Focus on Warehousing
Regulation Update

The magazine of the Minor Metals Trade Association

4th Edition/2013

www.mmta.co.uk

WAREHOUSES AND OTHER MATTERS
INSIDE THIS ISSUE
Warehouses & Other Matters....2
Obituary ...................................... ….3
40th Anniversary Dinner ........ ….4
EU Revised GSP………………..6
Letter From America…………..7
Opinion Piece: Warehousing …8
Sampling Guidelines……… …...9
Critical Raw Materials ............. 10
Scrap Metal Dealers Act……. 11
Tungsten Market Overview ... 12
Opinion Piece: Cobalt Science.16

1. Complaint against C Steinweg 3. Applications for Warehouse- Handelsveem BV (“Steinweg”) Approval from warehouse comThe Member that formally complained that panies in a Group containing a
Steinweg is in breach of the MMTA Ware- trading company
house Rules has made a further submission
to the MMTA challenging the decision of 12
March 2013 that “the Directors were unanimously satisfied that the activity in question is that of a service provider and not a
trading company within the meaning of the
MMTA Warehouse Rules and that Steinweg were not therefore in breach of theRules.”
On 17 September 2013 the Directors of the
MMTA discussed this new submission, theconfidential information submitted by
Steinweg and the previous decision of the
Directors and unanimously reconfirmed
the decision reached on 12 March 2013.

2. The MMTA Warehouse Rules

IN BRIEF


Click here to view
Industry Events.

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Click here to book the
MMTA meeting room.



Wogen vs MMTA
Cricket Match—

A huge thank you to
Wogen Resources for
hosting the event once
again this year, andcongratulations to the
MMTA team, who won ahigh-quality match on avery hot July evening.

2

If the Directors are petitioned by a significant number of Members to reconsider
MMTA Rules then the Directors have aduty to consider amendments and put
those amendments to a vote of the Members.
The MMTA Warehouse Rules require that:"The company shall be neutral, not owned
or associated with any trading company".

The MMTA has received two Warehouse
Approval requests from Pacorini Metals
and one from CWT Commodities.
Pacorini Metals is in a group that includes
Glencore and CWT Commodities is in agroup that includes Marc Rich Investments.
The MMTA Warehouse Committee concluded that as Pacorini Metals and CWTCommodities are each in a group that includes a "trading company", they do notmeet the criteria within the MMTA Warehouse Rules and therefore cannot be given
Warehouse Approval by the Committee.
As stated in the July edition of The Crucible this is in no way a reflection on any other aspects of the businesses of the companies concerned. The warehouses in question are used by some Members. They
simply do not meet the criteria for approval
determined by the Membership of the
MMTA.
At the MMTA Directors meeting on 17 September 2013 the MMTA Directors’ confirmed the findings of the Warehouse Committee that Warehouse Approval could not
be given in these cases.

The MMTA Warehouse Rules were debated
4. MMTA Warehouse Approvalin October 2011 when 97% of warehouseusing Members voted not to change the
MMTA Members are reminded that they
above requirement.
are free to use any warehouse they choose,
MMTA Approved or not. In many instancThe MMTA Warehouse Rules were again
es Members choose to use warehouses that
discussed at the AGM on 25 April 2013 in a are not MMTA Approved.
low key debate. Despite an invitation fromthe chair, other than the one Member who The only reference to use of MMTA Approved Warehouses is in the Trade Regulaspoke in favour of change, no other warehouse using Member has petitioned either tions, which is a form of contract provided
for the convenience of Members which they
the MMTA Directors or the MMTA Execuare free to use for trade with a counterparty
tive requesting that the existing Warehouse
if both parties wish to do so. Its use is not
Rules be amended.
required and indeed many, if not most,members will use their own contract terms
This invitation to Members to come forward in support of change was reiterated in when conducting business.
the July edition of the Crucible and to dateno additional Member has made known
their support for a change to the existing
MMTA Warehouse Rules.

The Trade Regulations provide that:"The usual basis of trade in respect of theseTerms and Conditions shall be "in warehouse" and, unless otherwise agreed at theAt the Directors meeting on 17 September time of concluding each contract, shall be2013 the Directors of the MMTA concluded in a warehouse currently listed in the Association’s List of Approved Warehouses."that there was no support amongst theMembership for a reconsideration of theMembers and others can therefore use the
MMTA Warehouse Rules.
Trade Regulations and still agree to use awarehouse that is not MMTA approved.

5. Publication of articles on a name withheld
basis
Many experienced and senior individuals involved in various
aspects of the minor metals industry cannot express views
and make observations on matters of importance and of wider interest to the industry due to Company policy.
To overcome this The Crucible is prepared to publish responsibly written articles of interest to the Membership on aname withheld basis. Such articles constitute the personalviews of the authors and should not be taken in any way as aview or position of the MMTA.

The article titled “The function of warehousing – or why we
do not know our cleaning lady by name” is very illuminating
for those of us who have had little involvement with the
LME. Functioning raw material markets, warehousing andlogistics are important to the well being of industry and theworld economy. Apportioning blame for the past is of little
interest and can be left to the Regulators and Class Actions
but understanding what is required for the proper functioning of these markets is vital to being able to get it right going forward.

6. 40th Anniversary

The MMTA has reached its 40th anniversary in good shapewith a record Membership and a busy programme of events.
Some of us are constantly reminded forty is young and I
don’t need to remind you all that there is a lot to be done. I
am very proud to be serving an association whose Members
have historically shown such foresight and vision. For examThe article titled “Recent advances in health science on Cobalt, and the dangers of ideologically driven regulation” con- ple in the early years determining the need for and role oftrade regulations, standard contract terms, metals norms
tains a really important message that our industry needs toand Warehouse Rules, speaking out on the shortcomings offocus on. Ideologically driven regulation and the way it is
the then proposed REACh legislation and more recently bebeing implemented by the EU and ECHA may be mutually
ing prepared to consider and debate alternatives to journalinconsistent to the way of life that the peoples of Europe
ist based price discovery. I would ask all Members to particiwould choose if they had a choice. Member States need towake up to this issue and deal with it before European indus- pate and take part in the activities and running of the Assotry is irreparably damaged and the people of Europe suffer
ciation and to encourage their staff to take part.
accordingly. This is not about one metal, other metals will
be subject to this in due course as testing is completed and if
not directly then indirectly as they are impacted by a downRoy Walton, MMTA Chairman
stream technology that will or can no longer be used.
To submit such an article on a name withheld basis in thefirst instance please contact Maria Cox on a confidential basis. I draw your attention to the first two such expert, quality
articles in this edition of The Crucible.

OBITUARY ~ GEORGE REYNOLDS-PAYNE
7 February 1942 -11 September 2013
George began his engagement with the metals business in assaying and sampling and was the Managing Director of
Nieberding in Antwerp, which was taken over by SGS. Previously he had a varied career in Advertising and
Journalism.
After Nieberding, George moved to London and joined Lewis & Peat Metals at the invitation of Mike Ashby, whoknew of George as he had been to school with his brother, Ian. George was part of the management team which
created A&M when the Lewis & Peat Group dissolved itself.
George, when he first came to London and even before when visiting from Antwerp promoting the warehousingbusiness, maintained the slightly outdated persona of a city gentleman, wearing a pinstriped suit, bowler hat andfurled umbrella, and smoking his pipe. This eccentricity and distinctiveness typified his approach to life, which he saw
with all its absurdities and always laughed at it, ensuring that he and his colleagues had fun. George initiated the
A&M Christmas parties which came to be seen by many in the trade as the start of the Christmas season. He also
founded the A&M luncheon and wine club.
George’s major trading area was scrap. He seemed to know everyone in the business and, perhaps unsurprisingly
for someone so distinctive, everyone knew him. He had a real affection for the various yards and their managers
and always referred to our side of the business as the brass platers.
After he left A&M George worked in his own firm Capital Minerals and even when suffering from his prolonged
illness was always a pleasure to have a beer with.
By Jim McCombie, Stapleford Trading

MMTA’s 40thInterContinental, London Park Lane
Join MMTA Members and Guests at the 40th Anniversary Dinner,at The InterContinental on London’s Park Lane.
The evening will begin with a

MMTA Founding Members’ Drinks Reception

kindly sponsored by the 3 current MMTA founding member companies – AMC plc,
Lambert Metals Intl. Ltd. & Wogen Resources Ltd.

Amalgamated Metal Corporation
PLC was formed in 1929 to acquire the
British Metal Corporation Ltd. (BMC)and Henry Gardner & Co. Ltd. AMC
holds a ring one dealing membershipon the LME and operates Physical
Trading operations in eleven different
countries worldwide.

Lambert Metals is a founder member of the
MMTA and remains a UK-based company located in London, owned by the management.
Lambert Metals trades all of the traditional
Minor Metals and is fully REACH compliant
for the trading of Antimony and is preregistered under REACH for many of the othermetals its handles, for which it is world renowned. www.lambert-metals.co.uk

Established in 1972 as a metal trading company with a strong China focus, Wogen has growninto one of the most diversified suppliers of high-value raw materials to the non-ferrous industry worldwide. There are few companies that trade such a full suite of products for industrial
end use and Wogen has established a reputation in noble-alloys, mineral sands, electronic metals, aerospace raw materials, the Platinum group of metals, ores and concentrates and othermetals and minerals not traded on an exchange.

Raffle in Aid of Cary Mufulira Community Partnership Trust
Take part in this year’s business card raffle in aid of CMCPT, supporting the Zambian copper
mining town of Mufulira. £10 per business card entry, with prizes of…

A delegate place at the MMTA’s International Minor Metals Conference
London, April 27-29, 2014~~~
An iPad Mini~~~
Afternoon Tea for 4 at the InterContinental Park Lane, London~~~£200 voucher for Dinner at Le Boudin Blanc in Mayfair

4Anniversary Dinner
Tuesday 8th October from 18.45—01.30
Starter
Terrine of chicken and foie-gras on watercress mayonnaise, chicken and tarragon fritter, red
pepper and chive oil(Vegetarian: basil marinated beef tomato and mozzarella salad with walnuts and olives)~~~
Main
Fillet of casterbridge beef with slow cooked ox cheek, potato and parsnip terrine, creamedceleriac, tomato and tarragon jus(Vegetarian: Vegetable Baklava with potato and parsnip terrine, creamed celeriac, tomato
and tarragon jus)~~~
DessertTatin of William pear with a Braeburn apple fool~~~
Coffee and Petit Fours
White wine - Chablis, Simonnet-Febvre – Louis Latour Burgundy
Red wine - Côte du Rhône, Guigal, Rhône

Dinner Sponsors

Alex Stewart International provides
inspection, supervision, weighing andsampling services and is also able to deliver fast, reliable and accurate analyticalservices covering base metals, non-ferrous
ores and concentrates, minor and precious
metals, ferro-alloys, recycled scrap metal,
complex materials and plastics.

Avon Metals is a UK based, privately
owned specialty aluminium master alloy
maker and a processor & trader of minor
metals including Tantalum, Niobium, Tungsten, Molybdenum, Hafnium, Rhenium andChromium. We are AS9100 Aerospace
Quality and ISO 14001 Environmentallycertified. www.avonmetals.com

Charity Raffle Sponsors

RC Inspection provides an independent, fast and reliable service with a direct people
to people approach as befits a modern inspection company. RC Inspection employs aprofessional and committed staff and offers services in both bulk ferro and noble alloys ,minor / rare earth - high purity metals, minerals and ores. Coal,coke and anthracite.
Ferrous-, non ferrous scrap and maritime services around the globe.

5

MMTA’s International
Minor Metals
Conference,

Park Plaza Hotel
Victoria London, UK,
27-29 April 2014

DON’T FORGET TO

EU REVISED GENERALIZED SCHEME OF
PREFERENCES (GSP)The EU has recently announced its
revised import preference scheme known as the Generalized Scheme ofPreferences (GSP).
The main aim of the EU’s preferential
trade scheme is to help developing
countries by making it easier for themto export to the European Union. The
system was revised in October 2012.
The EU states that one of the mostimportant objectives of this reform
has been to focus trade preferenceson those countries most in need –Least Developed Countries and otherpoorest developing economies.

TAKE ADVANTAGE OF
THE MEMBERS’ EARLYBIRD RATE UNTIL

Due to this change, the preference for the following
countries will expire with effect from 1st January, 2014
(1st February 2014 for Azerbaijan and Iran):

OCTOBER 24TH

This means that for the above countries there will be no preference
for material with a valid GSP /Form A certificate with effectfrom 1st January 2014 (1st February 2014 for Azerbaijan andIran).
This change will apply even incases where material was
brought into and/or stored in
the EU before 1st January 2014,
with a valid GSP / Form A certificate.

Argentina
Azerbaijan – from 1st Feb 2014

What Do You Need to Do?

BahrainBrazilBrunei
Cuba
Gabon
Iran – from 1st Feb 2014
Kazakhstan

Where members currently have material from one of the above countries
held in EU warehouses, or for material due to arrive in warehouse before
1st January 2014 (Azerbaijan and Iran
1st February 2014), in order to benefit
from the current regulations:

You will need to supply yourwarehouse with your instructions
to custom clear material into theEU.

The warehouse will need to be inpossession of the original andvalid GSP / Form A before 1st January 2014 (1st February 2014 for
Azerbaijan and Iran) .

KuwaitLibya
Macao
On 18th September, Pennington’s
Solicitors delivered, on behalf ofthe MMTA, an insightful seminaron how to use arbitration to solveinternational disputes. Attendees
learned the pros and cons of both
litigation and arbitration, and thespecific details of arbitration, witha particular focus on conducting
international arbitrations. Other
dispute resolution options, such as
mediation, were also explored.
This seminar will be repeated in
2014.

6

Malaysia
Oman
Palau
Qatar

More Information:

RussiaSaudi Arabia

http://trade.ec.europa.eu/doclib/press/index.cfm?id=840

Uruguay
Venezuela
UAE
Belarus

http://trade.ec.europa.eu/doclib/press/index.cfm?id=954

David Brown, Lambert Metals
International Ltd, Chair of the
MMTA Warehousing Committee

LETTER FROM NORTH AMERICA
Dear Members

MMTA PERSONNELCHANGESIt finally looks as if autumn/fall has arrived here in New York. The weather is cool,sunny and quite lovely. But, as usual, the days are drawing in noticeably, and thesun has yet to rise when I now get up in the mornings!
Liking, as I do on occasion, a glass of ale, I was most pleased to see the other day
that it was not just a single brewer here in the US – MillerCoors – who had entered
the lists against the likes of Goldman Sachs and JPMorgan over their ownership ofmetals warehouses, but the Beer Institute itself, that august body that “represents
the $246.5 billion beer industry. An industry that includes more than 2,800 breweries and 2 million jobs.” I feel that we partakers might now have a true champion.
So, where do things currently stand with regard not only to the issue of warehouseownership by banks, but also to the much larger issue of their involvement in physical commodities? Well, the latest salvo from the banks (through the trade group
the Securities Industry and Financial Markets Association), is a study by the research company IHS which, perhaps not surprisingly, finds that: “Banks play anessential role in assuring the smooth functioning of the commodity markets
which underpin the $16.6 trillion U.S. economy, and on which consumers ultimately rely.” From this it would appear that the banks are now really looking toengage battle in a more public arena.
Since mid-July, there have already been a number of skirmishes. A big piece in the
New York Times towards the end of that month headed “A Shuffle of Aluminum,
but to Banks, Pure Gold”, preceded a hearing of the Subcommittee on Financial
Institutions and Consumer Protection, entitled “Examining Financial Holding
Companies: Should Banks Control Power Plants, Warehouses, and Oil Refineries”. (Somewhat ironically, the occasion included a “face off” between a current
member of the law firm Davis Polk & Wardwell LLP on the one side, and a pastmember of the firm on the other!)
The Fed also entered the fray with a statement that it “regularly monitors the commodity activities of supervised firms and is reviewing the 2003 determinationthat certain commodity activities are complementary to financial activities andthus permissible for bank holding companies.” Next came the CFTC, who, Reutersreported, had in early August sent subpoenas hot on the heels of some pretty
strong letters dispatched to warehouse firms the previous month. Last, but certainly not least, it appears that the US Department of Justice, following some urging,amongst others, by the aforementioned beverage industry body, has been doing a
wee bit of poking around of its own. Needless to say, it has not made any commenton the matter.
Whilst, of course, there is considerably more at issue than just warehouses, it will
be interesting to see just how indicative of things to come Goldman Sachs’ reaction
was to continuing “enquiries” involving, and rather public interest in, its warehousing firm Metro International Trade Services LLC: It said it would be“contacting end users to offer to swap any aluminum currently in the queue for
immediately available aluminum so that they have access to the metal they needto make or package their products.” Goodness: Now you don’t see it, now you do!
A precedent? Who knows?
And the LME’s new proposal about warehouses expected to be discussed at its October meeting? OK, so it should reduce queues at the Affected Warehouses, butwhat kind of effect would it have on load-out rates at non-Affected Warehouses.
But then again, perhaps the LME will find itself, despite its best efforts to find asolution of its own, disburdened of the whole problem by US regulators and/or
legislators. We can but wait and see.

Dear Members,
As many of you know by now, I
shall be leaving the MMTA in
mid-October. I shall be staying
in the industry, so I am sure I
will bump into many of you on aregular basis!
I would like to thank all the
MMTA members for making myjob so enjoyable, and especially
the Main Committee for the
support they have given to me at
the beginning of my career. I
must also thank Maria Cox forbeing a wonderful boss andcolleague, and making sure thatcoming into the office every day
was interesting and enjoyable.
My successor, Tamara Alliot, hasa BEng in Materials Engineeringfrom Loughborough University,and a Master of Environmental
Policy from Sciences Po, Paris,so she speaks fluent French. She
completed extended internships
with Constellium in Paris, where
she worked in Corporate
Sustainability, and for Bentley
Motors in the UK, in theirInterior Materials Team.
Many of you will have met her
already; she can be contacted attamara@mmta.co.uk.
Best Regards, Emma Newman

With best wishes from New York to MMTA members everywhere
Tom Butcher, September 25th, 2013 Hard Assets Investor© 2013 Tom Butcher

7

MMTA’S 40 YEARSFor Howard Masters, whotook over from Bryan Webbin 1981, “the most significant
development during myperiod of office was that the
MMTA actuallysurvived!” He feels that themost important change
during those 14 years wasthat the Association started
to be taken seriously. “Fromthe early beginnings in 1972
when the London Metal
Bulletin had labelled us as“sardine traders”, it was clearthat the main participants inthe minor metals trade wereof a very high calibre and wewere able to draw upon avast wealth of voluntary
experience not only in
trading but also the law,
arbitration, finance,
administration and mostimportantly common
sense! The hardest bit was
getting companies to accept
the MMTA contract terms
and conditions, but by thetime I stood down I was
confident that we had
established the Association
on a firm footing which has
been built upon by mysuccessors making us thevery strong and importantinternational body that weare today”.
(Howard Masters, Chairman
1981-1995)

THE FUNCTION OF WAREHOUSING—OR WHY WEDO NOT KNOW OUR CLEANING LADY BY NAME.
I have nothing against the lady that cleans my office every evening, sometimes
wiping my desk while I am still at it. On the contrary, without her I might bedrowning in paper waste and coffee stains. Someone has to do it, and do it
well (and not break that wonderful crystal award I got last year or make off
with my laptop which I forgot to lock in my desk on the day that I took off before 8pm). But, I do not know her name, since I never cared to ask. As longas she is doing her job properly, I will most likely never know.
So why do we read about warehousing and specifically LME warehousing every day of the week, even making US headline news on TV? Why does it seemthat running a warehousing company is top news? Whilst not a task that isfully comparable to what my cleaning lady does, at least it is not a very glamorous function from the outset.
In my humble opinion, because the LME has got its rules wrong for a numberof years. They have allowed warehouses to become participants in the trade,
becoming the trade. They failed to address a systematic flaw in their rules,
and what started as a distortion and some isolated incidents, has ended up
being a major disruption of the metals trade. How was this possible, and what
can we learn from it?
The LME was, until the takeover by HKEx, an entity that started by facilitating
the business of its members, in the process growing to be the dominant metal
exchange in the world. So they got something right, obviously. Warehousing,and the resulting physical delivery of metal against positions, was (and still is)a core element of this phenomenal story.
This changed when warehouses started being taken over. One warehouse witha reputation for being difficult went from being occasionally difficult to being
systematically difficult. Other takeovers followed, including some that went
nowhere, at least in so far as exploiting the flaw in the rules is concerned.
And the problem started, because a trader owning a warehouse is not a problem, if the customer can vote with his feet and find a different service provider. However, the LME did not allow customers (read – warrant holders) to dothat. By upholding rules that allowed the warehouses to take and hold cargohostage and charge a ransom (read - warehouse rent and FOT charges), theLME allowed a systematic abuse of a flaw in the rules. Low interest rates andover-production (with the accompanying contango) were a necessary ingredient to start the scheme, but once the system was up and running, there wasnothing to stop it – the owner of the queue does not own the metal, and therefore does not care about interest rates or backwardations. Only a change inthe rules, such as that under consideration by the LME under new ownership,should break the vicious cycle.
By taking the ability to build ever-increasing stock levels at somebody else’s
expense out of the rules, the spell can be broken. And, in a way, the lawsuits in
the US and the investigation by the CFTC came as a blessing in disguise forthe LME. Because the proposal was made before the Senate hearing and before the official start of the CFTC investigation action had been taken. And
because even the most ruthless warehouse keeper (read trader / banker) will
think twice before jacking up rates to “compensate” for the “damage” done by
the potential rule change in light of the above spotlight shining on them.
There is definitely hope for the LME. Let’s be honest, the demands of someinterested parties for more transparency, publishing of trading reports, andposition reports could also add quality to the LME in the future. They might
not be a fix for the issue at hand, but they should make the LME a better
place.
What can we learn from this? Warehousing should be about storing the cargo

8THE FUNCTION OF WAREHOUSING, CONT’D…..
of others for a reasonable fee. One needs to be able to rely on the warehouse
keeper to be neutral, unbiased and not involved in the transactions taking placein the market. The warehouse should be discrete and a safe haven for my cargo,
which I or my customers can access at any time that is convenient to us. And if I
do not like what I get, I should be able to leave. Not that difficult, is it? Of
course, warehousing also has its intricacies, with things like REACH, ISPS, AEO,
ISO, customs rules, etc. requiring the ability to navigate bureaucracy. But, again,
those are basic abilities any good warehousing company should be capable of.
The MMTA tries to assure these kinds of capabilities by providing a tough minimum standard. One can discuss whether it is really necessary for the MMTA not
to accept warehouses that are owned by trading companies or banks, since
MMTA customers can vote with their feet any time. But the MMTA certainly
makes sure that the rules are on one end of the spectrum, where the LME was fora long time on the other end. Better safe than sorry!
By the way, her name is Margot, she is 62 years old, has a daughter (Kim) andtwo grandchildren. Her birthday is December 12 and she likes dark chocolate andoccasionally a glass of port. But that was not the point, was it?

(Name of author known, but withheld by agreement)This article constitutes the personal views of the author and should not be taken
in any way as a view or position of the MMTA.

MMTA SAMPLING & ASSAYING BEST PRACTICESTANDARDS
Details of best practice guidelines developed by the Warehousing Committee in conjunction with MMTA sampling and assaying companies are now
available to view on the MMTA website. To view, click HERE.
Details of applicable accreditation held by assayers is outlined. With regard to sampling, standards have been developed for the following:Noble Ferro-Alloys and Materials in Lump Form

Bulk Ferro-Alloys

Materials in Granule, Broken Cathode or Flake Form

Materials in Powder Form in Big Bags or Drums

Metals in Ingot Form

Accreditation of Samplers & Assayers



Sampling & Assaying Categories

MMTA’S 40 YEARSJohn Price reflects that“the MMTA went
through a steady period
at the start of the new
decade with an emphasison attracting a wider
membership which was
still trader dominated.
Much work wasundertaken to update theassay and sampling
regulations and on
widening the Arbitration
to include and encourage
Mediation”.
John’s Chairmanship saw
continued developmentof the social side of the
Association, including at
Minor Metals
Conferences, as well as
an increasing exposureworldwide.
“Having served on theCommittee, which
included holding all themain Offices, for overtwenty years, it gave me
great pleasure tocapitalise on the great
work of Howard andNigel to keep theorganisation going, and topass on the baton to
Anthony with thefoundations strong
enough for him and his
successors to build upon,which they most certainly
have done”. (John Price,
Chairman 2000-2003)

9

CRITICAL RAW MATERIALS: THE IMPORTANCE OF
EUROPEAN TRADE & INNOVATION

Johannes Drielsma, MEP Panayotov, Antti
Peltomaki;

Beryl Blecher, Frank Hoffmeister, Pawel
Zalewski, Lina Viltrakiene;

Attendees listen to panel on Trade & TTIP

On the 24th September, the MMTA travelled
to Brussels to attend a political event organIn July 2010 the European Commission identiised by the Beryllium Science and Technology fied 14 raw materials as ‘critical’; the criteria for
Association (BeST) at the European Parliadefining a material as a CRM are ‘Economic
ment- ‘Critical Raw Materials: The imImportance’ and ‘Supply Risk,’ including theportance of European Trade and Innovation.’concentration of supply (ie. if they are available
The day’s programme consisted of three highin limited geographical locations), ‘Recycling
level panel discussions on: Critical Raw MateRate’ and ‘Substitutability’, which produced therial (CRM) Strategy, Trade and TTIP
(Transatlantic Trade and Investment Partner- CRM list from 41 raw materials.
ship) and Health and Environment LegislaAntimony, Beryllium, Cobalt, Fluorspar, Gallium,tion. The international panels included MEPs, Germanium, Graphite, Indium, Magnesium,
industry experts and scientists. The aim of the Niobium, PGMs (Platinum Group Metals), Rare
event was to elevate the issue of CRMs and to
Earths, Tantalum, Tungsten.
examine the threats to the continuous supplyof these economically important materials
posed by EU environment and health legisla- potential impact these may have on the comtion.
petiveness of the EU. The flight of heavily
regulated industries and the associated jobs
The first panel aimed to identify current isout of Europe was examined, as well as thesues with regards to the economic significanceissue of ‘substitutability’, with particular emand supply of raw materials. With an analysis
phasis on the performance issues associatedof future global metal production and demandwith misjudged substitutions. The need for
projected to 2030 and a look at the current
sustainability, and striking a balance between
and potential mining developments in Europe
health and environmental legislation on theof CRMs, this session both laid the technicalone hand, and job creation and growth on theand economic groundwork for the day andother, were key points from two speakers,
identified for the audience the need for policy
Zofija Mazej-Kukoviv, an MEP and host of theaction on the subject. The panel did not comeconference, and Greek Ambassador Andreas
to a conclusion as to whether CRM need spePapastravou representing the incoming Presicial treatment under EU regulation.
dency of the EU. Dan Skoch, Executive Vice
The second session examined the underlying President of Materion Inc, the world’s largest
importance of favourable trade policies that
producer of beryllium containing products,
could help to ensure the supply of CRMs,
offered the need for cooperative, researchmeeting the needs of industry and ensuring
driven approaches that protect both workers
the retention of jobs in the EU.
and jobs. He stressed the need for cooperation between industry, labour and regulatory
TTIP negotiations have their second session in
authorities.
October, with the objective of creating open, sta-ble, transparent, non-discriminatory and sustainable trade between the EU the USA and 3rd parties.

MEP Mazej-Kukovic addressing attendees;

Erno Vandeweert, DG Research, Research
Programming Officer, responsible forMaterials for energy addressing the panel;

Pictures: Thierry Dauwe at theEuropean Parliament

10

From this session, it became clear that there
was some support for moving from purely
hazard based assessment criteria when imTTIP is to be agreed between the EU and theposing health and environmental regulations
USA, together representing 40% of world
on various hazardous materials, toward a ‘risk
GDP and 800 million consumers. These nego- -based’ approach, with consideration given totiations are looking at removing trade barrihow well the hazardous properties of the maers, simplifying the buying and selling proterial are managed in practice, as well as thecess, as well as making it easier for their com- supply risk created by a variety of sociopanies to invest in each other’s economies.
economic factors, including the potential banThe relevance to the day’s discussions is that ning of substances critical to applications up‘raw materials’ in trade and energy applicaon which we depend.
tions are included in the TTIP debate already,
The economic importance of CRMs, theirand the potential benefits of addressing suscontribution towards innovation in Europe
tainable supply of CRMs through this routeand the drive towards global competitivenesscould be very significant. Although both theis well known. It is important to maintain thisrepresentative of the European Parliament
supply and to meet the needs of consumers
and Council of Ministers agreed that CRMs
now and in the future. A revised list of CRMs
should be part of TTIP, this was rejected by(expected to rise to 20) will be published thisthe representative of the European CommisNovember, increasing the significance of thission.
issue in the minor metals industry.
The final panel of the day looked at upcoming
Tamara Alliot, MMTA Graduate Trainee
health and environment legislation and theTHE SCRAP METAL DEALERS’ ACT
Backgroundis attributable by weight to gold or silver.

The Scrap Metal Dealers Act 2013 will Minor metals are not excluded and it apshortly usher in a comprehensive new pears to follow that those whose businessregulatory regime for metal dealers in consists wholly or partly in buying or sellEngland and Wales. Under the scheme, ing such metals must be licensed.
the manner in which dealers do business
It is not relevant that a dealer may alreadyis much more tightly controlled; it is illebe licensed and regulated by the Environgal to pay for metal in cash; strict ID
ment Agency. A scrap metal license is anchecks must be carried out on anyone who
additional requirement, required for eachsells metal to the business; detailed reclocal authority area in which the businessords must be kept of metal which is sold.
carries on, not an alternative. This must
These are only examples. Breach of any of
be displayed on the premises.
the requirements under the Act is a criminal offence.
There is a very limited exception for manufacturers who sell only the spare metal
Most importantly, no person may carry on
which remains following their manufacbusiness as a scrap metal dealer unlessturing process. These do not need licenslicensed by their local authority. Breach ofes.
this provision is punishable by a potentially unlimited fine. Offenders may also have What are the pitfalls?
their business premises closed by a magisThe local authority, before granting a litrate.
cense, must decide if the applicant is a
The Act was motivated by a desire to “suitable person”. Full consideration ofclamp down on the recent epidemic of this would need an article in itself. The
metal theft which has seen memorials and authority will consider a wide range ofchurches desecrated, priceless sculptures matters, including whether the person has
lost to posterity, and rail services and elec- been convicted of a “relevant [criminal]
tricity supplies seriously disrupted.
offence” or is subject to “relevant enforcement action”. They will also consider
The Act is subject to review by Parliament
whether the dealer has “adequate proceafter five years, but all indications to datedures” in place to comply with the Act.
are that it is here to stay.
In some cases, company directors and“The Act ... applies to many owners can be prosecuted for failures by
junior employees, which emphasises thebusinesses which may
need for proper training and a culture ofview themselves neither as “top-down compliance”.

traditional scrap metalbusinesses, nor as highrisk so far as the trafficking of stolen metal is concerned”.

When do I need to do this?
Scrap dealers already registered under theold Scrap Metal Dealers Act 1964 aredeemed to have a license until 1 December
2013, but must at least apply for a licenseno later than 15 December 2013. If not,they are no longer deemed to have a license.

Who needs a license?

Conclusion
The definition of scrap metal is “any old,
Inevitably the new requirements put an
waste or discarded metal or metallic maadditional burden on legitimate businessterial”, or “any product, article or assemes, which in some ways is unfair. However
bly which is made from or contains metal
with prompt action and careful compliand is broken, worn out or regarded byance a dealer should be able to avoid any
its last holder as having reached the end
unnecessary damage to their business.
of its useful life”.

The Act therefore applies to many busi- Steven King is a barrister at Mariel
nesses which may view themselves neither Irvine Solicitors. More details ofas traditional scrap metal businesses, nor the Scrap Metal Dealers Act are
as high risk so far as the trafficking of stolen metal is concerned. The only metals available at www.marielirvine.com.
which are currently excluded are gold,
silver and any alloy of which 2% or more

LETTER TO THE
EDITORA small aside - among theFounder Members was
Leigh and Sillivan Ltd thecompany I joined in 1974.
Its main offices were in
Macclesfield and in thatyear celebrated its 100th
Anniversary. It also had an
office in Grey's Inn Road
principally trading Minor
Metals. Soon after I joined I
became its representativeon the MMTA.
A few years later, following
a family bust up, the trading team was dismantled
and some like myself thenset up Trident Traders Ltd
in 1982 and joined the
MMTA.
As an aside Leigh and Sillivan along with Intramet of
New York Joined with
Mitsubishi in forming Triland Metals the first time a
non UK company had been
allowed to become ring
dealers on the LME.
They are still on the ring tothis day although L&S andIntramet were bought out
by the Japanese many years
ago now.
John Price
Trident Traders
July 201311

JOB VACANCIESTUNGSTEN MARKET OVERVIEWIntroduction:

Advanced Alloy Services
Ltd
Situated North Midlands
Area

Trainee Metal Trader:






To work in a small but
busy office environment
Liaise directly with customers and suppliersWill be expected to learn
all aspects of metal trading
and associated administration
A clean driving licence isessential

Package: Car and benefits
Salary: circa £30-35k + bonus,
dependent upon experience

In hand, specimen tungsten appears a greyish-whitecolour and has a lustrous sheen. Tungsten is the 74 thelement in the periodic table and possesses a numberof distinctive qualities that make it an essential minor
metal used in industry. At approximately 3,400oCo
tungsten has the highest melting point and the lowest thermal coefficient of expansion of all metals. It is estimated that remaining
global tungsten reserves stand at 2.8 million tonnes, of which it is believed 65% is
in China. The average crustal concentration of tungsten is 1 ppm.
According to the BGS risk list 2011, tungsten ranks the joint number one metallic
resource under threat of supply disruption in the future. This insight has prompted both the UK and US governments to classify tungsten as a strategic resource.
Occurrence and Resources:
As with many metals, tungsten is not stable as its native element and exists mainly in compound form. Scheelite (CaWO4) is the most abundant tungsten containing mineral, and accounts for ca +60% of tungsten found at economic deposits.
Scarn deposit types contribute the largest proportion of total tungsten reservesglobally, at 41%. Vein/breccia/stockwork deposit types contribute the second
largest proportion of tungsten metal, at 36%. Most tungsten deposits occur proximal or within orogenic belts that have undergone associated subduction, withmajor occurrences in South Korea and East Siberia.

“At current production levels China will run out ofhigh grade wolframite reserves in 12 years...”Supply:Works Manager:









Working in warehouse/processing environment
alongside workforce
Responsible for all aspectsof receipt, processing anddespatch
Work to customer deadlines and quality demands
Must be numerate andhave good organisational
skillsExperience within the
Metals industry helpful but
not a necessity

Salary: circa £26k + bonus
Interested parties should
contact
wayne@advancedalloys.co.uk.
12

As of 2012 China contributed approximately 85% of primary tungsten products.
However, it is forecast that at current production levels China will run out of highgrade wolframite reserves in 12 years and will be forced to exploit lower grade
scheelite deposits. To meet domestic demand and curb resource depletion the
Chinese government announced plans to regulate its tungsten industry with alimit to the number of exploration, mining and export licenses awarded; limiting
or forbidding foreign investment; adjusting export quotas in favour of downstream value added products; and a ban on exports of tungsten concentrate.
At the start of the twenty first century, China flooded the market with inexpensive
tungsten concentrate. This approach meant that existing miners and explorers,
who would previously search for additional resources as they mined their existing
reserves, were no longer profitable and consequently many went out of business.
A rise in prices in the mid-2000s prompted renewed interest in tungsten projects
outside China.
However, the financial crisis of 2008-2009 resulted in a fall in demand and pricefor most metals, including tungsten. Consequently, there was a drop in interest to
explore for, or develop, new tungsten deposits between 2009 and 2011.
Nevertheless, in Q1 2012 IMC International Metalworking agreed to invest
US$80 million in a tungsten mining project in South Korea. In addition, development of the Hemerdon project in Devon is underway by Aim-listed Wolf Minerals
Ltd, and it intends to begin mining by Q4 2014 with the company hoping to produce about 3,000 tonnes of tungsten and tin a year. In the meantime, the Nui
Phao project in Vietnam is being commissioned and could start production in2013, with a downstream APT and oxide plant planned in a joint venture between
the project owner, Masan Resources, and H.C. Starck of Germany.

TUNGSTEN MARKET OVERVIEW, CONT’D...
Trade:
Tungsten is sold in a variety of forms, including the intermediate product APT(which is the most common raw material traded on the market), tungsten carbide, tungsten concentrates and tungsten oxides, each form will have a different
spot price with the benchmark for APT generally being Metal Bulletin’s CIF Europe price.

CAMPINE SITE
VISIT

On 2nd September a group ofover 30 members of MMTA
and MMTA member association, VDM, joined together fora site visit to Campine, amember of the FW HempelGroup, in Belgium.

To produce APT it is uneconomical to smelt the ore because of the high temperatures needed for melting tungsten. Consequently, a series of chemical reactions
and refining is employed. APT is not widely produced and generally confined to
producers in China, Europe, the USA and Russia, who consume it captively intheir downstream businesses for use in value added products, such as high purity tungsten powder (e.g. tungsten oxide). Additionally, a refiner may want thetungsten in solid form; the most common method of consolidation is sintering.
Sintering is the preferred method of solidification because it does not require
the material to be heated to its melting point. From this stage the tungsten
product may not have the desired properties an end-user may require, in addition, from this point it is possible to create alloys with tungsten depending on
the demands from the end-user. To achieve these desired characteristics the
crystal structure of the tungsten is manipulated in a series of industrial processes, including mill rolling and annealing.
Recycling and Uses:

Following an overview of theCampine business—the company is celebrating its centenary this year—the group
was taken on a tour of theplant and viewed productionof antimony, lead battery recycling and PET plastics.
Later that afternoon, thegroup sat outside in the beautiful late afternoon sun to discuss the merits of the Dodd
Frank Act, and possible scopeof similar European legislation
being discussed, and finishedthe evening with dinner kindly
hosted by Campine.
Many thanks to Campine for
their hospitality.

To reduce their exposure to supply risk and due to increasing environmental
considerations, many countries have looked to recycling to meet their domestic
tungsten requirements. It is estimated that a minimum of 35-40% is derived
from scrap when aggregating the US, Europe and Japan. Global estimates arelower at 22%, this is because China does not actively recycle large volumes tungsten at present.
There are two classifications for scrap, those derived from industrial process(new scrap) and those that have come to the end of their life cycle (old scrap). It
is estimated that losses up to 6% of total consumed tungsten can occur during
processing and a further 3% during fabrication. Old scrap is sourced commonlyfrom cemented carbide coatings found in cutting tools, and superalloys, foundin used turbine blades.

13

MMTA’S 40 YEARSThe MMTA that Anthony
Lipmann took the Chair of in2003 “was on the cusp of agreat moment. The
achievements of the past
included getting the Dutch
Government to permit VAT
free transactions for Duty Paid
goods in warehouse Rotterdam,
thus increasing liquidity. Thanks
to Derek Hodd, the MMTA
rules developed over theprevious 30 years were
published in written form, …
and socially too, the minor
metals community was vibrant.
There was, however, an
opportunity to go further … a
proliferation of applications
meant that a whole host ofelements once regarded as toorecondite even for the Minor
Metals Trade Association wereready and waiting to becolonised - elements such as,
Zirconium, Hafnium, Rhenium,
Thallium, Strontium, Calcium,
Tantalum, Niobium and others,
which would enlarge the scopeof the Association and put the
MMTA at the epicentre of newtechnologies … The MMTA
through its grasp of this space
can now truly claim to be at theheart of all the minor metals.
Where I failed was to makeeven the slightest dent in the
REACH legislation, which for all
its good intent raised the bar sohigh in Europe that large partsof the metals trade andmanufacturing have been
removed to less bureaucraticenvironments, whilemonopolies have been createdbecause smaller companies
have been unable to bear theweight of compliance. (Anthony
Lipmann, Chairman 2003 –
2006)

14

TUNGSTEN REPORT, CONT’D….
The intrinsic properties of tungsten make it suitable for a number of industrialuses. When combined with small quantities of carbon a tungsten carbide is produced and will yield considerable hardness. For this reason it is used in applications where a resistance to wear and abrasion are common place. Therefore,“hard materials” using tungsten carbide (with a hardness up to three times steel)can be used in industrial machinery, cutting tools and as an effective neutronreflector, used for scientific research into chain reactions. In Europe 72% of all
consumed tungsten is used for carbide products, according to ITIA.
Tungsten is also a major component of high speed steel (HSS), and dependent
on the grade can contain up to 18% tungsten. Furthermore, tungsten is often
used in electronics which operate at high temperatures, including light bulb filaments and rocket engine nozzles, often alloyed with rhenium or molybdenum
Substitutes exist for specific applications e.g. cemented carbides based on molybdenum carbide and titanium carbide could replace traditional tungsten carbides in steel tools. However, it is noted that direct substitution will likely lead toincreased cost and a deterioration of product performance, and so further work
is needed to develop viable tungsten substitutes for use in the future.

Source: Roskill
Demand and Price:
According to ITIA, global primary consumption was 71,000t in 2010, and up to
95,000t when including scrap. The increase in scrap use is partly reflected by a
300% price increase since 2004.
Demand growth has been steady at around 6% a year and is expected to remain
so until 2016, according to Roskill, and historically tungsten weathered the economic slowdown of 2008-2009 much better than other metals. From 2008 APT
prices increased from about $180/MTU to over $450/MTU tonne in mid-2011;
current (September 2013) prices are $300-350/mtu.
Tungsten prices are quoted in Metric Tonne Units (MTU), one MTU is equivalent to ten kilograms of 100% WO3 content, and is the standard unit of measurement for traded tungsten. Prices are normally quoted using US dollars per MTU
of tungsten trioxide (WO3). The grade of typical concentrates can vary from 62%
up to 72% WO3. In addition, prices can be quoted as US$ per MTU of WO 3 contained in ammonium paratungstate (APT).
In 2010, China’s share of total demand was 37%. Due to the slump in construction and demand for downstream electronics products, the consumption of

TUNGSTEN REPORT, CONT’D….
tungsten concentrate in China is estimated to fall by 16% between 2012 and 2013.
The Jiangxi region in south west China saw the largest output in the area at
46,500t, according to beforeitsnews.
Recent legislation changes have included a new methodology for determining accountability of companies that build products with tin, tantalum, tungsten andgold. Companies are asked to make “reasonable” attempts to find out if the materials came from Democratic Republic of Congo mines operated by armed militia.
According to Bloomberg; “If the companies’ inquiries don’t show the metals might
have been mined in the DRC or were exported from surrounding countries, they
can stop looking and report that to the Securities and Exchange Commission(SEC). Also, if they find the metals were recycled or scrap, the firms need look nofurther.”This procedure is often viewed as a complicated and sometimes unnecessary process, prompting many companies to look elsewhere for their raw materials, leading to a drop in global trade of 4% in 2008, to 2% in 2011 for the DRC.

Source: Roskill
It is estimated that the US reserves are falling by 2,000-3,000t W per year, andaccording to the USGS as of Sept 2010 there was just 17,000t W remaining in the
USA stockpile.
It is critical to note that new projects will witness a lag between construction,commission and production; a typical green field project may take up to 5 years to
begin production, for example. Thus, although investment is present in the exploration and development of tungsten resources, albeitnow at reduced levels, it will
likely be several years before significant output outside of China could influence
the market.
It should also be noted that as investment into finding and producing new tungsten are underway, and as countries continue to increase their proportion of tungsten derived from secondary sources (i.e scrap), there is a progression to selfsufficiency.
Alex Lewis, MMTA Intern, Recent graduate in Geology from Imperial
College, University of London

References:
http://www.itia.info/
http://www.roskill.com/reports/minor-and-light-metals/tungsten
http://minerals.usgs.gov/minerals/pubs/commodity/tungsten/mcs-2013-tungs.pdf
http://www.bgs.ac.uk/downloads/start.cfm?id=2063

MMTA’S 40 YEARSFor Charles Swindon, whotook over in 2006, “it was apleasure to be Chairman of
the MMTA during a periodof rapid expansion in termsof membership numbers
and the growinginternationalisation of its
membership”. During
Charles’ tenure, “theMMTA appointed aprofessional full-time
executive for the first time,and set up central London
offices for MMTA members
to take advantage of. “Thisperiod saw thedevelopment of a real senseof purpose and mission, as
well as a global presence
for the first time.
Developing activity saw the
MMTA go on the road tosmelters and factories, and[be] called upon to give its
expert opinion internationally. The MMTA very rapidly
came of age”. (Charles
Swindon, Chairman 2006 –2009)
Did you know….
that the International Union ofPure and Applied Chemistry
and the US Geological Survey
have announced tiny changes tothe atomic weights of a numberof elements, due to more accurate means of measurement.
For more information on the
Periodic Table putting on
weight, and a fun Periodic Table
quiz, go to the Telegraphonline.

http://www.bgs.ac.uk/downloads/browse.cfm?sec=12&cat=13315

MMTA’S 40 YEARSRECENT ADVANCES IN HEALTH SCIENCE ON
COBALT, AND THE DANGERS OF IDEOLOGICALLYDRIVEN REGULATION

Reflecting on the first 40 yearsof the Association, Guy Darby(Chairman 2009 – 2012) sums
up that “the MMTA … started
off life as a club for minor metal
trading companies, who sought
to harmonise contracts toavoid misunderstandings and tomeet for the occasional beer”.
By the time he took over the
Chair in 2009, “the club was
growing and involved not only
trading companies but
producers and consumers. It
was clear to me that that thefirst thing we needed to do washighlight the tangible benefits ofmembership to focus our minds
on what we were looking toachieve, and with appetite formembership growing from all
aspects of the industry, it wastime to visit every facet of theassociation with a view tomodernisation. During my
Chairmanship, we implemented
a push into North America
which was embraced wholeheartedly, the membership
rising from a handful to morethan 30 and to-date twoenormously successful
conferences have been held in
North America supporting thatdecision”. The MMTA’s mostrecent past Chairman believes“the association that I left bore
almost no resemblance to the
one I inherited—we had a professional organisation that wasfit for purpose thanks to thehard work and vision of all
those involved at committee
level and beyond, anorganisation that is looking
forward to its next forty years.

Recent Advances in Science

Happy birthday”!

In the ‘use phase’ of cobalt metal, there is also the need for worker protection.
Cutting and drilling tools and hard facing alloys are worn down during use to
produce fine particles, which could be hazardous if they become airborne. There
have also been recent concerns raised about the fate of the residue arising from

(Guy Darby, Chairman 2009 –
2012)

16

Scientific advances can create challenges for Industry, as much as they can forsociety at large.
Work by the Cobalt REACH Consortium to learn more about the health and environmental effects of cobalt and many of its compounds has continued tirelessly, long after the first REACH registration deadline of November 2010. One
recent discovery has highlighted that the toxicity of cobalt metal by inhalation
may be higher than previously suspected, and the Industry is moving towards aself-classification of inhalable forms of cobalt metal to reflect this. In parallel tothis, the National Toxicology Program in the United States has just publishedthe draft technical results of a cancer study on cobalt metal powder. If this evidence points to a heightened risk of cancer in animals through inhalation, theCobalt REACH consortium has committed to also upgrade its self classification
for cobalt metal powder from “possible” to “proven” carcinogen in animals.
Such an understanding would also eventually impact the classification of many
cobalt chemicals, as it would imply that the cobalt ion, depending on the dose,
rate of release, and route of exposure (inhalation), was a key factor in the modeof action.

“The biggest ‘unknown unknown’ is perhaps the
Authorisation component of REACH...”
Consequences for Industry
What do these advances in science mean? The principle objective of the Consortium continuing these studies is to learn more about the intrinsic hazard properties of the materials, so that the member companies can better protect workers, and the general public. Companies working with cobalt have long been conscious of the fact that there were questions over the safety of some forms of cobalt and cobalt chemicals, and already operate strict exposure monitoring andprotection. IARC (the International Agency for Research on Cancer) proposeda link between cobalt and all its compounds with cancer in animals as far backas 1991. By way of contradiction, cobalt is also recognized as being an “essential
element” for life, and is used in the manufacture of a synthetic vitamin B12 animal feed supplement where cobalt minerals are lacking in local soils. Healthscience can be complex and not always straight forward. Meanwhile, the Industry is committed to do what is necessary to protect workers and the general public where risks arise.
However, consequences of this improved knowledge will make themselves felt
throughout the downstream value chain. Much of the impact will be felt in theworkplace. Many of the chemical applications of cobalt are in liquid form within closed systems that mean opportunities for exposure to workers (especiallyinhalation) are limited. However, the large scale handling of solids during themining, refining, manufacturing and use stages of production cannot be done
within closed systems, and so here the aim is to minimize exposure to the risks
posed by dust generation.

RECENT ADVANCES IN HEALTH SCIENCE, CONT’D….
brake linings and tyres as they wear on roadside pollution (cobalt compounds
can be used in the vulcanisation of rubber).
There are fewer applications of cobalt in consumer goods. However, very few ofour ‘essential’ portable electronic devices, such as phones and laptops, are not
powered by cobalt in one form or another in the battery. These are sealed units,
and so the opportunity for exposure to the public is zero, unless the case is deliberately broken open.
However, it still means the fate of these batteries at the end of their life must be
carefully managed. The concern of release over time to the environment of cadmium from landfill sites was one of the main drivers to the banning of nickel
cadmium batteries from consumer goods in Europe.

The effect of Regulation
However, perhaps the biggest unknown is the impact of other regulations whensubstances become classified as hazardous. Transport costs for “dangerous
goods” are higher than for “safe” goods. Meanwhile, there is a raft of downstream legislation targeting “CMRs”: carcinogens, mutagens, and reproductive
toxins. Europe is currently revising its “Carcinogens at the Workplace Directive”. The latest revision of the European “Toys Directive” includes a restriction on any material that is even a “suspected carcinogen”. RoHS
(Restriction of Hazardous Substances Directive), the European legislation that
restricts certain substances from being used in electronic applications, is subject
to regular revisions. Meanwhile, end of life regulations, although well intentioned, can actually make it more difficult to transport and recycle hazardous
materials.
However, the biggest “unknown unknown” is perhaps the Authorisation component of REACH … the ‘A’ in REACH. The first step in this heavy process is for a
substance to be placed on the “Candidate List”, followed by “Prioritisation”, before a final recommendation to place the substance into Authorisation. Steps
one and two involve a full public consultation process. However, the way theauthorities operate this today, only the hazard properties of the substance areallowed to be considered in these consultations. Given that the EU has in mostcases already classified these substances as hazardous before being recommended to be placed on the Candidate List, this seems a rather pointless and time con-

CHANGES TO THE
MMTA MAIN
COMMITTEEThe Board of Directors
would like to thank
Deborah Stott and Rob
Bolton for theircontributions to the MMTA,
and wishes them all the bestin their new career
ventures.
At the Directors’ meetingon 17th September, theBoard unanimously voted
Simon Boon of Firth Rixson

and Phil Simmons of Aon
UK Ltd“at the same time as Authorisation follows its
ideological mandate of removing carcinogens from theworkplace, a worker can happily have a cigarette
during the lunch break, drive home by car, and enjoy aglass of wine or beer in the evening...”suming process for both regulator and stakeholders, including Industry. Furthermore, this means that any consideration of the downstream impact of removing these substances from the market, or whether there will even be any consequential benefit to worker or public health, is only explored at the final, application stage. There is a growing concern within Industry that this could have along term, negative impact on European manufacturing and employment. The
cost of preparing the data requirements for an application are onerous and a new
application must be made for every single use. SMEs (small / medium enterprises) are unlikely to be able to afford the cost of the application process. Even if
they band together to share the costs, the legal costs arising from the use of“trustees” to collect and submit the sensitive information demanded could easily
outweigh cost sharing benefits. This would be necessary to avoid infringements

to replace them andrepresent their respective
companies.

17

RECENT ADVANCES IN HEALTH SCIENCE, CONT’D….
Minor Metals
New York Dinner,
12th December,
The Water Club,New Yorkof competition law, or release of proprietary processes to competitors, Meanwhile,large engineering companies, such as the aerospace and automotive industries, fearthat one day, a critical component to their jet engine or car might not be available inEurope, because, unbeknown to them, at some earlier stage in the value chain, ahazardous raw material was an essential step in a supplier’s manufacturing process.
Even where Authorisation is eventually granted, the license is time limited. Eachapplication requires a substitution plan, and so implicitly drives the removal of thesubstance from the process with time. In business terms, such uncertainty canmean a death sentence for investment. With CMRs specifically targeted in the legislation, the regulation effectively operates a ‘zero tolerance’ of carcinogens in theworkplace. Unlike the “Registration” phase (the ‘R’ in REACH), Authorisation only
targets European manufacturing, as the substances targeted are the starting raw
materials for what can be long, multi-step value chains. The final product in manycases contains none of the hazardous material, and so can be manufactured outside
Europe and exported back to the EU.

Reputational Risk

This year's New York Minor
Metals Dinner will take place
at a new venue - The Water
Club, offering a spectacular
view of the East River. The
evening includes a drinks
reception, lots of networking
followed by dinner.
To book, please use thefollowing link—
http://www.mmta.co.uk/
events/2013/12/12/161

The drinks reception is kindly
sponsored by Exotech Inc

Finally, the reputational impacts of greater regulatory scrutiny that inevitably follow
from hazard classification should not be underestimated. What starts as communication of a hazard property to downstream manufacturers, so that they can better
protect their workers, can, in the wider public domain, lead to the stigmatisation ofan entire industry. Cobalt is already considered by many as a ‘heavy metal’, a labelwith many negative connotations, in spite of being in the first line of the transition
metals in the periodic table, alongside iron. Stigmatisation can, in turn, attract
more regulatory scrutiny. Meanwhile, stigmatisation can have a real economic impact too. There have been reports that European suppliers of components known to
use a substance that gets placed on the Candidate List are being automatically taken
off the overseas companies’ approved supplier lists, resulting in an immediate lossof business. It is an understandable and natural business consequence of the overseas company moving to protect its supply lines from a future threat, although regulators seem to be unwilling to acknowledge this economic fact of life.

Regulatory Inconsistency
The application of these regulations can seem arbitrary and inconsistent, and are
not harmonized with other regulation. Why is Authorisation needed when Europe
has a ‘Carcinogens at Work Directive’? How does this fit with efforts by European
governments to introduce other policies to re-energize the European economy andraise employment, in recognition of the fact that statistically the biggest threat tohuman health today is poverty. Meanwhile, at the same time as Authorisation follows its ideological mandate of removing carcinogens from the workplace, a worker
can happily have a cigarette during the lunch break, drive home by car, and enjoy aglass of wine or beer in the evening. Tobacco, benzene in petrol, and alcohol are allrecognized as ‘proven carcinogens’ in many regulatory jurisdictions.

Summary
The dinner is kindly sponsored by Tranzact Inc

In summary, no-one in the Cobalt Industry doubts the importance or correctness ofcontinuing its studies into the health and environmental properties of its products.
However, the wider industry must understand that this is the start of a journey.
The knowledge gained may not always be what the Industry would want to hear. It
must spread unwelcome, as well as welcome news. Meanwhile, as scientific certainty grows, regulatory uncertainty may increase, especially where ideology, and‘hazard’ rather than ‘risk’ considerations, dominate the regulatory practice. Thiscan lead to disproportionate regulatory action relative to the risk posed to workers
or the public, and to widespread, unintended economic consequences, such as theloss of manufacturing and jobs in Europe, and discouraging investment throughregulatory uncertainty.

(Name of author known, but withheld by agreement)
18

This article constitutes the personal views of the author and should not be taken in any way
as a view or position of the MMTA.

Christmas Lunch,18th December,
Pewterers’ Hall,
LondonThe MMTA’s Christmas Lunchis the perfect way to end theyear and catch up withcolleagues in the minor metals
industry.

Join MMTA members andassociates at Pewterers’ Hall inCentral London. The Livery
Room, where the lunch willtake place, is adorned with
pewter artefacts, as well as abeautiful pewter chandelier.
The MMTA promotes
essential elements thatadd quality, safety andenjoyment to ourlives.

To book please use thefollowing link—

The MMTA is the world's
leading minor metals
industry organisation.

The drinks reception is kindly
sponsored by Alfred H Knight

http://www.mmta.co.uk/
events/2013/12/18/149

Minor Metals Trade Association
Suite 53
3 Whitehall Court
LondonSW1A 2EL
Telephone: +44 (0)207 833 0237

And the lunch by
Fax: +44 (0)207 839 1386
Email: executive@mmta.co.uk

Roskill Information Services

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