Outlook to 2030, 16th Edition
Approximately 90% of all niobium is consumed as ferroniobium used in steelmaking. Besides ferroniobium, niobium is consumed in a wide range of smaller-volume but higher-value applications, such as high-performance alloys (which include superalloys), carbides, superconductors, electronic components, and functional ceramics.
Demand for ferroniobium increased steadily over the past couple of years, driven by higher high-strength-low-alloy (HSLA) steel demand, primarily in China. On top of growing demand, a spike in vanadium prices due to China implementing new rebar standards in 2018 caused steel mills to substitute vanadium with niobium for rebar alloying. As a result, niobium has captured some additional market share in the process, although more recently, falling vanadium prices drove China’s most price-sensitive steel mills to revert to vanadium.
Niobium demand will be heavily impacted by COVID-19 in 2020, however, the steel industry has developed a dichotomy between China and the rest of the world. In China, demand has been supported by government measures, while the rest of the world has been heavily impacted by lockdowns. Roskill believes that China’s steel production will reach a new all-time high in 2020, while the rest of the world will post a significant drop. Although global niobium demand will decline y-o-y in 2020, the drop will be mitigated by China’s resilience.
Although the unit consumption of niobium is very small in its applications (fractions of a percent by weight per tonne of finished steel) the benefits are large. Niobium additions in steel significantly increases strength, so less steel is required overall, which can reduce cost substantially. This has been the basis for the development and growth in its use in steels over the last few decades and should remain the driver in the years to come. Niobium intensity of use has been increasing in China but remains low in several large, steel-producing nations, such as India and Southeast Asian countries. Although niobium is more widely used for flat steel products, it has recently increased its market share in the rebar segment, taking advantage of its stable price compared to the volatility of the vanadium price. The utilisation of both niobium and vanadium is poised to keep increasing in coming years, driven by higher steel production, regulations implying a higher micro-alloying content, and the economics of steel making.
Almost all ferroniobium supply is from three industrialised producers, two in Brazil and one in Canada. By far the largest is Companhia Brasileira de Metalurgia e Mineração (CBMM), which operates a pyrochlore mine and processing plant near Araxá in east-central Minas Gerais state in Brazil. While historically the company has operated comfortably below operational capacity, recent increases in demand translated into rising operating rates and prompted a 50% expansion, to be commissioned in Q1 2021. The other major producers, Magris Resources in Canada and China Molybdenum in Brazil are thought to be operating at close to capacity.
In addition to expansion at current operations, there are numerous niobium projects in the pipeline, some of which could come on-stream over the coming years to meet growing demand. However, while some have released feasibility studies, none have started
Niobium pentoxide (Nb2O5) is the starting product for most specialised non-steel applications, such as nickel-based high-performance alloys used in the aerospace industry, where high-temperature strength is required. Commercial niobium oxide products are generally termed high-purity (optical-grade) oxide to distinguish them from intermediate forms. Niobium is also produced as pure metal along with other alloys typically containing titanium and zirconium. Niobium chemicals have a wide range of applications, e.g. in catalysts and functional ceramics.
New opportunities for niobium could come from batteries, both in the anodes and cathodes, as well as nano-crystalline materials, primarily for electrical vehicles. Although potentially interesting, these new applications are in their early stages of development and their contribution to the niobium demand should remain limited over this next decade.
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Roskill experts will answer your questions…
- How did COVID-19 impact the niobium market?
- To what extent are ferrovanadium and ferroniobium viable substitutes for each other?
- Does niobium have the potential to further increase its market share in the rebar segment?
- What is the outlook for ferroniobium demand in automotive and pipelines?
- What are the new potential sources of demand ex-HSLA?
- How will the supply base develop over the coming years?
- What is the outlook for prices?