Antimony prices should increase to around $6,000/metric ton during the fourth quarter, and then remain elevated around that level to 2010, forecasts metals consultancy Roskill Information Services, citing a close long-term balance in supply and demand.

Importantly, recent policy reforms by China, the dominant global producer, will end decades of market instability caused by that country's tendency to dump or withdraw supply of such commodities as tungsten, tin and antimony—"which had all but destroyed mine output and development in competing countries."

The Roskill Report, published in London, says the previous boom-or-bust market manipulation that "ravaged China's own mineral resources" has resulted this decade in widespread mine shutdowns and wide-ranging policy reforms aimed at resource conservation, orderly development, mine safety, environmental protection and value-added downstream processing, all controlled by quotas and licensing of mining, smelting and exporting. "As with everything the Chinese do in the antimony industry, the changes had worldwide effect," Roskill reports, noting that prices rose from a four-decade low of $1,000/metric ton (45¢/lb) in the world market in December 2001 to the $5,350/metric ton ($2.43/lb) level of July 2007.

"China is now also the largest importer of ores and concentrates, and its own domestic demand has also become the world's largest," the research house says, continuing that "this solid foundation for the antimony industry has reawakened interest in antimony resources in Australia, North America, Latin America, Russia and elsewhere, and new projects are under development." In fact, Australia soon will be producing over 12,000 metric tons/year of antimony metal equivalent.

Structural changes in the antimony supply sector, which began in the late 1990s, arose with growing exports from China of antimony trioxide at the expense of antimony metal. Between 1996 and 2006, Chinese exports of antimony trioxide grew from 20,000 metric tons to 41,300 metric tons. Over the same period, U.S. production fell from 25,000 metric tons to 1,500 metric tons in 2006, a 94% drop.

Installed capacity in China should be sufficient to meet world forecast trioxide demand growth of 7%/year through 2010 and idled capacity in Europe could come into play with new antimony mine output outside of China, Roskill says. However, the analysts also believe that higher-cost operations outside of China will be required to meet future global demand, pushing spot prices upward.

As for demand, flame retardants account for 70% of primary antimony demand and 90% of antimony trioxide demand. More stringent flammability standards and safety legislation, together with increased demand for plastics and information technology-related products, will result in higher demand for flame-retardants. World demand for antimony trioxide in this market is forecast to rise by 7.5% annually from an estimated 106,000 metric tons in 2004 to 152,000 metric tons by 2009.

Catalysts used to make polyethylene terephthalate (PET) plastic resins provide a further area of growth for antimony trioxide, says Roskill, especially in new industrializing countries where markets for PET containers for carbonated soft drinks, beer and mineral water are less mature. For example, Asian demand for bottle-grade PET is forecast to grow at over 10%/year to the end of this decade.