New Market Report Focuses on the Market Outlook for Rhenium to 2015
According to the report: Rhenium: Market outlook to 2015 (8th edition, 2010) the rhenium market went through a significant downward correction in 2009 after a period of strong demand growth and an escalation in prices up to the last quarter of 2008. The credit crisis and associated recession, particularly in North America and Europe, severely affected the major markets for rhenium and demand dropped by 16% in 2009. Primary production of rhenium responded by falling by almost 10%, but this was not enough to stop prices plummeting from a peak of US$12,000/kg on a spot basis towards the end of 2008 to around US$4-4,500/kg in mid 2009 before bottoming out. Rhenium metal prices are currently around US$4,500-5,000/kg.
Roskill says, “Consumption of rhenium in 2009 was estimated at 53,500kg, of which 78% was consumed in superalloys, 14% in catalysts and 8% in other end-uses including space, alloy mill products, petrochemicals and medical targets. The USA is the world’s largest producer of aerospace superalloys and is therefore the biggest consumer of rhenium. Consumption of rhenium in the USA has increased by 5.4%py over the last nine years, reaching 52,200kg in 2008. Consumption of rhenium in Europe peaked at 9,000kg in 2007, whilst consumption in other countries has increased from 3,000kg Re in 1998 to 4,500kg Re in 2009.
Also, Roskill’s base case growth scenario for rhenium is that total demand for rhenium will increase at an annual average rate of almost 5%per year for the period 2009 to 2015, taking total rhenium demand to 71,500kg. This rate is slightly above forecasts for world GDP over the same period, but is well below the growth rates seen up to 2008, due to the severe drop in demand in 2009, the possibility of recycling/re-use of rhenium and greater control over the unit consumption of rhenium in superalloys. It is unlikely that consumption for rhenium will follow a linear growth trend, particularly given the cyclical nature of the aerospace industry. As the global economy recovers from the current recession, demand is expected to recover strongly for the period 2010-2012 before flattening in 2012/13 and then recovering in 2014/15. Primary production of rhenium totalled 41,200kg in 2009, a 10% drop from 45,600kg in 2008. In 2009, almost two-thirds of primary rhenium production is estimated to have been carried out in Chile. Other important primary producing countries were the USA, Poland, Kazakhstan, and China. Lesser amounts of rhenium were produced in Uzbekistan and Armenia.
The scarcity and high value of rhenium are an incentive to recycle used material. Capacity for secondary rhenium production could be as high as 30,000kg per year Re, but a large part of this capacity is for recycling of spent catalysts, which is a closed loop and the rhenium recovered is not available to the open market. The majority of secondary production is carried out in Germany and the USA, but significant amounts of secondary rhenium are also recovered in Estonia and Russia.
The forecast growth in demand for rhenium is likely to be satisfied by expansions at existing facilities (e.g. Molymet, KGHM Ecoren) and new projects (e.g. Codelco, Kennecott Utah Copper, Xstrata Copper, Ivanhoe Australia). In addition, superalloy scrap will be a significant potential source of secondary rhenium units, as the recycling loop in the superalloy industry is currently far less efficient than the system in place in the catalyst sector. Superalloy scrap falls into two main categories; ‘revert’, which is essentially material that can be re-used ‘as is’ to produce the same or a different alloy and scrap, which is other material that tends to be processed to extract the constituent metals, such as rhenium.
Roskill has forecast future rhenium metal prices to 2015 on a "spot" basis. Prices are expected to start recovering in 2010, but are unlikely to regain the average levels of 2009 due to the steep nature of the decline in prices from 2008. Roskill expects spot prices to continue to rise steadily over the forecast period to reach an average of around US$6,500-7,500/kg in 2015, although there may be a slight correction in prices in 2012 as demand for rhenium in superalloys is expected to level off in that year. Contract prices should follow a similar trend and are likely to close the gap on spot prices as contracts are renegotiated with reference to spot prices.
The report: Rhenium: Market outlook to 2015 (8th edition, 2010) is available at a cost of GBP3500 / US$7000 / EUR5600 from Roskill Information Services Ltd, 27a Leopold Road, London SW19 7BB, England. More information can be obtained on their web at www.roskill.com/rhenium