead.

What is the Current Price of Tantalum?
Tantalum is not traded on the commodity metals markets but, rather, the price is freely negotiated between supplier and processor. As such, over the past 30 years, the tantalum market has been marked by long periods of stability, punctuated by very sharp price hikes created by a combination of strong demand and fear about a shortage of supply.

From what we know about the many and growing market applications for tantalum, the impending supply shortage of tantalum, the present low price for tantalum and the historic high price tantalum commanded just a few years ago it is evident that the future price of tantalum has no where to go but up – big time!

How can an Investor Profit from Tantalum?
There are major ‘unmined’ profits to be had by investing in one or more of the tantalum junior explorer companies (12 in total of which 5 are major); mining companies (14 in total with 4 producing 60% of the world’s supply); processor companies (9 of which 3 supply 80%); producer companies (26 in total of which 8 are major); integrators and recyclers.

It behooves you to investigate the companies involved that are publicly traded, do your analyses, make an informed choice as to which ones to invest in and deploy your investment dollars accordingly. Tantalum is, indeed, a tantalizing investment opportunity that warrants further study.

Editor’s Note:
– The above article consists of reformatted edited excerpts from the original for the sake of brevity, clarity and to ensure a fast and easy read. The author’s views and conclusions are unaltered.
Permission to reprint in whole or in part is gladly granted, provided full credit is given.
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