Company news

The company's CEO I.M. Petrov gave a commentary on the issue of rare and rare earth metals for the newspapers Kommersant and Vedomosti.

Tungsten production attracts new investors

https://www.kommersant.ru/doc/7564450

11.03.2025

A structure participating in Rosatom projects has become interested in the property of the bankrupt Gidrometallurg plant, a producer of tungsten and molybdenum oxides. The enterprise was shut down in 2023, analysts believe that the investor may organize a new processing of concentrate from a deposit located in the region.

AO Orbita Invest won the auction for the sale of part of the property of the Gidrometallurg plant in Kabardino-Balkaria, which was engaged in the production of tungsten, according to the bankruptcy register. The auction was held as part of the bankruptcy of the plant's owner, AO Company Wolfram; the lot included land participants and buildings, for which the winner offered 105 million rubles. Applications for the purchase of shares in the structures of Wolfram, including AO Gidrometallurg, which manages the plant, are also accepted until April 5. Orbita Invest has joint projects with Rosatom. According to the Unified State Register of Legal Entities, the company owns 30% of the Center for Polymer Composites LLC and 36.5% of Rusatom Pultrusia LLC, where 50% and 51% belong to AO Yumatex, a structure of Rosatom's composite division. Orbita Invest's assets also include the Zlatoust Metalworking Plant (ZZMK). It was not possible to contact Orbita Invest; Kommersant sent questions to ZZMK. Rosatom did not respond to Kommersant.

In addition to Gidrometallurg, the Wolfram company managed the Unechsky Refractory Metals Plant in the Bryansk Region and Primorvolfram LLC, which is developing the Zabytoye deposit for the extraction of tungsten and tin ores in Primorye. As noted in the market review of the Delovoy Profil group, Wolfram had ambitious plans, but the loss of foreign sales markets in 2022 as a result of sanctions, along with the deterioration of the price situation on the global tungsten market, led to bankruptcy.

The Gidrometallurg report for 2022 says that the plant was loaded at 15% of its design capacity at that time. The low percentage is due to a shortage of raw materials and difficulties encountered in export shipments. In 2022, the enterprise processed 1.08 thousand tons of raw materials. In particular, the plant produced alloys containing tungsten, nickel-tungsten and cobalt-molybdenum catalysts. Since the beginning of 2023, the plant's capacities have been mothballed.

Tungsten is a scarce mineral, molybdenum is a rare metal. The government strategy estimates the production volume of tungsten at 2.8 thousand tons (oxide; 2.1% of world production), molybdenum at 2.2 thousand tons (0.6% of world production). The strategy states that the Russian Federation depends on the import of tungsten and molybdenum. Anton Sviridenko, Executive Director of the P. A. Stolypin Institute for Growth Economics, notes that the global tungsten market is estimated at $5.5 billion.

The annual production of tungsten and molybdenum in the Russian Federation is estimated at 5 thousand tons.

The global market for these metals is monopolized by China and is mainly characterized by a surplus, says Igor Petrov, CEO of the InfoMine research group. In Russia, according to him, ore is mined to produce concentrates. Tungsten concentrate is mainly exported to China. Molybdenum concentrate is processed into ferromolybdenum and is also partially exported, the expert points out. The volume of domestic consumption in InfoMine is estimated at around 2 thousand tons in terms of tungsten trioxide.

As Igor Petrov notes, restarting the Gidrometallurg plant will not make sense. "It is necessary to build a new modern enterprise of a similar profile," he is sure. Oleg Abelev, head of the analytical department of Rikom-Trust, says that the electronic, chemical and aviation industries may become buyers on the domestic market.

Kommersant's sources believe that interest in the assets may be connected with plans to restore the extraction of tungsten-molybdenum ores at the Tyrnyauz Mining and Processing Plant in Kabardino-Balkaria. The project is being handled by Rostec; according to the latest public information, the resumption of the mining and processing plant's operations should take place in 2028. A successful project to restore the Tyrnyauz Mining and Processing Plant is only possible in conjunction with a new hydrometallurgical plant for processing concentrate to produce tungsten trioxide, Igor Petrov points out.

Kommersant newspaper

Russia could become one of the leading producers of rare metals

https://www.vedomosti.ru/analytics/trends/articles/2025/03/13/1097693-rossiya-mozhet-stat-odnim-iz-veduschih-proizvoditelei-redkih-metallov

13.03.2025

Thanks to significant reserves and a number of production capacities, the country can become self-sufficient in these types of raw materials and become their exporter, experts believe.

The topic of mining and processing rare earth and other rare metals in 2025 has become central not only to the economic, but also to the current political agenda. How this industry is currently developing in the world and what are the prospects for its development in Russia - in the material "Vedomosti. Analytics".

Russia must establish a full cycle of the rare and rare earth metals industry - ensure their extraction and processing up to the production of finished high-tech goods with high added value, said Russian President Vladimir Putin at a meeting on the development of the industry held in late February. He clarified that this task should be solved through the implementation of the national project "New Materials and Chemistry". The volume of rare metals production should increase exponentially, the president noted. Rare metals are a group of 40–50 (depending on classification) elements. According to one classification, they include light (e.g. lithium, beryllium), refractory (titanium, molybdenum, tungsten), dispersed (gallium, rhenium), radioactive (uranium, radium) and rare earth metals (yttrium, scandium, lanthanum and 14 lanthanides).

Rare earth metals (REM) are used in the nuclear, mechanical engineering, metallurgy, glass, defense, and chemical industries. REM are required to create high-tech devices and are necessary in the production of batteries, catalysts, ceramics, magnets, mobile phones, and glass.

The combination of metals with different properties into a group of rare metals developed historically - initially they were associated with those that were little or not used at all in industry. Most rare metals were discovered in the late 18th century and in the 19th century, and their practical use began in the 19th-20th centuries. Not all rare metals are poorly distributed in the earth's crust; some of them are considered rare due to their limited ability to form independent minerals and deposits. The metal content in the earth's crust can be significant, but deposits with concentrations high enough for profitable extraction are few. Obtaining REE for industrial use requires processing large volumes of ore at high costs and, most importantly, a complex and multi-stage separation scheme to obtain individual products.

Where REE are located and produced

According to the US Geological Survey for 2023, the world's REE reserves (excluding scandium) are about 110 million tons, data for 2024 - more than 90 million tons (exact estimate not given). The leader in world REE reserves is China - 44 million tons (share in 2023 - 40%). Vietnam is far behind with 22 million tons (20%) and Brazil with 21 million tons (19.1%). According to 2023 data, Russia (10 million tons, 9.1%), India (6.9 million tons, 6.3%), Australia (5.7 million tons, 5.2%) and the United States (1.8 million tons, 1.6%) have significant reserves. The 2024 report gives a different estimate of Russian reserves - 3.8 million tons. Similar estimates are given in the materials of the Ministry of Natural Resources of Russia and Rosnedra. According to the Ministry of Natural Resources, the world's REE reserves as of January 1, 2023 amounted to 105.9 million tons, and the reserves of deposits being developed and prepared for development in Russia were 3.8 million tons. The total REE reserves are 28.5 million tons, the ministry reported at the end of February. According to the US Geological Survey estimates for 2024, China produces the largest volume of REEs (excluding scandium) - 270,000 tons (69% of world production). It is followed by the United States - 45,000 tons (11%), Myanmar (31,000 tons (8%), Australia, Nigeria and Thailand - 13,000 tons each (3%). Less than 1% of production comes from India (0.7%, 2900 tons), Russia (0.6%, 2500 tons) and Madagascar (0.5%, 2000 tons). Total REE production in the world last year amounted to 390,000 tons, exceeding the 2023 figure by 3.7%. The growth was mainly due to the expansion of production in China, Thailand, Nigeria and the United States. A noticeable decrease in production was observed in Myanmar and Australia, while in India and Russia it remained at the same level. In monetary terms, the annual volume of global REE production, according to the Roscongress analytical review, is estimated at approximately $ 15 billion, which is equivalent to the cost of two days of global production oil. By 2035, this figure could reach $46 billion.

China's Leadership

China is the undisputed leader in reserves, production, and supply of rare earth metals to the world market. It is the only country that supplies all types of rare earth products, from raw materials to high-value-added products. There are more than 200 rare earth enterprises operating in China, including more than 30 mines and more than 10 processing plants.

The basis of China's raw material base is bastnaesite carbonatite deposits. The country's Inner Mongolia is home to the unique Bayan-Obo deposit, which contains 70% of China's rare earth reserves. Domestic demand for them, especially neodymium and praseodymium, used to produce permanent magnets, is growing by about 10% per year.

China's dominance in the REE market is the result of its export policy. Low production costs allowed Chinese manufacturers to supply REE to the world market at dumping prices in the 1990s and early 2000s. As a result, some rare earth production outside China closed, unable to withstand the competition, and China itself created a full technological chain of REE production and entered the market for products with high added value.

This position of China in the REE market is becoming an increasingly big problem for the United States, Europe and Japan: China provides about 85% of the world's production of compounds and metals, and for dysprosium its share is 95%, which is considered a geopolitical threat.

General Director of the InfoMine research group, Doctor of Technical Sciences Igor Petrov notes that China has significantly increased its REE production in recent years, and such a monopoly position is dangerous for other countries. "For 15 years now, various countries have been trying to create alternative sources of REE raw materials. There is progress, but this process is slow – largely because China controls prices for rare earth metals,” the expert says.

At the same time, China cannot fully take advantage of its dominant position in the market and conducts its pricing policy with an eye on US-friendly Asian semiconductor manufacturers, since it itself is 80% dependent on their imports, says Implementa analyst Demyan Lashkov. The trend towards deglobalization due to the desire of countries to achieve raw material and technological sovereignty and win the high-tech race is forcing the US to look for an alternative resource base, and China to invest in semiconductor production technologies, he explains.

Why rare earth metals are expensive

Classifying a metal as “rare” does not mean its unconditional economic value, but most of these metals are indeed critical for strategically important sectors of the economy, says Lashkov.

Thus, according to the expert's estimates, by 2035, just to achieve the carbon neutrality goals announced by countries, the global fuel and energy sector will need five times more lithium and twice as much REE, and the total consumption of these metals will amount to 1 million tons (+500% by 2023) and 500,000 tons (+200%), respectively. For comparison: the growth in demand for copper will be 32%, in absolute terms, the growth will be 7 million tons, the Implementa expert notes.

Significant volumes of rare metals are also consumed by other strategically important areas: big data technologies, quantum computing, the military-industrial complex, Lashkov specifies.

The most dynamic demand for REE is developing from manufacturers of permanent magnets, which are in demand in the automotive industry and renewable energy, says Petrov. According to estimates by Roskill (part of Wood Mackenzie), in 2022 such demand increased by 25%, and by 2030, permanent magnet manufacturers will provide up to 40% of the demand for REE. Additional demand can be provided by an increase in the production of military and civilian drones, the expert notes.

"Industrial Vitamins"

Rare metals are a strategic type of raw material, but their full-scale extraction is not carried out in the country, recalls Maxim Khudalov, a strategist at the Vector Capital investment company. At the end of February, the Ministry of Natural Resources reported that the total reserves of 29 types of rare metals in the country amount to 658 million tons and these reserves are "sufficient both for the current needs of the Russian economy and for the long term."

According to the order of the Government of the Russian Federation dated August 30, 2022 No. 2473-r, REE are included in the list of the main types of strategic mineral raw materials. But for now, the only industrial source of rare earth products in the country is loparite concentrate produced from the ores of the Lovozero deposit in the Murmansk region.

The REE industry in Russia will develop due to the implementation of a number of projects, Petrov notes. This includes the separation of REE into individual compounds at the Solikamsk Magnesium Plant (part of Rosatom) in the Perm region, the processing of phosphogypsum (a product formed during the production of fertilizers from phosphorite ponds) and the expansion of REE production by the Skygrad company in the Moscow region and, possibly, the development of the Tomtorskoye deposit in Yakutia. The industry's prospects are associated with the growth of production, not consumption, the expert clarifies.

Lithium mining is also of interest to major oil and gas companies, both globally and in Russia. According to the FT, ExxonMobil, Schlumberger, Occidental Petroleum and Equinor are exploring the possibility of using their skills in pumping, processing and re-injecting underground liquids such as oil and water to process lithium from unconventional sources (brines), which will help reduce the projected global deficit of the metal. In May 2024, Rosneft tested a technology for producing lithium carbonate from hydromineral raw materials mined at the Yurubcheno-Tokhomskoye and Kuyumbinskoye fields. Using a mobile pilot plant, the company's specialists quickly obtained more than 300 kg of lithium carbonate. Other large companies, such as Gazprom, Rosatom and Norilsk Nickel, are also showing interest in mining this metal. Khudalov notes that rare metals are important for the production of high-tech products in Russia. We are talking, first of all, about the use of rare metals in the defense industry, as well as in communication systems against the backdrop of the development of the Northern Sea Route, he specifies.

But now in Russia there are no high-tech industries that can consume significant volumes of rare earth metals, Petrov specifies. At the same time, he sees prospects for the export of such metals.

In his opinion, the demand for these metals in the country will grow extensively - from 1700-2000 tons at present to 2500 by 2030 - due to a small increase in use in the oil refining and chemical industries (catalysts) and metallurgy (alloying of alloys).

"Academician Alexander Fersman long ago called rare earth metals "vitamins of industry". However, it should be noted that the Russian industry currently does not need a lot of these vitamins, "says Petrov. Another thing is that a fairly significant part of the rare metals, their compounds used by the domestic industry are of imported origin, he continues.

The presence of a powerful raw material base, a number of production capacities and competencies potentially allow Russia to switch to full self-sufficiency in rare metals, the expert believes.

"On the world stage, we can act as one of the leading producers of rare metals, taking into account the aggravated contradictions between supplier and recipient countries. Russia already has a high export potential for such types of rare metals as, for example, titanium, scandium, vanadium, germanium, hafnium, zirconium, selenium, tellurium," he concludes.

Vedomosti newspaper