Vanadium prices continue upward

By Cyrus S Darabshaw Exclusive to Vanadium Investing NewsVanadium brings out the green bucks

The price graph for vanadium, especially ferrovanadium, continued northwards the past week. Alloy ferrovanadium was selling between US$ 12.30-13 per pound, slightly higher than the earlier week. Analysts say one reason could be because the global steel market was showing strong signs of improvement. Last Wednesday, for example, ferro-vanadium prices rose to US$ 27-29.50 per kg, up from the previous US$ 26.50-29 per kg, reported metalbulletin.com.

Opinion among analysts seem divided over the future prospects of vanadium. One section feels that if the Chinese steel mills continue to manufacture steel and book large-enough orders to tighten supply further, vanadium prices are bound to go further up. The other is of the opinion that if the “reds” were to squeeze supply, it would adversely affect vanadium in the short term.

In the US markets, spot metals prices for ferro-vanadium, too, continued their upward trajectory thanks to a tight supply picture. Ferro-molybdenum prices, though, remained unchanged. US spot ferro-vanadium prices moved up to a range of $13-13.50/lb.

In another positive bit of news, this time from Canada, the Vancouver-based Crosshair Exploration & Mining has cut the widest vanadium intercept to date – 241 metres near surface – during exploration drilling at its vanadium prospect in the Central Mineral Belt. The company, in a statement, said holes drilled outside the resource boundaries as currently defined continue to intersect vanadium mineralization.

Highlights from recent assays include 0.179 per cent V2O5 over 241 metres (from 30 to 271 metres) including 0.228 per cent over 20 metres (from 204 to 224 metres) in hole ML-182. Hole-143 assayed 0.428 per cent V2O5 over 14 metres (from 114 to 128 metres including 0.428 per cent over 4 metres (from 118 to 122 metres.

Company news

Eastern Iron (ASX:EFE) has received high-grade magnetite-vanadium assay results from an initial appraisal of iron ore potential within drill core from the Hawkwood joint venture area, located 250km from the port of Gladstone in Queensland.

This deposit type is an important host for titanium- and vanadium-bearing magnetite iron deposits such as at Savage River in Tasmania and Balla Balla in Western Australia as well as some of the world’s largest platinum-palladium group element (PGE) deposits such as the Merensky Reef, South Africa, a company release said.

The Eastern Iron work focused on historic drill core that is located outside the main area of the magnetic anomaly with the most prominent geophysical targets remaining untested.

Eastern Iron said this untested main anomaly zone represents a series of outcropping and subcropping magnetite segregations over a strike length extending well over 5km.

The size and geological environment provide a bulk tonnage iron ore exploration target of similar style, size and quality to other magnetite-vanadium bearing layered intrusive complexes such as Balla Balla, Western Australia.

Eastern Iron has applied for a new exploration permit of approximately 80km covering areas prospective for copper, gold, platinum and palladium outside the main area with iron ore potential.

Highveld Steel and Vanadium chief executive officer Walter Ballandino has resigned “for personal and family related” reasons, according to a company spokesman. Though the company said earlier that Ballandino’s resignation would take effect on February 28, the spokesman confirmed that he would stay with the group until the end of next month “to ensure a smooth transition”. Highveld did not name Ballandino’s successor, but said the name of a new CEO would be announced soon. Ballandino had become CEO in 2007.

And, before I sign off for the week, I reproduce here extracts from this very interesting, in-depth report by Metalsplace that I came across on Apella Resources, a vanadium major.

“Scratch at the surface at either of Apella Resources’ major vanadium/titanium/iron projects in Quebec and just a few centimetres down, under the moss and topsoil, you will find vanadium-titanium-iron mineralisation. Five and a half billion pounds of vanadium alone at the Lac Dore deposit which is majority-controlled by Apella, which makes it the second largest known deposit in the world behind Highveld in South Africa.

Yet Apella believes that its claims covering a Northeastern extension of the Lac Dore Deposit could be even bigger, and its Iron-T project, bigger still.  Consider too that these open-pittable projects are located in mining-friendly Quebec with significant infrastructure already in place, that the prospects for vanadium demand are becoming ever more interesting as new uses are developed, and that the projects will also benefit from iron and titanium credits -  and the Apella story becomes more intriguing.

“Apella took the decision to move into vanadium in 2007.  It was attracted both by the commodity itself – its demand prospects, relative rarity and uniqueness – and by the opportunity presented by the Lac Dore project which became available for staking in Apella’s home turf; the company already held a large land package and had a number of ties in the Chibougamau region of Central Quebec.

Apella had a number of reasons for optimism about the outlook for vanadium…..but it is reason number three – the potential new uses for vanadium in alternative energy and clean technology – that has really excited Apella.  Adrian O’Brien, Apella’s director of business development, waxed lyrical on the subject in an interview with Proactive Investors.

There are several new uses, he says, which could significantly boost the demand for vanadium. The first of these is vanadium redox (reduction/oxidation) batteries which can be used for storing massive quantities of electricity and so could have important load-levelling applications for wind farms, solar farms or even for conventional fossil fuel power stations and sub-stations.

But there are plenty of vanadium bulls besides O’Brien and Apella who believe that the future for vanadium is remarkably bright.

“So Apella has successfully negotiated its first three years down the vanadium road but it still has a lot further to go.  It has not yet reported any NI 43-101 compliant resources and there is still considerable geological risk.  It will require further capital to complete the feasibility study on Iron-T so there is a risk of share dilution. Further down the line could be the risks associated with development and operations,” according to the report.