The Threat of a Boron Market Shortage
Did you know that the world’s supplies of boron are running low?
Boron is one of the most important minerals on earth. Without it, our economy would be severely impacted.
What can we do to Prevent a Market Shortage of Boron?
The global boron market is experiencing a high shortage due to the rising demand in several traditional and emerging industry sectors, including decarbonization, advanced food supply, and agrochemicals.
In energy, for instance, boron is used in solar panels, and the market is expected to grow more than 20% annually until 2026. Furthermore, by 2050, wind and solar are expected to generate up to 70% of the world’s electricity.
With electricity generation increasing two and a half times over the same period, boron’s use in both technologies will undoubtedly be a huge boon to the industry.
Currently, boron is produced only in a few countries in Turkey USA, South America, and parts of Eastern Europe.
Like lithium, boron has a small supply chain with limited resources. But demand is rapidly increasing, for instance, for use in powertrains in electric vehicles.
5e advanced materials or FEAM, the latest company to be permitted to mine boron, estimates the various boron compounds make up around two and a half percent of an EV weight.
Production levels are on the decline, and there’s a need for more boron to be mined to keep up with demand.
This imbalance between demand and supply leads to higher prices. Boron prices are on the rise. Credit Swiss predicts that boron demand will rise significantly within three years.
As a result, the relative need for boron would increase rapidly, and elevated prices are likely to continue.
With glass and ceramics being manufactured for use in approximately half of the boron’s commercial usage and fertilizer accounting for about 20%, there’s plenty of growth in boron’s emerging uses.
According to Credit Suisse, boron demand could grow more than 10-fold by 2050 under a high-growth scenario.
At that point, decarbonization technologies would account for more than 90% of boron demand.
Boron Supply Around the World
Turkey accounts for over 60% of global boron sales, with state-owned Eti Maden controlling the production.
Rio Tinto produces much of its born in the United States. Together, these two players account for 85% of the boron supply. A new California-based player, 5E advanced materials represent a permitted future source of incremental borates supply in the United States.
Its Fort Cady site has a very low environmental and the company has opted for ESG initiatives in solvent extraction and geothermal potential. From an investor perspective, what are the investment opportunities with boron?
Boron prices were as low as $569 per ton in 2020. However, the increase to over a thousand dollars per ton in 22 indicates that the market appears to be gearing up for the upcoming demand.
5e Advanced Materials (FEAM), aiming to start production in 2023, will become a key player in supplies of boron. It has the potential to be a strategic boron producer by utilizing boric acid feedstock to integrate into various value chains vertically.
FEAM is developing a fully integrated and diverse portfolio of boron plus advanced materials business with a primary emphasis on enabling de-carbonization.
It will certainly be an interesting time for observers of producers of boron as advanced materials and de-carbonization shape the upward trend of demand against limited supplies.