This morning in metals news, the price of SHFE rebar continued its rise Tuesday, the Aluminum Association released its first new material registration record in almost two decades and Brazilian steelmakers are struggling with an iron ore shortage.
The designation covers so-called “purple sheets,” which cover aluminum powder used in 3D printing.
“The purple sheets are the newest addition to the Aluminum Association’s long-running ‘rainbow sheet’ series, which provides alloy designations and chemical composition limits for various types of aluminum,” the Aluminum Association said in a release. “Aluminum is the first materials industry to develop such a system specific to the 3D printing market.
“The first registration granted is for a high-strength aluminum alloy produced by HRL Laboratories, LLC. The association will grant HRL registration number 7A77.50 for the aluminum powder used to additively manufacture the alloy, and number 7A77.60L for the printed alloy.”
Iron Ore in Brazil
Brazilian steelmakers are facing a shortage of the key steelmaking ingredient iron ore in the months after Vale SA’s fatal dam breach at its Corrego do Feijao mine, Reuters reported.
“ITA tracks global R&D, patents and markets for tin and has identified a strongly growing interest in tin in energy materials and technologies, including lithium-ion batteries,” the association said in a release. “Tin has a wide range of technical properties that mean its uses extend to many areas of everyday life. For the same reason, it can adapt well to meet emerging needs for new materials that can generate, store and deliver tomorrow’s energy.
Per the release, ITA has identified “nine technology opportunities for tin in lithium-ion batteries, mainly in high-capacity anode electrode materials, but also in solid-state and cathode materials.”
Lithium-ion batteries are used in a wide variety of applications, from pacemakers to cellphones.
“It is concluded that if tin does gain market share, lithium-ion batteries could grow to represent a significant new tin use in the 2025-2030 timescale,” the ITA says in its release.
The idea of turning to tin for use in lithium-ion batteries isn’t new.
“In particular, the researchers have developed an anode made of tin, rather than the carbon used currently,” a 2012 university release about the research stated. “Rechargeable lithium ion batteries are made up of two electrodes, the cathode and an anode. During charging, the lithium ions move from the cathode to the anode. The anode holds the lithium ions and stores the battery’s energy. When the battery is used, the ions move from the anode to the cathode, discharging electrons and creating an electric circuit.
“The new tin anode has the potential to store almost three times the energy of graphite.”
According to the United States Geological Survey, in 2017 China led the way in tin production, producing 100,000 tons, followed by Indonesia and Myanmar (50,000 tons apiece).
As for price, LME tin rode a downtrend from April 2018 through the end of November, before gradually picking up over the next 2 1/2 months.
LME tin price since the beginning of 2018. Source: LME
The LME tin price hit $18,850 as of Dec. 3, 2018, and has increased 11.9% to $21,100 as of Feb. 19. As we noted in our most recent Monthly Metals Outlook report, a nearly 51% decline in LME stocks since December has helped drive the price uptrend.
The Renison mine, a joint venture of Metals X and Yunnan Tin Group, produced 871 tons of tin in January.
“Australian mining appears to be ramping up, with increased tin output from Renison coinciding with new production at the Granville mine,” the ITA said. “Despite bush fires threatening production in January and forcing the mine to suspend operations for two days, Renison still achieved record output. This bears well for the future of the mine, which is due to report its updated resource estimate in the June quarter.”
On the heels of a crowdsourcing campaign launched in November, GM announced late last week that its new electronic bike brand will be dubbed ARĪV.
The bikes were available for preorder starting Feb. 14. According to a GM release, the eBikes will be launching first in Germany, Belgium and the Netherlands due to “the popularity of lithium-ion battery-powered eBikes in those markets.”
The eBikes will begin being shipped to customers starting in the second quarter of this year.
Meld and Merge
GM’s new eBikes come in two models: a Meld compact bike and a Merge folding bike.
When it comes to electrified transportation, everyone wants to know about range.
“The battery was validated to rigorous safety standards similar to GM’s electric vehicles batteries,” the release states. “Riders can charge their ARĪV eBike’s battery in approximately 3.5 hours and receive up to 64 kilometers of ride time on a single charge.
“The ARĪV Merge and Meld come standard with safety components such as integrated, rechargeable front and rear LED safety lights for increased visibility and oversized brake rotors to increase stopping power.”
The bikes can reach speeds of up to 25 kph, the release states, powered by “four levels of pedal-assisted power.”
Features and Cost
Other features include an app, connectable via Bluetooth, which provides data like speed, distance and remaining battery level, among other pieces of information. The eBikes also come with a mount for smartphones and a built-in USB port for on-the-go charging purposes.
So, what will interested consumers be forking over to acquire one of these bikes?
Per the release, in Germany the Meld is going for €2,750, while the Merge will come in at €3,350. Meanwhile, in Belgium and the Netherlands, the Meld and Merge bikes will cost €2,800 and €3,400, respectively.
Of course, the automotive industry is no different, as automakers strive to adapt to the electric vehicle (EV) wave while simultaneously keeping an ear to the ground when it comes to what their customers want.
For Ford Motor Co., adapting meant ditching its lineup of sedans in the North American market, instead focusing on its popular SUVs and pickup trucks.
Other types of adaptation to a changing business world include simply partnering up with an industry colleague and pooling resources, if you will.
In that vein, this week Ford announced a partnership with Volkswagen, which it called “the first formal agreements in a broad alliance that positions the companies to boost competitiveness and better serve customers in an era of rapid change in the industry.”
According to the company announcement, the automakers plan to collaborate on production of commercial vans and medium-sized pickups for the global market as early as 2022. The alliance between the two companies will be led by a joint committee, which will include Ford CEO Jim Hackett, Volkswagen CEO Dr. Herbert Diess and other senior executives from the two companies.
“Over time, this alliance will help both companies create value and meet the needs of our customers and society,” Hackett said. “It will not only drive significant efficiencies and help both companies improve their fitness, but also gives us the opportunity to collaborate on shaping the next era of mobility.”
In addition to collaboration on vans and trucks, the automakers could work together on electric vehicles.
“In addition, Volkswagen and Ford have signed a memorandum of understanding to investigate collaboration on autonomous vehicles, mobility services and electric vehicles and have started to explore opportunities,” a Ford release stated. “Both companies also said they were open to considering additional vehicle programs in the future. The teams will continue working through details in the coming months.”
Ford is scheduled to announce its fourth-quarter 2018 and full-year results during a conference call at 4:15 p.m. ET on Wednesday, Jan. 23.
In other news, Volkswagen this week announced it would build its North American electric vehicle manufacturing base in Chattanooga, Tennessee.
“Strengthening the company’s commitment to an electric mobility future, this expansion of Volkswagen’s U.S. footprint will include an investment of $800 million into the Chattanooga facility and create 1,000 jobs at the plant, plus additional jobs at suppliers,” a Volkswagen release stated. “EV production at the site will begin in 2022.”
I say “blockbuster” not because it’s a rival to Tesla or a similar high-end brand — quite the opposite.
At under $9,000 (after massive subsidies available at the state and federal level in China), the Ora R1 could be a blockbuster in terms of sales.
With a projected range of 194 miles between charges and four doors, the article suggests the vehicle is firmly aimed at the less well-off commuter. In that context, it could have massive appeal for the authorities fighting smog and other forms of air pollution in China’s crowded cities.
The Ora R1 runs on just 47 horsepower with a top speed of about 62 mph, according to the report, which also quotes experts who say it should be capable of powering commuters for about a week per charge (based on real-world driving patterns).
Sounds like a winner, doesn’t it?
Maybe it will be, but for us it has echoes of Tata’s Nano “people’s car,” designed to lure consumers off their cheap motorcycles and into their set of four wheels.
Poor quality, reliability and growing losses forced Tata out of the sector. It was not helped, it should be added, by a PR disaster when the Nano displayed a tendency to burst into flames, frequently recorded on social media.
The Ora is packaging the R1 with a three-year, 120,000-kilometer (74,500 mile) warranty for the entire car, and an eight-year, 150,000-kilometer (93,200 mile) warranty for “core components,” suggesting reliability shouldn’t be a worry – providing the manufacturer honors its commitments.
Source: Great Wall Motors
Whether the Ora R1 will fare any better than the Nano remains to be seen. At prices between U.S. $8,680 to U.S. $11,293, the price is heavily subsidized and should retail at twice that level.
Even so, a $20,000 price in unsubsidized markets would pitch the Ora well under current small car contenders, such as the Nissan Leaf.
But success or failure hinges even more on quality and reliability in this sector than it did for the Nano in India, where consumers’ expectations were not high. EVs outside of China have so far been relatively high-end products with classy interiors and many modern innovations.
A first road test for the R1 has yet to be released by the Western press. It has to be said, in the visual sense the car looks as bad as the old East German Trabant — but if it drives well, achieves its range projections and holds up from a reliability perspective, owners may yet ignore its ugly duckling looks and flock to what could prove to be a disrupter for the lower end of the EV market.
ThomasNet occasionally puts out some great — if slightly quirky — reports, and this one from last week is in that form, covering the highly innovative watchmaker REC’s latest project to make a new range of watches from the wing skin of a World War II Spitfire. Nuts, maybe, but cool and rather clever (you can make your own judgement, but I will say it strikes a chord with me).
Firstly, REC hit on the neat idea of taking some kind of iconic piece of junk and turning it into a limited run of high-end watches.
That’s not totally unique, of course.
The Geneva watchmaker Romain Jerome SA took steel and coal from the Titanic and made them into a limited run of watches some 10 years ago, retailing between $7,800 and $173,100, according to Reuters.
REC’s first endeavor was much more accessible: a run of 250 watches made from the body of a rare 1966 Raven Black Mustang, costing “only” $1,500 each. Bravely, they asked clients what they would like to see next — the overwhelming choice was the British World War II fighter, the Spitfire.
REC located PT879, a MKIX, shot down in a dog fight over Russia in 1944. PT879 was one of something like a thousand Spitfires shipped to Russia under the terms of the Allied coalition against the Axis powers. The MKIX was the second-most popular variant of the highly successful Spitfire of which in total over 20,000 were made from just before World War II (in 1938) to a little after the war (in 1948), but of which less than 100 still fly today.
The Spitfire was remarkable in many ways.
Apart from being arguably the most beautiful aircraft ever produced, it was also highly effective, with a fast rate of climb, tight turning radius and an airframe that could be developed to perform and carry much more than it was originally designed to do.
In test pilot trials, one even set an airspeed record of Mach 0.92 (620 mph) — even though the resulting damage nearly ripped the wings off, it remains a remarkable story in its own right.
Part of the Spitfire’s novelty was the all-metal monocoque construction, in which the aircraft surface became a part of the airframe. Prior to World War II, most aircraft were designed around a wooden frame covered with a doped fabric skin, more akin to a World War I biplane.
The beautifully elliptical aircraft wings of the Spitfire were designed to reduce drag, but also gave the aircraft a beautiful and iconic shape that begged celebration in a personalized item, like a watch. The wing skin was made from a 2000 series aluminum-copper alloy and each dial will contain a piece of the wing skin, each carrying the unique service scars imparted during its brief life.
If it flicks your switch, a little piece of aviation history can be yours for around $1,300. If a Spitfire is not your thing, hang in there — REC will likely have some equally goofy, if no less alluring, idea in due course.
A health warning: no spitfires were destroyed or otherwise damaged in the making of this article, or these watches. PT879 is being painstakingly renovated with modern hairline crack free aluminum wings and may yet bless our skies when it rises, phoenix-like, from the ashes of the scrap yard.
In an announcement last week reported by Reuters, the 141-year-old exchange advised it was introducing a plethora of new contracts to woo customers increasingly attracted by products on competitors’ platforms.
New technology at the LME is said to enable the exchange to introduce alternative products more cheaply and quickly than previously and encouraged it to try several cash settled futures options that, historically, fear of low liquidity would have barred.
The exchange is said to be introducing some 10 new cash settled contracts, including two regional aluminum premium contracts, minor metal molybdenum, plus options in gold and silver.
But the most interesting is probably a hot-rolled steel coil contract, with three regional prices covering Europe, North America and China, as opposed to the CME’s contract (which just covers North America based on the CRU Mid-West Index).
The LME’s reference index has yet to be announced, but it is hoped the exchange’s intended global coverage will attract more liquidity than the CME’s North American contract, which has struggled to gain liquidity since launch (although it has been widely adopted as an index price for steel supply chain contracts).
The other contract that raised some eyebrows is one for alumina.
Traditionally, alumina prices were fixed under long-term contracts and often tied to the primary aluminum price. But a few years ago, Alcoa broke with tradition and started pricing its alumina on the spot market, a move that many other refineries have since followed.
A largely spot market has resulted in considerable price volatility, aided this year by tight capacity and supply disruption. The LME’s timing could not be better, as a few years ago an alumina contract would have gone down like a lead balloon; today, the market may well respond positively to the opportunity to hedge price risk.
Achieving volume — and with it, liquidity — is about attracting the major producers and consumers. The aluminum contract, now the LME’s largest, struggled in its early days because the producers would not touch it, seeing it as a vehicle to undermine their pricing power.
Today, those same primary producers are on the receiving end of price volatility and may be more welcoming of a mechanism to hedge their input costs and output prices on the same platform.
In the cards for 2020 is a possible lithium contract, a metal that has been propelled from back page news to the front page headlines in recent years due to surging demand from batteries for all kinds of electronics, from iPhones to electric vehicles.
The LME is rightly not rushing that one, as it is still a relatively immature market and one that entails a large proportion of mine to battery maker direct trade; a contract will take careful planning.
But resources the LME has in depth after 141 years are patience and experience.