China Reinforces Its Position At The Top of Zirconium Imports

Last year was a solid one for the global zirconium ore and concentrate market, as it rose by 16% to $2.4 billion in terms of size. The average import price at a global level amounted to $987 per ton, expanding at an average of 1.1% every year in the last decade. 

As the market for this metal grows, China has established itself as the world’s greatest importer according to an IndexBox study. The Asian giant, together with Australia and the U.S. in that order, account for a combined 78% slice of total volume. 

So, how is China positioned in this rising market and what are the main drivers behind growth? 

Global Consumption 

The $2.4 billion size reached in 2020 by the global zirconium market includes total revenues of both producers and importers, “excluding logistics costs, indirect taxes and intermediaries’ margins –which will be included in the final consumer price,” the report asserts.

More significantly, zirconium’s market value has grown at an average rate of 2.2% per year in the last decade.

China reached 1.2 million tons, while Australia and the U.S. topped 711,000 and 98,000 respectively. Spain, India, Senegal, and South Africa are trailing with a 10% market share.

Further, in value terms, “China ($976 million), Australia ($529 million) and the U.S. ($155 million) constituted the countries with the highest levels of market value in 2020, together accounting for 70% of the global market.” 

Zirconium is widely utilized in pipes, fittings, and heat exchangers, as well as steel alloys, colored glazes, bricks, ceramics, abrasives, flashbulbs, lamp filaments, artificial gemstones, and even some deodorants. However, the rise of nuclear power will have an enormous impact in years to come.

Global Imports 

Zirconium supply –like that of many other metals amid the pandemic– had dived 8% to 1.5 million as of 2020, following two years on the up. 

“Overall, total imports indicated a mild expansion from 2010 to 2020: the value increased at an average annual rate of +0.5% over the last decade,” the report states.  

At present, in terms of total imports share, China tops the world with 1.1 million tons, roughly 72% of the total worldwide. The second on the list is Spain, whose 101,000 tons represent a 6.7% share of total imports, followed by India (56,000 tons), Malaysia (35,000 tons), Italy (35,000 tons), and the U.S. (24,000 tons).

China’s zirconium imports have been in a very positive dynamic, since they have increased at an average annual growth rate of 4% in the last decade –from 732,000 to 1.1 million tons. This is what sets the Asian giant apart as the world’s greatest importer. 

The report asserts that both Malaysia (6.3%) and India (1.8%) have also shown a healthy pace, with the former emerging as the fastest-growing importer globally, with a CAGR of 6.3%. 

“Meanwhile, the U.S. experienced a relatively flat trend pattern. By contrast, Spain (-3.6%) and Italy (-9.9%) illustrated a downward trend over the same period.” 

Growth Drivers

According to a similar study by Research and Markets, the soaring growth in the nuclear power industry around the world is one of the main drivers of zirconium’s market growth. The metal is utilized for both cladding and outer covering in fuel rods, due to properties like high structural strength and low neutron absorption.

As reported by Forbes, China is betting hard on nuclear power, which at present accounts for 2% of the country’s power quota. By September, China had 49 nuclear reactors in operation –with a capacity of 7.5 GW– and a further 17 under construction with a capacity of 18.5 GW. 

“China leads the world in total energy production and also produces almost twice the amount of electricity that the United States does, 4.4 trillion kWh versus 7.5 trillion kWh per year, respectively.” 

Moreover, besides nuclear power, the rising product adoption in aviation and automotive protective coatings is acting as another growth-inducing factor for zirconium. The industry is looking at it as a solid alternative to protect metallic surfaces from sustained exposure to high temperatures.

Disclosure: No positions