The zircon market has undergone a reversal of fortune in recent years, according to The Economics of Zirconium (10th edition), published by London-based Roskill.
The Asian economic crisis, followed by declining consumption, caused prices to fall to under US$300 per tonne by mid-1999, their lowest level since 1995. Contributing to the fall was competition among suppliers. In 1999, despite a 4% increase in consumption, production remained steady at about 1 million tonnes.
In 2000, demand increased to almost 1 million tonnes, and the subsequent tightness in supply drove up prices. In the second quarter of 2001, prices reached US$380 per tonne for ceramic grade material, a trend which Roskill expects to continue for the remainder of the year.
Virtually all zircon output is a result of the production of titanium minerals, and producers traditionally have had difficulty controling production levels to match market demand. However, more than 80% of zircon consumption is now in applications for which there are few, if any, affordable substitutes, and this situation has had a stabilizing effect. Prices in the short term are expected to range between US$340 and US$350 per tonne for bulk material.
Meanwhile, production from Down Under continues to decrease. Australia’s share of production fell to roughly 36% in 2000 from more than 50% in the late 1980s. Meanwhile, South Africa’s share has risen 32% to from 15%.
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