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nickel in 2021: learn about this in-demand industrial commodity

nickel in 2021: learn about this in-demand industrial commodity

Although sulfidic ores are more expensive to mine, separating the nickel from these ores is cheaper than extracting nickel from lateritic deposits. Additionally, sulfidic ores generally contain other valuable minerals that can be extracted during nickel production.

Separating nickel from sulfidic ores takes place using froth flotation tanks and magnetic processes. These produce two products nickel matte and nickel oxide. These intermediate products contain between 40 and 70% nickel, but each requires further refining.

Further processing of nickel matte occurs using the Sherritt-Gordon process. With this technique, hydrogen sulfide is added to the molten material to remove copper. This leaves a concentrate of only cobalt and nickel. Solvent are then used to extract cobalt. This leaves a final product with a nickel concentration of more than 99%.

These kiln furnaces produce nickel oxide from the lateritic ores. At this stage, electric furnaces heat the nickel oxide at temperatures between 2,480 and 2,930 and produce Class 1 nickel metal and nickel sulfate.

The natural iron content of lateritic ores usually creates a final product after smelting that is ferro-nickel (a combination of iron and nickel). Steel producers can remove impurities such as silicon, carbon, and phosphorous from this combination and produce strong steel alloys.

For example, it is generally not economically feasible to extract the nickel from scrap stainless steel products. However, recycling these products allows manufacturers to create new stainless steel products that contain nickel.

Rapid economic development in China over the past decade has certainly accounted for the increased consumption. However, Chinas GDP growth has slowed considerably in recent years, creating doubts about future demand for all industrial metals including nickel.

Ultimately, nickel prices depend heavily on Chinese demand for everything from stainless steel products to batteries. If industrialization and urbanization in China renews its high growth trajectory, then the price of nickel should rise. Traders should pay close attention to Chinese economic data for clues about nickel prices.

If inventory levels drop, the market may be facing a shortage of nickel supply in the near future. This could lead to higher prices for the metal. Similarly, if stockpiling occurs and inventory levels expand, then the market might face an oversupply of the metal, which can lead to lower prices.

Nickel traders keep close tabs on Chinese inventories, in particular, since they have the largest impact on nickel prices. Data on shipping containers entering Chinese ports can provide valuable clues about demand for nickel and other commodities.

The use of nickel in stainless steel alloys for building projects is a market segment that deserves close attention. Stainless steel nickel alloys are used to produce durable structures and protect against corrosion. The Great Bridge of China is one example of a construction project that used nickel.

If the government earmarks funding for new infrastructure projects, the price of nickel could move significantly higher. Similarly, as other developed economies replace their infrastructure, nickel prices could rise.

Historically, Indonesia has been a leading exporter of nickel. However, the country has also banned laterite ore exports in recent years. The rationale for this policy was a desire by the government to support the domestic smelting industry. Ultimately, budget deficits in Indonesia led to a resumption of exports.

Mines and blast furnaces utilize energy to extract nickel ores from the ground and process it into nickel. These costs can have a big effect on primary production. Similarly, the costs of scrap metal can impact the price of secondary production.

Miners have been holding on as long as they can. They will be close to running out of wiggle room in terms of cutting costs. We need to see some reasonably sized refined capacity cutbacks to restore prices and confidence back to the market.

Consultant Wood McKenzie notes that half of the global nickel miners now operate at a loss, while Citi recently informed its clients that it sees little chance for a rally in prices in the short, intermediate, or long run.

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Lawrence Pines is a Princeton University graduate with more than 25 years of experience as an equity and foreign exchange options trader for multinational banks and proprietary trading groups. Mr. Pines has traded on the NYSE, CBOE and Pacific Stock Exchange. In 2011, Mr. Pines started his own consulting firm through which he advises law firms and investment professionals on issues related to trading, and derivatives. Lawrence has served as an expert witness in a number of high profile trials in US Federal and international courts.

2010-2020 Commodity.com. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 53.00%-83.00% of retail investor accounts lose money when trading CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. The content on this website is provided for informational purposes only and isnt intended to constitute professional financial advice. The content is provided on an as-is and as-available basis. Your use of the site is at your sole risk. Trading any financial instrument involves a significant risk of loss. Commodity.com is not liable for any damages arising out of the use of its contents. Relying on any Reviews could be to your detriment. When evaluating online brokers, always consult the brokers website. Commodity.com makes no warranty that its content will be accurate, timely, useful, or reliable. By using our site you agree to our Terms of Use.

ride the iron ore price with these three metals & mining stocks

ride the iron ore price with these three metals & mining stocks

Iron ore is one of the main ingredients used to produce steel. According to the U.S. Geological Survey (USGS), almost all iron ore (98%) is used in steelmaking. Iron ore is mined in nearly 50 countries, with the seven largest of these producing countries accounting for three-quarters of world production. Australia and Brazil are the two largest iron ore exporters (mostly to China), each with about one-third of total exports.

China is the largest importer and consumer of iron ore, so it is important to keep an eye on what is happening in this market. Weekly iron ore shipments from Australia have trended downward and there have been operational and safety issues limiting Brazils production and exports to China. These events have created a tight global supply-demand balance. As a result, iron ore prices have surged over the past few weeks in China as portside stockpiles have dropped to an eight-month low. Strong iron ore prices have carried over into global markets.

Iron ore is essential for the worlds iron and steel industries. Steel producers were negatively impacted by a freeze in consumption, economic shutdowns and disrupted supply chains during the coronavirus pandemic. However, the recovery in U.S. steel demand from pandemic lows exhibited a V-shaped recovery and steel prices entered 2021 at multi-year highs.

In addition, President Biden wants to spend billions on roads, bridges, airports, railways, sources of renewable energy, power grids and other major infrastructure projects and gained preliminary bipartisan support last week for his plans. If a large infrastructure spending bill passes, it would likely boost the sales and earnings for a variety of leading companies in the basic materials and industrials sectors.

When analyzing a company, it is useful to have an objective framework that allows you to compare companies in the same way. This is one reason why AAII created the A+ Stock Grades, which evaluate companies across five factors that have been shown to identify market-beating stocks in the long run: value, growth, momentum, earnings estimate revisions (and surprises) and quality.

Cleveland-Cliffs (CLF) is a vertically integrated producer of iron ore and steel products. The company has upstream and downstream operations. It supplies both customized iron ore pellets and steel solutions. Cleveland-Cliffs is the largest flat-rolled steel company and the largest iron ore pellet producer in North America.

Its segments include steel and manufacturing and mining and pelletizing. Its steel and manufacturing segment is a producer of flat-rolled carbon, stainless and electrical steel products, primarily for the automotive, infrastructure and manufacturing and distributors and converters markets. The companys steel and manufacturing segment includes subsidiaries that provide customer solutions with carbon and stainless-steel tubing products, engineered solutions, tool design and build, hot- and cold-stamped steel components and complex assemblies. Its mining and pelletizing segment is a supplier of iron ore pellets to the North American steel industry from its mines and pellet plants located in Michigan and Minnesota.

The company has significant exposure to harder-to-make steels and limited exposure to commodity steel products, such as hot-rolled coil. Since President Biden announced a tentative infrastructure deal, hot-rolled steel coil prices have more than tripled over the past year to reach an all-time high of over $1,800 per short ton this week.

Cleveland-Cliffs has a Value Grade of D, based on its score of 61, which is considered expensive. The companys Value Score ranking is high across several traditional valuation metrics, with a score of 91 for shareholder yield, 69 for the price-to-book-value ratio and 61 for the enterprise-value-to-Ebitda (EV/Ebitda) ratio (remember, the lower the score the better for value). Successful stock investing involves buying low and selling high, so stock valuation is an important consideration for stock selection.

The Value Grade is the percentile rank of the average of the percentile ranks of the valuation metrics mentioned above along with the price-earnings ratio, price-to-sales ratio and price-to-free-cash-flow ratio.

Cleveland-Cliffs has a Momentum Grade of A, based on its Momentum Score of 83. This means it ranks in the top tier of all stocks in terms of its weighted relative strength over the last four quarters. The weighted four-quarter relative strength rank is the relative price change for each of the past four quarters.

Earnings estimate revisions offer an indication of what analysts are thinking about the short-term prospects of a firm. Cleveland-Cliffs Earnings Estimate Revisions Grade is C, which is considered neutral. The grade is based on the statistical significance of its last two quarterly earnings surprises and the percentage change in its consensus estimate for the current fiscal year over the past month and past three months.

Cleveland-Cliffs has posted a positive and negative earnings surprise for its last two fiscal quarters, mainly due to higher realized iron ore and steel prices and higher integration costs due to its recent acquisitions of AK Steel and ArcelorMittal USA. These two acquisitions improved Cleveland-Cliffs competitive position in several markets, especially automotive. Over the last month, the consensus earnings estimate for the fiscal year ending December 31, 2021, has increased 17.1% from $4.09 per share to $4.79 per share; there have been six upward revisions to the fiscal-2021 estimate and one downward revision.

Rio Tinto (RIO) is a mining and metals company. The companys business is finding, mining and processing mineral resources. The companys segments include iron ore, aluminum, copper & diamonds, energy & minerals and other operations. The company operates an iron ore business, supplying the global seaborne iron ore trade. Its iron ore product operations are located in the Pilbara region of Western Australia and operations include approximately five iron ore products and approximately four port terminals.

The aluminum business includes bauxite mines, alumina refineries and aluminum smelters. Its bauxite mines are located in Australia, Brazil and Guinea. The copper & diamonds segment has managed operations in Australia, Canada, Mongolia and the U.S., and non-managed operations in Chile and Indonesia. The energy & minerals segment consists of mining, refining and marketing operations across sectors including borates, iron ore concentrate and pellets, titanium dioxide and uranium.

The company has exhibited strong sales growth over the past year. Sales increased 22.5% year over year for the six-month period ending December 31, 2020, to $25.2 billion, while operating cash grew over 55%. Rio Tinto currently has a 5.5% dividend yield.

Vale (VALE) is a global producer of iron ore and iron ore pellets, key raw materials for steelmaking, and producer of nickel. The company also produces copper, metallurgical and thermal coal, potash, phosphates and other fertilizer nutrients, manganese ore, ferroalloys, platinum group metals, gold, silver and cobalt. The companys segments include ferrous minerals, comprising the production and extraction of ferrous minerals such as iron ore fines and iron ore pellets and their logistic services, and manganese and ferroalloys and others ferrous products and services; coal, comprising the extraction of metallurgical and thermal coal and its logistic services; base metals, which include the production and extraction of non-ferrous minerals and are presented as nickel and its byproducts; and copper (copper concentrated); and others, comprising sales and expenses of other products, services and investments in joint ventures and associated in other business.

A higher-quality stock possesses traits associated with upside potential and reduced downside risk. Backtesting of the quality grade shows that stocks with higher quality grades, on average, outperformed stocks with lower grades over the period from 1998 through 2019.

The A+ Quality Grade is the percentile rank of the average of the percentile ranks of return on assets (ROA), return on invested capital (ROIC), gross profit to assets, buyback yield, change in total liabilities to assets, accruals, Z double prime bankruptcy risk (Z) score and F-Score. The score is variable, meaning it can consider all eight measures or, should any of the eight measures not be valid, the valid remaining measures. To be assigned a quality score, though, stocks must have a valid (non-null) measure and corresponding ranking for at least four of the eight quality measures.

Vale has a Quality Grade of A, putting it in the top tier among all U.S.-listed stocks. The company ranks highly in terms of its return on assets and F-Score, ranking respectively in the 91st and 95th percentile of all U.S.-listed stocks. However, it ranks poorly in terms of its change in total liabilities to assets, in the 40th percentile.

I am the VP for American Association of Individual Investors & AAII Journal Editor. I am also the author of Better Good than Lucky: How Savvy Investors Create Fortune with the Risk-Reward Ratio (published by W&A Publishing/Trader's Press). I write about stocks, ETFs, investing and provides insight about individual investor sentiment as well as market and economic analysis.

I am the VP for American Association of Individual Investors & AAII Journal Editor. I am also the author of Better Good than Lucky: How Savvy Investors Create Fortune with the Risk-Reward Ratio (published by W&A Publishing/Trader's Press). I write about stocks, ETFs, investing and provides insight about individual investor sentiment as well as market and economic analysis.

mining activity causing nearly 10 percent of amazon deforestation

mining activity causing nearly 10 percent of amazon deforestation

Nearly ten percent of all the deforestation occurring in the Brazilian Amazon between 2005 and 2015 came from mining activities, say researchers in a new study a stunning statistic far higher than the 1 to 2 percent noted in previous global assessments. The reason for the difference is that past research only looked at the mines themselves, and not at the ancillary development that accompanies and surrounds the mines.

Using satellite data, the researchers found that deforestation from mining encompassed 11,670 square kilometers (roughly 4,500 square miles) between 2005 and 2015, an area twice the size of the state of Delaware. The startling level of Amazon deforestation, they say, demands immediate action on the part of mining companies and government especially because Brazils Temer administration seems intent on opening vast swathes of the country to mining in the near future.

The international group of researchers, organized around the University of Vermont, published their findings in the journal Nature Communications. The research used satellite monitoring to study the fifty largest mining sites in the Amazon region, and analyzed the rates of deforestation in and around those sites between 2005 and 2015.

Strikingly, the study found that deforestation outside of and surrounding the mining-lease areas removes twelve times as many trees as within the lease boundaries. Further, this loss extends to as much as 70 kilometers (approximately 43 miles) from the lease areas as infrastructure such as roads, staff housing, and airports cut into the forest as seen in this time-lapse satellite sequence.

Our findings show that Amazon deforestation associated with mining extends remarkable distances from the point of mineral extraction, said Gillian Galford, a study co-author with the Gund Institute and Rubenstein School of Environment and Natural Resources at the University of Vermont (UVM).

Meanwhile, a preliminary study from Brazils space agency, INPE, found that deforestation in Brazil decreased 16 percent between August 2016 and July 2017. Laura Sonter, a co-author of the UVM study and also with the Gund Institute and Rubenstein School, warned that the INPE finding doesnt mean things are fine: The problem is that deforestation rates are still up over the last 3 years compared to years before that, and a drop in deforestation still means that 6,624 square kilometers [some 2,557 square miles] of Amazon forest was cleared [from August 2016 to July 2017]. Additionally, deforestation rates are expected to increase again next year, due to the current drought and expected rural fires. Amazon wildfires are at record levels this year, with most of them caused by people.

Sonter told Mongabay that the UVM research is significant because of the way it reassesses the impact mining has on deforestation. Mining is typically thought to cause about 1 percent of tropical deforestation worldwide, but our results suggest impacts are almost 10 times greater than this. We found most deforestation occurred outside mining leases and we were also surprised to find these off-lease impacts to extend 70kilometers from the site of operation. Previous estimates suggest indirect effects occur only up to 10 kilometers.

These findings come as Brazils government considers a series of measures to ease restrictions on mining in the Amazon region. In August, an international outcry spurred the countrys judiciary to block President Temers plans to open up the RENCA reserve to mining. The reserve covers 4.6 million hectares (17,800 square miles), an area roughly equal to Denmark. RENCA holds minerals such as gold, nickel and manganese, but it is also rich in biodiversity with large tracts of rainforest and numerous protected conservation units. The area is also home to two indigenous reserves, which experts say would be put at serious risk if mining operations began nearby.

Par state deputy Eduardo Costa told Mongabay that he suspects that the areas affected by deforestation due to mining are much greater than the figure the study presents. He explained that although pig-iron smelters are not as active in the Amazon region as they once were, the remaining facilities still use charcoal obtained from wood. Maybe 90 percent of the wood that was used in these ovens that process pig-iron came from illegal sources, and this created a big impact on deforestation. A 2012 report in Carta Capital pointed to criminal activities in the pig-iron production chain, including illegal charcoal operations, bribes and slave labor.

In August, the Brazilian forest research institute IMAZON noted that a Temer administration decree to reduce protections for the Jamanxim National Forest would also benefit mining companies. Although the measure ordering this reduction was vetoed, the president has since re-submitted the rollback in the conserved areas size under a bill to congress, and experts believe it is likely to be approved.

Brazils Ministry of Mines and Energy said that it was unprepared to comment on the study presented in Nature Communications or on measures the government is taking to prevent deforestation. A representative of the countrys mining agency did not respond to calls or an email request for comment.

Nilo DAvila manages Greenpeaces campaigns in Brazil. He told Mongabay that Greenpeace wasnt surprised by the study findings. The government uses [the Carajs mine] as an example of mining and [forest] preservation. But when we look around the Carajs mine, we find deforestation that is much higher than average. Carajs is an open-pit mine operated by the Vale Mining Company in the Amazonian state of Par. It is the worlds largest iron mine. Located within the Carajs National Forest, it is estimated to contain 7.2 billion tons of iron.

The Carajs mine serves as an example of the economic potential of mining and of minings environmental impact in the Amazon region. Iron ore is Brazils largest mineral export and accounts for 10 percent of the countrys total exports. However, satellite time-lapse photography from the UVM study shows how the mine has contributed to deforestation.

DAvila said that the government is considering easing mining restrictions in a vast area along Brazils northern and western borders a mostly wild region 300 times the size of RENCA, covering 1.7 million square kilometers of the Amazon biome.

These are areas that are still not designated [as protected], with few conservation areas. Brazil has few relationships, especially in the Amazon region, with its neighbors. So, the Brazilian government sees a way of having business relationships with these countries through mining, road construction, through progress. The findings of the UVM study clearly demonstrate that opening such a large area of native forest to mining and its accompanying infrastructure would result in significant deforestation.

Also, just as clearly, mining companies are eager to enlarge their Amazonian footprint: Throughout Brazil, mining leases, concessions, and exploration permits cover 1.65 million square kilometers [637,068 square miles] of land, of which 60 percent is located in the Amazon forest, notes the UVM study.

A closer look at the Carajs mine shows what could lie ahead environmentally for the Amazon and other parts of Brazil if these many leases, concessions and exploration permits are allowed to advance. A railway carries the iron from the Carajs mine to foundries in Bacarena and So Lus. Both the mine and the railway were funded by the World Bank in the 1980s. Residents have been fighting to stop the company from doubling the rail line for years. One reason for the battle, Brazils G1 news outlet reported earlier this year, is the number of people who are killed or maimed by the freight trains. Also, the Indigenous Missionary Council (CIMI) and other human rights groups say that the doubling of the railway was approved before an environmental impact assessment was completed and without consulting the indigenous communities affected, a violation of Brazils international agreements.

Prof. Philip Fearnside, who studies hydroelectric dams in the Amazon region, spoke with Mongabay about the Carajs mine. Aside from the hole in the ground, the big impact is the charcoal [used to process the ore]. What limits that is these pig-iron smelters, not the amount of ore that is dug out. In May of this year, Brazils environmental agency, IBAMA, destroyed 66 illegal ovens for producing charcoal in northeastern Par. Between 1998 and 2014, deforestation in Par outpaced all other states in the Amazon region, and mining contributed to that impact.

The Carajs mine is largely powered by hydroelectricity from the Tucuru dam, which brings up another major concern. Environmental impact assessments for proposed mines in Brazil dont cover the massive energy requirements for processing ore, energy which in the Amazon generally comes from hydroelectric dams. Hydropower has its own suite of environmental hazards, including deforestation, major greenhouse gas releases from reservoirs, and disrupted aquatic and terrestrial ecosystem. Dams, like mines, also bring ancillary development, as laborers arrive in a region to build infrastructure, and then settle locally. Dams also bring new roads and transmission lines. They often do substantial social harm as well, disrupting and displacing indigenous and traditional riverine settlements.

Mining, experts agree, is both a boon and bane to modern civilization: it provides critical materials for everyday items ranging from cell phones and computers to cars and home appliances. But without regulation it can cause major deforestation and pollute rivers and aquifers. The 2015 Fundo

Iron tailings dam collapse that killed 19 people and contaminated 500 miles of the Rio Doce all the way to the Atlantic Ocean Brazils worst environmental disaster is a warning to the nation and the world of what can happen when mining profits trump environmental protection and public safety, say experts.

Sonter suggested one important step Brazil could take to minimize mining-related deforestation: require an assessment not only of the immediate on-site impacts of mines, but also of off-lease impacts prior to approving projects. With this information, action can then be taken to avoid, reduce and mitigate [impacts]. Avoidance measures could involve siting new roads in areas of degraded and cleared [land], rather than through intact pristine forest. Mitigation efforts may involve establishment and management of new protected areas in the surrounding landscape to prevent further deforestation. Likewise, assessments should review whether new Amazon mines will require new hydroelectric dams to power the ores processing.

Considering the threat that mining poses to Amazonian forests, and the crucial importance of the regions forests to carbon storage and to curbing climate change, controlling mining impacts could be crucial to the future of both Brazil and the planet. Galford is hopeful that the UVM studys findings will lead to positive action: Many of these [mining] corporations may take this as an opportunity to step up and take responsibility for off-site deforestation. In fact, the world may demand it.

Sonter, L. J., Herrera, D., Barrett, D. J., Galford, G. L., Moran, C. J., Soares-Filho, B. S.: (2017) Mining drives extensive deforestation in the Brazilian Amazon. Nature Communications; DOI: 10.1038/s41467-017-00557-w

metallurgist & mineral processing engineer

metallurgist & mineral processing engineer

For its extensive practical experience, 911 Metallurgisthas a clear understanding of what successful mineral processing engineering is and how to go about achieving it. Your goal is the production of a material that is marketable and returns you and your investors sustainable revenues.

Although improvements to the metallurgical processes have been made over the years the fact is that the unit operations, the machines, those too often called black boxes involved have not evolved or changed much since inception. Ore is reduced in size, chemicals are added and minerals separated and upgraded to produce a marketable product. Much of this process is mechanical and generally mistaken for some dark alchemy.We are the Anti-Alchemists.

Our vast experience has been gained through operation and start-up of both small and large scale mining/metallurgical operations in a range of commodities in thebase metals (Cu, Pb, Zn) and theprecious metals (Au, Ag,)

A solid metallurgist understands, the most important aspect of an operating process is its stability. Simple to say, but generally the most ignored in mineral processing. Linked unit operations require each to be stable, and each contains a different set of variables that have to be contended with. Thanks to some degree of stability: operating changes can be made and evaluated; increases in throughput can be made; and equipment performance improved. The more complicated the processes become, the more difficult it is to achieve and maintain stability. In mineral processing, unlike most processing operations, we have limited control of the main input, the feed ore. In most cases this inherently is variable and usually outside of the processors control.

Because you are too close to your own story, you might not see the forest for the trees and have chaos mistaken for stability. We, you, and your group have been battling plant problems for weeks, you start to accept chaos as a daily state of affair and consider it your new stability.

Each mineral processing plant is different: with varied ore types, mining equipment, and management (operating) philosophy. The evaluation and prioritisation of variables that affect the plant performance is the primary function. Implementing changes within the constraints imposed can be difficult, as resources may be limited.

Invariably the ability to solve problems can be confusing due the large numbers of variables that may impact the processes. In most cases problems are not metallurgical in nature but rather operational and mechanical. Problem solving is a process and in many operations this ability is absent. All too often many changes are made together without a solution resulting, on more confusion. Most plants learn to live or survive their problems, not to solve them.

Our engineering team has a global experience in the mining industry across all facets of the mine life-cycle. Our focus is to add value to your project and company by understanding your needs, employing innovative ideas and applying sound engineering while maintaining an economically driven approach. We have a combination of senior level professionals, experienced project managers, and technical staff to execute projects efficiently. We work in a partnership with our clients to achieve their company goals and operational milestones in a timely and cost effective manner.

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