Once primarily used in steel-making to boost strength and add corrosion and heat resistance, niobium is now turning heads with its ability to cut charging times and fire risks for lithium-ion batteries.
Accordingly, companies finding the historically-rare metal are watching their stock take flight ahead of the next boom as sales for electric vehicles (EVs) step up another notch. For example, high-grade niobium finds have triggered a share price hike of an astonishing 4374 per cent for WA1 Resources in just eight months.
So what exactly is this prized alloy that is shaking up the ASX?
Before we were talking about powering cars with batteries, we were still looking to niobium to improve their performance. Ferroniobium, the primary saleable form of niobium, was sought traditionally as an ingredient to make the steel frame lighter and to boost fuel efficiency.
Adding 300g of niobium into the mix could reduce the weight of steel in a mid-size car by 200kg and in turn boost fuel efficiency by five per cent.
However, as the green-energy transition cyclone swirls around us, the focus is now on niobium because of its potential to turn the electrification of our transport fleet on its head.
Widely-held wisdom isolates the main issues holding back the adoption of EVs as “range anxiety”, or the fear of a charge running out in between charging points, and a general lack of the said charging points.
But those problems are being attacked in a two-pronged approach. Car makers have focused on increased range in an effort to ease consumer anxiety over available charging infrastructure and battery makers are turning their minds to smaller, longer-lasting and cheaper batteries that also charge more quickly.
The battery is an EV's most expensive part. So true fast-charging, coupled with widely-available chargers, would allow automakers to build cars with smaller batteries at more affordable prices, while boosting profit by selling more vehicles to a broader audience.
It almost sounds too good to be true, but it is what niobium’s boosters promise. Still, like most miracle cures, supply is somewhat restricted.
Brazil currently holds 88 per cent of the global supply of niobium via two of just three operating mines around the world.
One of those is the mega-mine run by Brazil’s CBMM, which alone provides 84 per cent of global supply. The rest is made up by China Molybdenum’s Boa Vista Mine in Brazil, which it acquired from Anglo American in 2016, and Canada’s Magris Resources’ Niobec Mine in Quebec.
The small group of dominant producers obviously cause headaches from a supply chain point of view and it is one of the reasons why niobium is on the critical minerals list for a growing number of countries around the world, including Australia.
CBMM is all about just digging it up. With a fully-integrated approach from mine to market, the company is looking to bring its niobium battery cells to the forefront of the next wave of EVs.
In March, it revealed it will start using technology it developed in partnership with Toshiba to supply niobium battery cells for fast-charging electric motorcycles, to be made by China's Horwin in Brazil. The South American miner plans to provide the battery cells, while Horwin will produce the motorcycles.
CBMM also already has ambitious projects planned with other battery makers in Asia, Europe and the United States.
Horwin believes its new batteries will slash the required charging time from three hours to about 10 minutes and says they will also have a longer life when compared to traditional batteries.
With the price of niobium sitting at somewhere between US$45,000 and US$50,000 (up to AU$88,000) a tonne, its perhaps easy to see why the commodity has been behind several mesmerising stock price runs in recent months.
WA1 put the spotlight on niobium in October last year when assays unveiled 54m at 0.62 per cent niobium from 162m in the first drill hole at its project, about 493km south of Halls Creek in Western Australia’s Kimberley region.
The former market cap minnow, which now holds one worth $231 million, has continued to make every post a winner. Its latest results earlier this month saw its highest-grades of niobium yet, with 10m at 8.3 per cent niobium from 79m.
It is results like that has made the market darling’s share price climb from 13.5 cents on October 20 last year to $6.03 during today’s trading.
Another company riding the niobium wave is Reach Resources in WA’s Gascoyne region. The explorer unveiled a niobium discovery at the start of the month and its share price doubled. Its stock was changing hands for just 0.03 of a cent in May and has recently been as high as 1.6 cents.
Reach says independent geological experts have advised that its consistent high‐grade niobium and heavy rare earths oxide (HREO) is associated with a rare-element pegmatite swarm about 2.5km long and which was identified from historical records at Wabli Creek. The company also believes the mineralisation likely extends under cover.
Its most recent numbers follow previous high-grade results from rock-chip samples in December last year that revealed 6.78 per cent niobium oxide, 3.71 per cent tantalum oxide and 2.57 per cent total rare earths oxide (TREO), including 88 per cent HREO. The high proportion of HREO includes 7226 parts per million yttrium oxide, 3430ppm dysprosium oxide and 4880ppm ytterbium oxide.
The company is obviously now keen to further investigate its tenure.
Further afield, Globe Metals & Mining is pushing ahead with it its Kanyika niobium project in Malawi and aims to become the world’s fourth operating niobium mine. And with the project receiving plenty of support from the Malawian Government in recent months, things are quickly coming into focus.
A feasibility study completed by the company in 2021 outlined an impressive total EBITDA figure for a fully-developed operation of US$3.74 billion (AU$5.62 billion) across an initial mine life of 23 years.
Globe is aiming to produce high-purity niobium pentoxide and tantalum pentoxide powders from a JORC-compliant total resource of 68.3 million tonnes using a cut-off grade of 1500ppm niobium pentoxide.
The proposed mining and processing operation at Kanyika is expected to churn out about 11,300 tonnes of niobium and tantalum concentrate per annum on the back of newly-unveiled proved and probable ore reserves of 33.8 million tonnes, grading an average 3048ppm niobium pentoxide and 141ppm tantalum pentoxide.
With carmakers chasing EV market leader Tesla and seeking to build vehicles that can travel further between charges, a key battlefront is already emerging in the battery space.
And if niobium can deliver on its hype, then the industry of trailblazers is likely to be faced with a new and genuine disruptor.
Is your ASX-listed company doing something interesting? Contact: matt.birney@businessnews.com.au
By Steve Kaless
