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ferronium

1,306 Posts.

17/02/15

20:07

Post #: 14771978
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Originally posted by Mongrel ↑

Thanks Ronraine.
Of course, Bluescope's operations at Waikato North Head Mine are palaeo dunes - neither modern beach nor seafloor. They don't "purchase" the iron sands as such - they mine it themselves for their own use.

The NZ mine at Taharoa produces for export - almost exclusively to Japan and almost exclusively as a feed for programmed blast furnace lining protection (the Ti content helps protect the refractory bricks from temperature shocks). Taharoa's production would increase if they could find additional customers, but they find it difficult to do so. So, no, its not a forgone conclusion that other sand miners will have no difficulty in selling their product.

Indeed, I would identify Sales and Marketing as the most crucial element of any magnetite sand project, yet most companies leave that till last on the assumption that it will sell easily. Unfortunately, it will not! (the old Aurox spent a great deal of time, money and effort to find a buyer for their Balla Balla Ti-V-magnetite product. Even though that product would have Ti-V "credits", they had to accept huge discounts in the end. That deposit was sold off when Aurox was taken over by Atlas. A hard rock deposit, I know, but an interesting lesson).

I am sure I know of most of the magnetite sands projects around the world. Of course, set the sell point for any product low enough and you should find a customer, but it is almost a forgone conclusion that Ti-V-magnetite sands will attract nothing like the IO spot price. Add to that the grade discount, currently running at around 20% for 57-58% Fe product and the delivered cost into the customer's port needs to be very low to make a profit.

I look at operations like Indon Mines and Trans Tasman Resources and note that they couldn't get into production during the IO bubble. Both have been around that long. Magnetite sand resources in Canada, Central America, Peru, Namibia and the Philippines have similarly not progressed (and in most cases sent the companies broke). Its a tough gig; dreams kept alive with the promise of low OPEX and CAPEX have pretty much failed to deliver. I cannot see Amex beating the odds easily.

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The NZ mine at Taharoa produces for export - almost exclusively to Japan and almost exclusively as a feed for programmed blast furnace lining protection (the Ti content helps protect the refractory bricks from temperature shocks).

Taharoa haven't sent any ironsand to Japan since mid 2000.

Taharoa's production would increase if they could find additional customers, but they find it difficult to do so.

So why is Bluescope expanding Taharoa from 1.3 to 4.0 Mtpa? https://www.bluescopesteel.com/media/320579/1 - ship announce.pdf
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