Titanium keeps flowing abroad

Published: 29/06/2011 05:00


The year 2010 was once set as the deadline for implementing the Government’s ban on raw titanium (ilmenite) export. However, the deadline has been extended until the end of 2011. As such, raw titanium ore keeps flowing abroad.

The year 2010 was once set as the deadline for implementing the Government’s ban on raw titanium (ilmenite) export. However, the deadline has been extended until the end of 2011. As such, raw titanium ore keeps flowing abroad.

Ilmenite, the metal component used in 30 different industries has been exploited in Vietnam mostly for export as raw materials. Experts pointed out that Vietnam’s titanium reserves are relatively big with the total estimated reserves of 300-500 million tons. To date, 15.71 million tons have been explored, according to the Ministry of Natural Resources and the Environment (MoNRE).

The titanium processing technologies in Vietnam remain simple which only allow to revert ilmenite or finely ground zircon, or process titanium slag with simple equipment. The technologies used in Vietnam are mostly the ones sourced from China which only can bring low efficiency, waste of the natural resources and cause environmental pollution.

According to the Ministry of Industry and Trade, every year, Vietnam exports 600-700,000 tons of ilmenite, not including the unlicensed exploited volume which has been illegally exported (the illegal exports in 2008 were estimated at 160,000 tons).

The massive and spontaneous licensing to titanium exploitation projects in Binh Dinh and Ninh Thuan provinces in recent years has led to the sharp increase of the newly established titanium exploitation enterprises.

According to the MoNRE, the number of private titanium exploitation enterprises has been increasing rapidly, now handling 50 percent of the exploited output. The output exploited by private enterprises has been increasing by 39-44 percent per annum.

Right in 2007, MoNRE found out that the volume of exploited ilmenite exceeded the allowed volume by 1.2 times. The exploited volume was 660,000 tons in 2000, far exceeding the volume set for 2025, at 600,000 tons.

For the last several years, the government has been pursuing the policy on encouraging enterprises to process titanium and export processed products, while gradually reducing the export of raw materials.

The Government also set the deadlines for stopping raw material export. However, the deadlines have been extended every year, the licenses granted to titanium exploitation enterprises continue offering loosened requirements for enterprises, and enterprises neglect the investments to process titanium.

In order to process titanium products, enterprises will have to spend a lot of money to purchase modern production lines. For example, in order to process titanium into pigment dioxide titanium, Hop Long Company, the investor at the Suoi Nhum Mine in Binh Thuan province, recently said it needs 400 million dollars to install two or three production lines with the capacity of 75,000-105,000 tons a year.

Prior to Hop Long, only the Ha Tinh Minerals and Trade Corporation spent money on building a factory which makes similar products with the capacity of 30,000 tons a year.

Meanwhile, other enterprises only focus on mining ores, which do not have experiences and lack capital. Therefore, they just have been trying to export raw materials.

Since raw material export can bring fat profits, more and more enterprises have jumped on the bandwagon, even though they have to pay the royalties of 7-20 percent and the export tax of 15-20 percent.

Also, they also have to pay the fees set up by local economies, estimated at several billion dong a year, depending on the exploited volume. However, since the fees are too low, the sums of money pocketed by exploitation companies are very big.

According to the Consultancy Development Institute, the export of raw materials just can bring modest profit. If Vietnam can make titanium slag from ilmenite, the value of the products will increase by 2.5 times, if it can make pignment, the figure would be 10 times. Meanwhile, if making titanium metal, the production value would increase by 80 times

As such, if Vietnam keeps exporting ores, with the average export price of 100 dollars per ton of ilmenite (52% TiO2) and the estimated reserves of 200 million tons, it would earn tens of billions of dollars, a modest figure.


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