Tantalum Market Update (April 5, 2012)

By Michelle Smith — Exclusive to Tantalum Investing News

Tantalum prices in March appeared to be continuing a softening trend. For the month, prices ranged between $89 and $105 compared with the $110 to $125 range solidly maintained during the first quarter of 2011.

H.C. Starck, a specialty metals processor, recently announced a 28 percent rise in sales for 2011. The company indicated that the growth was supported by high demand for tantalum and niobium products, particularly from Asia and the electronics industry.

China’s tantalum-niobium concentrate imports for January dropped just over 58 percent compared to 2011, while its export of unwrought tantalum reportedly rose over 150 percent year on year (y/o/y) during the same period.

The prices of both China’s above mentioned imported and exported materials were reportedly up in January on a y/o/y basis.

This may not necessarily dispel reports that the market is cooling.

Bill Millman, Technical and Quality Director for AVX‘s (NYSE:AVX) tantalum division, told Metal-Pages, “people are trying to talk the market up, understandably as they are holding a lot of high priced inventory, but the supply and demand situation is not going to improve in the next quarter, maybe even the quarter after.”

The 2012 tantalum market has tipped into an oversupply of about 500,000 pounds, according to Millman.

Demand for capacitors, one of the largest uses for the metal, is declining.