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Conflict minerals: the impact on the metal markets

March 24, 2011 - 16:27 GMT Location: London

KEYWORDS: conflict minerals , drc , africa

Conflict minerals are high on the agenda for market participants in tin, tantalum, tungsten and gold as US legislation and stipulations from industry groups look set to blow the opaque supply chain from central Africa wide open.


Confusion over the implications has left misinformed buyers interpreting the rules as an embargo on the Democratic Republic of Congo (DRC).


Cobalt traders are having to explain that their metal and the raw materials for it come from hundreds of miles away from the conflict zones in the east.


The jury is still out on the acceptability of up to 95% of London Metal Exchange tin stocks, as smelters wait to be audited and declared conflict free, or not.


Within weeks, consumers will have to disclose the use of material from the DRC and surrounding countries and describe the due diligence measures they have taken to trace it back to a safe origin.

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(AMM) Intel completes costly conflict-minerals supply tour- 24 March 2011

Global technology giant Intel Corp. has visited more than 30 smelters since it began its fact-finding mission at the end of 2010 to learn if any of its suppliers were sourcing metal from conflict zones in the Democratic Republic of Congo (DRC), according to a company executive.

"I don’t know that we have a complete handle on the whole supply chain, but we at least have a better handle on the nuances," Ted Jeffries, director of fab services and consumables at Intel, told attendees at the Strategic Metals for National Security and Clean Energy Conference this week.

***TREVOR TARRING: When is a commodity not a commodity?- 24 March 2011

This is not a children's riddle. It is a serious question in the light of the latest moves by the Electronics Industry Citizenship Coalition (EICC) to stipulate that its members should not buy conflict minerals after April 1.

To be precise, it will demand that suppliers give an undertaking that the material in question is not from a conflict source. That is not quite the same as insisting EICC members assure themselves that that is the case.

'Don’t put cobalt in conflict minerals basket', say traders- 22 March 2011

Confusion over imminent US regulations regarding the trade of conflict minerals, and over the areas where cobalt is produced, has prompted some electronics consumers to request cobalt that is not sourced from the Democratic Republic of Congo (DRC), traders have told MB.

Cobalt has not been designated as a conflict mineral and is not included in legislation being passed by the US securities & exchange commission (SEC) aimed at promoting a more transparent supply chain from central Africa.

Conflict-free stipulations will start on April 1 - EICC- 22 March 2011

The Electronics Industry Citizenship Coalition's (EICC) conflict-free stipulations will not be delayed and will go ahead from April 1, the industry body confirmed on Friday amid reports that the rules would be pushed back due to lobbying.

The EICC and the Global e-Sustainability Initiative (GeSi) are introducing a conflict-free smelter (CFS) scheme to help promote a responsible supply chain for tin and tantalum from central Africa.

MSC braced for DRC exit on conflict-free demands- 11 March 2011

Malaysia Smelting Corp. (MSC) will pull out of central Africa if it cannot satisfy new ethical stipulations being drawn up by tin industry consumers, the company confirmed to MB.

Two electronics industry organizations, the Electronics Industry Citizenship Coalition (EICC) and the Global e-Sustainability Initiative (GeSI), are launching a Conflict-Free Smelter (CFS) audit that effective April 1 will require full traceability and due diligence on all material coming from the region.

MSC can't buy from DRC and meet conflict free requirements - Itri- 09 March 2011

As a result of the conflict free requirements, the involvement of MSC in the iTCSi traceability scheme is uncertain and without its support Itri will be unable to continue any activity in the region, including the expansion of its Kantanga project and its work in Rwanda, the industry body warned.

DRC won’t lift ban on mining until illegal activity stops - M'Poko- 28 February 2011

The Democratic Republic of Congo (DRC) will not lift the ban on mining and trade in minerals in the volatile eastern districts of Maniema and North and South Kivu until the government has succeeded in clamping down on illegal mining, Bene M’Poko, the DRC’s ambassador to South Africa, told MB.

Mining and trade in tungsten, tantalum, coltan and other minerals has been banned since September 2010, with the government arguing that rebel groups have been exploiting some of the world’s most sought after minerals to finance military activities.

Tin could hit $40,000 as supply lag worsens, says MSC’s Anuar- 31 January 2011

Tin prices could hit $40,000 per tonne this year as lower grades restrain mine output and demand stays firm, according to Mohd Ajib Anuar, ceo and executive director of Malaysia Smelting Corp (MSC).

It is "not impossible" that tin could climb another $12,000 on the London Metal Exchange by the end of 2011, he told MB.

Tantalum prices will survive Wodgina restart, shortfall expected- 20 January 2011

The reopening of Global Advanced Metals’ Wodgina tantalum mine and Greenbushes processing plant in Western Australia poses a limited threat to the strength of prices, market participants agree.

The long-expected restart of the projects, which supplied 30% of the world’s tantalum in their most recent year of production, will hold back the pace of price increases but will not flood the market with new material or drag prices back to levels seen two years ago, GAM ceo Bryan Ellis told MB.

Itri, TIC call for urgent downstream traceability funding - 14 January 2011

Itri and the Tantalum-Niobium Study Group (TIC) are calling on downstream tin and tantalum market participants to contribute to a traceability scheme as the deadline for the implementation of US rules around conflict minerals approaches, Itri announced on Friday.

The industry bodies need "significant" funding for the ITRI Tin Supply Chain Initiative (iTSCi) due diligence scheme in the Democratic Republic of Congo (DRC), they said.

Market wakes up to conflict - 27 December 2010

Conflict minerals, no longer the remit of NGOs and human rights groups, caught the attention of the entire market last year, from producers, large trading houses and electronics companies through to trade and industry groups and the London Metal Exchange.

Long-standing awareness campaigns combined with soaring prices, alleged contract reneges, changing consumer behaviour and outrage among industry association members as tin and tantalum market participants debated what new US regulations around the trade of material from conflict zones will mean for them.

Itri teams up with ICGLR on traceability- 13 December 2010

Tin industry body Itri has signed an agreement with the International Conference on the Great Lakes Region (ICGLR) to collaborate on tin traceability and due diligence schemes in central Africa, Itri announced on Monday.

Both organisations are working to limit opportunities for armed groups in the area to benefit financially from the production and trade of minerals, Itri said.

LME meets Itri over conflict minerals rules - 29 November 2010

The London Metal Exchange has held discussions with at least one tin industry group regarding new regulations from the US Securities & Exchange Commission (SEC) that deal with the trade of material from conflict zones in central Africa, market sources said.

"There is the challenge for metal on the LME or elsewhere, that if someone buys it, how do they identify the provenance? It’s not like in tantalum which does not have a terminal market; it’s a bit of a unique problem for tin," a market source told MB.

 Tin market waits for outcome of smelter audit at MSC -15 November 2010

The vast majority of tin stocks in London Metal Exchange-bonded warehouses may become unacceptable to the international market if Malaysia Smelting Corp (MSC) cannot meet strict new ethical stipulations, market participants told MB.

The company, which is part of industry body Itri’s traceability scheme, says it has written to all its suppliers of tin concentrates from the Democratic Republic of Congo (DRC) asking for written clarification of the legitimacy of their trading operations.

LME tin gains 2.4% as Itri predicts DRC embargo- 09 November 2010

Tin exceeded its opening price by 2.4% in Tuesday's official trading on the London Metal Exchange, a day after industry body Itri announced that the market will refuse to accept untraceable material from the Democratic Republic of Congo and surrounding countries from April 2011.

"It will add more flame to the fire, especially if you’re a bit short," a category II trader told MB.

US conflict mineral rules will create DRC embargo: Itri - 08 November 2010

US regulations around conflict minerals will impose an effective embargo on tin- and tantalum-containing minerals from parts of central Africa when they are implemented in April, tin industry body Itri announced on Monday.

Itri and the Tantalum-Niobium Study Group (TIC) have been forced to set a March 2011 deadline on their iTSCi traceability programme, and the material they cannot tag in time will be unacceptable to the market, Itri said.

***SPOTLIGHT: OECD guide on conflict minerals will support US rules -08 November 2010

The Organisation for Economic Co-operation & Development’s (OECD) guidelines on conflict minerals, scheduled for approval this month and official recommendation in January 2011, will be read carefully by tantalum market participants long plagued by controversy around mining in the Democratic Republic of Congo.

Prices for the minor metal have more than doubled since the start of 2010, amid escalating concerns about central African conflict zones, and electronic companies’ fears of finding conflict tantalum in their highly-prized gadgets.

LME's Abbott warns of affect on tin of conflict mineral rule- 04 November 2010

Conflict mineral regulation included in the Dodd-Frank Act could have repercussions for the secondary tin market, according to London Metal Exchange chief executive Martin Abbott.

"At the moment there is no constraint on tin from the current legislation," Abbott said. "At the moment there is no penalty attached. That is such a weak position there should be a plan to follow through with sanctions."

Gippsland quits TIC citing conflict minerals concerns - 20 September 2010

Gippsland has resigned from the Tantalum Niobium International Study Centre (TIC), citing concerns over the alleged involvement of other members in the trade of metals from conflict zones, the company announced on Monday.

"Gippsland Ltd advises that it has resigned from the Belgium-based Tantalum Niobium International Study Center effective immediately as the directors have formed the opinion that the TIC no longer represents the interests of the majority of the world’s ethical tantalum miners," the Australian resource group said.

Electronics companies can halt 'blood tantalum' problem, says Commerce head- 15 September 2010

Tantalum consumers could avoid controversy surrounding the trade of conflict material by owning tantalum-containing minerals that are still in the ground, according to Commerce Resources president and director David Hodge.

The company is suggesting the solution to remove the necessity to buy cheap material from conflict zones in central Africa, including the Democratic Republic of Congo (DRC), Hodge told MB in an interview in Vancouver, Canada, last week.

TIC members could defect to MMTA amid conflict mineral fears - 30 August 2010

The Tantalum-Niobium International Study Center (TIC) could lose some of its members to the Minor Metals Trade Assn (MMTA), amid controversy over the agenda for its upcoming general assembly, market participants told MB.  The event, being held in Nevada this October, will include a tour of the operations of Niotan Inc, a TIC member based in Nevada.

Niotan director John Crawley was named in a United Nations (UN) Security Council report published in late 2009. Crawley is also a director of Refractory Metals Mining Co (RMMC), which the report linked to the trade of coltan - tantalum-containing material - from central African conflict zones.


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