For those that are new to GLF like me and are working through what it all means I thought I'd share some of the stuff I'm finding. This might be old news to those that have been in this for awhile but I hope it helps it some way.
Thought I'd start with the basics:
First whats Vermiculite...
"Vermiculite has been used in various industries for over 80 years. It is used in the construction, agricultural, horticultural and industrial markets. Vermiculite is the mineralogical name given to hydrated laminar magnesium-aluminium-iron silicate which resembles mica in appearance.
Vermiculite is found in various parts of the world. Locations of the dominant commercial mines are in Australia, Brazil, China, Kenya, South Africa, USA and Zimbabwe.
Vermiculite mines are surface operations where ore is separated from other material, then screened or classified into several basic particle sizes.
When subjected to heat, vermiculite has the unusual property of exfoliating or expanding into worm-like pieces. The name 'vermiculite' is derived from the Latin 'vermiculare' meaning worm-like. This characteristic of exfoliation, the basis for many commercial uses of the mineral, is the result of the mechanical separation of the layers during the rapid conversion of contained water into steam. The increase in bulk volume of commercial grades is 8 to 12 times, but individual flakes may exfoliate as many as 30 times the original size. There is also a color change during expansion that is dependent upon the chemical composition of the vermiculite and the furnace temperature. The bulk density of crude vermiculite or vermiculite concentrate is in the range of 640-1120 kg/cubic metre. (40-70 lb/cubic foot) and exfoliated or expanded vermiculite is in the range of 64 - 160 kg/cubic metre (4 - 10 lb/cubic foot)." Source: www.vermiculite.com.au/
Uganda Vermiculite Mine
Source: Industrial Minerals
"Global vermiculite supply tight going into 2011 25 Nov 2010
Global supply of vermiculite very tight going into 2011, especially for coarse grades of material, market sources told IM.
One buyer said that he is ?worried? about the situation going forward as a new round of pricing negotiations gets underway.
It is understood that one of the major producers, South African company, Palabora Mining Co (PMC), is looking for hefty price increases for next year.
Over the last few years, producers have pushed for little more than inflationary increases, but this year, supply is struggling to keep up with demand, particularly for coarse grade material.
This year price rises of up to 30% have been mooted. However, many buyers are holding off as long as possible, some until the New Year, before placing orders, so that they can see how the land lies.
Demand is growing
For the moment, price levels remain steady, until the true extent of price increases becomes clear.
Many contracts are usually settled on an annual basis. It could be that next year, contracts are set for a shorter period, or it may be that buyers are anxious to secure supply and look longer term.
There may also be an element of rationing for customers, for grades that are in short supply.
Vermiculite demand is growing, and most of the substitution by other products that would be economic or practical has already happened. Even at higher price levels, vermiculite is used for its specific properties in applications such as insulation and horticulture.
PMC is the world?s major vermiculite supplier, and owing to the geology of its deposits, it is struggling to keep up with demand for coarse grades of material.
To exacerbate the situation, supply has been reportedly been ?erratic? from China this year and very limited from Russia and Zimbabwe.
Newcomer, Gulf Resources has signed a 10-year supply deal with UK-based DuPr? Vermiculite to supply up to 15,000 tpa from its Ugandan operations which started up in April 2010.
Gulf produces a range of grades, including coarse material, but it won?t be enough to completely satisfy demand."
GLF Price at posting:
4.4¢ Sentiment: Hold Disclosure: Held
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