Iodine: Rising prices encourage increased supply

US iodine producer Iofina has announced production estimates for H1 2019 of almost 287t crystalline iodine, a rise of nearly 10% on the previous year when severe winter weather reduced output. Rising prices, however, are also encouraging higher production levels across the industry and Iofina expects to produce 305-325t in the second half of the year from its four plants in Oklahoma.

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Iodine prices have continued to rise through Q3 2019 with increasing market tightness. Spot market sales are now over US$30/kg compared to around US$25/kg at the start of Q3 2018. Price rises may encourage the entry of new capacity into the market in excess of that planned by SQM in Chile, which is thought to have been supplying from stocks to meet rising global demand.

Meanwhile, closed capacity could also come back online, including 2Ktpy of capacity at the Eloisa operation in Chile. The amount of secondary material recovered by recycling could also rise.

A number of smaller iodine producers that operate in other regions of the world could also increase production, including those in Iran and Turkmenistan. A new entrant to the market, Himiya Senagat, is operating in Turkmenistan with 300shtpy of capacity and had sold three containers of iodine by July 2019. It intends to increase its capacity to 500shtpy in the near future.

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This article was written by David McNeill and Suzanne Shaw. Please get in touch below if you wish to discuss further:

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