Drilling-grade barytes prices rise

Barytes prices will continue to increase as supply dwindles from China, a US-based supplier told IM late last week.

The source told IM that cargoes from China are now being loaded at $84/tonne for drilling-grade barytes out of China.

“I know of three cargoes that have been loaded at that price,” the source confirmed, adding that other participants have cited a top-end price of $91/tonne for the same grade.

As reported in March in IM, there are a series of factors which has hindered the production and supply of barytes in China.

These include a depletion of barytes reserves in Guangxi; higher than average flooding; an increase in fuel costs; and a rise in Chinese domestic demand for barytes . More recently, participants cite the fact that this spring has been unseasonably wet, making it difficult to mine.

“The Chinese woke up and realised they had the bulk of the commodity and they weren’t making any money,” one trader surmised.

“Prices have been going up and I think it will go up across the board,” the participant said.
China supply dwindles, Vietnam perks up
Barytes supply globally is expected to be largely affected by the Chinese government’s decision to become more environmentally responsible.

In Xiangzhou county, which produces between 10-15% of the world supply of barytes, recent policy decisions have been made to stop dependency on mining.

“[The Chinese government] forewarned the industry that it wanted to quit mining barytes as it was taking farmland and turning into something which couldn’t be reworked,” a market source explained.

The decision could lead to a shortfall of 650,000 tonnes, the participant added.

Extra supply could come from elsewhere however. In Vietnam over 20 deposits, with total reserves of 6.213m. tonnes, have been identified and assessed (See June 11 issue of IM for more information).

Above Article come from IM, which writen by Siobhan Lismore