The two main traded vanadium products are vanadium pentoxide (V205) and ferrovanadium (FeV).
V205 is the most common intermediate product from treatment of magnetite iron ores, vanadium-bearing slags and secondary materials. It can be used directly by some non-metallurgical applications and in the production of vanadium chemicals and is also used as an intermediate product for the production of FeV, a vanadium alloy used as a strengthening or hardening agent in manufacturing of high-strength steel.
A new catalyst for the increasing demand of Vanadium is the growing application of VRFBs (Vanadium Redox Flow Batteries), with current forecasts estimating that VRFBs will account for 20 per cent of vanadium consumption by 2030.
Whilst demand continues to grow for vanadium, supply remains constrained with very limited new suppliers expected to come on stream. More than 70 per cent of vanadium produced is through co-production of steel products mostly from China.
A large majority of the supply feedstock from China comes from steel plants that process low-grade vanadium-bearing magnetite ores to produce steel and a vanadium slag which is then further processed through salt roast and leach operations. This source of vanadium is significantly constrained by:
- high input costs as a result of mining and processing low grade captive ores, relative to the higher quality and low-cost haematite ore;
- high processing costs of complex steel plants that have to be designed for extraction of titanium and vanadium results in higher operating costs than simple blast furnace operations processing haematite ore;
- no leverage on steel prices as a consequence of the small share of steel production that the high cost vanadium and titanium bearing magnetite ore processing steel plants have.