Global Risk Register

2012-06-09T15:58:00.000-07:00

Tin and silver - the new electric metals

Record high prices for tin and silver are on the cards between now and 2018, as demand for the two metals in solder used in the electronics industry continues to climb and supply fails to keep pace, according to Jon Hykawy, head of global research at Byron Capital Markets, spesking at an April conference on electric metals sponsored by the investment dealer in Toronto and reported in Canadian Mining Journal.

Prices for the two metals started to climb sharply six years ago after the European Union banned the use of lead in all products sold in Europe after July 2006. The reasoning behind the Restriction on Hazardous Substances Directive (RoHS) is that a large percentage of electronic waste is never recycled and that the metals and other materials in electronic devices will simply dissipate into the environment.

The directive means that the formulation of conventional solder - made up of 63% Sn and 37% Pb - has had to be reconfigured. The result is that the de facto standard in the electronics industry became solder that typically is made up of about 96% Sn, 3.5% Ag, and 0.5% Cu, by weight. It may also contain very small quantities of manganese or zinc.

The problem is that supply of the two metals, primarily of tin but also for silver (which is also used as a conductive paste in the solar industry), is not keeping up with demand. The compound average growth rate (CAGR) for silver production between 2001 and 2010 was about 2% and that for tin was about 1%, he says.

As a result, prices for tin rose from US$7,385 per tonne in 2005 to US$8,755 in 2006 and by 2011 had reached US$26,051 per tonne. Silver prices demonstrated a similar trajectory rising from US$7.32 per ounce in 2005 to US$11.55 per ounce in 2006 and by 2011 had climbed to US$35.12 per ounce.

Hykawy predicts silver prices will move from US$35 per ounce to as high as US$68 per ounce by 2018 and tin will surge from US$26 per kilogram to about US$59 per kilogram during the same period.

And he forecasts major tin shortages by 2018. “We found that even with all the projects that we could identify globally that desire to come to market by then, the world will be in tin shortfall,” he concludes. “At that point we have a serious problem with respect to tin supply. We have a serious problem with respect to the provisioning of solders that will meet RoHS requirements.

“Tin and silver and especially tin are likely to come into shorter and shorter supply and that’s going to put a squeeze on prices in the near term [and] it’s going to be potentially disruptive in the longer term,” he cautions. “The reasons that we’re going to have higher prices is that most of the really good deposits are gone. We have been mining tin and silver for a very, very long time. And the best grades, the easiest deposits to find, the most metallurgically amenable deposits — our grandparents and our great grandparents got those.”

Recent discussions with one solder company have confirmed Hykawy’s suspicions that the electronics industry isn’t prepared for the impending tin shortages. The company admitted that there were issues with future tin supply but said they were looking into substituting tin with materials like bismuth. When Hykawy told the company that production of bismuth was 1,500 tonnes per year compared with 150,000 tonnes of tin, and that bismuth was only marginally less toxic than arsenic, the response was that they "were working on it."

2012-06-09T15:44:00.001-07:00

UK decision can mean life or death for thousands of African elephants

DOHA Qatar: Will the lives of thousands, perhaps tens of thousands, of Africa’s beleaguered elephants be put at risk because of decision that the representatives of the United Kingdom make in the next few days.

Two proposals before the CITES conference in Doha seek to downlist elephants to allow for trade in ivory.

The one from Tanzania would result in trade of over 89 tonnes of ivory and the one from Zambia in trade of almost 22 tonnes.

The findings of a Panel of Experts that recently visited both countries highlight numerous deficiencies in law enforcement and elephant protection as well as high levels of poaching and illegal trade. In light of this information, many Parties at the CITES meeting are strongly considering rejecting both Tanzania’s and Zambia’s proposals. The CITES Secretariat itself has now come out calling for rejection of the Tanzanian proposal.

The EU is split on Tanzania’s proposal, and on the Zambia proposal (Prop 5). A small number of countries remain in favour, a significant number are now opposed but the UK, the Netherlands and the Czech Republic remain undecided.

“What is going on?” asks Will Travers, CEO of the Born Free Foundation, a member of the Species Survival Network. “Most African countries with elephants are against the two proposals, most of the EU members appear to share that view, many other countries from Israel to India and Parties from South America are like-minded, but the UK clings to a mantra of sustainable use in the face of overwhelming evidence that supporting either of these proposals could have a further catastrophic impact on some of Africa’s most vulnerable elephants.”

Born Free has repeatedly called on the UK Environment Secretary, Hilary Benn, to take a lead on this issue yet it seems we are now even more out of touch with reality.

“I blame the poor quality assessment of the civil servants leading the UK on this issue for our weak and illogical position,” continues Travers. “These are the same people who previously supported the 2008 sale of over 100 tonnes of ivory to China and Japan in the erroneous belief that it would satisfy demand and reduce poaching. How wrong they were then – how wrong they are now.”

According to Born Free, in 2009 poaching hit countries like Kenya, Tchad, Sierra Leone, Nigeria, and Tanzania hard. Over 20 tonnes of illegal ivory has been intercepted and the price of raw illegal ivory has soared to over £1000/kg.

Zambia is also stricken with problems. The country’s elephant population which stood at an estimated 160,000 in 1981 is now at 27,000 or lower. Poaching increased by 150% between 2002 and 2007 and remains a severe problem. Zambia’s anti-poaching and elephant monitoring activities are inadequate and law enforcement activities are compromised due to cuts in Customs staff, down by 50% over recent years.

“Like so many citizens I am amazed and confused at the way the UK is handling this life or death situation.” concludes Travers. “If - and heaven forbid this is the case - either of these two proposals actually ends up being approved because of the UK, millions of people will have every right to believe that we have been betrayed. The blood of Africa’s elephants will be on their hands.”

About Born Free

The Born Free Foundation is a dynamic international wildlife charity, devoted to compassionate conservation and animal welfare. Born Free takes action worldwide to protect threatened species and stop individual animal suffering. Born Free believes wildlife belongs in the wild and works to phase out zoos.

Born Free protects lions, elephants, tigers, gorillas, wolves, polar bears, dolphins, marine turtles and many more species in their natural habitat, working with local communities to help people and wildlife live together without conflict.

2012-06-09T15:28:00.001-07:00

Deadliest Year on Record for Elephants

Large seizures of elephant tusks made 2011 the worst year on record for elephants since ivory sales were banned in 1989, experts said on Thursday. Recent estimates suggest that as many as 3,000 elephants were killed by poachers, according to the International Fund for Animal Welfare, an advocacy group. Tom Milliken, an elephant and rhino specialist for Traffic, a wildlife trade monitoring network, said that most cases involve the smuggling of ivory from Africa into Asia, where growing wealth has fed the desire for ivory ornaments and for rhino horn that is used in traditional medicine, though scientists have proved it has no medicinal value.

A version of this brief appeared in print on December 30, 2011, on page A9 of the New York edition with the headline: Deadliest Year on Record for Elephants.