Japan Chemical Trading Blog

The latest chemical trading industry insights from Japan, Asia and the world, reported by the President of Daishin Corporation, Masa Oguchi.

RECENT LITHIUM TRENDS

Recently in Japan, while shares have been rising due to the effects of the monetary easing measures of the Bank of Japan, the actual economy seems to still be struggling.
Throughout the world, the prices of many base metals and minor metals, which we handle, have been dropping as well, perhaps owing to the effects of the economic slump in Europe and China.
Nevertheless, the price of lithium (lithium carbonate) has been rising.
Needless to say, lithium’s usage in lithium-ion batteries is focused upon; the demand for lithium-ion batteries is about 14,000 tons, against 18,000 tons for the total domestic demand in Japan, showing a high growth rate during these years (estimated figures in 2014).
According to the United States Geological Survey, about 35,000 tons of lithium is produced in the world (Li, 2013); an oligopoly market is shared by three big makers: SQM (Chile) Rockwood Lithium (former Chemetall, Germany) and FMC (U.S.A.), which know the way of impurity separation to use salt water from salt lakes as raw material,.

As we mentioned before, Sumitomo Metal Mining is reinforcing its production facilities of lithium nickelate for positive-electrode material for lithium-ion batteries for Panasonic. The website of Sumitomo Metal Mining reports as follows: they anticipated a further increase of lithium-ion battery demand for the 4-door sedan, “Model S” of Tesla Motors of the U.S., so they invested 4.8 billion Japanese yen (approx. USD 48 million) by the summer in 2014 to increase the production of lithium nickelate from 300 tons to 850 tons a month and they will further increase the production from 850 tons to 1,850 tons a month, at 15 billion Japanese yen (approx. USD 150 million), by the winter of this year.

We are not sure whether or not the demand for Panasonic lithium-ion batteries will increase in the future; however, we are sure that the quantity of lithium Japan imports will increase for the moment.
That’s why we checked the customs clearance statistics of Japan (lithium carbonate) and found out, as we expected, the quantity of lithium Japan imported in 2014 rose to 12,107 tons from 8,215 tons in 2013; a 47% rise.
The unit price in 2014 has increased as well compared to that in 2013 and the unit price in 2015 is still higher (JPY 527 per kg in 2013, JPY 544 per kg in 2014, JPY 617 per kg in 2015).
FMC, U.S., declares on its website that they raised the lithium salts price by 10%, including lithium carbonate, as of December 1. The website also says “The increases are necessary to offset continued rising costs of raw materials and operational cost pressures at our Argentina facility.” We interpret this as international demand is becoming tighter because big consumers such as China, Korea and Japan need it more and more.

In the industry, SQM in Chile is rumored to not be producing enough lithium, therefore, people are feeling uneasy.
There are some factors to ease the supply and demand balance; a new lithium carbonate project in Salar de Olaroz, Argentina, which Toyota Tsusho Corp., Japan, has been developing since 2010.
The website of the company says it will start full-scale production of lithium in late 2014; 17,500 tons a year, in the initial plan.
It seems there is no detailed publicity of the current status of the project as of now; 17,500 tons can cope with the domestic demand of Japan, so that its actual shipment may become one of the factors to ease the supply and demand balance.
Those subscribers who are in the lithium salts business should watch the Toyota Tsusho project.

RECENT LITHIUM TRENDS

Recently in Japan, while shares have been rising due to the effects of the monetary easing measures of the Bank of Japan, the actual economy seems to still be struggling.
Throughout the world, the prices of many base metals and minor metals, which we handle, have been dropping as well, perhaps owing to the effects of the economic slump in Europe and China.
Nevertheless, the price of lithium (lithium carbonate) has been rising.
Needless to say, lithium’s usage in lithium-ion batteries is focused upon; the demand for lithium-ion batteries is about 14,000 tons, against 18,000 tons for the total domestic demand in Japan, showing a high growth rate during these years (estimated figures in 2014).
According to the United States Geological Survey, about 35,000 tons of lithium is produced in the world (Li, 2013); an oligopoly market is shared by three big makers: SQM (Chile) Rockwood Lithium (former Chemetall, Germany) and FMC (U.S.A.), which know the way of impurity separation to use salt water from salt lakes as raw material,.

As we mentioned before, Sumitomo Metal Mining is reinforcing its production facilities of lithium nickelate for positive-electrode material for lithium-ion batteries for Panasonic. The website of Sumitomo Metal Mining reports as follows: they anticipated a further increase of lithium-ion battery demand for the 4-door sedan, “Model S” of Tesla Motors of the U.S., so they invested 4.8 billion Japanese yen (approx. USD 48 million) by the summer in 2014 to increase the production of lithium nickelate from 300 tons to 850 tons a month and they will further increase the production from 850 tons to 1,850 tons a month, at 15 billion Japanese yen (approx. USD 150 million), by the winter of this year.

We are not sure whether or not the demand for Panasonic lithium-ion batteries will increase in the future; however, we are sure that the quantity of lithium Japan imports will increase for the moment.
That’s why we checked the customs clearance statistics of Japan (lithium carbonate) and found out, as we expected, the quantity of lithium Japan imported in 2014 rose to 12,107 tons from 8,215 tons in 2013; a 47% rise.
The unit price in 2014 has increased as well compared to that in 2013 and the unit price in 2015 is still higher (JPY 527 per kg in 2013, JPY 544 per kg in 2014, JPY 617 per kg in 2015).
FMC, U.S., declares on its website that they raised the lithium salts price by 10%, including lithium carbonate, as of December 1. The website also says “The increases are necessary to offset continued rising costs of raw materials and operational cost pressures at our Argentina facility.” We interpret this as international demand is becoming tighter because big consumers such as China, Korea and Japan need it more and more.

In the industry, SQM in Chile is rumored to not be producing enough lithium, therefore, people are feeling uneasy.
There are some factors to ease the supply and demand balance; a new lithium carbonate project in Salar de Olaroz, Argentina, which Toyota Tsusho Corp., Japan, has been developing since 2010.
The website of the company says it will start full-scale production of lithium in late 2014; 17,500 tons a year, in the initial plan.
It seems there is no detailed publicity of the current status of the project as of now; 17,500 tons can cope with the domestic demand of Japan, so that its actual shipment may become one of the factors to ease the supply and demand balance.
Those subscribers who are in the lithium salts business should watch the Toyota Tsusho project.

Tin prices fall

Tin has been used widely from ancient times; bronze is a mixture of copper and tin widely used during the Bronze Age, which started around 3,500 BCE.
Bronze has the merits of a lower melting point and becoming harder than copper because it contains tin, which has a low melting point (232 degrees centigrade).
However, tin consumption decreased when iron, which is cheaper and harder than bronze, started to be widely used; then, recently, increasing production of tin plates or tinned iron plates, since iron is apt to rust by itself, augmented the demand for tin.
Tinned iron plates don’t rust easily since tin has a smaller ionization tendency, so it is hard to melt.

As it was recognized as a militarily important material, international cartels were formed to strategically stock it and to maintain a steady supply to the market.
Because of its high price, substitutes have been aggressively developed, so long-term demand for tin has dropped. For instance, plastic bottles, cartons and aluminum have caused tin plate demand to lose ground in the field of drink containers.
Presently, the demand for tin in tin plates is about 15 to 20% of the total amount.
But demand for tin itself has been increasing again as a substitute for lead due to the recent lead-free trend. For example, tin has been increasingly required to be used in lead-free solder instead of lead, which, with its low melting point, used to be raw solder material in the electronics industry. Around 50 to 60% of the total production is for solder.
It is used in organic tin compound (10 to 15%) for vinyl chloride stabilizers and ITO, a compound with indium, used as transparent electrodes in liquid crystal panels.

The website of Nippon Steel & Sumikin Stainless Steel Corporation reports that it has implemented a breakthrough technology that drastically improves the corrosion resistance of ferritic (chromium-based) stainless steel by adding a tiny amount of tin (Sn) and, based on this technology, it developed the world’s first Sn-added high-purity ferritic stainless steel, “FW series,” which improves corrosion resistance while improving workability as well by decreasing the amount of chromium (Cr), the element of stainless steel. We expect demand will increase in the future.

China and Indonesia are the main producers, accounting for about 70% of global production. Large-scale mines are scattered throughout the world: Southeast Asia, China, South America and Australia. Ores are beginning to be exported from Myanmar, where sanctions have just been lifted, to China. In addition, Australia, Peru, Bolivia, Russia and African countries are said to be developing mines and increasing production.
A medium-term prospective says demand may exceed supply; however, prices have been down recently and LME, one of the world’s major indexes, posted its lowest price in two and a half years on March 2nd.

We export to the world high-quality tin compounds, including stannic chloride, stannic oxide, stannous chloride, stannous sulfate, potassium stannate, sodium stannate, stannous fluoroborate, and stannous pyrophosphate. We have fewer inquiries nowadays except for catalysts for medical purposes, possibly due to price decreases, so business is slow. Nevertheless, tin is a metal whose price has traditionally changed greatly and we have to constantly monitor how major producers such as Indonesia move.

Tin prices fall

Tin has been used widely from ancient times; bronze is a mixture of copper and tin widely used during the Bronze Age, which started around 3,500 BCE.
Bronze has the merits of a lower melting point and becoming harder than copper because it contains tin, which has a low melting point (232 degrees centigrade).
However, tin consumption decreased when iron, which is cheaper and harder than bronze, started to be widely used; then, recently, increasing production of tin plates or tinned iron plates, since iron is apt to rust by itself, augmented the demand for tin.
Tinned iron plates don’t rust easily since tin has a smaller ionization tendency, so it is hard to melt.

As it was recognized as a militarily important material, international cartels were formed to strategically stock it and to maintain a steady supply to the market.
Because of its high price, substitutes have been aggressively developed, so long-term demand for tin has dropped. For instance, plastic bottles, cartons and aluminum have caused tin plate demand to lose ground in the field of drink containers.
Presently, the demand for tin in tin plates is about 15 to 20% of the total amount.
But demand for tin itself has been increasing again as a substitute for lead due to the recent lead-free trend. For example, tin has been increasingly required to be used in lead-free solder instead of lead, which, with its low melting point, used to be raw solder material in the electronics industry. Around 50 to 60% of the total production is for solder.
It is used in organic tin compound (10 to 15%) for vinyl chloride stabilizers and ITO, a compound with indium, used as transparent electrodes in liquid crystal panels.

The website of Nippon Steel & Sumikin Stainless Steel Corporation reports that it has implemented a breakthrough technology that drastically improves the corrosion resistance of ferritic (chromium-based) stainless steel by adding a tiny amount of tin (Sn) and, based on this technology, it developed the world’s first Sn-added high-purity ferritic stainless steel, “FW series,” which improves corrosion resistance while improving workability as well by decreasing the amount of chromium (Cr), the element of stainless steel. We expect demand will increase in the future.

China and Indonesia are the main producers, accounting for about 70% of global production. Large-scale mines are scattered throughout the world: Southeast Asia, China, South America and Australia. Ores are beginning to be exported from Myanmar, where sanctions have just been lifted, to China. In addition, Australia, Peru, Bolivia, Russia and African countries are said to be developing mines and increasing production.
A medium-term prospective says demand may exceed supply; however, prices have been down recently and LME, one of the world’s major indexes, posted its lowest price in two and a half years on March 2nd.

We export to the world high-quality tin compounds, including stannic chloride, stannic oxide, stannous chloride, stannous sulfate, potassium stannate, sodium stannate, stannous fluoroborate, and stannous pyrophosphate. We have fewer inquiries nowadays except for catalysts for medical purposes, possibly due to price decreases, so business is slow. Nevertheless, tin is a metal whose price has traditionally changed greatly and we have to constantly monitor how major producers such as Indonesia move.