If you buy tantalum, you have surely noticed that tantalum prices are climbing. That’s because demand for the versatile gray metal is quickly escalating. The latest forecasts from industry leaders predict a 4-7 year increase in demand and higher market prices for the ore, capacitor powder, melt stock and mill products.
As smartphone and electronics usage grows in third world nations, an increased requirement of tantalum capacitors will drive powder sales. Turbine engine demand in the Asian-Pacific region will require significant volumes of tantalum for their nickel based super-alloys. These factors combined with growth in the chemical processing, defense and semiconductor markets will likely sustain high tantalum demand and continue to drive ore prices.
Some large tantalum users have already begun protecting themselves by entering into blanket contracts for as long as 24 months. These agreements allow suppliers such as Admat to purchase the raw materials at today’s market price. Finished goods are still shipped and invoiced when the customers releases them.
Another method to cut costs is by shifting the machining or fabrication steps to the tantalum supplier. By reducing product weight by purchasing lighter finished or nearly finished parts a substantial savings could be realized. Tantalum suppliers usually have efficient recycle systems in place which means the turnings or trimmings have a higher scrap value as compared to selling the material to traders yourself.
There is really no way to avoid the higher market prices of tantalum over the next few years, but by taking a few extra steps and working with your supplier, there is the opportunity of putting your business in a better position than the competition. If your business is interested in exploring what options are available to limit your exposure to the higher prices, now is the time to contact your supplier. To discuss your options with Admat, please call 484-322-2091.