Alnico Magnet dead or alive?

Cobalt has a higher melting point (1490°C) and maintains its strength to a high temperature, like iron or nickel, cobalt is ferromagnetic. It can keep its magnetic properties to 1100°C, a higher temperature than any other material. These distinctive properties make this metal perfect for two specialized high-tech purposes: superalloys and battery cathodes. Superalloys: high-performance alloys drive approx.16% of cobalt demand. The metal’s ability to resist intense temperatures and conditions makes it perfect for use in: Turbine blades - Jet engines - Gas turbines – Prosthetics - Permanent magnets Lithium-ion Batteries: Batteries drive approx.41% of demand – and most of this comes from cobalt’s usage in lithium-ion cathodes. Growing Cobalt demand and relatively regular supply (approx.100.000 ton per year), opened a 1500 Ton. deficit in 2016 that could triple this year. The coming age of battery-powered vehicles has already started a period of matchless growth for this metal. Worldwide cobalt request from the battery sector has tripled in the past five years and is projected to triple again by 2020, This increase has mostly been driven by electric vehicles growth. Cobalt is one of the main component employed into rechargeable batteries, the market is already facing a supply shortage that by 2020 is expected to be at least 12000 Ton. In fact, by 2020 it is expected that 75% of lithium-ion batteries will contain cobalt, because cobalt is the most important metal to increase the energy density of lithium-ion cathodes. A representative electric car battery contains between 8 to 15 kilograms of Cobalt. Reuters recently informed that Glencore had signed a major agreement to sell up to 20,000 tons of cobalt products to a Chinese firm, a move that would help Volkswagen assured car batteries for its move to electric vehicles. The four-year agreement between Glencore and Chinese battery manufacturer comes as global carmakers competition to lock in battery supplies and move away from traditional combustion engines. The trend was fortified by Chinese-owned Volvo, which said all its models launched after 2019 will be electric or hybrid. Speculators appetite for Cobalt also increased, in a bet on higher prices, this year several edge funds, have purchased and stored an estimated 6,000 tons of cobalt. On the London Metal Exchange Cobalt was traded at about $32,000 a ton at the end of 2016, up 36% from the previous year, and has rallied about 90% to more than $60,000 a ton this year. Cobalt has a complex and critical supply chain, Democratic Republic of Congo produce about half of Cobalt, and it holds approximately 60% of all global reserve. DRC is considered a country with elevated supply risks, it is one of the poorest, corrupt, county in the planet. In addition, approx. 98% of cobalt is produced as a by-product of Copper and Nickel mines. If copper and Nickel demand isn’t growing, then more cobalt isn’t mined to meet demand. Mine source                                                  % Cobalt Production Nickel             (by product)                                     60% Copper          (by product)                                     38% Cobalt           (primary)                                           2% This means it is hard to expand production when more is needed, if the growing trend of Cobalt is by far higher than Nickel and Copper. Alnico Magnet was the first major invention of magnetic materials, during WW2, it was used in military electronic applications. After the war, it rapidly spread into civilian versions of those applications, research and improvements on this material have gradually been reduced and almost terminated in late ’70. In recent years, many applications have been replaced Alnico with rare earth magnets, whose stronger fields (Br) and larger energy products (BHmax) allow smaller size magnets to be used for a given application. Alnico magnets are used mainly in high temperature applications or application which require low coercivities (the capacity to demagnetize and re-magnetize easily). The common grade Alnico 5 family contains a percentage of 24% of Cobalt, most performing grades such as Alnico 8-9 up to 35% of the total composition. Samarium Cobalt Magnets contains up to 70% of Cobalt of the total composition. Alnico magnet accounts for 2% of the total value, being in fact a niche product of the significantly wider market of magnetic materials. Cobalt production in tons.   1980 – approx. 50.000          2016 – approx. 100.000 Alnico production in tons.   1980 – approx. 40.000          2016 – approx. 5.000 % Cobalt used in magnet     1980 – approx. 20%             2016 – approx. 5% Western producer of Alnico 1980 – approx. 25                2016 – approx. 4 The recent past of Cast Alnico magnets it has been characterized by a continuous and progressive replacement of its use in mass industrial applications, causing a drastic reduction in production volumes and consequently in the number of manufacturer of this magnetic material. The current market phase and the incoming challenges in the supply chain of Cobalt, may accelerate the dismissing of Alnico magnets? 1         Expected Cobalt shortage and market speculation on metal price. 2         Replacement of Alnico with Rare Earth magnets 3         China willingness to increase the add value and technological content of its exported products. These are some of the major complications to be analysed for those who use Alnico as essential and irreplaceable material to manufacture their final product.