Commodity Intelligence Equity Service

Tuesday 16 September 2025
Background Stories on www.commodityintelligence.com

News and Views:









Featured

Nickel gains after Indonesia seizes part of giant Tsingshan mine

JAKARTA: Nickel rose after Indonesia seized part of a giant mine semi-owned by top Chinese producer Tsingshan Holding Group Co., underlining risks to ore output in the world’s largest supplier.

A government task force on Thursday (Sept 11) took control of about 148 hectares of the operation owned by PT Weda Bay Nickel - the world’s largest mine for the battery metal - over an alleged permit violation. France’s Eramet SA, one of the company’s shareholders, has said it sees no impact on operations at this stage.

Still, the seizure highlights ongoing challenges to reliable supply from Indonesia, which accounts for well over half of global nickel output. President Prabowo Subianto, who has outlined bold and costly plans for the nation, has also promised a crackdown on illegal mining, which may disrupt the flows of ore to local processors.

Smelters in Indonesia have been dealing with a tight ore market all of this year, due to high rainfall and low issuance of government mining quotas. At the same time, LME nickel prices have spent months range-trading at low levels, held back by disappointing demand from the electric vehicle battery sector.

Nickel futures advanced 1.6 per centto settle at US$15,391 a tonne on the LME. Copper added 0.2 per cent and aluminum rose 0.6 per cent. 

Bloomberg


https://www.thestar.com.my/aseanplus/aseanplus-news/2025/09/15/nickel-gains-after-indonesia-seizes-part-of-giant-tsingshan-mine

Back to Top

Macro

Trump's push to overhaul Fed casts long shadow over policy meeting

By Howard Schneider

WASHINGTON (Reuters) -Federal Reserve officials are preparing to gather on Tuesday for a two-day meeting amid rising concerns about the central bank's independence and uncertainty about the composition of its policy-setting committee, as President Donald Trump pushes ahead with a rushed effort to overhaul a pillar of the U.S. economy.

A federal appeals court is expected to rule on Monday on whether Fed Governor Lisa Cook can continue in her job while litigation over Trump's attempt to fire her is pending, a ruling that could either upend the Fed's standing as an institution largely free from executive branch influence in setting monetary policy, or reaffirm it at least for now.

However the court rules, an immediate appeal to the U.S. Supreme Court is expected, adding a further complication to Cook's status for this week's policy meeting.

Meanwhile, the U.S. Senate is expected on Monday to confirm Stephen Miran, the head of the White House's Council of Economic Advisers, to an open seat on the Fed's seven-member Board of Governors, likely positioning the Trump nominee to be sworn in quickly and participate in this week's meeting as a voice sympathetic to administration calls for steep rate cuts.

Trump on Monday repeated that call, saying in a social media post in reference to Federal Reserve Chair Jerome Powell that he "MUST CUT INTEREST RATES, NOW, AND BIGGER THAN HE HAD IN MIND. HOUSING WILL SOAR!!!."

The Fed has been wary to cut rates because of inflation concerns, but it is expected at the conclusion of its meeting on Wednesday to lower its benchmark interest rate by a quarter of a percentage point to the 4.00%-4.25% range, as officials grow more worried about a sharp drop in job growth and rising unemployment.

More cuts may follow in October and December, but at a slower pace than Trump has demanded, with the president's call for a 1% Fed policy rate seen broadly by economists as out of step with what would be needed to keep inflation stable, absent a recession.

The Fed's policy decision, however, may be less a focus of the meeting than the expected arrival of Miran and the implications of the coming Cook decision on the central bank as an institution and the direction of U.S. monetary policy.

Trump will also be able to replace Powell when the Fed chief's term atop the central bank expires next May.

MIRAN'S APPROACH MAY REVEAL TRUMP'S PLANS

In a recent poll by Duke University's Department of Economics, 24 of 25 former Fed policymakers and staffers said they now saw an "elevated," "serious" or "extreme" risk that a blow to Fed independence will lead to monetary policy being set too loose and stoking higher inflation - the textbook result expected when elected officials gain sway over monetary policy.


https://finance.yahoo.com/news/trumps-push-overhaul-fed-casts-155913051.html

Back to Top

South Korean stocks reach new high amid tax policy shift

South Korean stocks reach new high amid tax policy shift

South Korean stocks hit a fresh record high on Monday, extending their winning streak to a 10th consecutive session, as investors welcomed the government's decision to cancel a planned capital gains tax increase.

Meanwhile, the local currency traded lower against the U.S. dollar, News.Az reports, citing Yonhap.

The benchmark Korea Composite Stock Price Index (KOSPI) rose 11.77 points, or 0.35 percent, to close at 3,407.31, surpassing the previous all-time high of 3,395.54 set on Friday.

Trade volume was moderate at 374.97 million shares worth 12.53 trillion won (US$9.02 billion), with winners outnumbering losers 482 to 397.

Foreigners bought a net 266.89 billion won worth of shares, while retail and institutional investors sold 136.82 billion won and 138.24 billion won for profit taking.

Investor sentiment was buoyed by the news that the government decided to keep the capital gains tax threshold for stock holdings at 5 billion won, reversing an earlier plan to lower it to 1 billion won amid concerns it would undermine the market.

Eyes are also on the Federal Reserve's rate-setting meeting this week, where it is expected to cut interest rates amid a cooling labor market.

"Short-term volatility is expected following the recent rallies, but the relatively low level of foreign ownership compared with the past average provides a basis for further foreign buying," said Kim Jae-seung, an expert from Hyundai Motor Securities.

Top-cap shares traded mixed.

Market bellwether Samsung Electronics surged 1.46 percent to 76,500 won, and its chipmaking rival SK hynix climbed 0.76 percent to 331,000 won.

Major bio company Samsung Biologics added 0.19 percent to 1,040,000 won, while leading battery maker LG Energy Solution remained unchanged at 355,500 won. Major chemical firm LG Chem soared 1.21 percent to 293,500 won.

Defense powerhouse Hanwha Aerospace sank 1.6 percent to 986,000 won, but No. 1 financial firm KB Financial Group went up 0.25 percent to 119,600 won.

Carmakers drifted lower. Top automaker Hyundai Motor sank 3.8 percent to 215,000 won, and Kia dipped 3.97 percent to 101,700 won.

Power plant manufacturer Doosan Enerbility dropped 3.61 percent to 58,800 won, while No. 1 steelmaker POSCO Holdings remained flat at 285,000 won.

Major shipbuilder HD Hyundai Heavy lost 2.25 percent to 498,500 won, and Hanwha Ocean tumbled 3.27 percent to 109,500 won.

The local currency was quoted at 1,389.0 won against the U.S. dollar at 3:30 p.m., down 0.8 won from the previous session.

News.Az


https://news.az/news/south-korean-stocks-reach-new-high-amid-tax-policy-shift

Back to Top

Oil

Primorsk is recovering faster than the Ukrainian Armed Forces would like: tankers receive oil


The Primorsk oil terminal in the Baltic Sea has restored the shipment of oil. After the APU attack on Friday, at least five tankers were loaded on it at the weekend. But, obviously, the restoration work continues.

On Friday night, the Ukrainian Armed Forces attacked an oil terminal in Primorsk drones. The governor of the Leningrad region, Alexander Drozdenko, wrote in the telegram channel about the fire at the pumping station and on the ship, which were promptly extinguished.

"I thank the special forces of the Security Service of Ukraine, who recently worked very efficiently in Primorsk. Russia's largest oil terminal in the Baltic Sea. There is significant damage, everything has been checked," Volodymyr Zelenskyy said on Sunday.

Obviously, there is damage to the terminal, but it restores work much faster than the APU would like. The loading of tankers resumed on Saturday, and since that time at least five tankers have been loaded with oil and oil products.

So, the sanctioned Walrus received up to 163 thousand tons of oil and has already left the Gulf of Finland. Also, the Samos tanker received a cargo of raw materials, up to 149 thousand tons. He is still standing next to the terminal.

At the same time, oil products were loaded by three tankers — Fidan, Primorye and Chiba.

Two more vessels, Jagger and Angi, were loaded onto the terminal itself. According to AIS vessels, another oil tanker is planning to receive a shipment today.

At the same time, one berth at the terminal is obviously not in use yet, and the Kusto and Cai Yun tankers loaded during the attack are still standing at the terminal. Judging by the AIS data, Cai Yun is not loaded. The third tanker, the Phosphor oil product, is loaded with fuel and went to the anchorage to Ust-Luga. Some tankers make such a route before leaving for the flight.

As reported by EADaily, the constant attacks by drones of the Armed Forces of Ukraine on Russian refineries and the Druzhba oil pipeline led to unscheduled repairs of factories and jumps in wholesale prices on the stock exchange. This does not affect the combat capability of the Russian army. At the same time, Kiev's goal may not even be a war of attrition — to organize fuel outages in Russia, a decline in exports and some social unrest. Washington's pressure aimed at an early peaceful settlement pushes Kiev to take action in order to provoke an even tougher response from Russia, which can be interpreted as Moscow's own unwillingness to negotiate, experts believe. In their opinion, the retaliatory strikes of the Russian army are testing Ukraine for strength, but in Kiev would like something more powerful and tragic.


https://eadaily.com/en/ampnews/2025/09/15/primorsk-is-recovering-faster-than-the-ukrainian-armed-forces-would-like-tankers-receive-oil

Back to Top

Oil and Gas

Europe has requested more gas from Gazprom: Greece is changing LNG to Russian fuel


In September, Russian pipeline gas supplies to Europe rose to the highest level since a record February. Greece has increased imports.

In the first month of autumn, Gazprom's deliveries to Europe increased to an average of 51.2 million cubic meters per day, according to ENTSOG. So much is supplied via the company's only route to the region — the European line of the Turkish Stream. This is the highest figure in history after February of this year, when exports amounted to 54.6 million cubic meters per day.

Judging by the data of the platform of the GTS operators of the EU countries, we are not talking about increasing supplies to Hungary, Serbia or Slovakia. Deliveries to Greece increased significantly, which increased imports by 80% compared to August - up to 9 million cubic meters per day.

At the same time, the gas supply to Romania decreased slightly — up to 3 million cubic meters per day. EADaily wrote that the increase in deliveries via the Turkish Stream arrives in this country in the summer. It is quite possible that Greek traders resold part of the Russian gas to Romania, and in September they will import it directly to Greece and with even bigger bids.

Greece has no gas storage facilities and is dependent on current supplies. The growth of Russian gas imports into the country immediately affected LNG purchases. Compared to August, they decreased by 30% at once - up to 6 million cubic meters per day.

Experts have repeatedly noted that Russian gas exports depend on applications from long-term customers. And, obviously, in September, Greek companies are increasing purchases due to a more favorable price. Russian gas is sold under long-term contracts linked to the price of European stock exchanges.


https://eadaily.com/en/news/2025/09/15/europe-has-requested-more-gas-from-gazprom-greece-is-changing-lng-to-russian-fuel

Back to Top

At Current Rate, Russia’s Entire Oil Refining Industry Faces Collapse Within a Year

At Current Rate, Russia’s Entire Oil Refining Industry Faces Collapse Within a Year

Ukraine’s deep-strike campaign against Russian oil infrastructure has shifted from symbolic raids to a systematic dismantling of one of the Kremlin’s most important industries. In just the past 45 days, Ukrainian drones have struck 12 refineries, pushing nearly a quarter of Russia’s total refining capacity offline. The scale and tempo suggest that Russia’s fuel production is not facing a slow erosion, but a rapid breakdown.

The Pace of Destruction

Russia operates roughly 30 major refineries, with Kirishi, Tuapse, Syzran, Novokuybyshevsk, and Ufa among the most strategically vital. At the current strike rate—averaging nearly eight refineries hit per month—Ukraine could target the entire refinery network within six months.

Even accounting for Russia’s efforts to repair facilities and strengthen defenses, the cumulative effect is already visible: outages are compounding faster than repairs, and the overall share of disabled capacity continues to climb.

From early 2024 into 2025, Ukraine demonstrated the ability to strike refineries deep inside Russian territory. But the escalation since midsummer 2025 has been unprecedented. Satellite data, local reports, and even reluctant admissions by regional governors confirm that fires and production stoppages have become routine. The strikes are no longer isolated incidents—they are the shaping of a campaign designed to cripple Russia’s energy backbone.

Economic Fallout

The consequences for Russia’s economy are profound. Refined products—gasoline, diesel, aviation fuel—are not only critical for domestic use but also among the most profitable export streams. Losing 24% of this capacity means the Kremlin must increasingly export crude oil at steep discounts while cutting back on refined exports that normally generate higher margins.

For ordinary Russians, the effects are already being felt. Gasoline shortages and price spikes have appeared in multiple regions. Transport costs are rising, feeding inflation across agriculture, food distribution, and manufacturing. In a country where oil and gas account for a third of federal budget revenues, shrinking refinery output cuts directly into Moscow’s ability to finance both its war and basic state functions.


https://kyivinsider.com/at-current-rate-russias-entire-oil-refining-industry-faces-collapse-within-a-year/

Back to Top

Sanctioned Suezmax Oil Tanker Without Ice Protection Stuck for Days on Russia’s Arctic Northern Sea Route

NSR escort July 2024

A non ice-class Suezmax oil tanker has been forced to wait several days due to ice conditions before proceeding along Russia’s Northern Sea Route. The Oman-flagged 274-meter Lynx is carrying around a million barrels of oil from Murmansk, Russia to China. Its exact destination currently remains unknown. It is one of several oil tankers without ice protection shuttling Moscow’s crude to buyers in China via the Arctic.

The vessel encountered late-season sea ice highlighting the navigational challenges for ships without ice protection in Arctic waters. Lynx came to a stop at 72° northern latitude in the High Arctic on September 6 waiting several days before proceeding at very slow speeds in close proximity to the shoreline to find a route through the ice.

Overlay of Lynx’s AIS track and satellite image showing ice conditions along the eastern section of the Northern Sea Route. (Source: MagicPort Maritime Intelligence and Sentinel 2)

The vessel does not hold a mandatory Arctic shipping permit and Russian authorities did not list it in their daily logs of active traffic on the route, an increasingly common practice to obscure sanction-busting shipping activity. Lynx has been sanctioned by the US, UK, EU and others for violating the G7 oil price cap and engaging in irregular high-risk shipping practices.

It is the second time in as many weeks that a non ice-class ship has run into difficulties in the East Siberian Sea. In early September the LNG carrier Arctic Metagaz was delayed in the area around Pevek for more than a week. Neither vessel had arranged for icebreaker escorts ahead of time as would have been required by navigational rules. Non ice-class vessels are not permitted to operate independently even in light ice conditions, according to the rules set by the Northern Sea Route administration.

Both vessels eventually proceeded with the assistance of nuclear icebreakers operating in the area. Another LNG carrier, La Perouse, also without ice-class, turned around in the waters off Western Siberia and elected to instead take the long way around Africa.

Russia has promoted the Northern Sea Route as a faster alternative to the Suez Canal for shipments between Europe and Asia, but a shortage of ice-class vessels has forced it to increasingly use ships without protection and stretching navigational rules.


https://gcaptain.com/sanctioned-suezmax-oil-tanker-without-ice-protection-stuck-for-days-on-russias-arctic-northern-sea-route/

Back to Top

IEA Reverses Course on Oil and Gas Investment

By Tsvetana Paraskova - Sep 16, 2025, 4:32 AM CDT

The world needs to develop new oil and gas resources just to keep output flat amid faster declining rates at existing fields, the International Energy Agency (IEA) said on Tuesday in a major shift in its narrative from 2021 that ‘no new investment’ is needed in a net-zero by 2050 scenario.

The rates of decline at operating oil and gas fields have accelerated in recent years, largely due to higher reliance on shale and deep offshore resources, said the IEA.

The agency is under pressure from the Trump Administration to return to its core mission to help protect global security of supply, instead of pushing the net-zero agenda it has been doing so far this decade.

A new IEA report, The Implications of Oil and Gas Field Decline Rates, said on Tuesday that if the industry has to maintain current levels of production, more than 45 million barrels per day (bpd) of oil and around 2,000 bcm of natural gas would be needed in 2050 from new conventional fields.

Even with projects ramping up and others approved for development and not yet in production, a large gap still exists “that would need to be filled by new conventional oil and gas projects to maintain production at current levels, although the amounts needed could be reduced if oil and gas demand were to come down,” the IEA said.

“Only a small portion of upstream oil and gas investment is used to meet increases in demand while nearly 90% of upstream investment annually is dedicated to offsetting losses of supply at existing fields,” IEA Executive Director Fatih Birol said.

“Decline rates are the elephant in the room for any discussion of investment needs in oil and gas, and our new analysis shows that they have accelerated in recent years,” Birol added, finally acknowledging what the industry has been saying for years—underinvestment threatens global energy supply.

“In the case of oil, an absence of upstream investment would remove the equivalent of Brazil and Norway’s combined production each year from the global market balance, Birol added. “The situation means that the industry has to run much faster just to stand still.” 


https://oilprice.com/Latest-Energy-News/World-News/IEA-Reverses-Course-on-Oil-and-Gas-Investment.html

Back to Top

Precious Metals

Gold Rises to Fresh Record With Fed Seen Cutting Rates This Week


Gold rose to a new a record high as traders geared up for an anticipated easing of the US Federal Reserve’s monetary policy this week and looked for clues on further rate cuts this year.

Bullion traded above $3,682 an ounce on Monday, after gaining for four consecutive weeks. Investors see a quarter-point cut this week, following signs of labor market weakness. Swaps also price in at least another reduction before the end of the year, with a high probability of a third one.

That expectation has driven Treasury yields to the lowest level in months and weakened the dollar, making bullion more appealing as a store of value that doesn’t bear interest, while also cheaper for buyers in other currencies. Whether the Fed will challenge these bets is a key question for investors this week.

“Macroeconomic numbers are likely to take over from tariff-related headlines,” ANZ Group Holdings’ Daniel Hynes and Soni Kumari said in a note.

Gold has rallied 40% this year and recently broke out from a spell of range-bound trading to surpass an inflation-adjusted record. Persistent uncertainty over geopolitics and President Donald Trump’s trade agenda, along with concerted central bank buying, have supported prices for the haven asset.


Trump’s unprecedented pressure on the Fed — including his attempt to oust Governor Lisa Cook — is the latest catalyst, which Goldman Sachs Group Inc. sees potentially driving gold to near $5,000 an ounce, just 1% of the privately-owned US Treasury market were to flow into bullion.

Gold edged higher to $ an ounce as of in New York. The Bloomberg Dollar Spot Index slipped . Silver and platinum rose, while palladium fell. Copper rose 1% on the London Metal Exchange to $ a ton.

Meanwhile, Thai authorities are discussing ways to tax gold bought and sold through various online channels and settled in baht, in a bid to stem a currency rally that’s hurting exports and tourism, according to people familiar with the matter.

With the tax, authorities aim to reduce exports of gold and make it more expensive for Thais to own the precious metal, the people said, adding that dollar inflows tied to bullion shipments were among the factors fueling the baht’s rally.

--With assistance from Doug Alexander.


https://finance.yahoo.com/news/gold-trades-near-record-high-003705651.html

Back to Top

Base Metals

Germanium Prices Soar to 14-Year High

Periodic table

Prices of the metal germanium, critical for making infrared military equipment including in fighter jets and missiles, hit a 14-year high this month as the Chinese export restrictions of critical and rare earth metals are hitting the supply chains of the West's military systems.

The market has dried up and there is panic among customers who are desperate to find supply of germanium, traders have told the Financial Times.

As a result of the supply crunch from China, first announced in 2023, the price of germanium has soared to $5,000 per kilogram this month, five times higher than the $1,000 per kg price in early 2023, per data from price reporting agency Fastmarkets cited by FT.

The current price is the highest in Fastmarkets data going back to 2011.

China dominates the global market for critical minerals, putting Western defense manufacturers and their governments in a rather awkward position of depending on China for key raw material supplies amid tense bilateral relations.

The heavily concentrated supply of critical minerals in a handful of countries and China's export controls are raising the risk of "painful disruptions" in the market, the International Energy Agency (IEA) warned in its new annual report, Global Critical Minerals Outlook.

Despite major deals and government support in the West for building domestic supply chains, China has raised its market share over the past few years, the IEA's report found.

The most recent market shortages have prompted companies to source materials directly from suppliers outside China or to look to establish domestic manufacturing chains.

Lockheed Martin, for example, signed last month a strategic deal with Korea Zinc to procure germanium and cooperate in the critical minerals supply chain. The memorandum of understanding stipulates that Korea Zinc will supply Lockheed Martin with germanium smelted (covering the entire process from mining to production) outside of China, North Korea, Iran, and Russia, and that Lockheed Martin will pursue an off-take agreement, securing priority rights to procuring this output.

Metals producer Nyrstar, a subsidiary of trading giant Trafigura, is currently assessing a project to build a germanium and gallium recovery and processing facility at its Clarksville zinc smelter in Tennessee. The Clarksville smelter is currently the only primary zinc producer in the United States.

By Tsvetana Paraskova for Oilprice.com


https://oilprice.com/Latest-Energy-News/World-News/Germanium-Prices-Soar-to-14-Year-High.amp.html

Back to Top

China has a 'chokehold' on the rare earth supply chain. Could Australia offer an alternative?

Bulldozers move piles of dirt at the base of giant red cranes.

When it comes to rare earths, China is the dominant player in the market.  (Reuters: Stringer)

In short: 

China controls around 90 per cent of the global processing and production capacity for rare earths. 

Rare earth metals are used in a wide range of applications from wind turbines to electronics and defence equipment. 

The Albanese government's critical minerals strategic reserve plan is due by the end of next year. 

abc.net.au/news/china-rare-earths-monopoly-australia-alternative-supplier/105748058Link

They sound like the names of characters in a science fiction blockbuster: Neodymium, Praseodymium, Dysprosium and Terbium.

In reality, these magnetic rare earth elements are more like the invisible main characters of our modern world — critical for manufacturing everything from electric vehicles and wind turbines to fighter jets and nuclear submarines — and they are almost certain to be on the agenda when Prime Minister Anthony Albanese meets with US President Donald Trump.

2025-05-30T193526Z_249707549_RC2ISEABKP21_RTRMADP_3_RARE-EARTHS-CHINA-AUTOS

Rare earth minerals are critical for manufacturing everything from electric vehicles and wind turbines to fighter jets and nuclear submarines. (Reuters, via a third party )

China has carved out a near-total monopoly in rare earth production and processing, but its dominance in the area has taken decades of investment. 

This has become an increasing concern for nations including Australia, according to Naoise McDonagh, an international trade and geopolitics expert and senior lecturer at Edith Cowan University.

A man wearing a suit and tie leaning against a wall.

Naoise McDonagh is a geopolitics and international trade expert at Edith Cowan University. (ABC News: Mitchell Edgar)

"We are now in an era marked by geopolitical tensions," Mr McDonagh told 7.30.

"If we do not have an independent supply chain for rare earths, Australia may not be able to access the defence equipment it needs in an incredibly volatile period.

"So there is an absolute security imperative here that cannot be weighed purely against profit."

China's Trump card

Despite the name, rare earth elements are not actually all that rare. In fact, they're quite abundant in the Earth's crust.

But the difficulty lies in the downstream process: Extracting and refining these rare earth metals can be costly, complex and environmentally challenging. 

Rare earth elements

Clockwise from top centre: praseodymium, cerium, lanthanum, neodymium, samarium, and gadolinium. (Wikimedia Commons)

The first time China's stranglehold on the supply chain became an issue was in 2010.

Following a territorial dispute, China suspended rare earth exports to Japan — prompting the Japanese government to invest in West Australian miner Lynas Rare Earths to help future-proof its supply.

Today Lynas is the world's only significant producer of separated rare earth materials outside of China.

An industrial plant for processing rare earth minerals.

The Japanese government financed Lynas Rare Earths in 2010 and they are now the world's biggest producer of rare earths outside of China.  (ABC Goldfields: Jarrod Lucas)

However, China still controls around 90 per cent of global processing capacity.

This domination was on show during US President Donald Trump's tariff orders.

"As Trump ratcheted up tariffs on China … the Chinese responded and played their biggest card — their chokehold over rare earths," Mr McDonagh told 7.30.

"That really woke up the Americans to the absolute dominance China has over this critical input."

Enter: Australia

Drive a few hours north of Perth to the quaint ex-mining town of Eneabba, and you'll find a million-tonne mound of what looks like worthless dirt.

But it's actually a stockpile of mineral sands that is part of the Australian government's plan to try to break China's dominance.

Aerial view of a mine.

The federal government is loaning Iluka $1.65 billion to build a rare earths refinery at Eneabba.  (ABC News: Glyn Jones)

Hidden inside this stockpile are the rare earth elements Neodymium, Praseodymium, Dysprosium and Terbium.

Critical minerals miner Iluka Resources has been building this stockpile since the 1990s, and Daniel McGrath, the company's head of rare earths, said it is now worth around $1 billion.

It is destined for an under-construction refinery being built at the Eneabba site, due for completion in 2027, thanks to a $1.65 billion loan from the federal government.

"What the rare earth refinery [will do] is it takes rare earth mineral concentrates, extracts those rare earths and separates them into their discrete individual form," Mr McGrath said.

"And that is the first step in developing an independent supply chain from China."

A man wearing a helmet and high-vis vest.

Daniel McGrath is the head of rare earths at Iluka Resources. (ABC News: Rhiannon Shine)

Iluka's stockpile will only feed the refinery for about seven years, but the idea is that other rare earths miners will sell their ore to Iluka, which will then on-sell the refined oxide to countries with the capacity to use it in advanced manufacturing.

"Our intention is to supply like-minded western markets that are building that downstream supply chain to address the monopoly that is currently held by China," he said.

But the refinery alone won't be enough to kickstart rare earths mining in Australia.

Chinese manipulation

Mr McDonagh said China has been able to manipulate the international rare earth market by forcing out new entrants.

A large rock sits upon a monument with wind turbines in the background.

A Chinese monument which reads, "Home of rare earths welcomes you."  (Reuters: David Gray)

"If a new miner or investor wants to set up a rare earth refining capacity, China has been known to flood the market with a lot of supply; this forces down prices and undermines the operations investments of the new non-China supply," he said.

"This is a tactic that even private firms use if they are a monopoly, to protect their monopoly — so it is not just China that does this. But in this instance, it is critical to the whole world's supply of rare earths.

"Private investors will not invest in the rare earths industry because they're competing against state-led capitalism."

Price volatility is part of the reason why the Yangibana rare earths project is sitting unfinished in WA's Gascoyne region, according to Wyloo Metals CEO Luca Giacovazzi.

A man standing in front of tall shelves.

Luca Giacovazzi is the chief executive of Wyloo. (ABC News: Mitchell Edgar)

He said the mine could be operational within 18 months, but needed a further $350 million investment and improved market conditions.

Mr Giacovazzi would like to see the Australian government set a floor price for specific rare earth metals, as the US government did earlier this year. 

"I don't think you should rely on government support to get projects built, but I think the government can play a role in helping to smooth out price volatility," he said.

"We like the idea of a floor price when prices are really low to support the industry and to keep mines running, but when the price becomes very high, that there is a repayment back to the government for that support."

Australia could be 'alternative supplier'

Resources Minister Madeleine King indicated a floor price could form part of the federal government's Critical Minerals Strategic Reserve plan, due by the end of next year.

A woman standing in front of a map of Australia.

Federal Resources Minister Madeleine King says the idea of a floor price for rare earths could form part of the government's planned critical minerals strategic reserve.  (ABC News: Adam Kennedy)

"The notion around [the Critical Minerals Strategic Reserve] is to introduce mechanisms that bring stability to the market of rare earths and critical minerals," she told 7.30.

"It may be a virtual stockpile, there may be space for it to be a physical stockpile — but that would be very, very minimal."

The minister said the government was more focused on developing offtake agreements, which are contracts that commit a buyer to purchasing a set volume of product. 

"Government involvement in offtake and setting a price floor can bring that really important stability to a market that can be subject to quite stern manipulation from outside sources."

Ms King said the government would need to establish an exit point out of any floor price arrangement, which may mean a ceiling price or some other form of off-ramp, to ensure it was a fair deal for taxpayers.

She hoped Australia could become the world's alternative supplier of refined rare earths.

"These minerals and metals go into all matter of things. But importantly, they also go into a number of very advanced defence applications," Minister King said.

"They go into the Virginia-class submarines, they go into fighter jets.

"Whilst there is no immediate risk to defence applications, we have to look into the long-term and realise that Australia is in a position where we can and should take up the responsibility to lead on rare earths and critical minerals globally, so that we are the alternative supplier."

Mr McDonagh said whilst government investment in this space was necessary, it was not without risk.

Aerial view of a mine.

Iluka Resources has been building this stockpile of critical minerals since the 1990s. (ABC News: Glyn Jones)

"We don't know if the investment is going to be successful," he said.

"Australia is solving the supply side. We have to now get our partners on board to help solve the demand side.

"If Australia's partners get on board, where they commit to paying a higher price — a premium for rare earths produced in Australia, then Australia has a bright future in rare earth elements.

"If not, then there's a risky future for rare earth element production in the country."


https://www.abc.net.au/news/2025-09-16/china-rare-earths-monopoly-australia-alternative-supplier/105748058

Back to Top

Steel

China cut steel production to a 9-month low in August

Photo – China cut steel production to a 9-month low in August

From January to August, the figure dropped 2.8% year-on-year

Chinese steel companies reduced steel production by 0.7% in August 2025 compared to August 2024, to 77.37 million tons. Compared to the previous month, the figure fell by 2.9%. This is evidenced by data from the National Bureau of Statistics of the PRC, Reuters reports.

This is the third consecutive decline in monthly smelting volume, as a result of which steel production in January-August this year fell to 671.81 million tons (-2.8% y/y). Average daily output fell to 2.5 million tons from 2.57 million tons in July.

In August, steel mills in Tangshan, China’s main steelmaking center east of Beijing, were forced to limit production to ensure clean air during the military parade in the capital on September 3.

As a result, blast furnace output at the end of August fell to its lowest level in more than a month, according to Mysteel data. Some electric arc furnaces operating on scrap metal also cut production due to negative profitability.

“Last month, steel prices fell due to seasonally weak demand, while the cost of scrap metal remained virtually unchanged, leading to losses among EAF furnace producers,” said Xu Xianchun, a representative of Mysteel.

Rebar prices fell 4% in August. Demand remained weak, constrained throughout the month by the ongoing crisis in the construction sector, where new projects fell 19.5% over the year, while steel exports declined compared to July.

Photo – China cut steel production to a 9-month low in August

As GMK Center reported earlier, Chinese steel companies reduced steel production by 1.7% in 2024 compared to the previous year, producing 1.005 billion tons. This is the lowest figure in the last five years. Experts note that 2024 is likely to be the last year when steel production in China exceeded 1 billion tons.


https://gmk.center/en/news/china-cut-steel-production-to-a-9-month-low-in-august/

Back to Top

Iron Ore

India’s proposed 30% export tax on low-grade iron ore pits miners against steel mills

The Indian government is preparing to introduce a 30 percent export tax on low-grade iron ore fines by October this year, aiming to promote domestic value addition and ensure higher availability of raw material for local steel mills. Currently, high-grade iron ore with Fe content above 62 percent attracts a 30 percent duty, while low-grade ores are exported duty-free.

Miners raise concerns over export duty impact

The Goa Mineral Ore Exporters’ Association (GMOEA) has voiced serious concerns about the proposed duty, emphasizing that Goa’s iron ore reserves are predominantly low-grade and lack domestic demand. GMOEA warned that the new tax could disrupt mining operations in Goa, cause large-scale stockpiling and wastage, and threaten livelihoods and regional economic stability.

The association also highlighted that India already faces an accumulation of 180 million mt of low-grade iron ore, creating both economic and environmental challenges.

FIMI calls for no duty on low-grade iron ore

The Federation of Indian Mineral Industries (FIMI) stressed that there is virtually no domestic demand for low-grade iron ore, as Indian steel producers only consume higher-grade ores. In its formal appeal, FIMI argued that imposing an export tax would hinder utilisation and monetisation of low-grade ore, exacerbate environmental risks due to waste dumps, and reduce employment in mining-dependent regions

FIMI also noted that nearly 70-75 percent of mined low-grade material remains stranded at pitheads or stockyards, causing environmental degradation and inefficiencies.

Steel producers support government’s plan

On the other hand, major steel producers including ArcelorMittal Nippon Steel (AMNS), JSW Steel and Jindal Steel have supported the government’s plan. They believe that ensuring cheaper domestic iron ore supplies would:

  • strengthen India ’s raw material security
  • allow the country to export up to 50 million mt of finished steel in the near future
  • enhance competitiveness in global markets by keeping steel export prices low

At a recent inter-ministerial meeting, steelmakers even suggested supplying iron ore at half the current price to the local industry, helping sustain competitiveness amid changing tariff regimes and global trade challenges.


https://www.steelorbis.com/steel-news/latest-news/indias-proposed-30-export-tax-on-low-grade-iron-ore-pits-miners-against-steel-mills-1410006.htm

Back to Top

Company Incorporated in England and Wales, Partnership number OC344951 Registered address: Commodity Intelligence LLP The Wellsprings Wellsprings Brightwell-Cum-Sotwell Oxford OX10 0RN.

Commodity Intelligence LLP is Authorised and Regulated by the Financial Conduct Authority.

The material is based on information that we consider reliable, but we do not guarantee that it is accurate or complete, and it should not be relied on as such. Opinions expressed are our current opinions as of the date appearing on this material only.

Officers and employees, including persons involved in the preparation or issuance of this material may from time to time have 'long' or 'short' positions in the securities of companies mentioned herein. No part of this material may be redistributed without the prior written consent of Commodity Intelligence LLP.

© 2025 - Commodity Intelligence LLP