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May 27-28, 2021
Hangzhou, Zhejiang, China
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May 20-21, 2021
Hangzhou, Zhejiang, China
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April 15-16, 2021
Hangzhou, Zhejiang, China
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March 25-26, 2021
Hangzhou, Zhejiang, China
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May 23-24, 2019
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May 16-17, 2019
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11th Rare Earth Summit
May 9-10, 2019
Qingdao, Shandong, China
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April 11-12, 2019
Zhuhai, Guangdong, China
12th World InBiGeGa Forum
March 14-15, 2019
Zhuhai, Guangdong, China
6th World Manganese & Selenium Forum
May 21-22, 2018
Hainan Sanya, China
Interview with Mr. Stephen Leahy, the Chairman and CEO of North America Tungsten Corporation，Vice President of International Tungsten Industry Association
North American Tungsten Corporation Ltd. is the Western World's largest producer of tungsten concentrate. The company has two mining projects, CanTung and MacTung, both located in Northern, Canada. Mr. Stephen Leahy founded North American Tungsten Corporation in 1993, and is the Chairman & CEO. He is also the vice president of International Tungsten Industry Association, based in London, England. In addition, he serves as a director for three separate junior mining companies.
Tungsten concentrate supply will not increase in short time
----Interview with Mr. Stephen Leahy, the Chairman and CEO of North America Tungsten Corporation，Vice President of International Tungsten Industry Association
Asian Metal: Good afternoon, Mr. Leahy.
Mr. Leahy: Hello. How are you?
Asian Metal: I am fine, thanks! It has been a while since we talked last time, and how is everything going?
Mr. Leahy: Well, The market is certainly improving, and you know, we shut down our production for winter.
Asian Metal: Was the shutdown at the Cantung production since middle of October last year caused by low market price and weak demand?
Mr. Leahy: That is correct. We had accumulated a large amount of inventory which we normally sell in the spot market, so we decided to close the production for certain period of time, in order to wait for the market to get better and sell our inventory. When we resume our production, we expect to produce in excess of 3,000t annually.
Asian Metal: I do remember the annual production capacity of Cantung was about 4700t, so how many tons of tungsten concentrate did the company produce last year.
Mr. Leady: The figure is shown on our annual report. Production of 315,192 metric tons units was at 95% of budgeted production in fiscal 2009, and it increased by 16% compared to 2008.
Asian Metal: What is the current situation for Mactung, the other tungsten mining site of North American Tungsten Corporation?
Mr. Leahy: Mactung, we have completed the Bankable Feasibility study, and currently the project is in the permitting process within the territory of Yukon; that is on going process. Mactung production will really depend on economics, demand, and of course, the eventual financing.
Asian Metal: When do you expect Cantung will resume production?
Mr. Leahy: The decision to resume production at CanTung will be predicated on securing supply agreements that are sufficient in terms of volume and economic viability. Of course an improvement in market prices is also required which I believe is inevitable. We believe that the supply is certainly not plentiful in the world of tungsten, and there is hardly any new supply available in the Western world. China will remain as the dominate supplier of tungsten products.
Asian Metal: And Chinese government is putting more controls on tungsten export.
Mr. Leahy: Yes, I think there are some reasons. First, China is using much more material internally, and second, they want to sell more value-added products, such as tungsten carbide powders and finished good; I think that goal is slowly but certainly being realized..
Asian Metal: Last year was very difficult for most companies in the industry. Could you briefly summarize the economic situation?
Mr. Leahy: Yes, certainly. The last one-and-half or two years have been very difficult for everyone, including the Chinese producers, but I do think things are starting to return to better times in terms of markets and demand. I think worldwide tungsten inventories of consumers are quite low, if the resurgence of the economy remains, then there will be a significant increase in demand for tungsten in the coming year.
Asian Metal: Can you make a forecast for tungsten market this year.
Mr. Leahy: Well, again, I think pricing is going to be affected by increasing demand and low inventory levels, and that will impact the tungsten price moving it upwards. What in term of dollars, I am not sure. However, history has taught us that the tungsten world and industry was quite comfortable in the APT price USD240-260/mtu range. I don’t think we will get there immediately, but probably in the second half of this year.
Asian Metal: I spoke with some market participants, and we agreed that the APT price will increase to the level of USD220/mtu level this year, and back to USD240-250/mtu next year; the tungsten concentrate price will also rise to USD180/mtu later this year. However, I also learned that the production cost of tungsten concentrate increased fast in the last two years. Can you comment on the tungsten concentrate production?
Mr. Leahy: Certainly, we have been a comparatively high cost tungsten concentrate producer due to our remote locations and high cost of our production facilities, but we are currently working very hard to upgrade our facilities and other measures to reduce our cost. On a go forward basis, we plan to produce at a much lower cost and be more competitive. Other tungsten producers have also seen their costs rise and some by significant amounts. As the Chinese producers experience higher material and labor costs they are also dealing with the elimination of Government subsidies.
Asian Metal: There are about 10 mining companies in Australia, and they are all in exploration stage, the soonest one put into production will be in the second half of 2011. How do you think the new productions in Australia will affect the world tungsten market?
Mr. Leahy: Well, I think that again will depend on demand. There are quite a few products that will use tungsten that are in research stage or just being introduced to the market, such as new tungsten composites, which will add volume increases in tungsten consumption With production from traditional sources declining, and other groups in the supply chain depleting their resources, such as United State Defense National Stockpile Centre, new production coming in the next few years, will be insufficient to meet demand, causing a shortage of raw material. In short, we need new sources of Tungsten.
Asian Metal: Is there any other things you want to share with other companies in the tungsten market, or any suggestion that can help market to improve?
Mr. Leahy: I think new market places for Tungsten should be aggressively explored, many of which have been held back by the uncertain nature of tungsten supply. These new products such as Tungsten composites to replace lead can really, in my view, boost the tungsten consumption around the world. This lead replacement market has the potential to become a big percentage of the overall tungsten market.
Asian Metal: You just said some new products developments are held back by uncertainties of raw material. Can you be a little more specific?
Mr. Leahy: Any developer of new products today will most certainly research the availability of the required raw materials. When people realize the small size of the worldwide Tungsten market and the dominance of China many become reluctant to launch new tungsten containing products. With more certainty of global supply such as MacTung, I believe you will see an expansion of new innovative products that utilize Tungsten.
Asian Metal: I guess this is the end of our interview for today, and we will keep contact in the future. Thank you for sharing the market views with us, and wish you all the best!
Mr. Leahy: Thank you!
Mr. Leahy: Hello. How are you?
Asian Metal: I am fine, thanks! It has been a while since we talked last time, and how is everything going?
Mr. Leahy: Well, The market is certainly improving, and you know, we shut down our production for winter.
Asian Metal: Was the shutdown at the Cantung production since middle of October last year caused by low market price and weak demand?
Mr. Leahy: That is correct. We had accumulated a large amount of inventory which we normally sell in the spot market, so we decided to close the production for certain period of time, in order to wait for the market to get better and sell our inventory. When we resume our production, we expect to produce in excess of 3,000t annually.
Asian Metal: I do remember the annual production capacity of Cantung was about 4700t, so how many tons of tungsten concentrate did the company produce last year.
Mr. Leady: The figure is shown on our annual report. Production of 315,192 metric tons units was at 95% of budgeted production in fiscal 2009, and it increased by 16% compared to 2008.
Asian Metal: What is the current situation for Mactung, the other tungsten mining site of North American Tungsten Corporation?
Mr. Leahy: Mactung, we have completed the Bankable Feasibility study, and currently the project is in the permitting process within the territory of Yukon; that is on going process. Mactung production will really depend on economics, demand, and of course, the eventual financing.
Asian Metal: When do you expect Cantung will resume production?
Mr. Leahy: The decision to resume production at CanTung will be predicated on securing supply agreements that are sufficient in terms of volume and economic viability. Of course an improvement in market prices is also required which I believe is inevitable. We believe that the supply is certainly not plentiful in the world of tungsten, and there is hardly any new supply available in the Western world. China will remain as the dominate supplier of tungsten products.
Asian Metal: And Chinese government is putting more controls on tungsten export.
Mr. Leahy: Yes, I think there are some reasons. First, China is using much more material internally, and second, they want to sell more value-added products, such as tungsten carbide powders and finished good; I think that goal is slowly but certainly being realized..
Asian Metal: Last year was very difficult for most companies in the industry. Could you briefly summarize the economic situation?
Mr. Leahy: Yes, certainly. The last one-and-half or two years have been very difficult for everyone, including the Chinese producers, but I do think things are starting to return to better times in terms of markets and demand. I think worldwide tungsten inventories of consumers are quite low, if the resurgence of the economy remains, then there will be a significant increase in demand for tungsten in the coming year.
Asian Metal: Can you make a forecast for tungsten market this year.
Mr. Leahy: Well, again, I think pricing is going to be affected by increasing demand and low inventory levels, and that will impact the tungsten price moving it upwards. What in term of dollars, I am not sure. However, history has taught us that the tungsten world and industry was quite comfortable in the APT price USD240-260/mtu range. I don’t think we will get there immediately, but probably in the second half of this year.
Asian Metal: I spoke with some market participants, and we agreed that the APT price will increase to the level of USD220/mtu level this year, and back to USD240-250/mtu next year; the tungsten concentrate price will also rise to USD180/mtu later this year. However, I also learned that the production cost of tungsten concentrate increased fast in the last two years. Can you comment on the tungsten concentrate production?
Mr. Leahy: Certainly, we have been a comparatively high cost tungsten concentrate producer due to our remote locations and high cost of our production facilities, but we are currently working very hard to upgrade our facilities and other measures to reduce our cost. On a go forward basis, we plan to produce at a much lower cost and be more competitive. Other tungsten producers have also seen their costs rise and some by significant amounts. As the Chinese producers experience higher material and labor costs they are also dealing with the elimination of Government subsidies.
Asian Metal: There are about 10 mining companies in Australia, and they are all in exploration stage, the soonest one put into production will be in the second half of 2011. How do you think the new productions in Australia will affect the world tungsten market?
Mr. Leahy: Well, I think that again will depend on demand. There are quite a few products that will use tungsten that are in research stage or just being introduced to the market, such as new tungsten composites, which will add volume increases in tungsten consumption With production from traditional sources declining, and other groups in the supply chain depleting their resources, such as United State Defense National Stockpile Centre, new production coming in the next few years, will be insufficient to meet demand, causing a shortage of raw material. In short, we need new sources of Tungsten.
Asian Metal: Is there any other things you want to share with other companies in the tungsten market, or any suggestion that can help market to improve?
Mr. Leahy: I think new market places for Tungsten should be aggressively explored, many of which have been held back by the uncertain nature of tungsten supply. These new products such as Tungsten composites to replace lead can really, in my view, boost the tungsten consumption around the world. This lead replacement market has the potential to become a big percentage of the overall tungsten market.
Asian Metal: You just said some new products developments are held back by uncertainties of raw material. Can you be a little more specific?
Mr. Leahy: Any developer of new products today will most certainly research the availability of the required raw materials. When people realize the small size of the worldwide Tungsten market and the dominance of China many become reluctant to launch new tungsten containing products. With more certainty of global supply such as MacTung, I believe you will see an expansion of new innovative products that utilize Tungsten.
Asian Metal: I guess this is the end of our interview for today, and we will keep contact in the future. Thank you for sharing the market views with us, and wish you all the best!
Mr. Leahy: Thank you!