Strategic Materials: Technologies To

Reduce U.S. Import Vulnerability

May 1985

NTIS order #PB86-115367
Recommended Citation:

Strategic Materials: Technologies to Reduce U.S. Import Vulnerability (Washington,

DC: U.S. Congress, Office of Technology Assessment, OTA-ITE-248, May 1985).

Library of Congress Catalog Card Number 84-601153

For sale by the Superintendent of Documents

U.S. Government Printing Office, Washington, DC 20402
Foreword

This report presents the findings of OTA’s assessment of Strategic Materials:

Technologies to Reduce U.S. Import Vulnerability. The study was requested by

the House Committee on Science and Technology and the Senate Committee on

Commerce, Science, and Transportation.

The United States imports well over $1 billion worth of chromium, cobalt, manganese, and platinum group metals annually. Many of the uses of these metals are

essential to the industrial economy and the national defense. The United States

imports virtually all of its requirements for these metals; their production is highly

concentrated in two regions of the world: the Soviet Union and southern Africa.

The potential for interruption of supplies from these sources has heightened congressional interest in alternatives to continued import dependence,

This study assesses the technical alternatives to continued reliance on southern Africa and the U.S.S.R, for strategic metals. Promising opportunities for domestic and diversified foreign production and for conservation and substitution

are identified for each metal. Technical, economic, and institutional barriers to

the implementation of the alternatives are reviewed and governmental options to

overcome those barriers are identified and analyzed.

We are grateful for the assistance of the project advisory panel, workshop participants, contractors, and the advice of many government agencies in the United

States and Canada. As with all of our studies, however, the content of the report

is the sole responsibility of the Office of Technology Assessment.

JOHN H. GIBBONS

Director
Technologies to Reduce U.S. Import Vulnerability

Advisory Panel

Walter S. Owen, Chairman*

Professor of Materials Science,

Massachusetts Institute of Technology

Arden Bement William A. Owczarski

Vice President, Technical Resources Manager, Technical Planning

TRW, Inc. Pratt & Whitney Aircraft Group

Edwin Clark R. Byron Pipes

Senior Associate Director, Center for Composite Materials

Conservation Foundation University of Delaware

Tom Clough

Director of Technology

Atlantic Richfield Co.

Robert G. Dunn

Senior Vice President

AMAX Metals Group

Michael E. Fisher

professor of Chemistry, Physics, and

Mathematics

Cornell University

Herbert H. Kellogg

Professor of Extractive Metallurgy

Columbia University

Hans Landsberg

Senior Fellow

Resources for the Future

Ernest K. Lehmann

president

E. K. Lehmann & Associates

Jessica Tuchman Matthews

Vice President

World Resources Institute

R. K. Pitler

Senior Vice President and

Technical Director

Allegheny-Ludlum Research Center

Dennis Readey

Head, Department of Ceramic Engineering

Ohio State University

James K. Sebenius

Assistant Professor

John F. Kennedy School of Government

Harvard University

Albert Sobey

Director, Energy Economics

General Motors Corp.

Alex Zucker

Associate Director

Oak Ridge National Laboratory

● Robert Ellsworth resigned as panel chairman in August 1983, when he became Chairman of the Board of Howmet “1’urbine Components CorfI

Walter S, Owen became chairman in September 1983.

iv
—

OTA Project Staff on Strategic Materials:

Technologies to Reduce U.S. Import Vulnerability

Lionel S. Johns, Assistant Director, OTA Energy, Materials, and International Security Division

Audrey Buyrn, Industry, Technology, and Employment

Program Manager

Lance N. Antrim, Project Director

Wendell Fletcher John Newman* Kirsten U. Oldenburg

Katherine Gillman Margaret Hilton

Karen Larsen Patti Litman*

Richard Parkinson Diana Rowen

Nick Sundt* Paula Wolferseder*

Contractors

Charles River Associates, Inc.

INCO Research and Development Center

Earth Resource Associates Sierra Research

J. K. Tien Massachusetts Institute of Technology

George St. Pierre James A. Broadus

Kathryn Van Wyk David Stauffer Susan Stauffer

DMEA, Ltd. Judith Bolis Iris Goodman Greg Shuey

Administrative Staff

Patricia Canavan Carol Drohan Andrea Amiri

* lmhouw (.ontra(. tor
Advanced Materials Workshop Participants

H. Kent Bowen

Materials Processing Center

Massachusetts Institute of Technology

Cambridge, MA

John Busch

Massachusetts Institute of Technology

Cambridge, MA

Joel Clark

Department of Materials Science and

Engineering

Massachusetts Institute of Technology

Cambridge, MA

Tsu-Wei Chou

Center for Composite Materials

University of Delaware

Newark, DE

Arthur Diness

Office of Naval Research

Arlington, VA

Christopher Hill

Congressional Research Service

Library of Congress

Washington, DC

Robert Katz

Army Materials & Mechanics Research

Center

Watertown, MA

George B. Kenney

Materials Processing Center

Massachusetts Institute of Technology

Cambridge, MA

Robert E. Piret

Massachusetts Institute of Technology

Cambridge, MA

Robert Pohanka

Office of Naval Research

Arlington, VA

Dennis Readey

Department of Ceramic Engineering

Ohio State University

Columbus, OH

David W. Richerson

Garrett Turbine Engine Co.

phoenix, AZ

B. Walter Rosen

Materials Science Corp.

Spring House, PA

Elaine Rothman

Massachusetts Institute of Technology

Maxine Savitz

Consultant to the Garrett Corp.

Washington, DC

Thomas Schmid

Pratt & Whitney Aircraft Co.

W. Palm Beach, FL

Samuel Schneider

Inorganic Materials Division

National Bureau of Standards

Washington, DC

Albert Sobey

Director, Energy Economics

General Motors Corp.

Detroit, MI

Conrad Trulson

Union Carbide Corp.

Danbury CT
Acknowledgments

OTA also wishes to acknowledge the contributions and cooperation of’ the following agencies and

organizations:

Allison Division, General Motors Corp.

Amax, Inc.

American Society for Metals

Automotive Dismantles & Recyclers

Association

The Broken Hill Proprietary Co., Ltd.

Elkem ,Metals Co.

The Ferroalloy Association

Garrett Turbine Engine Co.

General Electric Co.

Interlake, Inc.

Globe Metallurgical Division

Government of Canada

Energy, Mines and Resources Canada

National Defence College

Gulf Chemical & Metallurgical Co.

GTE Corp.

Hal] Chemical

Inco, Ltd.

Inmetco, Inc.

International Development and Cooperation

Agency

Trade and Development Program

Manufacturers of Emission Controls

Association

National Aeronautics and Space Administration

National Association of Recycling Industries

Metal Properties Council, Inc.

National Science Foundation

National Materials Advisory Board

North Atlantic Treaty Organization

Advisory Group for Aerospace Research and

Development

Oak Ridge National Laboratory

Pratt & Whitney Aircraft Co.

Union Carbide

U.S. Congress

Congressional Research Service

General Accounting Office

U.S. Department of Commerce

International Trade Administration

National Bureau of Standards

U.S. Department of Defense

Office of the Secretary

U.S. Air Force

Army Materials and Mechanics Research

Center

U.S. Department of Energy

U.S. Department of the Interior

Bureau of Mines

Geological Survey

In addition, OTA wishes to express its appreciation to the many individuals, organizations, and companies who acted as reviewers for all or part of this report.

vii
Contents

Chapter Page

1. -

2.

3.

4.

5.

6.

7.

8.

Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

An Introduction to Materials Import Vulnerability . . . . . . . . . . . . . . . . . . 56

Critical Materials Consumption: Current Patterns and Trends . . . . . . . . 59

Security of Supply. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83

Strategic Material Supply . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125

Conservation of strategic Material . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 215

Substitution Alternatives for Strategic Materials . . . . . . . . . . . . . . . . . . . . 263

Policy Alternatives for Strategic Materials . . . . . . . . . . . . . . . . . . . . . . . . . 331

Appendix A: Review of Previous Lists and Methods of Selection . . . . . . . . 383

Appendix B: Import Sources of Materials Judged to be

Nonstrategic, 1978-82 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 386

Appendix C: Overview of Second-Tier Materials . . . . . . . . . . . . . . . . . . . . . . . 388

Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 401

. . Vlll
CHAPTER 1

Summary
Contents

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Identification of Strategic Resources . . . . . . . . . . . . . . . .

Essential Uses of Strategic Materials . . . . . . . . . . . . . . . .

Chromium . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Cobalt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Manganese . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Platinum Group Metals . . . . . . . . . . . . . . . . . . . . . . . . . .

Outlook for the Future . . . . . . . . . . . . . . . . . . . . . . . . . .

Production of Strategic Materials . . . . . . . . . . . . . . . . . . .

Historical Perspective . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Technological Approaches to Reduce Materials Import

Summary of Technological Approaches . . . . . . . . . . . .

Implementation of Technological Approaches . . . . . .

Mineral Production and Metal Processing . . . . . . . . .

Substitution Alternatives . . . . . . . . . . . . . . . . . . . . . . . . .

Conservation Approaches . . . . . . . . . . . . . . . . . . . . . . . .

List of Tables

Table No.

. . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . .

..,,... . . . . . . . . . . .

. . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . .

. . . . . . ...*.., . . . . .

Vulnerability. . . . . .

. . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . .

..*.., . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . .

5

’11

12

12

13

13

13

13

14

15

17

17

29

31

33

36

A.

B.

1-1.

1-2.

1-3.

Domestic Consumption and Production of Strategic Metals . . . . . . . . . . 7

U.S. Imports of Strategic Materials–1982 .. .,. ,~, . . . . . . . . . . . . . . . . . 10

Summary of Most Promising Technological Approaches to the

Reduction of Strategic Materials Import Vulnerability. , . . . . . . . .......18

Substitution for Chromium in Metallurgical Applications. . . . . . .......22

Potential New Foreign Cobalt Production . . . . . . . . . . . . . . . . . . . .......23

l-4. Current and Projected Manganese Consumption in U.S. Steel

Production . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .......27

l-5. Outlook for Development of Known Domestic Deposits of Strategic

Resources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .......31

List of Figures

Figure No. Page

l-1. Regional Distribution of Strategic Material Production . . . . . . . . . . . . . . 12

1-2. PGM Demand vs. Potential Supply From Recycling . . . . . . . . . . . .......29
CHAPTER 1

Summary

Three nations, South Africa, Zaire, and the

U. S. S. R., account for over half of the world’s

production of chromium, cobalt, manganese,

and platinum group metals. These metals are

essential in the production of high-temperature

alloys, steel and stainless steel, industrial and

automotive catalysts, electronics, and other applications that are critical to the U.S. economy

and the national defense,

With minor exceptions, there is no domestic mine production of any of the four metals,

The Government maintains a material stockpile but its contents are reserved for national

security purposes only. As a result, the U.S. industrial economy is vulnerable to a variety of

supply disruptions that may arise in times of

peace. Disruptions of supply, such as the Canadian nickel strike in 1968 and the rebel interruptions of cobalt production in Zaire in 1978,

can have a major impact on U.S. industries

which must, in times of shortages, either compete for limited supplies of strategic metals or

limit production of products that use strategic

metals. Competition for supplies can result in

price increases that may eventually be passed

on to consumers, while reduction or cessation

of production may result in loss of market

share or permanent withdrawal from some

markets, weakening the competitiveness of

U.S. industries.

In the longer term, there are many technical alternatives that can provide more secure

sources of supply, improve the prospects for

conservation and recycling of strategic materials, or speed the acceptance of substitute

materials that reduce the need for strategic

materials.

Few of these technical alternatives can be implemented immediately on the occurrence of

a supply disruption: some are near commercialization, others require further testing and

evaluation, and still others are only in the research and development (R&D) stage. Nearly

all of the alternatives must overcome substantial economic and institutional barriers before

their full promise to reduce U.S. reliance on

southern Africa and the U.S.S.R. for strategic

materials can be realized.

Government actions to assure secure supplies of metals critical to the United States have

been limited largely to reliance on the national

defense stockpile to ensure the availability of

materials required for national defense in time

of war, leaving it to the free market to provide

a diversity of suppliers for the industrial economy. These actions are appropriate for normal

commerce and for periods of military conflict,

but they are not intended to protect American

industry from disruptions of the supply of

chromium, cobalt, manganese, and platinum

group metals that might occur as a result of political disturbances, strikes, changes in political ideology or other non-war-related factors

affecting supplier nations.

There is no single generic approach to reduce materials import vulnerability–to be effective, different actions must be taken for each

metal under consideration. An overall strategy

to reduce U.S. reliance on uncertain sources

of supply of strategic materials should be based

on a combination of three technical approaches:

●

●

●

increase the diversity of world supply of

strategic metals through the development

of promising deposits, both foreign and domestic, outside of southern Africa and the

Soviet bloc and through exploration for

new deposits of strategic materials;

decrease demand for strategic metals

through the implementation of improved

manufacturing processes and recycling of

strategic materials from scrap and waste;

and

identify and test substitute materials for

current applications and develop new materials with reduced strategic material content for future applications,

3
4 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

There is a wide range of actions that the Government may draw from to implement some

or all of these approaches. These actions vary

in cost, degree of Government involvement,

probability of success, and contribution to the

overall strategy for reducing vulnerability. The

actions include:

Collection and analysis of data and the dissemination of results to industry. Government

already plays a key role in provision of essential information about strategic materials, An

expanded role, including more emphasis on

identification of foreign investment opportunities for U.S. firms abroad, sponsorship of

a substitution information “bank,” development of better data about domestic mineral

occurrences, and periodic reexamination of

trends in strategic materials recycling and

conservation, would help Government policymakers adjust strategies to changing circumstances, and encourage private actions to reduce vulnerability,

Support for research and development and for

mineral exploration. Implementation of any

technical approach to reduce import vulnerability will assume a continuing R&D effort,

most of which will continue to need Government support. Strategic materials R&D programs, decentralized among many agencies,

need better coordination if common objectives,

goals, and purposes are to be met.

Federal funding of strategic materials R&D

in the areas of recycling, substitution, and advanced materials appears adequate to keep

pace with the changing materials mix in the

economy. In the area of mineral exploration,

prospects for a major domestic discovery of

one or more of these materials are not promising, but could possibly be enhanced through

greater support of public and private exploration research, including basic research on geological theories of mineral occurrence, improved geophysical, geochemical, and drilling

equipment, and more intense study of the resource potential of Federal lands.

Assistance for education and training. Advanced materials, now in their infancy, hold

promise of altering the mix of basic materials

used in many applications now dependent on

strategic materials. International competition

for supremacy in these emerging markets is

strong, with some other countries, including

Japan, placing greater emphasis than the United

States on technical education and training of

workers in these fields. Increased Government

support to U.S. educational institutions in conjunction with the advanced materials industry

may be needed to ensure the long-term competitiveness in these fields.

Development of alternative technologies and

materials. In cases where the principal barrier

to commercialization of a technology is the cost

of demonstration and pre-commercial development, or where benefits arise from having the

technology or material “on-the-shelf,” the Government could support the construction and

operation of demonstration plants or the testing and evaluation of substitute materials. This

would reduce industry response time in an

emergency,

Financial assistance for domestic industry.

The economics of nearly all opportunities for

domestic mineral development are discouraging to potential investors. If the benefits of domestic mineral production are desirable from

the public’s perspective, however, assistance

could be provided in the form of subsidies, purchase commitments, loan guarantees, tax incentives or other Government financial aid.

Such programs need not be limited to mineral

production: processing of ores and metals, production of substitute materials, and operation

of recycling facilities could also be encouraged

by similar programs. Financial assistance programs could be expensive, however, so that

their cost effectiveness, compared to other

alternatives and to reliance on the free market,

needs to be carefully considered.

Role of Government in reducing materials import vulnerability. The degree to which the Government should actively support activities to

reduce materials import vulnerability ultimately

depends on the perceptions of policymakers as

to the degree of harm that could result from

supply interruptions, the probability that such

interruptions may occur, and the role policy-
.

Ch. 1—Summary ● 5

makers see for the Government in dealings

with the private sector. In addition, the effectiveness of the technical approaches that Government chooses to pursue depends, to some

degree, on its commitment to their success and

to the coordination of the approaches in a

unified strategy directed toward reducing materials import vulnerability. The effectiveness

of Federal policies also depends on establishing goals for strategic materials policy, identifying the most promising technical approaches

to reduce vulnerability for priority materials,

coordinating governmental actions, and encouraging industrial and academic activities

in support of the technical approaches. In view

of the multiplicity of Government activities that

already affect the strategic materials issue and

the long time required to implement most of

the technical approaches, the Government

would need a process for the periodic reevaluation of strategic materials objectives and of

the effectiveness of programs implementing the

technical approaches.

The following sections summarize the background to strategic materials issues and the

most promising technical approaches to reduce

the vulnerability of the United States to interruptions of supplies of strategic materials.

Introduction

The United States is well endowed with

many natural resources. Timber, coal, water,

and agricultural resources are the envy of the

rest of the world. The endowment is not complete, however. The United States is dependent

on foreign suppliers for many mineral resources.

The Soviet Union and the nations of southern

Africa are suppliers of many of the minerals

and metals that the United States must import.

Although in some cases these nations play only

a limited role in the world supply of raw materials, for some materials they quite literally

dominate the market.

Mine production of cobalt, chromium, manganese, and platinum group metals, all essential to defense and to the civilian economy, is

concentrated in the Soviet Union and southern Africa (see map on pp. 8-9 for the worldwide distribution of mine production of these

metals), Reliance on a potential adversary such

as the Soviet Union for materials essential to

defense and industry is an obvious area for

concern. Nor is it certain that supplies from

nations in southern Africa will continue without interruption: the division of nations on

racial grounds, the role of Soviet influence and

Cuban military involvement, the internal political division of key mineral-producing countries, and the vulnerability of mines and transportation systems to sabotage and guerrilla

actions combine to raise questions about the

reliability of mineral supplies, regardless of the

good intentions or financial needs of the governments in power.

Dependence of the United States on a few

nations of uncertain reliability for materials

that are essential to many industrial and defense uses has heightened concern over materials and minerals policy in recent years. This

concern is not new; since World War II U.S.

policy makers have sought ways to reduce U.S.

vulnerability to interruptions of supplies of

strategic materials.

The most visible policy taken by the United

States to guard against disruptions of supplies

of strategic materials is the National Defense

Stockpile (see box A). The objective of the

stockpile is to support U.S. defense, industrial,

and essential civilian requirements during a

prolonged military conflict or declared national

emergency, If properly stocked and maintained,

the stockpile can be effective in coping with

a disruption of supplies during a war or extended military conflict.

However, the defense stockpile does not protect, nor is it meant to protect, American industrial and other civilian consumers from
6 ● Strategic Mater/a/s: Technologies to Reduce U.S. Import Vulnerability

Box A.-The Strategic Materials Stockpile

For over four decades, the strategic and critical materials stockpile has been seen as a kind

of insurance policy for safeguarding the United States against the effects of a supply emergency.

The stockpile, however, is only intended to safeguard military, industrial, and essential civilian

needs in times of war or declared national emergency, and is not a general-purpose source in an

emergency.

First established in 1939, the stockpile was built up rapidly in the post-World War II and Korean War era, when the goal of the stockpile was to accumulate a 5-year supply of critical materials.

Many of the materials now in the stockpile date from this period, and maybe antiquated due to

changes in material specifications. During the Vietnam War period, substantial amounts of stockpiled material were declared excess to stockpile needs and sold by successive administrations—a

circumstance that led to charges that the stockpile was being used to keep metal prices stable during the Vietnam War. (Stockpile goals had been reduced from the initial 5 years to 3 years in 1958,

and to 1 year in 1972, before being raised back to 3 years during the Ford Administration.)

In 1979, Congress reaffirmed its commitment to stockpiling through enactment of the Strategic and Critical Material Stockpiling Revision Act (Public Law 96-41). The law stated that the stockpile “should be sufficient to sustain the United States for a period of not less than 3 years in the

event of a national emergency. . . “ and “is to serve the interest of national defense only and is

not to be used for economic or budgetary purposes.” The 1979 law also established a stockpile

transaction fund, under which materials can be purchased for the stockpile from sales of excess

materials. At the time the law was passed, stockpile inventories in excess of the 3-year requirement were valued at $4.9 billion. Acquisition needs were estimated to be $12.9 billion. In March

1981, President Reagan announced a major new stockpile acquisition program, aimed at meeting

stockpile goals for 15 priority materials. For fiscal year 1985, the Administration is seeking to sell

$78 million in excess materials and to purchase $120 million for the stockpile. However, the request is significantly below the amount required to meet stockpile goals. At present spending rates,

it would take 100 years to meet stockpile goals.

The Federal Emergency Management Agency (FEMA) oversees the stockpile, and submits to

Congress the Annual Materials Plan (AMP) for the buying and selling of materials for the stockpile.

An AMP steering committee, comprised of 12 agencies and chaired by FEMA, develops the annual plan. Actual management of the stockpile sites, which are dispersed throughout the United

States, is conducted by the General Services Administration.

Alternatives to acquisition and sale of stockpile materials are under consideration, including

the potential for technology to upgrade stockpiled materials to today’s standards. For example,

most of the cobalt in the stockpile does not meet current industry requirements, and therefore may

need replacement. The American Society of Metals, in a recent report to FEMA, suggested that

U.S. firms be given stockpile samples to demonstrate whether the out-of-date materials could be

processed to meet current standards. If so, some materials already in the stockpile could be readied

for use in an emergency, and some materials may not need to be replaced through purchase.

Barter is an alternative means of obtaining materials for the stockpile. The U.S. Government

operated a barter program under the Department of Agriculture from 1950 to 1973, which disposed

of surplus agricultural commodities and acquired strategic materials for the stockpile. The total

value of agricultural exports under this program was $6.65 billion. The barter program was

suspended in 1973 when agricultural surpluses were drawn down, and stockpile goals were

changed. In 1981, the U.S. Government again became involved in barter on a limited basis when

it concluded three Jamaica bauxite-dairy barter agreements worth $47 million, but a formal barter

program has not been reestablished. Approximately 20 barter bills have been introduced in the

98th Congress. The Administration has established a working group on barter to review proposals

on a case-by-case basis.
Ch. 1—Summary ● 7

Table A.— Domestic Consumption and Production of Strategic Metals

Price

— .—

Apparent Domestic production

consumption primar y scrap

Chromium: (tons x 1,000)

1979 . . . . . . . . . . . . . . . . . . . . . . 586 0 67

1980 . . . . . . . . . . . . . . . . . 567 0 72

1981 . . . . . . . . . . . . . . . . . . 533 0 70

1982 . . . . . . . . . . . . . . . . . . . . . . 333 0 63

1983 . . . . . . . . . . . . . . . . . 334 0 78

Cobalt: (pounds x 1,000)

1979 . . . . . . . . . . . . . . . . . . . . . 18,806 0 1,170

1980 . . . . . . . . . . . . . . . . . . . . . . 17,054 0 1,183

1981 . . . . . . . . . . . . . . . . . 12,532 0 972

1982 . . . . . . . . . . . . . . . . . . . . . . 11,452 0 871

1983 . . . . . . . . . . . . . . . . . . . . 15,712 0 724

Manganese: (tons x 1,000)

1979 . . . . . . . . . . . . . . . . . . . . 1,250 31 0

1980 . . . . . . . . . . . . . . . . . . . . . . 1,029 23 0

1981 . . . . . . . . . . . . . . . . . . 1,027 24 0

1982 . . . . . . . . . . . . . . . . . . . . . . 672 4 0

1983 . . . . . . . . . . . . . . . . . . . . . . 730 4 0

Platinum group

metals: (troy oz x 1,000)

1979 . . . . . . . . . . . . . . . . . . . . . . 2,992 9 309

1980 . . . . . . . . . . . . . . . . . . . . . 2,846 3 331

1981 . . . . . . . . . . . . . . . . . . . . 2,445 7 392

1982 . . . . . . . . . . . . . . . . . . . . . . 1,822 9 344

1983 . . . . . . . . . . . . . . . . . . . 2,464 9 287

aAP~a~~nt ~OnSUmptlon eqUalS total Imports minus exports plus domestic production PIUS Increases of stocks and Inventories

bchromlum ~rlce ,s for metric tonnes of Transvaal ore. fob South Africa

CLTU (long ton unit) IS the metal content of one long ton of one percent grade ore It IS equivalent to 224 pounds of contained metal

NA—nol available

SOURCE US Department of the lnterior, Bureau of Mines

$/M.T. b

54-58

54-58

51-55

48-52

48-52

$/pound

24.58

25.00

19.73

12.90

12,50

$/LTUC

1,40

1.70

1.72

1,58

NA

$/troy ounce

Platinum Palladium

352 113

439 214

475 130

475 110

475 130 —

supply disruptions that result from economic

or foreign political disturbances. The concentration of supply of important minerals in a few

countries, combined with anxieties aroused by

the success of the oil producers’ cartel in the

1970s, has led to calls for materials policies that

protect the Nation against supply disruptions

in a wider range of scenarios than those contemplated under Defense Stockpile policies.

Two general approaches have been proposed

to reduce materials import vulnerability in nonwar scenarios. One is to establish uneconomic

stockpile, similar to the defense stockpile, but

which maybe used in times of economic disruption rather than military conflict. The purpose of such a stockpile would be to reduce the

impacts to the U.S. economy from peacetime

market and supply disruptions. However, there

is considerable skepticism on the part of industry that an economic stockpile could be managed without causing market disruptions itself.

The advantages and disadvantages of various

types of economic stockpiles have been the subject of much study. (See, e.g., OTA’s, An Assessment of Alternative Economic Stockpiling

Policies, OTA-M-36, August 1976.)

The second approach is technological. Through

a combination of technical advances in mineral

production, conservation, and materials substitution, the requirements for imported strategic materials can be lessened and the reliability of supplies can be increased.

This assessment concentrates on the role of

technology in reducing the vulnerability of the

United States to interruptions of supply of strategic materials. The technical approaches may

be directed either toward developing alternative sources of supply and alternative technologies for use in cases of supply interruption or,

in the longer term, toward developing new

materials and processes that significantly re-
8 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Distribution of Mine Production of Cobalt, Ch

Canada Cobalt 8%

PGM 6 %

Cuba

Cobalt 6%

Mexico

Manganese 2%

Brazil

Chromium 4 %

Manganes e 1 1 %

Finland Turkey Philippines

Chromium 4 % Chromium 6 % Chromium 5 %

Cobalt 3%0 China Cobalt 4%

USSR Manganes e 6 % Australia

Chromium 3 3 %

India Cobalt 5 %

Cobalt 8 %

Chromium 3 %

Manganes e 8 %

Manganes e 3 2 %

PGM 4 9 %

Manganes e

6 %

Albania

Chromium 5 %

SOURCE Office of Technology Assessment, from U S Bureau of Mines data
.

Ch. 1—Summary ● 9

m, Manganese and Platinum Group Metals—1981

Zaire South Africa

Cobalt 4 7 % Chromium 3 4 %

Gabon Manganes e 2 3 %

Manganes e 9 %

PGM 4 4 %

Botswana Zimbabwe

Cobalt Chromium 1 %

5 %

Zambia

Cobalt 15%

Philippines
10 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

I

I

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Ch. 1—Summary ● 1 1

duce the need for strategic materials, The va- of the current policy of supporting the defense

rious technological approaches identified are stockpile and, potentially, the establishment of

distinct from, but may be combined with, the an economic stockpile.

nontechnical alternatives, that is, continuation

Identification of Strategic

What makes a material strategic? Two factors must be considered: the critical nature of

its uses and the vulnerability of its supply. The

criticality of a material is measured by its degree of use in applications essential to the

United States, both civilian and military. Vulnerability is assessed on the basis of the risk

that the supply of the material may be interrupted, and the scale and duration of the potential interruption. Thus, a strategic material

may be briefly defined as follows:

A strategic material is one for which the

quantity required for essential civilian and

military uses exceeds the reasonably secure

domestic and foreign supplies, and for which

acceptable substitutes are not available within

a reasonable period of time.

Because many materials are essential in

some applications but not others, difficulties

may arise in defining a material as critical. Definition of vulnerability poses still more difficulties, since the assessment of the risk of

supply interruption involves a subjective analysis of the behavior of other nations. Altogether, the definition of a “strategic material,”

combining uncertainties both of criticality and

of vulnerability is not a cut-and-dried matter.

The U.S. Bureau of Mines compiles and

reports data on 86 important non-fuel mineral

commodities. After eliminating the materials

and minerals that the United States exports or

for which the United States has no net imports

and the minerals for which the United States

relies on

remain.

Resources

Canada for its supply, 33 commodities

This list can be reduced further by

eliminating the materials which have a high degree of geographical and political diversity in

their production.

The result is a list of 13 minerals and materials that are essential to the national economy

and whose supply is relatively limited and vulnerable to interruption. The regional distribution of the production of these 13 strategic

materials is shown in figure 1-1. For six of the

materials in the figure, beryllium, chromium,

cobalt, industrial diamonds, manganese, and

platinum group metals, over 70 percent of

world production is located in Africa or the

Communist bloc. The pervasive role of chromium, cobalt, manganese, and platinum in the

economy, as contrasted to the more limited

roles for beryllium and industrial diamonds,

place these four materials in a “first tier” of

strategic materials; the remaining nine, while

all essential to the U.S. economy, form a second tier of strategic materials.

The four first-tier strategic materials are the

subject of this report, Chromium, cobalt, manganese, and platinum group metals are clearly

essential to the United States, and their uninterrupted supply is certainly open to question.

Issues considered with regard to these materials, and the technologies that may help reduce U.S. vulnerability to disruptions in their

supply, will also have some application to materials in the second tier.
12 ● Strategic Materials: Technologies to Reduce U.S. /report Vulnerability

—

Platinum

Diamonds

Cobalt

Beryllium

Chromium

Manganese

Vanadium

Graphite

Rutile

Bauxite

Tin

Tantalum

Columbium

Figure 1-1 .—Regional Distribution of Strategic Material Production

10 20 30 40 50

Legend

Communist bloc Oceania

Africa Western Europe

Asia N

Latin America

60 70 80 90 100

u North America

Other market c1

n

economy countries

SOURCE Off Ice of Technology Assessment from U S Bureau of Mines data

Essential Uses of Strategic Materials

The first-tier strategic materials have many

uses, a number of which are considered to be

essential. The essential uses of the first-tier strategic materials are discussed below.

Chromium

Chromium is used in a variety of applications

throughout the economy, the most essential of

which are superalloys, stainless steel, and as

an alloying element in tool, spring, and bearing steels.

As an alloying element, chromium raises the

hardness of steel, increases its strength and oxidation resistance at elevated temperatures,

and increases its wear resistance. These properties make chromium alloy steel essential in

springs, bearings, and tools, as well as in components of automobile engines.

In stainless steel, the formation of a tenacious

chromium oxide film on the surface of the material provides a barrier to corrosion and oxidation. This corrosion and oxidation resistance is essential in chemical processing plants,

oil and gas production, power generation, and

in automobile exhaust systems, principally in

the catalytic converter.

Chromium is combined with nickel, cobalt,

aluminum, and titanium to give superalloy

their exceptional corrosion and oxidation re-
Ch. 1—Summary ● 1 3

sistance at temperatures above the useful range

of steel. For example, superalloys are used in

the high-temperature regions of the aircraft gas

turbine engine in parts such as turbine blades

and vanes, turbine disks, and combustor liners.

Chromium in its mineral form of chromite

is used in insulating liners in boiler fireboxes,

steel and ferroalloy furnaces and vessels, and

in foundry sands used for casting molds. In a

chemical form it is used in pigments, metal

treatments, leather tanning, and a variety of

other applications. Although some of these uses

are essential, the quantity of chromium required to meet them is small relative to the

amount consumed in metallurgical applications,

Cobalt

Although U.S. demand for cobalt is less than

2 percent (by tonnage) of that for chromium,

it is essential in many of its applications. The

most critical are as an additive in some superalloy, as a binder for tungsten carbide tool bits,

and as a constituent of some magnetic alloys.

It is also desirable, but not irreplaceable, as an

alloying element in some tool steels, hard facing alloys, and high-strength steels. Cobalt is

contained in catalysts used in certain essential

steps in the refining of petroleum and the manufacturing of chemicals. Other nonmetallurgical applications include pigments and paint

dryers, but only a very small portion of these

applications are essential.

Manganese

Although manganese is used in a variety of

applications, ranging from an alloying agent

in aluminum alloys and bronzes to nonmetallurgical uses in batteries and chemicals, its

principal use—about 90 percent—is as an alloying and processing agent in steel. As an alloying element, manganese prevents the formation of iron sulfides which adversely affect the

properties of steel. In addition, manganese is

the most cost-effective method of increasing

the hardness of steel, leading to its use in certain impact-resistant steels and in the highstrength low alloy (HSLA) steels. As a processing agent in steelmaking, manganese is instrumental in removing oxygen from steel and in

improving slag characteristics.

Platinum Group Metals

Platinum group metals (PGMs), which comprise platinum, palladium, rhodium, iridium,

osmium, and ruthenium, are essential in catalytic applications in petroleum refining, chemical

processing, and automotive exhaust treatment.

They are also used as contacts in telecommunication switching systems and as electrodes

in ceramic capacitors, but in many of these applications gold is a satisfactory, albeit expensive, substitute for some of the platinum group

metals. Other applications include jewelry and

medical and dental equipment.

Outlook for the Future

Domestic production of stainless and alloy

steel accounted for 237,000 tons of chromium

in 1981. Requirements for these steels are projected to grow substantially for the rest of the

century. Superalloy, which require high purity

chromium metal or low carbon ferrochromium,

accounted for less than 7,000 tons of chromium

in 1981. Demand for chromium in this application may nearly double by the year 2000.

Domestic cobalt consumption was 5,800 tons

in 1981. Superalloys, the largest consumer, accounted for 2,100 tons or 36 percent of domestic consumption. Magnetic alloys used about

800 tons (14 percent of domestic consumption);

chemical and petroleum catalysts accounted

for about 600 tons (10 percent of domestic consumption); and cemented carbide tools and

dies consumed about 500 tons (almost 9 percent of domestic consumption). Growth of cobalt demand is expected to be slow over the

next decade, increasing somewhat after 1995.

In 1981, 775,000 tons of manganese contained in ore and ferroalloys were used in the

production of carbon, stainless and alloy steel.

If current steelmaking practices continue,

manganese requirements for the domestic production of steel would be expected to rise sig-
14 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

nificantly. However, changes in steelmaking

practices could result in a significant decrease

in the amount of manganese required per unit

of steel production, causing a major drop in

future manganese consumption per ton of steel

(see p. 27).

U.S. demand for platinum group metals was

1,92 million troy ounces in 1981. Of this total,

607,000 troy ounces, or 32 percent, were used

in catalytic converters of automobiles. Other

catalytic uses in the chemical and petroleum

industries accounted for 342,000 troy ounces

(18 percent of domestic consumption). Electrical applications accounted for almost 500,000

troy ounces (26 percent of domestic consumption).

PGM demand for catalytic converters may

more than double by 1995 as automobile sales

increase and as larger vehicles, such as heavy

trucks and buses, are required to use converters. Demand for PGMs in the petroleum industry will probably grow at roughly the same

rate as the economy, unless there is a sharp increase in demand for domestic fuels that would

require large quantities of PGM catalysts in the

expansion of refinery capacity. Growth of demand for PGM catalysts in the chemical industry is difficult to predict. Increased demand for

“specialty” chemicals (e. g., pharmaceuticals,

agricultural pesticides and herbicides, and biocatalyst) could push PGM consumption in the

chemical industry to as much as 400,000 troy

ounces in 1990 and to over 800,000 troy ounces

by 2000, PGM demand in the electrical industry is likely to increase slowly, although a sharp

increase in palladium demand for ceramic

capacitors is likely in the near future and demand for this use will remain high for several

years until high prices and tight supplies encourage the use of substitute materials in this

application.

These projections must be taken with caution. They are based on extensions of current

patterns and trends, and do not fully reflect the

effects of advances in materials production

technology, nor do they reflect technical advances in end uses that may result in significant increases or decreases in consumption of

these materials, However, the projections do

provide a starting point for the evaluation of

the importance of the various technical alternatives to materials import reliance that are

discussed below.

Production of Strategic Materials

Chromium is found in many parts of the

world, but world mine production is dominated by several large, high-grade deposits. In

1982, South Africa accounted for 27 percent

of the total world chromium production of

about 2.6 million short tons. The Soviet Union

produced 36 percent of the world total; six

other countries, Albania, Brazil, Finland, the

cent from the Soviet Union, 11 percent from

the Philippines, and the rest from a variety of

sources. The rest of chromium imports were

ferrochromium and chromium metal, with 35

percent coming from South Africa, 26 percent

from Zimbabwe, 12 percent from Yugoslavia

(produced, in part, from Albanian chromite),

and the balance from diverse sources,

Philippines, Turkey, and Zimbabwe, each ac- In 1982, Zaire produced 45 percent of the counted for between about 3.6 and 6 percent

of world production. world supply of cobalt, while neighboring Zambia produced 13 percent, The Soviet Union and

In 1982, the United States imported 227,000 Cuba together produced 15 percent of the

short tons of chromium contained in ore and world’s cobalt, Canada accounted for 6 percent

metal. About half of the imports were as chro- and Australia 8.7 percent, with lesser amounts

mite ore: 59 percent from South Africa, 6 per- being produced in Finland, Morocco, the
Philippines, New Caledonia, and Botswana.

Principal suppliers to the United States were

Zaire, 36 percent of imports; Zambia, 8.5 percent; Canada, Norway, Finland, and Japan between 6 and 11 percent each; and Belgium/Luxembourg, 4.5 percent, Belgian cobalt originated

from ore obtained from Zaire, while Australia,

Canada, and the Philippines supplied cobalt

ore to other processes,

Manganese ore supplies are more diversified

among major producers than are supplies of

chromium or cobalt. The Soviet Union accounted for 41 percent of 1982 world production and South Africa accounted for 23 percent. Australia, Brazil, Gabon, India, and China

each accounted for between 5 and 7.1 percent.

Ch. 1—Summary Ž 15

U.S. imports of ore came from Gabon (19 percent), South Africa (55 percent), Australia (16

percent), and Brazil (3 percent). Manganese

was also imported as ferromanganese, with

South Africa providing 40 percent and France

providing 21 percent.

Production of platinum group metals is concentrated in the Soviet Union and in South

Africa, accounting for 54 percent and 40 percent of 1982 world production, respectively.

U.S. imports were from South Africa (48 percent), the Soviet Union (16 percent), and the

United Kingdom (14 percent, processed from

material imported into the United Kingdom

from South Africa and Canada).

Historical Perspective

In the past 25 years, the United States has

had at least four major disruptions in the

supply of materials critical to the economy and

the national defense. The first of these occurred

in 1949 when, in a Cold War exchange of trade

restrictions with the United States, the Soviet

Union stopped the export of manganese and

chromium ore to the United States. The second interruption was the U.S. boycott of chromium from Rhodesia (now Zimbabwe). The

third was a many month hiatus in the import

of nickel from Canada as workers carried on

a prolonged strike, Most recently, political

disturbances in Zaire, while not actually reducing cobalt production, triggered major disruptions in supplies, inventories, and prices for

cobalt.

The Soviet Union embargo on chromium and

manganese exports to the United States in 1949

was a political action. It was a response to a

U.S. clampdown on exports of machinery,

tools, trucks, and scientific equipment to the

Soviet Union—which, in turn, was a response

to the Soviet blockade of Berlin in 1948. Another

politically motivated supply cutoff was the embargo on imports of Rhodesian chromium from

1966 to the end of 1971. The U.S. embargo conformed with a United Nations resolution which

called on all members to refrain from trade

with Rhodesia after it declared independence

from Great Britain and set a course of continued white minority rule.

In neither of these cases were there serious

effects on the economy or any interruption of

defense production. The response in both instances was, essentially, to find other foreign

sources of supply. After the 1949 Soviet embargo, the U.S. Government was active in finding alternative suppliers and in upgrading the

infrastructure of these suppliers by providing

steel to improve India’s rail transport system,

sending railcars to South Africa, and helping

to improve rail and port equipment in Ghana.

With the U.S. embargo on purchases of Rhodesian chromium in 1966, the Government sold

excess chromium from the national stockpile

but otherwise took little active part, leaving industry to find alternate suppliers, That industry was able to do so quite readily with little

evidence of shortage was due to several factors, besides the stockpile sales. The Soviets

promptly volunteered to serve as alternate suppliers of chromium to the United States, even
16 ● Strategic Materials: Technologies tO Reduce U.S. Import Vulnerability

though the United States was fighting against

their allies in Vietnam. Prices rose, drawing

other suppliers like Turkey and the Philippines

into increased production, And the Rhodesian

embargo leaked. Despite the international embargo, France, Japan, and Switzerland bought

what was probably Rhodesian chromium from

South Africa and Mozambique, Had they not

done so, the alternate suppliers might have

been hard put to provide the whole industrialized world with chromium.

A most important factor in reducing the economic impact of the loss of Rhodesian chromium was the wide-scale adoption of the argonoxygen decarburization process for the manufacture of stainless steel, This process made

it possible to use high-carbon ferrochromium

made from South African chromite in place of

the more costly low-carbon ferrochromium

made from Rhodesian ore that had been used

before the embargo.

The 1969 nickel strike in Canada shut down

supplies from the quintessentially “safe” foreign source. Unlike the politically inspired embargoes described above, it caused actual shortages and acute price hikes. The reasons for the

acute effects were twofold: the cutoff occurred

at a time of strong demand for nickel when

world supplies had already been tight for 3

years; and Canada was then almost the sole

supplier to the United States. Even so, military

and essential civilian production continued

without interruption throughout the shortage.

By 1970, world nickel prices were back to normal and supplies were ample.

The shortages and high prices elicited changes

in the behavior of U.S. nickel users, They substituted other materials where they could, for

example, replacing nickel stainless steel with

chrome-manganese stainless steel (a substitute

alloy that had been developed during the Korean war). Many users turned to nickel recycled from scrap. And they paid high prices for

the limited remaining supplies of nickel—once

more supplied largely by the Soviets, An important factor in recovering from the acute

nickel shortage was the U.S. Government’s release of a large quantity of nickel from the

stockpile as the strike came to its end. Earlier

Government actions had been to allocate available supplies to military users.

During the cobalt “shortage” of 1978-79,

there was never any real interruption of supply,

On the contrary, production in Zaire and Zambia—by far the largest cobalt producers in the

world market—rose 43 percent during 1978

and another 12 percent in 1979. But the combination of rapidly rising world demand and

fears of a supply cutoff, triggered by a rebel invasion of Zaire’s mining region, set off a wave

of panic buying. This, coupled with the recent

removal of an important source of world supply (sales from the U.S. stockpile) and the relatively low industry inventories of cobalt, sent

cobalt prices soaring.

During the “shortage,” cobalt users turned

quickly to substitutions and recycling. Under

the spur of high prices, nonessential uses made

way for essential. Government allocation was

not needed to reserve cobalt for superalloys for

military jet engines; superalloy producers and

users paid the high prices demanded by dealers,

and they recycled. Use of cobalt in permanent

magnets for loudspeakers dropped by half as

ceramic magnets were substituted. The ceramic magnet technology was already on the

shelf but had not been widely adopted because

it required redesign and retooling. High cobalt

prices made these changes worthwhile, The

drop in demand for cobalt due to substitution,

recycling and conservation had its effect on

prices, which turned down in 1980. By 1982,

with worldwide recession, cobalt prices plunged

below the 1978 level.

None of these cases resulted in severe or

long-lasting damage to the United States. Nonetheless, the issue of foreign dependence for

materials critical to the country is a major one.

For some materials, alternative suppliers are

by no means as readily available today as they

were in past years. In 1949, small producers

such as India and Turkey were capable of expanding their production sufficiently to replace

our major suppliers of manganese and chromium; they are not today, Nor are there any

major new technologies in stainless steelmak-
Ch. 1—Summary ● 1 7

ing opening up new types of ore for exploitation, as the argon-oxygen decarburization process did for South African chrome ore after

Rhodesian supplies were embargoed. The

Canadian nickel strike and, to a lesser degree,

the disruption in cobalt markets resulting from

the Zairian disturbances, showed that interruptions in metal supplies could have financial effects much greater than might have been expected, on the basis of the dollar value of

imports of these metals,

These four diverse historical examples illustrate two important points. First, interruptions

or even complete cessation of supply from major producers of strategic materials are possible, whether as a result of international politics, internal rebellion, labor difficulties or

other causes. Second, technology provided a

means to respond to interruptions of supply in

each of the examples. Thus, a basic question

to be answered in considering the full range

of possible elements in a Government policy

for strategic materials is the extent to which

technology can protect the U.S. economy from

the adverse effects of possible interruptions in

the future. The first step toward answering this

question is to identify the technological alternatives to the current state of reliance on imports of strategic materials.

Technological Approaches to Reduce

There are many technological approaches to

reduce U.S. materials import vulnerability, and

they may be combined in many different ways.

For the strategic materials policy maker, it may

be best to group these various approaches into

a materials technology triad. The components

of this triad are minerals production and metal

processing, conservation, and substitution.

The production leg of the triad includes domestic production, diversified foreign production, and production of minerals from regions

beyond national jurisdiction, The processing

of these minerals into forms used by industry,

particularly ferrochromium and ferromanganese

for the steel industry, is also included in the

production leg. The conservation leg includes

improved manufacturing technologies that use

materials more efficiently, such as improved

casting methods, more efficient forging techniques, and the manufacture of parts from

powdered metals. It also includes the recycling

of scrap generated during the manufacture of

components and of obsolete scrap retrieved

from discarded products. The third leg of the

triad, substitution, involves the use of materials

with reduced strategic materials content in

place of traditional materials. An example is

the use of 9 percent chromium steel in place

of

Materials

stainless steel

Import Vulnerability

containing 18 percent chromium in certain powerplant applications. Substitution also includes the displacement of

strategic materials by new materials such as

advanced ceramics or composites.

Individually, no one technological approach

can meet all of the varied problems that might

arise with regard to the security of supply of

the four first-tier strategic materials; the approaches must be combined to improve their

effectiveness. Further, each provides opportunities that differ for the various materials.

Thus, the most effective combination of technological approaches for dealing with materials import vulnerability varies from one material to the next,

Summary of Technological Approaches

In reviewing the outlook for technological approaches to reduce materials import vulnerability for the four first-tier strategic materials,

several points become apparent. First, there is

no single solution. For example, as is shown

in table 1-1, substitution is extremely important to reducing chromium vulnerability, but

has little contribution to make in the case of

manganese. Recycling, which is important for
18 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table 1-1 .—Summary of Most Promising Technological Approaches to the Reduction of

Strategic Materials Import Vulnerability

Approach Potential benefitsa Barriers to implementation

Chromium:

Substitution Direct substitution could now reduce U.S.

chromium needs by one-third. Another onethird reduction may possibly be achieved

through a 10-year R&D program.

Advanced materials may displace chromium

alloys in certain aerospace and industrial applications.

Conservation Expanded recycling of scrap and waste could

provide at least 20,000 tons of chromium

beyond current recycling levels.

Production Development of alternative foreign sources

could provide about 30,000 to 60,000 tons,

about 10 to 20% of current U.S. demand.

Cobalt:

Conservation Recycling could recover much of the cobalt in

scrap and waste that is currently lost or

downgraded.

Substitution

Production

Process improvements now being adopted may

make significant reductions in the amount of

cobalt used to make jet engine components.

Direct substitutes under development could

reduce the need for cobalt by 50°/0 or more

in some critical superalloy applications.

Advanced materials may displace cobalt in

some aerospace and industrial applications.

Domestic production from three sites could produce up to 8 million pounds of cobalt per

year.

New foreign production could provide almost 15

million pounds of cobalt per year.

Manganese:

Conservation Process improvements could reduce needs for

imported manganese in steel by 45% by year

2000.

Production Alternative suppliers to South Africa and the

Soviet Union could increase production

after 2 to 3 years to expand facilities.

Platinum group metals (PGMs):

Conservation Recycling of catalytic converters could recover

500,000 troy ounces of PGM annually by

1995.

Product ion Development of the Stillwater deposit could produce 175,000 troy ounces of PGM in the near

term; additional development is possible.

Low cost of chromium alloys deters use of

substitutes; lack of information on

substitutes slows their use in times of shortage; need for further tests and experience

limits near-term potential for substitution to

one-third of consumption.

Basic and applied research is needed to improve properties and reliability of advanced

materials. Designers and engineers need better understanding of properties and limitations of advanced materials. Tests and

standards need to be developed for these

materials.

Barriers to chromium recycling are economic,

not technical.

At current prices for chromium, there is no

economic incentive to diversify suppliers.

Government assistance would be required to

make development of alternative suppliers

more attractive.

Principal barrier is economic; however, extensive recovery of superalloy scrap may require

use of technology that is now limited to

laboratory testing.

Economic factors favor the adoption of process

improvements.

Industry has little or no incentive to expend the

time and money needed to qualify alternative

alloys except when there are significant performance advantages.

Barriers to adoption of advanced materials to

reduce cobalt consumption are the same as

for chromium, as described above.

Current prices for cobalt and/or co-product

metals are too low to justify investment

without Federal subsidies.

Investments are being postponed until cobalt

prices rise. Lead times of 2 to 5 years are

needed to bring deposits into production,

Adoption of improvements will depend on incremental upgrading of domestic steelmaking facilities.

Assured market for increased production is

needed to justify investment in production

and transportation facilities: U.S. would be in

competition with other consumers for new

production; facilities for processing ore into

ferromanganese must also be available.

No significant barriers; several years will be

needed to develop collection and processing

infrastructure.

Domestic production will require slightly higher

prices for platinum and palladium and

evidence of increased demand.

aThe benefits accruing from the various approaches are not cumulative. For example, as scrap generation in manufacturing IS reduced through improved processing

techniques, the potential benefits of recycling are also reduced

SOURCE Office of Technology Assessment
Ch. 1—Summary ● 19

.

platinum and cobalt, is also a minor contributor for manganese, Similarly, processing efficiency, diversity of supply, and domestic production all vary in importance for each of the

strategic materials.

Second, none of the approaches offers a

“quick fix” to import vulnerability problems,

All require a continuing commitment, whether

the approach is to maintain substitution information on a current basis, or to move new

materials from the laboratory to industrial use,

or to encourage investment in new mines or

processing facilities.

Third, the existence of technological alternatives is based on a history of long and continued support by Government, academia, and

industry for basic research in materials science

and engineering. Had this commitment been

significantly less, fewer alternatives would be

available today.

Fourth, in only a few instances is it likely that

the technological approaches which offer

promise to reduce import vulnerability will be

implemented under normal economic and market conditions. Improvements in steelmaking

technology and recycling of catalytic converters are underway and are likely to continue, as are improvements in superalloy

fabrication technology. Development of the

Stillwater, MT, PGM deposit is a strong possibility, although the actual decision to go

ahead will rest on a positive assessment of

future markets for platinum group metals. Development of advanced materials that contain

no strategic materials is likely, but it is not clear

how useful these materials will be in applications that now require strategic materials, For

the rest of the technical approaches, the outlook for implementation is poor unless new incentives are forthcoming, provided either by

the market (in the form of tightened supplies

and higher prices) or by the Government (as

investment assistance or price supports).

Chromium

PRODUCTION

World production of chromite, the ore from

which chromium is obtained, is largely accounted for by southern African and Communist countries. In 1982, South Africa accounted for 22 percent of chromite production,

the U.S.S.R. accounted for 24 percent, Albania

for 12 percent and Zimbabwe for 4 percent.

Another 22 percent was spread among Brazil,

Finland, India, Madagascar, the Philippines,

and Turkey. The processes of ferrochromium,

the form used in making alloy and stainless

steel, are more diversified. In the 1980-82

period, the Soviet Union and South Africa each

accounted for 20 to 25 percent of world production. Japan was a midlevel producer, accounting for about 15 percent and the United

States accounted for about 7 percent. These

figures are static, however, and do not reflect

the trend toward decreased diversity of ferrochromium production. From 1974 to 1980,

U.S. ferrochromium production declined by 29

percent, Japan by 21 percent, and France by

30 percent. During the same period, South African ferrochromium production rose by 193

percent and the Soviet Union 279 percent.

Domestic Production.—Domestic resources offer

few opportunities for reducing import dependence for chromium. United States chromium

resources are limited to low-grade deposits,

such as the Stillwater Complex in Montana, the

small, discrete deposits of chromite in northern California and Oregon, and extremely lowgrade chromite associated with nickel laterites

such as the Gasquet Mountain deposit in northern California. The Stillwater deposit was

mined under Government contract during

World War II, but it is not under consideration

for development now, Somewhat lower in cost

to mine than the Stillwater ores, the disseminated, or podiform, chromite deposits of California and Oregon also provide a resource that

could be tapped in times of national emergency, but one that is not competitive with

worldwide chromite deposits now in operation,

Only one domestic chromite resource, the

Gasquet Mountain nickel laterite deposit, is

under consideration for development at this

time. The development proposals call for this

deposit to produce nickel and cobalt, with a

chromite concentrate as a byproduct. Considering current prices for nickel and cobalt, the

outlook for this mine is dim. Even if it does enter into operation, the production of chromite
20 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

would be less than 3 percent of U.S. annual

consumption of chromium.

Although only low-grade deposits of chromium have been discovered in the United

States, the possibility remains that better deposits exist. High-grade chromite deposits,

where they exist, are normally associated with

the Precambrian rock such as that which

underlies much of North America. Unfortunately, only small areas of this rock are exposed. Conventional mineral reconnaissance

techniques, which rely heavily on the identification of surface features associated with

the desired mineral deposits, are limited to

these exposed areas. In other areas, the precambrian rock is covered by thick layers of

sediment or glacial debris, precluding the use

of surface features to disclose the nature of subsurface deposits. Advances in exploration technology, however, may improve the outlook for

the discovery of more deposits. Improved geophysical techniques, such as arial gravimetric

and magnetic analyses targeted specifically at

chromium, could reduce the dependence of explorationists on surface geology. Improved geochemical and core drilling technology could

encourage the exploration for chromium (and

other minerals) by reducing exploration costs.

In the long term, improved scientific understanding of the processes that form deposits

could assist explorers to identify regions in

which to concentrate their efforts.

Diversified Foreign Production.— Unless major new

deposits of chromite are discovered, the opportunities to diversify supplies of chromium are

limited to minor expansion of small producers,

such as Albania, Turkey, and the Philippines, and

the exploitation of known, but undeveloped,

chromite resources in the laterites and beach

sands of New Caledonia and the Philippines,

The deposits in Albania, Turkey, and the

Philippines are small and discrete, and it is

likely that many deposits remain undiscovered,

Production from these countries might be increased if techniques for identifying scattered

deposits of chromite can be improved.

Technologies have been developed for the

production of chromite from nickel laterites

and beach sands, but the ore grades of such deposits generally range from 2 to 5 percent

chromic oxide. With the major producers

supplying ore that contains 35 to 48 percent

chromic oxide, the lateritic and sand deposits

would require substantial concentration to produce a marketable product, and the estimated

cost of producing such a product is two to three

times the current market price.

Ferrochromium Processing Capacity.—Before 1970,

the United States had sufficient capacity to

meet its needs for ferrochromium, the form of

chromium used in the production of steel.

Since that time, however, imports of ferrochromium have reduced the domestic industry’s

share of United States demand and, with time,

the capacity to produce ferrochromium domestically is also decreasing as furnaces and plants

are decommissioned. As domestic processing

capacity declines, the United States loses its

flexibility to turn to alternative sources of ore

from countries that do not have their own ferrochromium facilities.

The decline of the domestic industry is directly related to the cost of operation. Costs of

power, labor, and transportation are, in general, lower for the producers in countries

where chromium ore is mined than for U.S.

firms, In addition, national policies in the producer countries often provide economic incentives for local processing of ferroalloys.

The advantages enjoyed by producing countries are not insurmountable. The growing

need to blend together ores that have different

chemical and physical properties means that

all producers will need to import ores, so that

all producers will pay the additional cost of

transporting ore rather than the more concentrated ferroalloy. Labor rates in many producer

countries are now quite low, but are likely to

increase more rapidly than in the United

States, thereby narrowing the cost differences.

Improvements in the technology for measurement and automatic control of processing operations should provide gradual improvements

in domestic plants. In the longer term, advanced furnaces may provide means to reduce

energy consumption, further reducing advan-
Ch. 1—Summary ● 2 1

tages held by some foreign producers. Economic and trade agreements may also help narrow the economic gap. With the advantage of

proximity to consumers, which gives U.S. producers an advantage in responding to special

orders placed by the steel industry, technical

improvements in ferroalloy facilities could improve the potential to maintain a domestic ferrochromium industry capable of processing

ore from a variety of foreign sources,

In the long term, with wise adoption and application of technology, the industry may be

able to keep a significant share of the domestic market for ferrochromium, ferromanganese, and other ferroalloys. In the near term,

however, there is little technology can do; so,

during this period, the domestic industry is

likely to need economic and political assistance

if it is to preserve a market presence against

foreign competition.

CONSERVATION

Chromium-bearing manufacturing and obsolete scrap are marketable products that account for about 10 to 15 percent of U.S. consumption of chromium, Because recycling of

manufacturing scrap is already at a high level,

there is little opportunity to increase chromium

recovery in this area. There are, however, significant opportunities to increase the recovery

of chromium from obsolete stainless steel scrap

and from waste produced by steelmaking and

chemical processing plants.

Recycling of obsolete stainless steel scrap is

difficult because of the long lifetime of stainless

steel products, the wide dispersion of the products through the economy, and the difficulty

of separating the stainless steel from other

materials in discarded products. The most

promising prospect is in the automotive area.

About one-third of all obsolete stainless steel

scrap is obtained from junked automobiles;

even so, only 30 to 40 percent of the chromium

contained in the cars is recovered. The best opportunity for increasing chromium recovery

from automobiles lies in the catalytic converter.

The shell of the converter, which is made from

Type 409 stainless steel, contains 1,8 to 2.6

pounds of chromium—over half of the total

chromium content of the automobile. Since this

type of stainless steel is magnetic, it is not

easily separated from other magnetic parts either before or after the cars are shredded. However, interest in recycling of the platinum in

the converters is increasing (see “Platinum

Group Metals” below) and the converters are

starting to be removed for separate processing,

which makes the stainless steel shell available

for recycling. If recycled separately, the converter shells could produce about 5,000 to 7,000

tons of chromium per year, or up to 3 percent

of the 1981 U.S. demand for chromium in stainless and alloy steels,

Opportunities for recovery of chromium

from industrial wastes are difficult to quantify

because of a lack of up-to-date information. In

1974, the most recent year in which data were

compiled, chromium lost in industrial waste

was estimated to be over 28,000 tons, including

over 17,000 tons from various metallurgical

processes. Since that time, several firms have

instituted both internal and commercial waste

processing programs. For example, Inmetco,

a subsidiary of Inco, processes flue dust, mill

scale, and grinding swarf containing 3,100 tons

of chromium with chromium recovery rates of

about 90 percent. Other facilities have been developed to process other forms of scrap and

waste.

Chemical and metal finishing industry wastes

were estimated to contain over 3,000 tons of

chromium in 1974, which was then almost entirely lost. Although recycling or regenerating

the chromium from these wastes is expensive,

the cost of meeting strict standards for the disposal of waste in landfills could encourage the

recovery of metals, Furthermore, the value of

the metal could help lower the costs of processing the waste for disposal. Several recovery

technologies, including closed-loop systems to

extend the life of acid baths, have been under

development and hold promise to reduce chromium losses in the future.

SUBSTITUTION

Direct Substitutes.—The most important use of

chromium is in metallurgical applications,
22 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

where it provides properties of hardness, wear

resistance, high-temperature strength, and resistance to oxidation and corrosion. It is in

these uses that substitution offers the greatest

opportunities to reduce the requirements for

imported chromium.

Because of its relatively low cost, availability, history of satisfactory performance, and

familiarity to designers, chromium-containing

steels, particularly stainless steels, are widely

used, even in applications that do not require

the superior performance provided by the high

chromium content. There are many opportunities to use materials with reduced chromium or no chromium at all, but there is no

single substitute material that can serve in all

of the applications where stainless steel is now

used. Appropriate substitute materials must be

selected for specific applications. Some of the

more promising substitutes for stainless steel

are summarized in table 1-2.

It is important to note that there are few incentives to replace stainless steel in most applications. As a result, most potential substitute materials remain at the laboratory stage

because, without economic incentives to adopt

alternative materials, private industry will not

spend the money required to move the materials to commercial use.

Advanced Materials. —In the long term, nonmetallic and unconventional metallic materials

may provide alternatives to chromium-bearing

stainless and alloy steels and superalloys.

Ceramics are being developed for possible use

in engine components, power plants, and bearings—all applications that now use stainless or

alloy steel—and in gas turbine engines in place

of superalloys. Advanced composites may be

used in applications that require high strength

and light weight. New metallic materials, including rapidly solidified metals and longrange ordered intermetallics may provide alternative materials for use at high-temperature applications, such as turbine components in jet

engines, that otherwise require alloys with

chromium contents of 20 percent or more.

However, advanced materials must overcome substantial barriers before they can significantly reduce the need for chromium or

other strategic materials, With few exceptions,

these materials are still in early stages of development. Considerably more work must be

done in the laboratory to improve the properties of the materials, and processing and manufacturing methods must be developed to accommodate their special properties. Even then,

the materials must gain acceptance by designers, who will evaluate them not only on ecoTable 1-2.—Substitution for Chromium in Metallurgical Applications

Application material Current material Alternative Developer Status

Boiler tubes in con- Type 304 stainless Modified 9°/0 Oak Ridge National In process of cerventional and nuclear steel (18% chromium) chromium/1% Laboratory tification by ASME

powerplants molybdenum steel code committees

General use in Type 304 stainless Manganese-alumi- Diverse locations in Laboratory stage in

moderately corrosive steel num steels U.S. and other U.S. Minor practical

or oxidizing countries applications in China

environments

High-temperature ox- Type 304 stainless 8°/0 aluminum/6% Bureau of Mines Laboratory stage

idizing environments steel molybdenum steel

Corrosive environ- Type 304 stainless 9°/0 chromium alloy Bureau of Mines/ Laboratory stage

ments (chemical steel steel Inco

processing)

General use (moderate Type 304 stainless 12°/0 chromium NASA Lewis Laboratory stage

corrosion and oxida- steel stainless steel Research Center

tion uses)

Automotive exhaust Type 409 stainless 6-12°/0 chromium ARMCO Laboratory stage

systems and catalytic steel (1 2°/0 chromium) alloy steel

converters

SOURCE Office of Technology Assessment.
—

nomic grounds but on the familiarity that

grows with practical experience,

Cobalt

PRODUCTION

Cobalt is generally produced as a byproduct

of nickel or copper mining, its sales supplementing the revenues from these other products. Only rarely is it mined for its own sake.

The largest cobalt producers, Zaire and Zambia, produce cobalt from their copper mines.

Canada and Botswana produce it from nickelcopper mines, and Cuba and the Philippines

recover it from nickel laterites. Less commonly,

cobalt may also be found in deposits of lead,

iron, and manganese. Only in Morocco has cobalt been produced as a principal product. As

a result of the wide distribution of cobaltbearing ores, diversified production, both domestic and foreign, is a more promising option

for the reduction of import vulnerability for

cobalt than for chromium, manganese, or platinum group metals.

Domestic.—In the aftermath of the Korean war,

the United States obtained cobalt from domestic sources, largely by granting Federal subsidies to the mine operators. Three deposits,

the Blackbird mine in Idaho (a copper-cobalt

mine), the Madison mine in Missouri (leadcobalt) and the now-depleted Cornwall mine

in Pennsylvania (an iron deposit with small

amounts of cobalt), provided the bulk of domestic cobalt. In addition to these proven deposits, several other deposits are known and have

been studied as possible domestic sources.

These are the copper-nickel deposits of the

Duluth Gabbro in Minnesota and the cobaltcontaining nickel laterites in northern California.

At current and projected prices for cobalt

and other metals that can be produced from

the Blackbird mine, the Madison mine, the

Duluth Gabbro, and the nickel laterite deposit

at Gasquet Mountain in California, domestic

cobalt production is economically unattractive,

Unless prices for cobalt, nickel, lead, and copper show major and prolonged increases, private industry will not develop any of these deCh. 1—Summary ● 2 3

posits. Increases on the order of 50 percent for

nickel and copper, or 100 percent or more for

cobalt would be necessary to encourage private

investment. At these higher prices, domestic

production of cobalt could be significant, Development plans for the Blackbird mine call for

the production of 3.7 million pounds of cobalt

per year, for the Madison mine 2 million

pounds, and for the Gasquet Mountain deposit

2 million pounds. The lives of these mines vary

from 10 to 20 years, based on proven reserves.

Potential cobalt production of hypothetical

mines in the Duluth Gabbro is estimated to be

from 1 million to 2 million pounds annually,

Diversified Foreign Production.--The high market

prices that are required for domestic production of cobalt have led developers to look for

deposits in foreign countries that offer more

attractive economics. With long-term price increases less extensive than those required to

make U.S. deposits economic, cobalt production from nickel mines in Canada and Australia, which accounted for 10 percent of world

production in 1980, can be increased substantially.

Increases in cobalt and nickel prices would

also improve the prospects for the development

of cobalt deposits in Indonesia, New Guinea,

New Caledonia, and Peru. These four deposits are summarized in table 1-3. The total potential cobalt production of these four deposits could be 14.7 million pounds per year if they

were all to enter production. As with the domestic deposits of cobalt, however, these four

are unlikely to be developed under current economic conditions. In fact, development at Gag

Island was recently halted due to poor economic outlook and partnership disagreements,

Table 1-3.—Potential New Foreign Cobalt Production

Estimated production Leadtime to

Site (million pounds/year) start production

Gag Island, Indonesia 2 8 2 to 3 years

Ramu River, New Guinea 5 9 5 + years

Goro, New Caledonia 20 3.5 to 5 years

Marcona Mine, Peru 4.0 2 years

Total 147

SOURCE Off Ice of Technology Assessment
24 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

and development of the other three deposits

awaits improved markets for nickel and cobalt.

Ocean Resources.—For over 100 years it has

been known that in the depths of the ocean

there are deposits of nodules and crusts of

manganese that contain copper, nickel, and cobalt, sometimes in concentrations that would

be very attractive in land-based deposits. Advances in the technology for ocean resource

exploration and development during the 1960s

and 1970s raised the possibility of recovering

these minerals from the seabed. Commercial

interest centered on the manganese nodules of

the east central Pacific ocean where the nickel,

copper, and cobalt contents were at their highest. After a peak of interest in the late 1970s,

however, interest in the development of these

resources declined sharply, Although uncertainties about the legal right to mine the resources contributed to the decline in interest,

more significant were the increases in the projected cost of exploitation (based on the analysis of data from prototype tests conducted in

1979 and 1980) and the realization that assumptions of future increases in the price of nickel

and copper were overly optimistic, The high

cost of building and operating an ocean mining system is compounded by the legal uncertainties arising from U.S. abstinence from the

seabed mining provisions of the Law of the Sea

Convention, and by the cost of development

and testing remaining to be done on mining

systems. With time, as higher grade land-based

resources are depleted, the resources of the

deep sea floor may well become a major source

of cobalt and other metals. At this time, however, land-based sources of cobalt, whether foreign or domestic, appear more attractive for

commercial development.

CONSERVATION

There are a number of conservation alternatives to reduce U.S. requirements for cobalt.

The manufacture of superalloy components is

a particularly attractive area for improvement.

A considerable amount of machining is performed on jet engine components, resulting in

large quantities of manufacturing scrap. Ratios

as high as 10 to 1 for purchased metal to metal

used in the engine are seen, with ratios of 6

to 1 being common. Less than 50 percent of this

superalloy manufacturing scrap is recycled for

use in superalloy; the rest is used in steel for

its nickel and chromium content, is exported

to foreign consumers, or is disposed of as

waste. Obsolete parts made of superalloys are

contaminated with carbon and sulfur, and generally are not recycled for production of jet engine components. Past failure to utilize scrap

has been based, in part, on engine manufacturers’ standards that limited the use of scrap

and, in some cases, prohibited its use altogether, due to concern that contaminants would not

be removed in refining processes and the resulting alloy would be unsuitable for use in critical applications, With experience, it has been

possible for manufacturers to relax the specifications to allow the use of superalloy that

contain up to 50 percent recycled materials

(principally from manufacturing scrap) in aircraft applications,

Recent advances in remelting and refining

technology have led to the development of

processes that could refine manufacturing

scrap, and even some obsolete scrap, to produce new alloys that can meet the strictest of

standards required by aircraft engine manufacturers, Processes have also been developed to

recover individual elements from mixed alloy

scrap. The usefulness of these processes is

limited, however, because they have only been

tested in the laboratory or in small pilot plants.

Further time and effort are needed to determine their technical and commercial feasibility as full-scale facilities.

A second conservation measure that could

reduce import vulnerability for cobalt is the use

of more efficient manufacturing technologies,

Particularly important among these, for superalloy, are near-net-shape technologies, These

include powder metallurgy, in which powdered metals are pressed under high pressure

and temperature into a form close to the final

shape of the desired component; hot isothermal forging, in which materials are deformed

under extremely plastic or superplastic conditions to near final shape; and advanced precision casting methods that allow the production
Ch. 1—Summary ● 2 5

of complex shapes as a single part, eliminating many machining steps that would otherwise produce scrap, much of which would be

downgraded or lost.

An example of the benefits of these advanced

manufacturing processes is the production of

the turbine disk for the Pratt & Whitney F-100

jet engine. When first designed, this 15-pound

part was forged from a 250-pound billet of

Astroloy (17 percent cobalt), which resulted in

235 pounds of chips containing 40 pounds of

cobalt. With isothermal forging, the billet

weight is reduced to 126 pounds and the material used is IN-100 (18.5 percent cobalt) instead of Astroloy; the result is 110 pounds of

chips containing 20.5 pounds of cobalt—almost

a 50 percent saving in cobalt. Future improvements are expected to reduce chip formation

to 35 pounds of material containing less than

7 percent cobalt; the result will be a net cobalt

savings of over 80 percent, compared with the

original manufacturing process,

Improvements both in recycling and in manufacturing efficiency act to reduce U.S. dependence on imports. However, the economic factors that may impel manufacturers to adopt

them are different. Manufacturing improvements are likely to continue because the improvements result in overall cost savings and

performance benefits, not because they reduce

cobalt consumption, per se. Advances in recycling technology are much more dependent

on a specific interest in conserving cobalt; they

are likely to occur slowly, if at all, unless price

increases or supply uncertainties provide incentives for further development in the reuse

of superalloy scrap for critical applications,

SUBSTITUTION

Owing largely to the uncertainty of cobalt

supplies following the 1978-79 disturbances in

Zaire, the U.S. Government sponsored research

into the potential to reduce strategic material

requirements in jet aircraft, Results of laboratory tests indicate that cobalt content of some

superalloys currently used in aircraft engines

could be reduced by 50 percent or more through

the use of new alloys, Some steps along this

line were taken by jet engine manufacturers

through the substitution of nickel-based superalloy containing little or no cobalt for cobaltbased superalloys and cobalt nickel-based superalloys with high cobalt content. Further

steps along these lines are more difficult, however, The certification of a new alloy for use

in critical aircraft applications is an expensive

and time-consuming process, one that companies will not carry out unless the substitute

provides clear performance benefits or unless

faced with high metals prices or extreme and

prolonged uncertainty about the availability of

cobalt.

As with chromium, long-term opportunities

to develop substitutes for cobalt-bearing alloys

are enhanced by the development of advanced

materials, Ceramic cutting tools are already being used in place of high-temperature tool

steels or cemented carbide tool bits that contain cobalt. Ceramics and carbon-carbon composites have shown some potential for hightemperature applications that now require

superalloy. Advanced metallic materials, including rapidly solidified materials and longrange ordered alloys, also have high-temperature characteristics that may lead to their

future application in place of conventional cobalt and chromium-bearing superalloys.

Manganese

About half of the manganese consumed in

the production of steel is contained in iron ore

and scrap, Since these materials are available

domestically or from Canada, this supply of

manganese is relatively secure from interruption. The remainder of the manganese in steel

is provided in the form of manganese ore and

ferromanganese that the United States must

import.

PRODUCTION

World manganese production is dominated

by a limited number of very large deposits that,

because of their large reserves and high manganese content, are very economical to operate. The major producers, South Africa, the

U. S. S. R., Gabon, Australia, China, and Brazil,

accounted for all but 5 percent of world production in 1982. In addition, Mexican produc38-844 0 - 85 - 2 : QL 3
26 • Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

tion accounted for 2 percent of total world production. Production is concentrated in the

U.S.S.R. (4 I percent of 1982 production) and

South Africa (23 percent).

Domestic Production. —The United States is endowed with only relatively small and low-grade

deposits of manganese. Although these deposits were exploited during World War II, they

are not economically competitive with the

world class deposits now in production. Prices

between $8 and $35 per long ton unit (equivalent to 22.4 pounds of manganese) are estimated to be required for domestic deposits to

become economic. With the current market

price ranging between $1.45 and $1.75 per long

ton unit, it is doubtful that domestic manganese

will be developed, although some production

of low-grade ferruginous manganese ores (defined as ores containing less than 35 percent

manganese) is possible.

Undiscovered deposits of manganese of commercial or near-commercial grade may exist in

the United States. However, manganese cannot be detected by airborne methods, so exploration must be conducted on the ground,

raising the cost of initial reconnaissance. Wide

distribution of manganese in rock and soil

makes it difficult to distinguish traces of manganese associated with ore deposits from the

general background concentration, reducing

the usefulness of geochemical exploration

methods. If exploration for manganese is to be

encouraged, improved theories of formation

must be developed so that promising locations

for deposits can be identified and geochemical and geophysical methods can be concentrated in these more promising areas. Given the

availability of manganese at low cost from a

variety of suppliers, it is unlikely that private

firms will conduct research aimed at locating

domestic manganese deposits since the benefits, if any, would occur far in the future.

Diversified Foreign Production.—Increased production of manganese at the Groote Eylant mine

in Australia offers the best opportunity for

diversification away from South Africa. Highgrade ore and proximity to ocean transport

make expansion of this deposit relatively easy.

Mexico also could expand its production, but

Mexican ore is lower in quality than that of the

major producers. Expansion of this deposit

would be more costly than expansion of the

Australian deposit because, in addition to the

cost of expanding mine capacity, additional investment to increase the capacity of the ore upgrading equipment would be necessary. Possibilities for diversification are also limited in

Gabon, where a long transportation line that

includes an aerial tramway limits the potential

to increase the production rate, In Brazil and

China, a large share of manganese production

is dedicated to the current and future needs of

their domestic steel industries. Although expansion of manganese production for export

is possible in these countries, it is not currently

planned,

Ocean Production.—Certain areas of the ocean

are favorable to the formation of crusts or

nodules containing up to 30 percent manganese. Manganese contained in these deposits

is finely disseminated through the material and

not easily processed into a conventional manganese ore. With further development of ocean

mining technology, the nodules located on the

Blake Plateau off the coast of Florida could become a new domestic source of manganese but

costs of production would be similar to those

of other domestic ores and much higher than

many foreign ores. Similarly, manganese could

be recovered as a byproduct of deep ocean mining in the Pacific for nodules rich in nickel,

copper, and cobalt. However, mining of the Pacific nodules appears to be far in the future.

Manganese Processing Capacity .-For its largest

and most important application—as a processing and alloying agent in the manufacture of

steel—manganese ore must be processed into

ferromanganese. As is the case with chromium,

the United States has become dependent on

foreign processing of manganese ore to meet

much of its demand for ferromanganese. Since

the equipment and processes for ferromanganese production are similar to those for ferrochromium (in fact, the facilities are sometimes converted from one product to the other,

although at a reduction in efficiency), the tech-
Ch. 1—Summary ● 2 7

nical approaches to maintain a domestic processing capacity are also similar. Technological advances offer little help to the domestic

industry in the immediate future. However, improved technology for monitoring and controlling ferromanganese furnaces could raise the

productivity of domestic facilities to a limited

degree. Over a longer period, the development,

refinement, and adoption of new high-voltage

and plasma arc furnaces may give domestic

producers an edge in efficiency over foreign

producers who

and allow them

who do.

do not adopt the technology

to be competitive with those

CONSERVATION

Improvements in steel production technology provide the best prospect for the reduction

of manganese import vulnerability. Careful

measurement of sulfur levels and manganese

additions, resulting in manganese contents

near the lower level allowed by steel specifications, can result in reductions of manganese

consumption per ton of steel by about 8 percent. External desulfurization, which reduces

manganese requirements, may provide even

more dramatic savings and so may up-to-date

steelmaking techniques such as continuous

casting, which keep to a minimum internal, or

“home” scrap that in each cycle through the

steelmaking process contributes to inevitable

losses of manganese in slag.

As shown in table 1-4, 35.6 pounds of manganese are used on average to produce one ton

of steel, 17.8 pounds of which is provided by

imported manganese ore and ferromanganese.

Only 13.8 pounds remain in the steel while the

other 21.8 pounds is lost in slag, dust, and

waste. By the year 2000, the average manganese content of steel is likely to decline slightly

to 12.2 pounds per ton of product, but major

reductions are expected in the amount of manganese lost. The net result will be a reduction

in total manganese consumption per ton steel

from 35.6 to 24.8 pounds. Even more striking,

and more important from a security of supply

viewpoint, the consumption of imported manganese ore and ferromanganese is estimated

to decline from 17.8 pounds per ton of steel to

Table 1.4.—Current and Projected Manganese

Consumption in U.S. Steel Production

(pounds of manganese per ton of steel product)

Current Projected–2000

(1981-82) Expected Best Worst

Inputs:

Manganese products:

Manganese ore 1 9 1,2 1,0 1.5

Ferromanganese 159 8.3 55 12 2

Tota l 17.8 9 5 6,5 13, 7

Iron and steel products:

Iron ore and sinte r 129 8.5 7.1 10.1

Purchased ferrous scrap 5.0 6.8 6.9 66

Total 17,9 15.3 14,0 167

outputs:

Retained in steel products 13,8 1 2 2 112 13 4

Losses (slag, dust, waste) 21,8 1 2 6 9.4 170

Total manganese use 35,6 2 4 8 20,6 30 4

SOURCE Office of Technology Assessment

9.5 pounds per ton, a decline of over 45 percent from current levels.

SUBSTITUTION

The bulk of manganese consumption is in

steelmaking, and in this application there is

no satisfactory alternative, with the exception

of the use of rare earths in a limited group of

applications that can justify the sharply higher

cost,

Platinum Group Metals

PRODUCTION

The Soviet Union and South Africa account

for over 90 percent of world PGM production,

with most of the remainder coming from Canada. Production in all other countries accounts

for only 1 percent of world production. Canadian production results from byproduct recovery from copper-nickel ores and cannot be expanded substantially without corresponding

increases in the production of these metals.

Since economics do not favor increases in copper or nickel production, Canada cannot be

considered an important diversification opportunity.

The United States offers the only significant

opportunity to affect, even slightly, the domi-
28 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

nating role of South Africa and the U.S.S.R. in

PGM production. While minor amounts of

PGM are obtained as a byproduct from three

U.S. copper mines and, in the past, from placer

deposits such as Goodnews Bay, AK, there are

plans under consideration to develop resources

of platinum group metals in the Stillwater Complex in Montana. This deposit could produce

175,000 troy ounces of platinum group metals

annually, or between 2 and 3 percent of current world production. This operation is under

evaluation and review, and the decision to go

ahead with development will rest on assumptions of stable or increasing metal prices,

Undiscovered domestic deposits of platinum

group metals are almost certain to exist, most

likely as placer deposits such as Goodnews Bay

and as byproducts of copper-nickel sulfides, Although less likely, another major domestic

PGM deposit, similar to the Stillwater Complex, could exist, Exploration for such a deposit

would face problems similar to those described

for chromium and for cobalt-bearing coppernickel sulfides. As with those metals, prospects

for success in exploration for PGMs would be

enhanced by improvements in geophysical,

geochemical, and drilling technology and by

advances in the understanding of the geologic

processes that formed PGM deposits,

CONSERVATION

As with manganese, conservation technology

provides the greatest opportunity for the reduction of materials import vulnerability in platinum group metals. Platinum contained in industrial catalysts is already extensively

recycled, but the recovery of platinum group

metals from electronic scrap and from obsolete

automotive catalytic converters is less extensive. There are no major technological barriers

to recovery of platinum group metals from either type of scrap. Instead, the principal barriers are in the collection of scrap from widely

dispersed locations for processing at central

facilities, Scrap from electronic manufacturing plants is the easiest to collect, and recycling

operations are well underway in this area. Obsolete electronic components are also processed, but this is hampered by the high labor

intensity required to identify and separate

platinum-bearing components. Catalytic converters are now beginning to enter the scrap

yards in sufficient quantities to interest

platinum recyclers, and a number of firms are

showing interest in processing the converters

to recover the contained platinum group metals.

Platinum metal available annually from catalytic converters, which was about 115,000 troy

ounces in 1982, is projected to grow to over

800,000 ounces in 1995 (fig. 1-2), Actual recovery will probably not exceed 500,000 troy

ounces, since only about 70 percent of obsolete

cars and trucks reach automotive dismantles

where converters may be removed for recycling, and some PGM is lost in processing.

It is also possible that new engine designs

may allow the reduction of pollutants without

the need for catalytic converters. However, the

wide-scale adoption of any significantly new

automotive engine is not likely until the next

decade, and long-term prospects will depend

on price and performance factors, not on potential savings of platinum group metals.

SUBSTITUTION

Substitution opportunities for platinum group

metals are greatest for electronic components,

Gold is a substitute for platinum in electric and

communications relays, with substitution decisions being based on the relative prices of gold

and platinum, Silver and palladium alloys may

be used in place of pure platinum in many applications, although platinum may offer superior performance and reliability. Palladium,

now used in ceramic capacitors in rapidly increasing amounts, may be subject to substitution in 5 to 10 years as technologies using

silver, nickel, and lead electrodes are improved. In catalytic applications, however, the

outlook for substitution is dim. Unless new developments arising from advances in the study

of surface science and chemistry lead to new

catalytic systems, the high efficiency and long

lifetime of platinum catalysts make them virtually irreplaceable.
Ch. 1—Summary ● 2 9

1500

1000

500

0

Figure 1-2.— PGM Demand vs. Potential Supply From Recycling

—

PGM needed for new vehicle production

PGM available from scrapped vehicles

75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95

Model year

SOURCE Sierra Research

Implementation of Technological Approaches

There are many technological approaches to

reducing import vulnerability for each of the

four first-tier strategic materials. These are

summarized in the preceding section. They

vary in the potential contribution they could

make to the reduction of vulnerability, in the

cost of carrying them out, in the period of time

when they are effective, and in the assurance

that they will fulfill their potential. These factors, as well as the interrelationships among

the approaches, mean that it is important to direct and coordinate the implementation of

technology toward specific goals, As a result,

the management of strategic materials policy

is critical to the successful implementation of

the various approaches. The following sections

address alternatives available to the United

States, both in the general management of

materials policy, and in the implementation of

the technologies.

Legislative Guidance for Strategic Materials Policy

The 1980 National Materials and Minerals

Policy, Research and Development Act (Public Law 96-479] provides a basic policy framework that could be used to develop and evaluate various technological approaches for

reducing U.S. import vulnerability. The law

emphasizes the importance of research and development activities related to all stages of the

materials cycle (from exploration and mineral

extraction through recycling and disposal) in

addressing materials problems, The law applies

to all materials, not just those for which the

United States is import dependent, but many

of its provisions apply to strategic materials in

particular,

The Critical Materials Act (Public Law 98-

373) requires the Administration to establish

a Critical Materials Council, reporting to the

Executive Office of the President. The Council is required, among other things, to prepare

a critical materials report and assessment, to

be reviewed and updated on a biennial basis,

and also to prepare a Federal program plan for

advanced materials, to be annually reviewed.

The Council is also to review annual authorization and budget requests related to Federal

material activities, so as to ensure close coordination of goals and directions of such programs

with Council policies.

In addition, several other laws, already in

place, could be employed should Congress
30 Ž Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

wish to encourage private industry to adopt

technical alternatives to reduce import vulnerability. Title III of the Defense Production Act

(DPA) of 1950 authorizes direct Federal subsidies, purchase commitments, loan guarantees, and other instruments to assure availability of essential defense materials and industrial

processing capabilities. The main use of Title

III has been to encourage domestic production

of strategic materials, especially during the Korean war and its aftermath, but DPA also could

be used to encourage other private sector actions, such as development of processing technologies and substitute materials. Congress, in

April 1984, authorized the appropriation of up

to $100 million to the Department of Defense

for Title III projects for fiscal years 1985 and

1986, and provided new criteria for Presidential review of proposed projects before they are

undertaken. Other measures of potential relevance to implementation of these technical

alternatives include Federal stockpiling law

(comprehensively amended in 1979 as the Strategic and Critical Materials Stock Piling Revision Act), the Minerals Policy Act of 1970, and

the Stevenson-Wydler Technology Innovation

Act of 1980, which emphasized transfer of federally developed technological innovations to

the private sector.

Structure and Information for Strategic Materials Policy

The 1980 materials act required the Executive Office of the President to assume a more

active role in coordinating and formulating

materials policy, beginning with preparation

of a materials program plan to be submitted to

Congress by the President on a one-time basis.

The plan, submitted in April 1982, emphasized

domestic production and stockpile issues. It

did not encompass the full range of technological issues (including substitution and recycling)

emphasized in the 1980 act.

In spite of strong statements of interest in

strategic materials issues, the Administration

has yet to carry out all of the provisions of the

1980 act. Specific reports required of the White

House Office of Science and Technology Policy (OSTP) have not been submitted to Congress, and a Department of Defense report (due

to Congress in late 1981) has not yet received

Administration clearance. Although a policymaking structure, based in the Cabinet Council on Natural Resources and the Environment

and the renewed Committee on Materials, was

established by the Administration, there is

strong evidence that materials policymaking

procedures remain relatively uncoordinated,

both among agencies and among technological approaches.

It was the goal of the 1980 act to require the

coordination of agencies over the range of

materials technologies. Since this goal has not

been fulfilled, Congress may wish to consider

further action to assure compliance, for example by establishing specific reporting dates for

the OSTP and the Department of Defense, and

by requiring submission of a revised program

plan, with the explicit requirement that the

plan include evaluation of the role of substitution and conservation technologies in U.S. strategic materials policy.

Another alternative to improve the coordination and direction of Federal strategic materials policy would be to require the Administration to prepare, on a regular basis, a

multi-year strategic materials program plan

that would establish long-term goals and objectives for materials policy, Such a plan could

be submitted on a 4-year schedule, reflecting

the long-term goals of each Administration,

Goals, Objectives, and Coordination of

Federal Materials R&D

The Federal Government is the principal

sponsor of research related to strategic materials. This research is conducted through many

agencies in the Government, with the Departments of Defense, Energy, Interior, and

Commerce and the National Aeronautics and

Space Administration being major sponsors. In

the past, this research has succeeded in developing many of the technological alternatives

identified in this report. However, goals of this

research are often narrowly directed towards

problems of specific interest to the sponsoring

agency.
Ch. 1—Summary ● 3 1

Many of the technological approaches identified in this report will yield their benefits only

in the medium to long term. To obtain these benefits, executive branch policies need to be clearly

defined and stable over a number of years, Establishment of research priorities among materials,

identification of specific objectives for Federal

programs, and formulation of overall strategies

may be needed so that individual agencies can

better plan their research, development, and

budget priorities.

Information developed so far in response to the

1980 materials act is insufficient to provide a

basis for coordinated interagency responses to

strategic material issues. A 1983 inventory of

materials research conducted by the Committee

on Materials (COMAT) did not disaggregate research funds by specific material or by research

activity. Nor has COMAT required individual

agencies to identify all strategic materials research within their own organizations.

Without more detailed information as to the

level of research support, by agency, by type of

research and by material, Federal objectives for

strategic materials policy cannot be established

in an effective manner. In order to strengthen

the Federal mechanism for policy formulation,

Congress may wish to provide additional guidance to the Administration for the review of Federal strategic materials R&D as required by the

Critical Materials Act,

Mineral Production and Metal Processing

opment policies of producer nations are strong,

actions to expand the range of suppliers, both

through diversity of foreign supplies and domestic production, can be taken. Four alternatives to broaden the range of suppliers and producers are discussed below. The opportunities

for production of strategic metals from known

domestic deposits are summarized in table 1-5.

Domestic Production of Strategic Materials

Reasonable prospects exist for domestic production of 5 to 10 percent of U.S. demand for

platinum group metals. Opportunities for the

development of domestic resources of other

first-tier strategic materials are limited to several low-grade cobalt deposits. Industry evaluation of these deposits, located in Idaho, Missouri, and California, indicate that about 7.7

million pounds of cobalt could be produced annually over a 10- to 15-year period. However,

at current market prices for cobalt (and for the

nickel, copper, lead, and zinc also found in the

various deposits) development of these resources in competition with the existing lowcost producers in Zaire and Zambia will not

proceed. Further R&D on ore concentration

and processing systems might improve the outlook for development somewhat, but the only

means to ensure the development of these resources is through Government purchase contracts for metal produced from the mines. Production of cobalt from the Idaho and Missouri

deposits would require long-term (10 years or

more) commitments to purchase cobalt output

The current distribution of mineral produc- at $16 to $25 per pound. With recent contracts

tion and metal processing facilities around the

world is dictated largely by the economics of

exploitation; although national policies to encourage mineral development, promote employment, gather foreign exchange, or protect

the environment also affect the flow of investment. The limited number of high-grade deposits of the four first-tier strategic materials has

resulted in a narrow range of producers, and

policies of foreign governments to promote

local economic interests are contributing to a

declining role for domestic firms in the ferroalloy processing industry. Although the pressures of market economics and of the develTable 1-5.—OutIook for Development of

Known Domestic Deposits of Strategic Resources

Chromium Cobalt Manganese Platinum

Good News Bay, AK — — 1-2

Stillwater Complex, MT 3 — 1-2

Madison Mine, MO 2-3

Blackbird Mine, ID 2-3 —

Gasquet Mountain, CA 2-3 2-3 –

Duluth Gabbro, MN — 3 3

Domestic Manganese — — 3

–Not applicable

I — Economic a[ current prices

Z Marginally economic to subeconomlc -under conslderat!on tor exploitation

3–Subeconomlc– not considered for commercial exploitation at current metals prices

SOURCE Off Ice of Technology Assessment
32 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

for cobalt from Zaire running up to $12 per

pound, the cost of subsidizing mine production

of 2 million pounds of cobalt would run between $8 million to $26 million per year. For

this cost, the United States would be assured

of cobalt production amounting to 16 percent

of 1981 domestic consumption,

According to industry estimates, development of the Gasquet Mountain deposit at current prices for nickel would require cobalt

prices in the $20 to $25 per pound range. However, an increase in the price of nickel from

the 1983 average of $2.20 to $3.50 per pound

might make cobalt economic at about $12,50

per pound. However, such a dramatic increase

in the price of nickel is unlikely.

Exploration for Domestic Resources

The fact that known domestic resources of

strategic materials are very limited does not

rule out the possibility that there may be significant deposits, as yet undiscovered. However, little domestic exploration for these minerals is going on, The reasons are the high cost

of exploration, combined with industry pessimism about the likelihood of locating deposits of chromium, cobalt, or manganese that can

be profitable in current and projected markets,

Several steps may be taken to increase the

potential for discovery of domestic resources

of the first-tier materials. The Government can

provide economic incentives, principally through

the tax system, to improve the economics of

exploration. The cost of the incentives could

be reduced by making them effective only for

exploration that leads to the development of

the target materials. However, tax incentives

can only improve project economics by a marginal amount, so other action might be required

if exploration for strategic materials is to be encouraged,

Targeting of Government mineral resource

assessments toward the first-tier materials and

increasing the detail of the assessments could

identify areas of favorable potential for strategic materials. Government-supported research

on improved geophysical and geochemical

technologies could reduce the cost of prospecting and exploration for these materials. The

lower costs, combined with improvements in

techniques directed toward the desired materials, could increase private exploration for the

first-tier materials.

Improved understanding of the geological

processes that form deposits of strategic materials offers the greatest opportunity to expand

domestic strategic materials resources. The

benefits of increased research into the process

of mineral formation and into techniques of

predictive geology will only be seen in the long

term, but, since many promising areas for the

first-tier materials are covered by layers of

glacial debris or sediment, predictive methods

may be essential if the Nation’s resource endowment is to be assessed.

Diversity of Foreign Supplies

The potential to diversify supply to reduce

U.S. materials import vulnerability is greatest

for cobalt and manganese. There are also opportunities to diversify somewhat the supply

of chromium. Supply diversity, however, requires investment in and construction of new

or expanded mining and transportation facilities. The distribution of world resources and

the economic policies of producer countries

have resulted in the current distribution of production, so policies meant to encourage diversity of supply must somehow change the economics of production in desired locations to

attract investment.

A first step to diversity of suppliers is for the

Government to identify and make known to

private investors the most promising diversification opportunities. A basic program for

this purpose is now underway in the International Development Cooperation Agency where

the Trade and Development Program supplies

funds for resource assessments of deposits of

strategic materials, identifies potential U.S.

participants in development activities, and

brings the potential participants together with

resource experts and officials in the foreign

country.

In some cases, uncertain legal environments

or restrictive foreign investment laws discour-
Ch. 1—Summary ● 3 3

age development of mineral deposits. Prospects

for the diversification of supply of strategic

materials could be improved by coordinating

actions by U.S. Government agencies, including the Department of State, the Department

of Commerce, the Export-Import Bank, the

Overseas Private Investment Corporation, and

U.S. participation in international development

banks and United Nations activities, to improve both the political and the economic climate for the development of strategic materials in specific countries, A program of this type

could be an integral part of U.S. foreign affairs

activities, perhaps consisting of a redirection

of current resources and efforts rather than a

commitment of new or increased Government

funds. If desired, however, economic incentives, such as foreign assistance for infrastructure development or special tax treatment for

U.S. investors, could be used to promote investment in specified projects,

In all of the approaches to diversify supplies

of strategic materials, it is important that the

Government target its efforts at specific materials and specific countries. In this way, the effectiveness of the Government’s resources can

be maximized and side effects, such as the promotion of foreign production of nonstrategic

minerals in competition with domestic mines,

can be avoided,

Ferroalloy Production Capacity

For chromium and manganese, promotion of

diversification of the supply of minerals from

the ground is only a partial solution. These

metals are generally processed into intermediate products, ferrochromium and ferromanganese, before they are used in the production

of steel. A strategy for diversification of supply

should consider whether the processing of

these ferroalloys is also to be diversified or

whether domestic processing of the ores into

their alloy form is to be encouraged,

For a variety of reasons, including the use

of newer facilities, lower labor costs, reduced

transportation costs, and various forms of local

government assistance, processing of ores into

ferroalloys at or near the mine site has made

major inroads into what was once a strong U.S.

industry. This is a matter of some concern, that

extends beyond the specific interests of the ferroalloy industry, because domestic ferroalloy

processing facilities provided a capacity for

quick response to interruptions in the supply

of imported minerals, If one source of minerals

should be cut off, it would be necessary only

to expand foreign mine production elsewhere,

not to increase capacity of ferroalloy plants as

well. With decline of U.S. capacity, it would

become more difficult and expensive to maintain production of ferroalloys for steel and

stainless steel production in the event that supplies from one of the major producers were interrupted.

In the near term there are no technological

fixes to improve the competitive state of the

U.S. ferroalloy producers, If domestic capacity is to be maintained, assistance must be of

a political or economic nature instead. In the

longer term, however, there are several opportunities to increase the competitiveness of the

U.S. industry. The U.S. Bureau of Mines could

support development of improved technology

for existing facilities in order to increase labor

productivity and conserve energy and materials. Such improvements, though incremental,

could help U.S. facilities compete with more

modern facilities overseas, The Government

could extend a greater degree of support,

largely through policies targeted to encourage

investment by U.S. firms to modernize their

operations with new processes for the production of ferroalloys. Such processes, which are

expected to produce substantial improvements

in energy conservation, will be used in new foreign facilities and, to be competitive, U.S. firms

must adopt them as well.

Substitution Alternatives

Substitution offers considerable potential to

reduce U.S. materials import vulnerability with

respect to chromium and, to a lesser degree,

cobalt. However, because of the satisfactory

performance, reasonable cost, and familiarity

of chromium and cobalt containing alloys,

there has been little interest in developing,

testing, certifying, or using substitutes.
34 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

There are three major opportunities for the

Government to improve the materials vulnerability status of the United States through substitution:

1.

2.

3.

by making information about substitutes

widely available to consumers, thus promoting and speeding the adoption of substitute materials;

by developing, testing, and, where required, certifying new materials lower in

chromium and cobalt content for use in

a limited number of industrial applications

that account for large fractions of the critical applications for these materials; and

by supporting the development of advanced- materials, including ceramics,

composites, and unconventional metallic

compounds, through basic and applied research, education, and the development of

design and testing methods appropriate

for the new materials,

Substitution Information Systems

During times of chromium or cobalt supply

interruptions, interest in substitute materials

rapidly increases. However, the period of time

required to identify possible substitute materials, test them for particular applications, and

modify production techniques for the substitute materials can be quite long. During this

period of adjustment, consumers continue to

demand these metals, drawing down the available supplies, and resulting in high prices and

depletion of producer and consumer inventories. If the shortage is severe, the Government

may be forced to allocate supplies to essential

applications to the detriment of other industries and consumers. A system that helps users

quickly identify and adopt substitutes could reduce the need for strategic materials, particularly in nonessential applications, thereby freeing materials from suppliers and in consumer

inventories for use in essential applications.

To be useful, a substitution information system must reflect the needs and concerns of industrial consumers, but, because of its importance to the Nation as a whole as a means of

reducing materials supply vulnerability, the

Government has a major interest in establishing it. The system would describe current uses

of strategic materials, identify the promising

alternative materials, and maintain information on the performance of the substitutes and

other information users need to determine how

to adopt the substitutes.

Although supported by the Government, major elements of the system could be conducted

by private sector participants (materials and

testing professional societies, trade associations, universities, and individual industries)

under Government-established guidelines,

Commercialization of Alternative Alloys

During World War II, the Government established a system of National Emergency Steels

for use by industry when shortages of raw

materials made it impossible to meet demand

for the alloys then in use. Now, laboratory research has identified a number of promising

alloys that could become substitutes for the

high chromium and cobalt alloys in use today.

These alloys are not ready for commercial use

because they require further testing in the laboratory, evaluation of production techniques,

and evaluation of performance in actual operating conditions, Since these testing and evaluation procedures may take a number of years

and several million dollars to complete, the

alloys are not “on the shelf, ” ready to be used

in times of emergency. These alloys do hold

promise for reducing the need for chromium

and cobalt in critical applications, however.

The Bureau of Mines, the National Laboratories of the Department of Energy, NASA, the

Defense Department, and the National Bureau

of Standards could direct efforts toward testing

and evaluation of a limited number of alternative alloys where the potential for strategic material substitution is greatest. To be effective,

such an effort would need to have the participation of industry to identify the alternative

alloys to be evaluated. This approach is most

promising for a number of applications that

now use stainless steel. Alternative alloys, low

in cobalt, are also possible in superalloy applications, but the high cost of testing and qualification could push costs of a comprehensive
program to develop alternatives to the dozens

of cobalt-containing superalloy now in use

into the hundreds of millions of dollars.

Encourage Development of Advanced Materials

Ceramics, composites, and unconventional

metallic materials have properties that suggest

they might serve as substitutes for conventional

materials that require strategic metals. Basic

and applied research is still needed to overcome undesirable characteristics present in the

materials and difficulties in the processing of

raw materials and the manufacture of components. In addition, design methodologies for

use of the materials must be developed to emphasize their advantages and minimize their

disadvantages. Finally, up-to-date knowledge

of the materials and the associated design and

manufacturing technologies must be disseminated to potential users, Three separate activities could further these efforts:

1. Coordinate Federal Advanced Materials

R&D: Research and development on advanced materials is conducted in many

parts of the Government, but coordination

is achieved largely through personal contacts and professional societies. Programs

are developed in response to individual

agency objectives, resulting in fragmentation and overlap of research efforts, Although it would be detrimental to attempt

to control rigidly all research in advanced

materials, increased interagency coordination toward common goals could improve

the effectiveness of Government research

and speed advances in understanding

these new materials. Coordination of Government research is a responsibility of the

executive branch, but Congress could further the coordination of Federal research

on advanced materials through oversight

of the progress of the Administration in

preparing its report on the status of Government R&D in advanced materials. Such

a report could also raise the visibility of

Federal work on advanced materials, resulting in improved coordination with private industry and academic research.

Ch. 1—Summary ● 3 5

2.

3.

Improve Understanding of Advanced Materials: Unlike direct substitutes, which

may be used in place of current materials

with little modification of designs or manufacturing processes, advanced materials

will require designs and processes to be

developed around their specific properties.

This means that academic institutions,

professional organizations, and individual

firms need to develop programs to train

engineers and designers in the proper

selection and use of advanced materials.

The Federal Government can assist in developing these education programs by providing grants for the hiring of new faculty,

acquisition of new laboratory equipment,

and design of curricula emphasizing advanced materials.

Develop Testing and Certification Procedures for Advanced Materials: Reliability

and predictability are essential for any

engineering material. Until a large body

of information on the properties of advanced materials is developed in the laboratory and in the field, industry will not

adopt the materials. The same is true for

any new material; but in the case of advanced materials the barriers are likely to

be greater and the delays longer because

testing methods and certification procedures that reflect the special qualities of

the materials, and the new design and

manufacturing processes that will develop

around them, do not yet exist. These barriers could be lessened if Government, industry, and academia focus on developing

data on the properties of advanced materials, establish appropriate testing methods, and direct attention to certification

procedures to ensure that advanced materials are not restricted from some applications unnecessarily. One approach

could be the establishment of a nonprofit

center associated with a testing society,

professional organization, or academic institution under partial Federal sponsorship

for the purpose of overcoming barriers to

the use of advanced materials resulting

from lack of data as to material properties.
36 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Conservation Approaches

Conservation offers a number of ways to reduce U.S. dependence on foreign sources of

supply of chromium, cobalt, manganese, and

platinum group metals. In many cases, conservation opportunities are already being implemented, and others are under evaluation by private industry. In the case of manganese, it is

likely that improvements in steelmaking technology will continue so that U.S. requirements

for imported manganese will decline sharply.

Recycling of catalytic converters is just beginning, and several major firms are considering

opportunities to expand into this area. Recovery of chromium and cobalt from steelmaking, industrial, and chemical waste has begun

to rise in the past few years, driven in part by

Federal laws and standards on air and water

quality and disposal of waste. Other opportunities are less likely to go forward under normal conditions. Superalloy scrap from obsolete

aircraft components, a significant and reliable

source of cobalt and chromium, is not likely

to be used in the production of new superalloys

so long as low-priced metal from foreign sources

makes it economically unattractive to invest in

the development of new recycling systems.

The promise of conservation of strategic

materials—even from those practices already

underway—is not assured. The strategic materials recycling industry is new, and our

understanding of it is incomplete. Three approaches to improve the prospects for conservation of strategic materials are discussed

below.

Update Information on the Recycling of

Strategic Materials

Data on the generation and flow of scrap containing strategic materials is incomplete and

out of date. The United States is poorly prepared to utilize scrap as a source of strategic

materials in times of emergency. With more

complete and detailed information, the Government could develop more effective R&D programs to enhance scrap recovery. Congress

could direct the Bureau of Mines to conduct,

and update on a regular basis, surveys of the

generation and disposal of scrap containing

chromium, cobalt, manganese, and platinum

group metals. Information from these surveys

would be useful in planning Government R&D

efforts, in updating requirements for the national defense stockpile, and in identifying investment opportunities for private businesses.

Identify Specific Government Actions to Support

Recycling of Strategic Materials

In recent years, a number of Federal actions

affecting air and water quality and waste disposal have encouraged increased recycling.

The potential effects of Government actions on

recycling are beginning to receive consideration by policy makers, For example, Government-established freight rates on scrap—previously set at a level higher than the rates for

shipping raw material—have been reduced.

The 1980 National Materials and Minerals

Policy, Research and Development Act directed the Administration to assess the effects

of Federal policies that affect all stages of the

materials cycle, including recycling and disposal. A number of recycling activities are new

and their economics have not been tested commercially. In some cases these activities may

be affected substantially by Government policies. These recycling activities include the recovery of PGMs from catalytic converters, recovery of chromium and cobalt from industrial

and chemical wastes, recovery of cobalt from

spent hydroprocessing catalysts, and recovery

of cobalt and other metals from cemented carbide scrap. Because these recycling industries

are small or nonexistent, the effects of Government actions on the recovery of strategic materials from waste or scrap is generally ignored,

Yet these sources, combined, could be important supplements to imports of chromium, cobalt, and platinum.

Congress could improve the outlook for conservation of strategic materials by requesting

that the Administration identify opportunities

to promote the recycling of strategic materials,

identify barriers to new or increased recycling,

and recommend to Congress ways to structure

taxation, procurement, environmental, and
—.—.

Ch. 1—Summary ● 3 7

other policies to encourage increased recycling. Such a study could be conducted by the

Department of Commerce as part of its series

of evaluations of strategic materials issues and

U.S. industries.

Develop Recycling Technology for Superalloy Scrap

Scrap from processing of superalloys and

from obsolete aircraft engine components

could provide a secure source of material containing cobalt and chromium metal, At present,

only a portion of this supply is reused in superalloy. The remainder is either downgraded to

less demanding uses (often completely wasting the cobalt content), exported for use in

other countries, or disposed of as waste. Several technical processes to recover individual

metals from superalloys have been developed,

but so far have only been tested in the laboratory.

The capacity of the United States to respond

to cobalt supply disruptions could be enha-need

if the Government were to put “on-the-shelf”

one or more of the new superalloy recycling

technologies by scaling the process up to a

demonstration plant. Although relatively costly,

on the order of $10 million, such a plant could

make available the technology to recover highquality cobalt from nearly all forms of superalloy scrap. This source was estimated to contain 4 million pounds of cobalt in the year 1980,

making it equivalent to several opportunities

for domestic mineral production, Estimates of

the cost of metals produced from these recycling systems are proprietary, but are said to be

in the range of $15 to $25 per pound of cobalt,

which is in the same price range as domestic

cobalt production.
CHAPTER 2

An Introduction to

Materials Import Vulnerability
Contents

Page

The Importance of Nonfuel Minerals Imports . . . . . . . . . . . . . . . . . . . .......42

Changes in Amount of Imports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42

Definition and Selection of Strategic Materials . . . . . . . . . . . . . . . . . . . . . . . . . 45

criticality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46

Vulnerability .,.... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48

Selecting Strategic Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51

Overview of Selected Strategic Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53

Chromium . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53

Cobalt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54

Manganese . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55

Platinum Group Metals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56

A Perspective on Strategic Materials Selection . . . . . . . . . . . . . . . . . . . . . . . . . 57

Table

2-1.

2-2.

2-3.

2-4.

2-5.

2-6.

2-7.

2-8.

2-9,

2-1o.

2-11.

2-12.

List of Tables

No. Page

U.S. Dependence, Selected Minerals, 1950-82. . . . . . . . . . . . . . . . . . . . . 42

Materials To Rescreened . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51

Materials for Which the United States is Self-Sufficient

or a Net Exporter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52

U.S. Strategic Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52

U.S. Consumption of Chromium, 1978-82 . . . . . . . . . . . . . . . . . . . . . . . . 53

Sources of U.S. Chromium Imports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54

U.S. Consumption of Cobalt, 1978-82 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54

Sources of U.S. Cobalt Imports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55

U.S. Consumption of Manganese, 1978-82 . . . . . . . . . . . . . . . . . . . . . . . 56

Sources of U.S. Manganese Imports. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56

U.S. Consumption of Platinum Group Metals, 1978-82 . . . . . . . . . . . . . 56

Sources of U.S. Platinum Group Metal Imports . . . . . . . . . . . . . . . . . . . 57

List of Figures

Figure No. Page

2-1. Net Import Reliance As a Percent of Consumption, 1982 . . . . . . . . . . 43

2-2. U.S. Imports of Chromate Ore and Chromium Alloys . . . . . . . . . . . . . . 44

2-3. U.S. Imports of Manganese Ore and

Manganese Alloys and Metals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
CHAPTER 2

An Introduction to Materials Import Vulnerability

The United States, despite its wealth of resources, is a substantial importer of materials

for industry. To some observers, the Nation’s

reliance on these imports constitutes a dangerous dependency, threatening a “materials

crisis” more devastating than the recent energy

crisis, Others see the U.S. position as quite

manageable, though not without dangers and

difficulties.

U.S. reliance on foreign sources for a number of important nonfuel minerals is not new

nor, in itself, a cause for alarm. What really

matters is whether import dependence makes

the United States vulnerable to a cutoff of supply and whether that cutoff could have very

damaging effects. In the past few years, these

possibilities have raised a wave of concern. Undoubtedly, one factor in the crescendo of concern was the success of the OPEC cartel in controlling oil production during the 1970s, raising

the world oil price to unheard of heights, and—

at least temporarily—reducing oil exports to the

United States for political reasons.

Today, many people believe that the United

States is vulnerable to disruptions at least as

serious as the oil crisis because of the nature,

level, and sources of U.S. materials imports.

Some fear that worse times are in store: they

are persuaded that the Soviet Union is conducting a “resource war” against the United States

and its allies, with the threat of shutting off supplies of minerals from central and southern

Africa that are vital to U.S. national defense

and basic industries.

Others familiar with minerals issues believe,

on the contrary, that the interdependence policy for minerals supply has served the Nation

well over the years and that the costs of selfsufficiency would be extremely high. Those

who take this view concede that the supply of

some imported materials could be interrupted,

but count on flexible responses of the market

economy—e.g., alternate suppliers, substitutions in use, and shifts from less to more essential uses—to compensate tolerably well for

supply cutoffs or dislocating price increases.

There is some common ground in the opposing views. Both sides favor stockpiling imported materials that are vital to national defense and essential supporting industries as an

insurance against supply interruptions. Both

agree that, for at least a few imported minerals,

continuity of supply is a serious question deserving a carefully considered government response.

The short list of these generally agreed upon

“strategic” materials includes chromium, cobalt, manganese, and the platinum group metals

(which comprise platinum, palladium, rhodium,

iridium, osmium, and ruthenium). All of the

four have essential uses, including military

uses, for which there are no readily available

substitutes—or in some cases, no substitutes

even in sight, For all of them, production from

domestic mines is negligible at best. Instead,

these minerals are imported, mainly from a

very few countries in the politically unstable

region of central and southern Africa, an area

that, along with the Soviet Union, holds most

of the world’s known resources of these important minerals.

Thus, for a few specific materials at least,

most observers agree that the United States is

in a vulnerable position. To shed light on the

dimensions of this vulnerability, this chapter

looks at the significance of imported materials

in general to the United States and its allies and

discusses those factors that led to the selection

of chromium, cobalt, manganese, and the platinum group metals for in-depth assessment in

this report.

41
42 Ž Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

The Importance of Nonfuel Minerals Imports

In terms of dollar value in world trade, U.S.

reliance on imports of nonfuel minerals is moderate. The United States is still a leading world

minerals producer as well as the world’s largest

minerals consumer. In 1981, as the dollar rose

against other currencies, U.S. imports of nonfuel minerals (raw and processed) amounted

to $17.6 billion, exports were $28.8 billion, and

thus net imports were $11.2 billion, a moderate sum when compared to U.S. net energy imports, which were $75 billion.1

The overall figures, however, aggregate a

great many unlike materials, from scrap steel

to gem and industrial diamonds to fertilizers.

It is particular kinds of minerals—materials

needed for basic industry and vital ingredients

for military hardware—that are the center of

concern, Figure 2-1 shows the extent of U.S.

reliance on imports of 34 important nonfuel

minerals and metals as of 1980. Nearly all of

the manganese, bauxite, cobalt, tantalum, and

chromium used in the United States is mined

in foreign countries. Imports of other important minerals—the platinum metals group, asbestos, tin, nickel, zinc, cadmium, and tungsten—range from 85 to 50 percent of U.S.

consumption. 2 Even iron ore, once supplied

wholly by domestic mines, now comes in substantial amounts from foreign mines. As table

2-1 shows, import dependence was high 30

years ago for much the same list of minerals

that is the focus of concern today: In 1952, foreign mines provided 70 to 80 percent of the Nation’s bauxite, manganese, and tungsten, and

90 to 100 percent of its platinum, cobalt, nickel,

and chromium. a

I Unless otherwise noted, data on production, consumption,

and imports of nonfuel minerals comes from the Bureau of

Mines, Department of the Interior. Energy data was provided

by the Department of Energy.

“’Consumption” here means apparent consumption, which

is domestic primary production, plus recycled materials and net

imports, adjusted to reflect releases from or additions to industry or government stocks.

3The President’s Materials Policy Commission, Resources for

Freedom (Washington, DC: U.S. Government Printing Office,

1952), vol. 1, pp. 6 and 157.

Table 2-1.–U.S. Dependence, Selected Minerals, 1950-82

(net imports as percent of apparent consumption)

1950 1970 1979 1980 1981 1982

Bauxite a . . . . . . . . . . . 71 80 93 94 94 96

Chromium . . . . . . . . . 100 100 90 91 90 85

Cobalt . . . . . . . . . . . . . 92 96 94 93 92 92

Copper . . . . . . . . . . . . 35 8 13 16 6 1

Iron ore. . . . . . . . . . . . 5 30 25 25 22 34

Lead . . . . . . . . . . . . . . 59 40 5 O

b 1 3

Manganese . . . . . . . . 77 94 98 98 99 99

Nickel . . . . . . . . . . . . . 99 91 75 76 75 76

Platinum . . . . . . . . . . . 91 98 89 88 84 80

Tungsten . . . . . . . . . . 80 40 58 53 50 46

Zinc . . . . . . . . . . . . . . . 37 60 63 60 64 58

a1979-82, Includes alumina

bNet export

NOTE: Net imports = imports exports + adjustments for government and industry stock changes

SOURCE 1950, 1970: Report of Nat/orra/ CornrrJIssIon on Material Policy, June

1973, pp 2-23 1979-82: U S Deptiment of the Interim Bureau of Mines,

M/nera/ Comrnod/ty Summaries 1984

It is worth noting the modest dollar value of

many of the materials for which the United

States is most import dependent. For example,

the entire year’s bill for 1981 imports of cobalt,

chromium, and manganese was between $230

million and $300 million apiece—equivalent to

11⁄2 days (at most) of oil imports. The fact that

the quantities involved are relatively small and

total costs low does not imply that imports of

these materials are insignificant; some are vital. It does imply that even a sharp rise in price

for the materials might have no great effect on

the economy as a whole (a point to keep in

mind later, in the discussion of possible cartel

control). It also indicates that stockpiling these

materials, as a way of assuring a reliable supply, can be practical and relatively inexpensive.

Changes in Amount of Imports

U.S. minerals imports increased from 1950

to the 1980s, but at a modest pace overall, and

not uniformly for all minerals, (Import dependence as a percentage of U.S. consumption for

platinum, nickel, and chromium declined,

mostly because of recycling.) In general, the

gradually rising flow of imported minerals into

the United States reflects lower prices of foreign materials, often because the ores being
Ch. 2—An Introduction to Materials Import Vulnerability ● 4 3

Figure 2-1.— Net Import Reliance As a Percent of Consumption, 1982

Columbium

Industrial diamond stones

Natural graphite

Mica sheet

Strontium

Manganese

Bauxite and aluminum

Cobalt

Tantalum

Chromium

Fluorspar

PGM

Nickel

Asbestos

Tin

Ilmenite

Potash

Cadmium

Rutile

Gallium

Silver

Zinc

Selerium

Tungsten

Antimony

Mercury

Gold

Iron ore

Iron and steel

Silicon

Vanadium

Titanium sponge

Copper

Aluminum

1

, 1

I

I I

k

r J

I I

r 1

, 1

I

Major foreign sources, 1978-81

and percent supplied, 1982

Brazil (73) Canada (6) Thailand (6)

S. Africa (61) Zaire (14) Bel-Lux (8) UK (6)

Mexico (60) Korea (12) Madagascar (5) China (5)

India (83) Brazil (11) Madagascar (4)

Mexico (99)

Ore: Gabon (32) S. Africa (24) Australia (18) Brazil (15)

Ferro Mn: S Africa (42) France (25) Mexico (7)

Jamaica (40) Guinea 28 Suriname (13)

Alumina: Australia (7 ) Jamaica (15) Suriname (8) 6

Zaire (38) Zambia (13) Bel-Lux (11) Finland (6)

Thailand (38) Canada (11) Malaysia (8) Brazil (7)

Chromite: S. Africa (44) USSR (18) Philippines (17)

FeCr: S. Africa (71) Yugoslavia (11) Zimbabwe (6) Brazil (?)

Mexico (60) S. Africa (30) Italy (4) Spain (3)

S. Africa (56) USSR (16) UK (11)

Canada (44) Norway (11) Botswana (9) Australia (8)

Canada (97) S. Africa (3)

Malaysia (39) Thailand (21) Bolivia (17) Indonesia (?)

Australia (59) Canada (34) S. Africa (6)

Canada (94) Israel (3)

Canada (27) Australia (18) Mexico (11) Korea (9)

Australia (77) S. Africa (8) Siera Leone (7)

Switzerland (65) Canada (12) Germany (10) China (?)

Canada (37) Mexico (24) Peru (23) UK (5)

Ore & core: Canada (59) Peru (17) Mexico (8)

Metal: Canada (51) Spain (8) Mexico (6) Australia (?)

Canada (44) Japan (17) Germany (8) UK (8)

Canada (21) Bolivia (19) China (14) Thailand (7)

Metal: Bolivia (38) China (34) Mexico (10) Belo Lux (7)

Ore & core: Bolivia (36) Canada (19) Mexico (19) Chile (8)

Oxide: S. Africa (44) China (15) France (14) Bolivia (11)

Spain (34) Japan (21) Italy (12) Algeria (10)

Canada (52) USSR (20) Switzerland (17)

Canada (64) Venezuela (16) Brazil (9) Liberia (?)

Europe (37) Japan (34) Canada (14)

Canada (25) Norway (22) Brazil (14) S. Africa (?)

S. Africa (58) China (10) Canada (8)

Japan (81) China (10) USSR (8) UK (1)

Chile (32) Canada (22) Peru (14) Zambia (11)

II I Canada (62) Ghana (11) Norway (4) Japan (4)

u J

NOTES Net Import reliance IS figured as percent of apparent consumption, except for rutlle, for which net import reliance IS figured as percent of reported consumption

Net Imports = Import exports + adjustments for government and industry stock changes

Apparent consumption = U S primary and secondary production + net imports

SOURCE U S Department of the Intenor, Bureau of Mines
44 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

.

mined abroad are richer, although other factors such as lower labor costs or government

subsidies may also be important. The U.S.

minerals economy is managed, on the whole,

by a great many private businesses looking for

the best deal they can get.

Changes in Use of Imports

While nonfuel minerals imports of the United

States have slowly risen, significant changes

in the uses of imports have taken place. Growth

has occurred in selective demand for specialty

steels using chromium, for high-strength, hightemperature superalloy using cobalt and chromium, and for cobalt catalysts. Also, in the 10

years from 1970 to 1980, annual consumption

of cobalt for superalloy (which are particularly

important for aerospace applications, military

and civilian) roughly tripled, rising from about

2 million to over 6 million pounds. Use of cobalt in catalysts quadrupled. Platinum group

consumption jumped from 1.4 million troy

ounces in 1970 to 2,2 million in 1980, of which

more than 700,000 troy ounces went for catalytic converters to control pollution from automobile exhausts. Use of platinum as a catalyst

in petroleum refining has also grown, rising

from less than 40,000 troy ounces in 1960 to

171,000 in 1980. In the severe worldwide 1981-

83 recession, U.S. consumption of all these metals declined, but recovery is now in evidence.

Changes in Form of Imports

Nonfuel mineral imports are no longer mostly

in the form of raw ores. Instead, mineralsproducing countries like South Africa are now

taking advantage of their lower wages, proximity to raw materials, cheaper energy, and

modern new processing facilities, to export

processed materials such as ferroalloys4 rather

than chromite and manganese ores, Figures 2-2

and 2-3 show how rapid this change to importation of ferroalloys has been. The United

States now imports 35 to 50 percent of its chromium in ferroalloy form, compared with 8 to

12 percent a decade ago. Ferromanganese and

refined manganese metal now account for 60

4Alloys of iron and other elements, used as raw material in

the production of steel; e.g., ferromanganese and ferrochromium.

Figure 2-2.— U.S. Imports of Chromite Ore and

Chromium Alloysa

600

I

Years

aTOn~ of contained chromium.

SOURCE: U.S. Bureau of Mines data.

Figure 2-3.—U.S. Imports of Manganese Ore and

Manganese Alloys and Metalsa

1969 1971 1973 1975 1977 1979 1981

Years

aTon~ of contained manganese.

SOURCE: U S Department of the Interior, Bureau of Mines data

to 75 percent of manganese imports; at the beginning of the 1970s they amounted to only 20

percent of the total. As part of the same process, the domestic ferroalloy industry has

shrunk remarkably, from production levels of

2.6 million to 2.8 million tons in the peak years

of 1965 to 1970, to 1.5 million tons in 1981 and

an estimated 800,000 tons in the recession year

of 1982.
Ch. 2—An Introduction to Materials Import Vulnerability ● 4 5

This has led to concern that if international Similarly, if a major high-grade deposit of chrotrade were restricted or disrupted, it might be mium or manganese were discovered, we

difficult to replace lost supplies of ferroalloys might not have the production capacity to prowith imports of chromium or manganese ores duce ferroalloys until facilities were expanded,

from other sources, because of the lack of U.S. which could take several years.

facilities to process the ore into ferroalloys.

Definition and Selection of Strategic

One of the greatest difficulties in assessing

import vulnerability lies in defining what materials are strategic. There is no fixed, universally accepted definition of the term “strategic material, ” Much depends on the purpose

of the definition. For purposes of a national

stockpilers present U.S. law defines “strategic

and critical materials” in the context of a

hypothetical, complete cutoff of foreign supplies during a 3-year national emergency, The

Strategic and Critical Materials Stock Piling

Revision Act of 1979 (Public Law 96-41) says:

The term “strategic and critical materials”

means materials that (A) would be needed to

supply the military, industrial, and essential

civilian needs of the United States during a

national emergency, and (B) are not found or

produced in the United States in sufficient

quantities to meet such need. The term “national emergency” means a general declaration

of emergency with respect to the national defense made by the President or by the Congress.

In the context of broader materials policy,

former Secretary of the Interior James B. Watt

gave the term “strategic” a more elastic meaning. In 1981 testimony before the House Subcommittee on Energy and Mineral Resources,

he said:

It is not my intention to limit the word “strategic” to its former definition of minerals

wholly or substantially from foreign sources.

We must acknowledge, as an element of min5Current stockpile planning is based on the military, industrial, and essential civilian requirements of the first 3 years of

a major conflict, assuming that austerity measures are taken to

sustain defense production.

erals policy, that

Materials

all minerals are strategically

important in a complex industrial society, B

By this definition, however, every element

of production—land, energy, labor, capital,

technology—is also essential and therefore strategic, and the term becomes so broad as to lose

any practical meaning. Moreover, a definition

of strategic materials as all those that are

“wholly or substantially from foreign sources”

is not widely accepted, First, it leaves out the

element of critical needs for particular materials. Then, it seems automatically to equate

import dependence with vulnerability. Many

materials analysts do not accept this equation

as a guide to policy decisions.7 Moreover, it

runs counter to a major shared conclusion of

the materials commissions that have reported

to three American Presidents over the past 30

years; that is, that the Nation should seek materials wherever they may be found, at the least

cost and consistent with national security and

the welfare of friendly nations,

8U. S. Congress, Senate Committee on Energy and Natural Resources, Subcommittee on Energy and Mineral Resources, Hearings on Strategic Minerals and Materials Policy, 97th Cong., 1st

sess., Apr. 1, 1981, p. 4.

7See, for example, Congressional Research Service, A Congressional Handbook on U.S. Materials Import Dependency/Vulnerability, Report to the Subcommittee on Economic Stabilization, Committee on Banking, Finance, and Urban Affairs, House

of Representatives, 97th Cong., 1st sess., September 1981, p. 7,

p. 341 ff; Hans Landsberg and John E. Tilton, “Nonfuel Minerals, ” in Current Issues in Naturai Resource Policy, Paul R. Portney with Ruth B. Haas (eds. ) [Baltimore: The Johns Hopkins

University Press, 1982); Robert Legvold, “The Strategic Implications of the Soviet Union’s Nonfuel Minerals Policy, ” paper

prepared for the School of Advanced International Studies, The

Johns Hopkins University, May 1981.
46 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

In its 1981 Preliminary Assessment of strategic metals, the Materials Forum of the United

Kingdom discussed the term “strategic” in this

way:8

The term “strategic minerals” has traditionally been used in the United Kingdom to refer

to those minerals which are vital to the national

defense and yet have to be procured entirely

or in large part from foreign sources. However,

in this country, “strategic” no longer has a

mere defense connotation when attached to

minerals; it has come to have a wider meaning, somewhat obscure, and A. A. Archer of

the Institute of Geological Sciences in London

has recently shown how this can be clarified.

He believes it is useful to distinguish some

minerals from others by disengaging two main

strands. One is, that some minerals are more

important, vital, essential or critical than others

because they make a demonstrably greater contribution to the national well-being, so that interruption or cessation of supplies, from whatever source, would have graver consequences.

This can be described as the degree of “criticality” of a mineral. The other strand is the

“vulnerability y“ of supplies to interruption;

some minerals have sources which may be

judged to be more vulnerable than others. Although the concept of vulnerability is mainly

linked with imports, the possibility of the disruption of domestic supply cannot be entirely

overlooked.

The concepts set forth above are used in this

report as the basis for a definition and selection of strategic materials,

Not surprisingly, both the selection of criteria

and the screening of materials against the criteria involve a good deal of qualitative judgment. OTA’s assessment uses quantitative

measures as much as possible. Also, it builds

on the earlier efforts of others to define and list

strategic materials. (See app. A.) In the end,

however, any list of strategic materials must

reflect the judgment of its authors.

—. ——

8The Materials Forum, Strategic Metals and the United Kingdom: A Preliminary Assessment, published by the Institution of

Mechanical Engineers, July 1981, p. 3.

Criticality

The criticality of materials has to do with

how they are used. Three main factors are part

of the concept:

• Essential use for national defense.

● Essential use for industry.

● Lack of suitable substitutes.

Essential use for national defense means that,

without the material, the Nation’s capacity to

defend itself could be seriously compromised.

Examples of material uses that are vital to national defense are cobalt in superalloy for jet

engine turbine blades and discs, where resistance to heat under conditions of high stress

is necessary; or chromium for jet engines, to

withstand hot corrosion and oxidation; or the

manganese used industrywide in steelmaking

to eliminate faults in steel that arise from sulfur

content.

Essential use for industry is another main factor. Use of the materials must fill such an important need that without it, industries that are

basic to the Nation’s economic well-being and

to military production could be crippled.

Materials vital to national defense are likely

to be essential for industry, as well, in the same

or other applications, Industrial machinery is

a prime example. The machine tools that shape,

stamp, cut, and drill all metal goods, military

and civilian, are made of manganese-bearing

steel. The best binder for carbide cutting tools

and drill bits is cobalt, Another example is in

the aerospace industry, where jet airplanes for

civilian use have much the same material requirements as do military planes.

Industrial uses for some critical materials

cover a broad spectrum, ranging from virtually indispensable to nonimportant. Chromium

is an example: stainless steel cannot be made

without it. Of the hundreds of industrial uses

for stainless steel, some—e.g., automobile bumpers or hub-caps—are easily replaceable; for

others—e.g., corrosion-resistant pipes in oil

refineries—nothing else now available serves

as well.
Ch. 2—An Introduction to Materials Import Vulnerability ● 4 7

——-

f

Photo credit Arner/can Petro/eurn /nst/tufe and Exxon CorLJ

Petroleum refiners are major consumers of strategic materials in steel, stainless steel, and processing catalysts

Closely related to the concept of essential use

is the lack of suitable substitutes. This implies

that substitutes, if available at all, either cost

much more or involve important sacrifices of

properties or performance. In a few cases (e.g.,

chromium for corrosion resistance) there may

be no real alternative at present levels of technology in some critical industrial and defense

applications.

One aspect of substitution is simply the replacement of one material for another—nickel

for cobalt, for example, in some superalloys.

Some of these substitutions replace one critical metal with another. Of obviously greater

value is the replacement of a scarce material

with an abundant one—advanced ceramics for

instance, may be a long-term replacement for

metal superalloys.

The economic dependence of the Nation on

particular materials is sometimes mentioned

as a factor in criticality. One of the conventional measures of economic importance—the

dollar value of the material consumed or imported per year—is not a useful criterion for

critical function. Several materials that have

essential uses but no substitutes readily available are quite low in dollar value; for example,

net imports of cobalt, chromium, and manganese each ran about $230 million to $300 million in 1981–a drop in the bucket in a $3

trillion-per-year economy. Yet even a partial

loss of supplies of these materials could have

serious effects on production, jobs, and the survival of business firms in the many industries

where their uses are essential (e. g., steel, aerospace, and automotive industries).
48 • Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Exactly how much the economy as a whole

would suffer from a sudden drop in the supply of specific critical materials is hard to calculate. Cranking figures on supply loss through

an economic input-output model may appear

to be systematic and objective, But such models

can produce highly unrealistic results if they

make no allowance for compensatory moves

by users of the material in question.9 Studies

of chromium and cobalt shortages are worth

noting at this point.

The National Materials Advisory Board

(NMAB) (of the National Academies of Science

and Engineering) in its 1978 study of chromium conservation opportunities, concluded

that about one-third of U.S. chromium use

could be quite promptly replaced in an emergency. Without specifying any dollar figures,

the study observed that replacing a chromium

shortfall of this magnitude would “not have

serious economic consequences on industrial

dislocations.” 10 The study also refrained from

estimating the economic costs of a greater

shortfall cutting into uses which could not be

quickly replaced; obviously the effects of such

a shortfall would be greater.

In its 1982 study of cobalt, the Congressional

Budget Office reported cost estimates of a cobalt supply cutoff that took into account the

buffering effects of private stocks, materials

substitution, scrap recovery, and alternative

suppliers.11 The Department of the Interior provided a range of cost estimates, depending on

various political assessments. The most extreme case (considered highly improbable) involved a 2-year shortfall (in 1985-86) from both

Zaire and Zambia. In this extreme case, U.S.

cobalt consumption was expected to drop 20

percent in 1985 and 35 percent in 1986—but

with little loss in economic output, mainly because of substitution. Extra costs to the econ-

‘Hans H. Landsberg, “Minerals in the Eighties: Issues and Policies: An Exploratory Survey, ” paper prepared for the Oak Ridge

.National Laboratory, Oak Ridge, TN, 1982, pp. 30-31.

IONationa] Materials Advisory Board, Contingency Plans for

Chromium Utilization, NMAB-335 (Washington, DC: National

Academy of Sciences, 1978].

IICongressiona] Budget Office, Cobalt: Policy Options for a Strategic M;neral (Washington, DC: U.S. Government Printing Office, 1982), pp. 21-24.

omy (in terms of higher prices) were estimated

as $1 billion for 1985 and $1.8 billion for 1986

(in 1980 dollars). A Commerce Department

study, which assumed a 75-percent reduction

in output in Zaire and Zambia in 1985, came

to similar conclusions: 23 percent lower cobalt

consumption, forced substitution, little lost output, Extra cost to the economy of high cobalt

prices was estimated at $2.5 billion—assuming

a cobalt price of $112 per pound (more than

twice as high as the top price during the cobalt price spike of 1978-79, and over 20 times

the 1982 price). The inflationary pressure of

this price increase was reckoned as no more

than 0.1 percent in the economy as a whole,

Analysis of the effect of material shortfalls

on the economy as a whole is at an early, unrefined stage.12 In addition, because these economic effects are a reflection of the essential

nature of the material’s uses and the lack of

substitutes, it seems needlessly complex to add

“economic effects” as another criterion of criticality. Thus, for the purpose of this chapter,

which is to select a list of strategic materials

for study, no attempt was made to quantify the

economic effects of losing a part or all of the

supply of candidate materials. Rather, economic effects were simply kept in mind as a

part of the meaning of criticality,

Vulnerability

Among the conditions that affect supply vulnerability, a most important factor is lack of

diversity of supply. Reliance on a sole supplier,

even a highly reliable one, can be risky. Of the

few significant interruptions in U.S. materials

supply in the past 30-odd years (described in

ch. 4), the most disruptive was probably the loss

of nickel from Canada during the 4-month nickel

strike in 1969. Canada was at that time the

source of 90 percent of new (nonrecycled) U.S.

nickel supplies.

12A recent attempt to quantify economic effects Of materia]S

supply disruptions, using a neoclassical econometric model of

the primary metals industry is reported by Michael Hazilla and

Raymond J. Kopp, “Assessing U.S. Vulnerability to Mineral Supply Disruptions, An Application to Strategic Nonfuel Minerals, ”

paper prepared for Resources for the Future, Washington, DC,

draft May 5, 1982.
U.S. imports of critical minerals are part of

the nexus of world trade in these commodities.

If one of its usual suppliers fails for some reason to produce, the United States can buy elsewhere as long as alternate producers exist (although probably with some shortage and delay,

since mining companies often commit supplies

to their customers considerably in advance and

it takes time to expand capacity). Thus, the total number of producers in the world for particular minerals is important, and so are their

relative shares of production. If one or two

countries dominate (as South Africa and the

Soviet Union do for PGM), the potential for disruption is greater than if there were a number

of substantial producers.

In the same way, diversity in the location of

mineral reserves is important for the future.

Since reserve estimates change dramatically

over time with new technology, new discoveries, and price changes, they are a rough indicator of where to expect minerals production. 13

By the measure of reserve location, it appears

that world production of certain important

minerals could become more concentrated

than it is now. For example, South Africa and

the Soviet Union produced 64 percent of the

world’s manganese in 1982; they own 77 percent of the reserves. South Africa today

produces 22 percent of the world’s chromite

ore, but holds 91 percent of the reserves (see

ch. 5 for further discussion).

In general, reliance on one or a very few suppliers creates the potential at least for cartel

action to limit supplies and raise prices, for politically inspired embargoes, or for a cutoff of

supply due to local disturbances in the producer countries. Of these possibilities, disCh. 2—An Introduction to Materials Import Vulnerability

cussed in some detail in chapter 4, the last

pears most likely.

● 4 9

apInstability in foreign sources of supply is certainly an element in vulnerability. The only

way to evaluate instability in particular countries is by qualitative judgment, and opinions

differ, For example, some consider South

Africa a risky source because they see an inherent instability in minority rule by 4.5 million whites of 20 million blacks.14 Some of those

concerned about a “resource war” fear that the

Soviets or Soviet-backed forces may seize

power in South Africa, and the Soviet Navy interdict shipments of critical materials from

South African ports.15 Others see such an interdiction of trade as virtually an act of war,

and do not consider it likely, short of a shooting

war. 16 A quite different point of view is that

South Africa has proved to be one of the world’s

most reliable suppliers, with a record of longrange planning and steady production, and a

conservative commercial approach that rules

out political embargoes,

There is greater consensus that production

of minerals in the relatively new African nations could be disrupted by local wars, insurrection, or civil disorder, or by inexperienced

management of complex minerals enterprises—

regardless of the part the Soviet Union might

play in aggravating these dangers (see ch. 4 for

a discussion of these possibilities).

Other developing countries also may be subject to political instability, thus affecting minerals production. Indonesia (a significant supplier of tin) was governed less than 20 years

ago by the strongly anti-Western Sukarno, and

Thailand (an important source of tantalum and

tin) is under some pressure from its revolutionary neighbors. In Latin America, too, political

upheavals have, on occasion, interfered with

1~’’Reser\ws” comprise only part of a countr}’s mineral wealth.

They are deposits i~hich are known and are technically and econornical]jr feasible to mine at a profit at the time the data is ana -

l~zed, “Resources” include rcscr~es and all other deposits that

are known but are not econorni(; to mine, as well as deposits

that are rneret~r inferred to exist from geologic e}idence. “Reseri’e base” in[.ludes resources that are current]}’ economic (4’res[:ries”), those that are considered marginally’ economic plus

a portion of the sutxx, onom i{, resources. Throughout this stud~’,

reser~’e (fata has been used for comparison purlmses, unless

other~j’i ~e note(].

14 Robert E. Osgood, “The Securit]’ Implication of Dependence

on Foreign Non fuel Minerals, paper prepared for the School

of Adva need International Studies, The Johns Hopkins

Uni\’ersitS.

“Rear Arfm. William C. N!ott, “Introduction: What 1s the Resource War?’ Strotegjc Nlinerrrjs: A Resource Crisis [Washington. I)C: The Council on Economics and National Securit\, 1981],

pp. 20-29.

1~() sgood. op. (: it.; I, f)g\ol d, 0}). (: it.
50 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

+--..... *..*.+

---

Photo credit U S Air Force

Chromium and cobalt are essential in jet engines of high-performance military aircraft such as this U.S. Air Force F-16

minerals production and export, Cuba, for example, was considered a potential supplier of

nickel for the United States, as a supplement

to Canadian supplies. When the Communist

government was installed in Cuba, access to

this source was lost due to a U.S.-imposed

embargo.

Another possible source of vulnerability is

long-distance transportation by sea. The United

States imports large tonnages of a number of

important materials from distant countries by

sea, For example, in 1981 the United States imported 3 million tons of alumina from Australia; some 640,000 tons of manganese ore, mainly from Gabon, South Africa, and Australia;

and 800,000 tons of ferromanganese and ferrosilico-manganese, largely from South Africa,

France, and Brazil. If sea lanes were blocked

in a war, it is difficult to conceive how these

large tonnages could be airlifted to the United

States from the producer countries.17

Although import dependency does not equate

with vulnerability, and domestic supplies are

not an ironclad guarantee against disruption,

the lack of adequate domestic supplies counts

as a most important factor in vulnerability. Lagging investment and labor troubles have, on occasion, limited production from U.S. mines.

Yet, at the very least, domestic supplies can be

relied on in a national emergency, to meet part

of domestic requirements, assuming the government would exercise special powers to keep

production going.

“Lack” of domestic supply can be a relative

term, ranging from resources that look prom17 The ~aY,]oad of a C5A, our largest cargo aircraft, is about

100 tons. At that payload, it has a range of 2,500 miles.
Ch. 2—An Introduction to Materials import Vulnerability ● 5 1

ising now or in the near future (platinum in the

Stillwater Complex in Montana) to subeconomic deposits (cobalt in the Blackbird deposit

of Idaho) to resources of such poor quality

(manganese in Minnesota and Maine) that they

may never be economical to mine.

Combining Both Strands: Defining “Strategic”

When the strands of criticality and vulnerability are combined, a definition something

like this emerges: If a material’s essential uses,

for which there are no available economic substitutes, exceed the reasonably secure sources

of supply, the material is “strategic. ” However,

neither “essential uses” nor “reasonably secure

sources of supply” can be defined with quantitative precision. The following section screens

particular materials against the criteria described in this section, with the aim of selecting a few materials that nearly everyone can

agree are “strategic” and that exemplify the

problems and opportunities presented by these

materials.

Selecting Strategic Materials

The group of materials chosen for screening

for this report included the 86 nonfuel minerals

for which the Bureau of Mines regularly publishes statistics.18 The Bureau reports data for

each material on the structure of the domestic

industry; consumption (overall and by end use

or industry); imports and exports, including

sources of imports and how much each source

supplies; purchased scrap recycling; events,

trends, and issues relevant to the material;

world production, reserves, and resources; and

substitutes and alternatives. These kinds of

data (drawn from the Bureau of Mines and

other sources) were the basis for fitting

materials against the criteria described earlier,

defining which materials are strategic, and selecting them for further study. Table 2-2 lists

the 86 materials that comprised the group chosen for screening,

1 B[J n]ess ~therw~ls~ rlotecl the i n formation presented is from

the Bureau of Mines.

Table 2-2.—Materials To Be Screened

Aluminum

Antimony

Arsenic

Asbestos

Barite

Bauxite

Beryllium

Bismuth

Boron

Bromine

Cadmium

Cement

Cesium

Chromium

Clays

Cobalt

Columbium

Copper

Corundum

Diamond (industrial)

Diatomite

Feldspar

Fluorspar

Gallilum

Garnet

Gem stones

Germanium

Gold

Graphite (natural)

Gypsum

Hafnium

Helium

Ilmenite

Iridium

lodine

Iron ore

Iron and steel

Iron and steel scrap

Kyanite and related

materials

Lead

Lime

Lithium

Magnesium metal

Manganese

Mercury

Mica (natural), scrap and

flake

Mica (natural), sheet

Molybdenum

Nickel

Nitrogen (fixed) ammonia

Peat

Perlite

Phosphate rock

Platinum group metals

Potash

Pumice and volcanic

cinder

Quartz crystal (industrial)

Rare-earth metals

Rhenium

Rubidium

Rutile

Salt

Sand and gravel

Selenium

Silicon

SiIver

Sodium carbonate

Sodium sulfate

Stone

Strontium

Sulfur

Talc and pryophyllite

Tantalum

Tellurium

Thallium

Thorium

Tin

Titanium dioxide

Titanium sponge

Tungsten

Vanadium

Vermiculite

Yttrium

Zinc

Zirconium

Magnesium compounds

SOURCE Off Ice of Technology Assessment, drawn from U S Department of the

Interior Bureau of Mines data

One of the leading criteria for vulnerability

was the sufficiency of domestic supplies of a

material. The United States is a net exporter

or is self-sufficient for 22, or approximately

one-quarter, of the materials on the list (table

2-3), As a first cut in the screening, all these

materials were eliminated from further consideration as strategic. In addition, 50 of the 86

materials on the original list are imported

mostly from countries judged to be stable

sources of supply—i.e., countries presently free
52 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table 2.3.—Materials for Which the United States is

Self-Sufficient or a Net Exporter

Boron Magnesium compounds

Bromite Mica (natural), scrap and

Clays flake

Diatomite Molybdenum

Feldspar Perlite

Garnet Phosphate rock

Helium Quartz crystal (industrial)a

Iron and steel scrap Sand and gravel

Kyanite and related Sodium carbonate

minerals Stone

Lithium Talc and pyrophyllite

Magnesium metal Vermiculite

aLaSCa IS One of the three commodities reported in this category It IS imported,

but the net import reliance is not avatlable

SOURCE Office of Technology Assessment, based on U.S Department of the

lnIertor, Bureau of Mines data

from threats of internal disturbances or outside

pressure from forces hostile to the United

States. These “stable” sources range from industrialized countries such as Canada and

Australia to advanced developing nations, particularly Latin American ones such as Brazil,

Chile, and Mexico. For most of the 50 materials

in this group, there was either considerable

diversity in sources of supply, or stability, or

both. For these reasons, the vulnerability of the

United States to disruption of the supply of

these materials was judged to be relatively low,

However, dependable allies or even the United

States itself cannot be considered totally immune from interruption in minerals and metal

production, as shown by the previously mentioned Canadian nickel strike.

The primary end uses of this group of materials were also scrutinized, to see whether the

uses should be considered critical. For materials with significant military or important industrial uses, the availability of substitutes to

replace these uses was checked. Combining

qualitative judgments with quantitative information on both the vulnerability and criticality

factors, it appeared that the critical uses of

materials in this group did not exceed the

amount imported from stable sources. Thus,

they were screened out of the list of strategic

materials candidates, Appendix B shows these

50 materials and their import sources.

It was not possible to eliminate as a group

the remaining 14 materials. They required

more detailed individual scrutiny. As the following discussion shows, at least four of them–

chromium, cobalt, manganese, and the platinum group metals—clearly met all of the criteria set forth in the first part of this chapter

and were definitely strategic:

They are essential for the national defense

and other important industries.

For some of their essential uses no satisfactory substitutes are available,

There is little or no production of any of

these materials in the United States (although for some, recycling is significant).

They are supplied largely by a very few

countries in a politically unsettled region

(central and southern Africa), and this

same region, plus the Soviet Union, holds

most of the world’s known resources.

These four minerals form a “first tier” of strategic materials that have been selected for

detailed treatment in this report. The remaining 10 materials share some characteristics of

criticality and vulnerability with the first tier

(as detailed in the discussion below), but in less

definitive ways. While the materials in this second tier may be thought of as strategic to some

degree, they are less so than those in the first

tier. Table 2-4 shows the 14 materials grouped

by first and second tiers.

Table 2-4.—U.S. Strategic Materials

First tier

—

Second tier

Chromium Bauxite/alumina —

Cobalt Beryllium

Manganese Columbium

Platinum group metals Diamond (industrial)

Graphite (natural)

Rutile

Tantalum

Tin

Titanium sponge

Vanadium

SOURCE: Office of Technology Assessment
Ch. 2—An Introduction to Materials Import Vulnerability ● 5 3

Overview of Selected Strategic Materials

Agreement that chromium, manganese, cobalt, and the platinum group metals are strategic materials is widespread. The selections

of strategic materials made by other authors,

as described in the first part of this chapter,

all include these metals. A brief explanation of

the reasons for selecting these four materials

follows, with an emphasis on the vulnerability strand. Chapter 3 summarizes in more detail the essential uses of the first-tier materials,

probable trends in their consumption over the

next 10 to 25 years, and the current status of

substitutes for their uses. The discussion below

presents data for each of the materials on U.S.

consumption over the past 5 years and on several factors related to vulnerability: U.S. net import reliance, import sources, world production and reserves. Similar information about

second-tier materials can be found in appendix C.

Chromium

Chromium (Cr) is a lustrous, hard, steelgray metallic element found primarily in chromite, a black to brownish-black chromium ore

(FeCr 2O4

). It imparts unique properties of corrosion resistance, oxidation resistance at high

temperatures, and strength to other metals. An

important ingredient in many steels and alloys,

chromium is irreplaceable (at present levels of

technology) in stainless steels and high temperature-resistant superalloys. And many of the

uses of stainless steels and superalloy are

essential, such as in jet engines, in other military applications, and in vital nondefense production.

Besides its metallurgical uses, chromium is

essential in the chemicals industry, where it

is used in making pigments and chromium

chemicals. Chromite is used in making refractory bricks to line metallurgical furnaces; such

bricks retain their strength and stability even

when subjected to rapid, extreme changes in

temperature, and are resistant to acid and alkali

environments. Additional uses of chromium

are in leather tanning, in wood treatment, and

as additives to oil-well drilling mud.

Table 2-5 shows chromium consumption in

the United States from 1978 to 1982, including the chromium contained both in chromite

ore and in the semi-processed alloy ferrochromium. The sharp decline in 1982 reflects that

year’s recession, with the steel industry especially hard hit.

In the 1979-82 period, imports accounted for

85 to 91 percent of U.S. chromium consumption, Recycling of scrap amounted to 12 percent of apparent consumption in 1982. As table

2-6 shows, the largest supplier to the United

States for both chromium ore and ferrochromium is South Africa. The Soviet Union is actually the world’s largest producer of chromium, and once played a significant role in

supplying the United States with chromium

ore. Since the mid-1970s, however, its contribution to U.S. supplies has declined significantly. Other U.S. suppliers of chromium ore—

e.g., the Philippines, Finland, and Turkey—

have limited production capacity compared to

South Africa’s,

The recent trend among a number of ore

producers has been to process the ore into

ferrochromium. Zimbabwe presently exports

most of its chromium as ferrochromium.

U.S. chromium resources are mostly in the

Stillwater Complex in Montana, podiform deTable 2-5.–U.S. Consumption of Chromium, 1978.82

Apparent consumption

(thousand short tons Net import relianceb

Year chromium content) (percent)

1978 . . . . . . 590 91

1979 . . . . . . 610 90

1980 . . . . . . 587 91

1981 . . . . . . 510 90

1982 . . . . . . 319 85

aAppa~ent ~onsumptlon = u s primary and secondary (recycled) producf{on and

net Import rellance

bNef lrnport rellarrce = (irnms exports + changes In government and Indus.

try stocks) apparent consumption

SOURCE U S Department of the Interior, Bureau of Mines, Mlnera/ Commodity

Summar/es, 1983 and 1984
54 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table 2-6.—Sources of U.S. Chromium Imports

1979-82 1982

Country (percent) (percent)

Chromite: a

South Africa . . . . . . . . . . . . . 48 59

Soviet Union. . . . . . . . . . . . . 17 6

Philippines . . . . . . . . . . . . . . 13 11

Turkey . . . . . . . . . . . . . . . . . . 7 6

Albania . . . . . . . . . . . . . . . . . 6 1

Finland . . . . . . . . . . . . . . . . . 5 7

Madagascar . . . . . . . . . . . . . 4 9

Ferrochromium:

South Africa. . . . . . . . . . . . . 61 35

Zimbabwe . . . . . . . . . . . . . . . 12 25

Yugoslavia . . . . . . . . . . . . . . 12 12

Brazil . . . . . . . . . . . . . . . . . . . 4 11

Sweden . . . . . . . . . . . . . . . . . 4 4

Turkey . . . . . . . . . . . . . . . . . . 2 4

West Germany . . . . . . . . . . . 2 3

Japan . . . . . . . . . . . . . . . . . . . 1 —

China. . . . . . . . . . . . . . . . . . . 1 4

Other . . . . . . . . . . . . . . . . . . . 1 2

achromite = chromium OreS

NOTE: Major world producers of chrorn!te and their contribution to world supplies in 1982 were” Sowet Union (34 percent), South Africa (22 percent);

Albania (12 percent); Brazil (10 percent), Zimbabwe, Philippines, Turkey,

and Finland (4 percent each), India (3 percent). See table 5-4 of ch 5 for

more detail, and for Information on reserves

SOURCE U S Department of the Interior, Bureau of Mines, M/rrera/s Yearbook,

1980, 1!331, 1982, and 1983

posits in California and Alaska, and beach

sands in Oregon. These deposits are not considered close to being economically mineable

at present. Some chromium would be produced

as a co-product of nickel and cobalt at Gasquet

Mountain in northern California, according to

the plans of the developer. However, startup

of this mine in the near future seems highly unlikely without either Government subsidies or

substantially higher world prices for these metals. (Detailed information on domestic and

world chromium production is covered in ch. 5.)

Cobalt

Cobalt (Co) is a hard, brittle metallic element

found in association with nickel, silver, lead,

copper, and iron ores. It resembles nickel and

iron in appearance.

The largest and most critical end use of cobalt is in superalloys, used mainly in gas turbines (aircraft and land and marine-based) that

require high strength at very high temperatures, Cobalt has no satisfactory substitute as

a binder in carbide tools. It is a preferred ingredient in other steels and alloys as a hardening agent, Another application is in electrical

equipment, where cobalt’s strong magnetic

properties make small, powerful, and longlasting magnets. Cobalt is also used as a catalyst, especially in petroleum refining, to remove

sulfur and heavy metals. Spurred by high cobalt prices in the 1978-80 period, considerable

substitution for cobalt has occurred—e.g., ceramics in permanent magnets. But cobalt is still

considered essential in many of its applications, especially in many superalloys.

Table 2-7 shows total annual consumption of

cobalt. Quantities used are relatively small

compared to materials such as chromium and

manganese. A trend toward declining cobalt

consumption is apparent since the price hike

and fears of shortage in 1978 (see ch. 4).

The United States is highly import-dependent

(92 percent) for cobalt, with the rest of demand

supplied by recycling. The largest sources of

supply, both for the United States and the rest

of the free market countries, are Zaire and

Zambia (see table 2-8). In the past 4 years, world

supplies have been expanded and diversified;

other countries such as New Caledonia, the

Philippines, and Australia now make a greater

contribution to world supply. This expansion

was also induced by the cobalt price spike in

the wake of the Katanga invasion of Zaire’s

mining belt in 1978. Zairian cobalt currently

accounts for about 43 percent of U.S. imports,

compared with 53 percent before the 1978 cobalt panic. Despite the considerable number of

suppliers at present, Zaire and Zambia have

Table 2-7.—U.S. Consumption of Cobalt, 1978.82

—

Apparent consumption

(short tons Net import relianceb

Year cobalt content) (percent)

1978 . . . . . . 10,182 95 –

1979 . . . . . . 9,403 94

1980 . . . . . . 8,527 93

1981 . . . . . . 6,266 92

1982 . . . . . . 5,592 92

aApparen~ Consurnptlon = U S primary and secondary (recycled) production and

net import reliance

bNet import reliance = (imports exports + changes rn government and Indus.

try stocks) apparent consumption

SOURCE U S Department of the Interior, Bureau of Mines, Mineral Commodity

Summaries, 1983 and 1984
Ch. 2—An Introduction to Materials Import Vulnerability Ž 55

Table 2-8.—Sources of U.S. Cobalt Imports

.

1979-82 1982

Country (percent) (percent)

Zaire . . . . . . .-.:. . . . . . . . . 37 39

Zambia . . . . . . . . . . . . . . . . . 13 9

Canada . . . . . . . . . . . . . . . . . 8 12

Belgium-Luxembourg a . . . 8 5

Finland ... . . . . . . . . . . . . 7 6

Japan a . . . . . . . . . . . . . . . . . . 7 8

Norway a . . . . . . . . . . . . 7 7

Botswana . . . . . . . . . . . . . . . 3 3

France a . . . . . . . . . . . . . . . . . 3 3

Other . . . . . . . . . . . . . . . . . 7 8

a proc e sses cobalt ore orlgrnatlng from other counlrles

NOTE Major world producers of primary cobalt and their contribution to world

su ppl Ies i n 1982 were Zal re (45 percent), Zambia (13 percent), Australia

(9 percent), Sov!et Un!on (9 percent), and Canada (6 percent) See table

5-16 of ch 5 for more detail and for information on reserves

SOURCE U S Department of the Interior, Bureau of Mines, M/nera/s Yearbook.

1980 1981 1982, and 1983

substantially the largest and richest cobalt ore

deposits. Due to these reserves, these two countries promise to continue to dominate cobalt

supply far into the next century.

The United States has sizable cobalt deposits, particularly at the Blackbird Mine in Idaho,

the Madison Mine in Missouri, and Gasquet

Mountain in California. Substantial cobalt is

also associated with copper-nickel deposits in

the Duluth Gabbro of Minnesota. But the world

price of cobalt (except during the panic) has

been significantly less than what is needed to

make U.S. cobalt mining economically feasible without government assistance.

Manganese

The dominant critical use of manganese, a

gray-white or silver metallic element, is in steelmaking which accounts for about 90 percent

of domestic manganese consumption. The addition of manganese prevents steel from

becoming brittle. Normally, iron and sulfur

compounds in steel tend to form at grain boundaries and weaken the steel at high temperatures. When manganese is added, the sulfur

bonds with it instead of the iron, forming a stable compound and avoiding weakness at grain

boundaries. Manganese also has uses as an alloying element to impart strength and hardness

to all grades of steel. For example, manganesealloy steel is used for armored vehicles that

withstand impacts.

Only 10 percent of U.S. manganese consumption goes into nonsteel applications. Manganese dioxide is used in batteries for its oxygen content, wherein the oxygen combines

with hydrogen, which would otherwise slow

the cell’s action. Manganese dioxide is also

used in making chemicals, in the leaching of

uranium ores, and in the electrolytic production of zinc.

For these smaller uses, manganese has some

substitutes. Although no satisfactory material

replacements for manganese exist in iron and

steel production (see ch. 6), there are functional

substitutes for manganese in steelmaking: external desulfurization is reducing the manganese requirement for sulfur control and several other process modifications in steelmaking

also reduce manganese requirement or improve manganese recovery.

Domestic consumption of manganese has declined slightly in recent years (table 2-9). The

big drop in 1982 is due to the recession in the

steel industry.

There is no domestic production of “manganese ore” (defined as ores containing more

than 35 percent manganese). The United States

relies on import sources for 99 percent of its

supply, with the remaining 1 percent recovered

from domestic production of manganiferous

ores that contain less than 35 percent manganese.19 Ferromanganese and silicomanganese—

alloys used in steelmaking—are also highly imported.

The largest suppliers of manganese materials

to the United States are Gabon and South

Africa, as shown in table 2-10. The U.S.S.R.

and South Africa have by far the largest manganese deposits in the world. However, Australia and Gabon are well-endowed with reserves which could last a century or more at

18The iron and Steel i rl~u,st r}~ derives a significant quantity Of

manganese from iron ores charged to the blast furnace, This input accounts for approximately one-third of total consumption,

but it is not included in manganese import statistics. The quantity of manganese contained in these iron ores has been declining. Based on George R, St, Pierre, et al., Use o,f Manganese in

Stcelrnaking and Steel Products and Trends in the Use of hlangunrsc as an Al)o~ing Element in Steels, report prepared for the

Office of Technology Assessment, 1983.
56 Ž Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table 2-9.–U.S. Consumption of Manganese, 1978-82 Platinum Group Metals

Apparent consumption

(thousand short tons Net import relianceb

Year manganese content) (percent)

1978 . . . . . . 1,363 97

1979 . . . . . . 1,250 98

1980 . . . . . . 1,029 98

1981 . . . . . . 1,027 99

1982 . . . . . . 672 99

aA~~areflt Consumption = U.S primary and secondary (recycled) production and

net tmport rellance

bNet import reliance . (lrnpOrts exports + changes in government and tndus.

try stocks) apparent consumption

SOURCE U S Department of the Interior, Bureau of Mines, Mineral Comrnod/ty

Summaries, 1983 and 1984

Table 2-10.—Sources of U.S. Manganese Imports

Country —

Manganese ore:

South Africa. . . . . . . . . . . . .

Gabon . . . . . . . . . . . . . . . . . .

Australia . . . . . . . . . . . . . . . .

Brazil . . . . . . . . . . . . . . . . . . .

Mexico . . . . . . . . . . . . . . . . .

Morocco . . . . . . . . . . . . . . . .

Other . . . . . . . . . . . . . . . . . . .

Ferromanganese:

South Africa . . . . . . . . . . . . .

France a 

. . . . . . . . . . . . . . . . .

Mexico . . . . . . . . . . . . . . . . .

Brazil . . . . . . . . . . . . . . . . . . .

Australia . . . . . . . . . . . . . . . .

Other a 

. . . . . . . . . . . . . . . . . .

1979-82

(percent)

30

27

22

13

4

4

—

43

26

6

3

2

20

1982

(percent)

52

21

17

3

1

4

2

49

21

7

6

1

16

aprocesses mangmese ore originating from other count rres.

NOTE Major world producers of primary manganese ores and their contribution

to world suppltes in 1982 were: Soviet Union (41 percent); South Africa

(23 percent); Gabon (7 percent); China (7 percent), Brazil (6 percent), Aus.

tralia (5 percent); Mexico (2 percent). See table 5.22 of ch 5 for further

details, and for information on reserves.

SOURCE U S Department of the Interior, Bureau of Mines, Minera/s Yearbook,

1980, 1981, 1982, and 1983.

the current rate of production, and other countries also have significant reserves—all of

which perhaps implies that supply vulnerability for manganese is somewhat less than that

for other materials in the first tier. Nonetheless, the only large manganese reserve in the

Americas is in Brazil. All sources of U.S. manganese imports (except a small amount coming from Mexico) require long-distance transportation by sea, which adds an element of

vulnerability to U.S. supply. The tonnages required by U.S. industry rule out any other

method of transport. Unclaimed resources are

the manganese nodules which are found in

large areas of the ocean floor (see ch. 5).

Platinum group metals (PGMs) refer to six

metals which have similar properties: platinum, palladium, rhodium, iridium, osmium,

and ruthenium. They have the ability to catalyze many chemical reactions and withstand

chemical attack, even at high temperatures.

Their leading use in the United States is in automobile catalytic converters, which use small

amounts of platinum, palladium, and rhodium

in each car, At present, there is no satisfactory

substitute for this use of platinum group metals. Other catalytic applications are in petroleum refining, to produce high-octane gasoline,

and in chemical manufacture of acids (e. g., nitric acid for fertilizer) and other organic

chemicals.

The great strength, high melting points, and

resistance to corrosion and oxidation of PGMs

make them the material choice for electrical

contacts and relays in telephone systems. PGM

alloys are also used as crucible materials (e. g.,

for the growth of single crystals of oxide compounds, used for semiconductor substrates), in

glass fiber manufacture, in dental and medical applications, and in jewelry. Most uses of

PGMs as catalysts and in electronics are highly

important to U.S. industry. 20

U.S. consumption of PGMs declined in the

1981-83 recession but is now recovering (table

2-11),

ZONationa] Materia]s Advisory Board, Suppl~F and USe Patterns

for the Platinum-Group Metals, NMAB-359 (Washington, DC: National Academy of Sciences, 1980).

Table 2-11. —U.S. Consumption of

Platinum Group Metals, 1978-82

Apparent consumption Net import relianceb

Year (thousand troy ounces) (percent)

1978 . . . . . . 2,635 90

1979 ... , . . 2,995 89

1980 . . . . . . 2,859 88

1981 . . . . . . 2,411 84

1982 . . . . . . 1,787 80

a Apparent Consumption = u s prlm~ and seconda~ (recycled) product~on and

net import reliance,

bNet impo~ reliance . (imports exports + changes in government and industry stocks) apparent consumption

SOURCE U S Department of the Interior, Bureau of Mines, Mineral Commodity

Summaries, 1983 and 1984
Ch. 2—An Introduction to Materials Import Vulnerability

The United States is highly import-dependent

(85 percent) for PGMs. There is a small amount

of domestic production (less than 1 percent of

apparent consumption), The remaining 15

percent of demand is supplied by purchased

secondary materials. Actually, this figure

understates the amount of PGM recycling. If

consumption is defined to include the PGM

catalysts which are owned by refiners and

chemical manufacturers, sent out for “toll

refining," 21 and then reused, recycling accounts for about 40 percent of total consumption. Chapter 6 discusses further recycling possibilities.

The Stillwater Complex in Montana is the

most significant known U.S. deposit of PGMs.

Development of an underground mine has

been proposed for this site, with the decision

on whether to develop the property scheduled

for mid-1985. Small amounts of PGMs were recovered from placer deposits at Goodnews Bay

in Alaska as recently as 1975. Chapter 5 has

more details regarding PGM mineral deposits,

The largest source of PGM supply for the

United States is South Africa. As table 2-12

shows, the South African deposits of the Bushveld Igneous Complex dwarf those of the

United States and Canada. In fact, the U.S. and

-- ~ 1‘1’h(, t[I rm ‘‘to] 1 r[’ f i n I n ~‘ c]cnotet the rc(, J(,I i ng of metals for

:1 ff>(> In i\’}11(:]1 [)!$’ll[]r\]llJ) of thr Jnf>ta]s (]()(?s not (:han~t> hdn(]s.

Table 2-12.—Sources of U.S. Platinum

Group Metal Imports

1979-82 1982

● 5 7

Country (percent) (percent)

South-Africa . . . , . . . . , ., 56 48

U.S.S.R. . . . . . ... . 16 16

United Kingdom. ., . . . . . 1 1

a

13

Other . . . . . . . . . . . . . . . . . . . 17 23

~FJGM production from the Unttt?d Kingdom IS from ores orlglnatlngIn South A frl

ca and Canada md from secondary materials

NOTE Major world producers of PGM and their contr!butlon to world suppl!es

In 1982 were Soviet Union (54 percent) South Africa (40 percent) and

Canada (4 percent) See table 5-33 of ch 5 for further details and for In

formation on reserves

SOURCE U S Department of the Interior, Bureau of M(nes M/nera/s Commod(

fy Sumrnar(es 1983 and 1984

Canadian reserves combined would satisfy

U.S. demand at the current level for only about

10 years. The Soviet Union is presently the

world’s largest producer of PGMs; its reserves

are substantial but only about one-fifth the size

of South Africa ’s.

PGMs are mined in South Africa for their

own sake, while in the Soviet Union and Canada they are coproducts or byproducts of nickel

and copper. Thus, South Africa has the advantage of responding directly to the PGM market in making production decisions. Moreover,

the combination of PGMs in the ores is more

favorable in South Africa than anywhere else,

with a greater proportion of higher value platinum in the mix.

A Perspective on Strategic Materials Selection

For many reasons, no list of strategic materials can be the last word. It cannot be exhaustive: the cutoff point at the end of the list is

bound to be somewhat arbitrary, separating

materials which are “more” strategic from

those that are “less,” rather than representing

ones that “are” strategic as opposed to those

that “are not. ” Nor can the list be final. Conditions change. Take copper, for example. In

1952, the Paley Commission selected copper

as a “key commodity, ” for which world consumption and U.S. net imports were rapidly

rising. 22 The commission projected that by

1975, the United States would be able to supply only about 60 percent of its copper needs

through domestic mine production and recycling. Thus, copper, which had a number of

important industrial uses, might have been

considered at that time as a good candidate for

a strategic materials list. In fact, domestic cop38-844 0 - 85 - 3 : QL 3
58 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

per production rose so much over 25 years that

net imports fell to about 10 percent of consumption in the 1970s, rather than to the projected 40 percent, and were well below the 35

percent of 1950.23

The position of copper may change again in

the future, American mines were closing in

large numbers in the recession year of 1982,

with some industry officials predicting that the

mines would never reopen because high wages

and pollution control costs had made the

American copper mining industry—the world’s

largest—uncompetitive with foreign producers.

Even if this prediction proves true, copper’s

designation as a strategic material will depend

on many factors, including the nature of its use,

the availability of substitutes, and the number

and character of foreign suppliers.

The continual development of new materials

and uses also tends to make lists of strategic

materials out of date. For example, natural rubber was a strategic material of great concern

to the United States before World War II. But

during the war, when imports of natural rubber from Southeast Asia were cut off, U.S.

production of synthetic rubber expanded enormously. The displacement of natural rubber for

most uses proved to be permanent.

ZsData on production, reserves, and imports of m i nera]s come

from the Bureau of Mines, Department of the Interior.

Perhaps it is most useful to look at the strategic materials selected for careful analysis

herein as indicative of a set of problems and

possible solutions, not as fixed or exhaustive.

The brief discussion above—much amplified

in chapters 3 and 4—indicate why cobalt, chromium, manganese, and PGMs are judged to be

highly strategic materials. Because they meet

all, or nearly all, of the criteria for critical uses

and vulnerability of supply, they have been

selected for detailed examination in this report.

The essential functions of these materials,

present and anticipated, potential substitutes,

and technologies that can reduce dependence

on uncertain supplies are discussed at length

in the chapters that follow.

The second-tier materials, which share some

strategic characteristics with those of the first

tier, are described in appendix C. These materials, though judged to be less strategic than

the first four, are still worthy of attention and

study. As a practical matter, this report must

confine its assessment to a manageable number of materials. The four first-tier materials

are judged to be most strategic, and they

present the problems of import vulnerability

and possible solutions in the most striking way,

Thus, the assessment here may serve as a useful model for studying other materials which,

though judged less strategic, may be of some

concern because of combined factors of vulnerability and criticality,
CHAPTER 3

Critical Materials Consumption:

Current Patterns and Trends
Contents

Page

Chromium . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Transportation Applications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Construction Applications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Machinery Applications. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Chromite Refractories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Electrical and Chemical Uses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Cobalt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Transportation Applications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Machinery Applications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Chemicals and Catalysts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Electrical Applications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Other Cobalt Applications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Manganese . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Platinum Group Metals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Transportation Applications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Construction Applications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Chemical Applications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Electrical Applications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Refractory Applications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Other Applications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Future Applications for Strategic Materials .....,, . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Nonconventional Energy Systems . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Critical Metals in Automobiles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Summary: Essential Uses of Strategic Materials .,...,. . . . . . . . . . . . . . . . . . . . . . . . .

Superalloy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. .. .., ,. ... ... .....,O . . . . . . .

Stainless Steel for Construction .. .. .. .. .. .. .. .$ . . . .......0. . . . . . . . . . . . . . . .

Automobiles. , . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Cemented Carbides . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Industrial Catalysts.,.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Manganese in Steelmaking . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Palladium in Electronic Components. .,, . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

62

62

65

65

66

66

66

67

67

69

69

70

71

.72

72

74

74

74

77

77

77

77

78

78

79

80

80

80

80

80

80

Table

3-1.

3-2.

3-3.

3-4.

3-5.

3-6.

3-7.

3-8.

3-9.

3-1o.

List of Tables

No.

Strategic Metal Consumption by Industrial Sector, 1980 . . . . . . . . . . . . . . . . .

Chromium Usage in U.S.-Built Passenger Cars, 1980 . . . . . . . . . . . . . . . . . . . .

Typical Structural Alloys Used for Hot-Section Components of the Aircraft

Gas Turbine Engine . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Estimated Requirements for Chromium for Energy-Related Facilities,

1977-2000 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Uses of Cobalt, 1980 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Cobalt Consumption in Tool Steels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Composition of Maraging Steels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

U.S. Manganese Consumption, 1980 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Annual Consumption of Platinum Group Metals in Domestic Automotive

Catalytic Converters .. .. .. .. .. .. .. ... .., ... ...$. . . . . . . . . . . . . . . . . . . . .

U.S. Bureau of Mines Estimates of Probable Demand for Strategic Metals

in the Year 2000 . . . . . . . . . . . . ..., . . . . . . . . . . . . . . . . . . . . . . . . . . . ..., ...,

List of Figures

Figure No.

3-1. Current and Projected Cobalt Consumption in Magnets (1981-90) . . . . . . . . .

3-2. Distribution of Platinum Group Metal Consumption by Applications . . . . . .

3-3. Estimated Future Vehicle Sales in the United States . . . . . . . . . . . . . . . . . . . .

3-4. Estimated PGM Requirements in Catalytic Converters for Domestic

Automobile Production, 1984-95, . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Page

62

62

64

65

67

68

69

71

73

79

Page

70

73

74

75
CHAPTER 3

Critical Materials Consumption:

Current Patterns and Trends

The metals that form the principal subject of

this report—chromium, cobalt, manganese, and

the platinum group—serve throughout the

economy in applications that range from the

essential, such as structural applications in

high-performance aircraft, to the decorative,

as in trim and jewelry, These metals are strategic because they are necessary in a number

of essential industrial and defense applications

and because the major sources of supply are

considered to be vulnerable to disruption, This

chapter identifies the major essential uses of

these metals, describes the properties that

make them irreplaceable at present, and discusses the trends in their use.

As discussed in chapter 2, the strategic nature

of these materials is not static. In time, alternatives may be found to replace the metals in

essential functions, or changing conditions

may mean that the functions are no longer essential, It is also possible that changes in technology will cause these metals, or other materials, to increase in importance beyond their

current status, Such changes are slow in coming, however, and are likely to take a number

of years before they have a major effect,

Table 3-1 shows the distribution of consumption of the four metals over the major industrial sectors in the United States.

The transportation sector consists of the aviation, automotive, railroad, and maritime industries, These industries together account for 19

to 41 percent of the consumption of each of the

four strategic metals,

The construction sector includes facilities for

the production and processing of fuels; production of electricity; equipment for metallurgical,

chemical, and food processing; and structural

materials in buildings.

Examples of the uses of the strategic materials in the machinery sector are tools for metal

cutting and forming, drill bits, ball and roller

bearings, and other machinery components.

Important equipment in the electrical sector

includes transformers, switchgear, motors, instruments, batteries, generators, cooling equipment, and household appliances. Major applications for strategic metals are in magnets,

contacts and electrodes, shafts and bearings for

rotating machinery, tubing and conduits, and

decorative trim.

Refractory uses of strategic metals and minerals are those in which the materials must

operate in an extremely high-temperature environment without chemical change or loss of

desirable properties. An example is liners for

boilers and furnaces. Materials for the production of ceramics and glasses are also in this

category.

Chemical uses of chromium, cobalt, manganese, and platinum group metals are quite varied. They include dyes and pigments, preservatives, food additives, and catalysts for the

production of other chemicals.

The listing in table 3-1 provides only a starting point for the analysis. Further detail on the

uses of the metals is provided below.

61
62 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table 3-1.—Strategic Metal Consumption by Industrial Sector, 1980

Chromium Cobalt Manganese Platinum group

1,000 1,000 1,000 1,000

Sector tons (Percent) lb (Percent) tons (Percent) tr 02 (Percent)

Transportation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 112 (19) 7015 (41) 215 (21) 731 (33)

Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 123 (21) o (o) 375 (36) 171 (8)

Machinery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98 (17) 3081 (18) 165 (16) o (o)

Electrical . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52 (9) 2530 (15) 67 (7) 526 (24)

Refractory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44 (7) 538 (3) o (0) 63 (3)

Chemical . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87 (15) 3785 (22) 50 (5) 284 (13)

Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71 (12) 190 (1) 157 (15) 431 (20)

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 587 (loo) 17,139 (loo) 1,029 (loo) 2,206 (loo)

SOURCE US Bureau of Mines, Mineral Commodity Profiles, 1983

Chromium

Chromium is the most versatile of the many

alloying agents used in steel. It may be added

to provide high-temperature strength, lowtemperature toughness, hardness, corrosion resistance, or oxidation resistance, It is also a

major constituent of nickel- and cobalt-based

superalloy. Additionally, in the form of chromite, it lines crucibles for molten steel and is

used in forms for ferrous castings. In the form

of sodium bichromate, it is processed into a variety of chemicals.

Transportation Applications

Automotive Applications

The automotive industry is one of the largest

consumers of chromium. Chromium consumption by the industry is on the order of 40,000

tons per year, mainly in the form of stainless

steel. Of the 5.5 pounds of chromium contained

in a typical 1980 car, the National Materials

Advisory Board estimated that 2.5 pounds were

used for functional purposes, including suspension, chassis, and engine components and the

catalytic converter (table 3-2), Further reduction of chromium usage could be achieved

through attention to the exhaust emission system, particularly through the use of stainless

steel-clad carbon steel in place of the solid

stainless steel now in use in the converter.

Parts of the automobile engine subject to high

wear, high temperature, or corrosive environments are candidates for chromium-bearing alTable 3-2.—Chromium Usage in U.S.-Built

Passenger Cars, 1980

Total Essential

Propulsion:

Cylinder block, camshafts, valves . . . 0.860 0.325

Cooling system, electrical system . . 0.016 0

Carburetors, air intake, exhaust . . . . 0.079 0

Catalytic converter . . . . . . . . . . . . . . . . 2.070 2.070

Drive train . . . . . . . . . . . . . . . . . . . . . . . 0.155 0.067 (misc.)

Subtotal . . . . . . . . . . . . . . . . . . . . . . . 3.180 2.462

Chassis:

Wheel covers. . . . . . . . . . . . . . . . . . . . . 0.971 0

Suspension . . . . . . . . . . . . . . . . . . . . . . 0.261 0

Brakes . . . . . . . . . . . . . . . . . . . . . . . . . . 0.032 0

Steering . . . . . . . . . . . . . . . . . . . . . . . . . 0,013 0

Miscellaneous . . . . . . . . . . . . . . . . . . . . 0.093 0

Subtotal . . . . . . . . . . . . . . . . . . . . . . . 1.389 0

Body:

Windshield wipers . . . . . . . . . . . . . . . . 0.265 0

Seat belts. . . . . . . . . . . . . . . . . . . . . . . . 0.355 0

Roof and door moldings . . . . . . . . . . . 0.032 0

Plating . . . . . . . . . . . . . . . . . . . . . . . . . . 0.041 0

Subtotal . . . . . . . . . . . . . . . . . . . . . . . 0.903 0

Total . . . . . . . . . . . . . . . . . . . . . . . . 5.472 2.462

SOURCE: As projected by the National Mater!als Advisory Board In 1978

loys. Examples include exhaust valves, which

may contain as much as 21 percent chromium,

and camshafts, which range from 0.9 to 1,5 percent chromium. Engine components account

for slightly less than 1 pound of chromium in

an “average” automobile, Of this amount, only

about one-third of a pound is essential, but

there is little incentive to make the reductions

under the present conditions of availability and

price. Further, some of the reductions, such as

the use of stainless steel containing 12 to 14
Ch. 3—Critical Materials Consumption: Current Patterns and Trends ● 6 3

percent chromium in place of the 21 percent

chromium alloy now in use could not be made

without additional testing to ensure that the

material would behave as expected when in

service.

The principal structural use of chromium alloys in automobiles is in the AISI 5160 steel

used for springs in the suspension. A relatively

new, but growing, use is in the main structural

members of the chassis where high-strength,

low-alloy steels that contain about 1 percent

chromium are gaining acceptance.

In 1982, General Motors (GM) introduced a

fiber composite leaf spring into the rear suspension of the Chevrolet Corvette. In 1983,

similar springs were introduced into other

lightweight cars in the GM line,

Unlike the case with engine parts, there is

a strong incentive to reduce the use of conventional steels in the structural parts of cars, That

incentive is weight reduction, which results in

reduced power requirements and lower fuel

consumption. However, the development of

the high-strength, low-alloy (HSLA) steels has

provided an alternative to other lightweight

materials such as aluminum and fiber composites. These steels, which obtain their strength

through the use of small additions of chromium, manganese, molybdenum, and other

metals, combine high strength and low weight

with conventional metal-forming techniques.

The overall economics of HSLA steels have led,

and are expected to continue to lead, to increasing use of these alloys in automobiles, Although

these steels are not essential to the design of

cars, once incorporated into a design, any

replacement of materials—e.g., in response to

a reduction in the supply of chromium—will

be difficult to make.

Aviation

Aviation, with its demands for high strength,

low weight, and oxidation- and corrosionresistant materials with long fatigue lives and

resistance to high temperature, is another major consumer of chromium. Chromium consumption by the aviation industry accounted

for 3,250 short tons in 1978, of which approximately 80 percent was used in jet engines as

a constituent of superalloy and of other heat-,

corrosion-, and oxidation-resistant alloys. Chromium-containing steels are used in other hightemperature components of jet engines, where

the exceptional heat resistance of superalloy

is not required.

Superalloy, containing substantial amounts

of chromium, nickel, and, in some cases, cobalt, have exceptional resistance to high temperatures. These alloys retain their strength at

high temperature and stress, whereas alloy

steels would fail owing to creep (a gradual

deformation of a material when it is subjected

to stress at high temperature) or to rapid corrosion by the hot exhaust gases of a jet engine.

These materials are essential in the current designs of aircraft gas turbine engines as well as

many land- and sea-based gas turbine engines.

The manufacture of superalloys accounts for

a majority of the total domestic consumption

of chromium metal. In 1981, consumption of

metallic chromium in superalloy was 2,500

short tons or 64 percent of the total domestic

consumption of chromium metal. Ferrochrome

is also used in the production of superalloy,

in 1981, 4,300 tons of chromium contained

in ferrochrome were used in superalloy production,

Already, hundreds of superalloys are used in

aircraft engines, with more being developed all

the time. Some of these alloys are in widespread use, while others have become obsolete

or have been superseded by newer alloys. Table

3-3 identifies some of the typical alloys used

in the most severe applications in the jet engine, With regard to the metals under examination, the table shows a range of chromium

(Cr) content, from a low of 8 percent to a high

of almost 26 percent, and a range of cobalt (Co)

content from zero to 56 percent.

Substitution of known alternative alloys is a

simple method of reducing critical metal consumption in times of a shortage of raw materials. During the disturbances in Zaire in 1978-

79, the cobalt-free alloy IN-718 was used as a

direct substitute for Waspaloy (13.5 percent cobalt). The alloy IN-718 may be used in place
64 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table 3-3.—Typical Structural Alloys Used

for Hot-Section Components of the Aircraft

Gas Turbine Engine

Composition

(percent by weight)

Alloy Ni Co Cr Fe

-——.

Combustor liner:

Hastelloy X . . . . . . . . . . . . . . . . . . 48 1.5 22 18,5

HA-188 . . . . . . . . . . . . . . . . . . . . . . . 22 41 22 —

Turbine vane:

MA-754 78 — 20 1

MAR-M200 . . . . . . ... . . . . . . . . 60 10 9 —

MAR-M247 . . . . . . ... . . . . . . 60 10 8 –

MAR-M509 . . . . . . . . . . . . . . . . . . . 10 55 23.5 –

X-40 . . . . . . . . . . . . . . . . . . . . . . . . . 10.5 56 25.5 –

IN-713 . . . . . . . . . . . . . . . . . . . . . . . 72,5 — 13.5 —

Rene-77 . . . . . . . . . . . . . . . . . . . . . . 55 15 15 —

Turbine blade:

Alloy 454 . . . . . . . . . . . . . . . . . . . . . 62.5 5 10 —

MAR-M200 . . . . . . . . . . . . . . . . . . . 60 10 9 –

MAR-M247 . . . . . . . . . . . . . . . 60 10 8 —

B-1900 . . . . . . . . . . . . . . . . . . . . . . . 65 10 8 —

Rene-80 . . . . . . . . . . . . . . . . . . . . . . 60.5 9.5 14 —

IN-713LC . . . . . . . . . . . . . . . . . . . . 72.3 — 12 —

Rene-77 . . . . . . . . . . . . . . . . . . . . . . 55 15 15 —

Turbine disc:

IN-100 . . . . . . . . . . . . . . . . . . . . . . . 56 18.5 12.5 —

MERL-76 . . . . . . . . . . . . . . . . . . . . . 54.1 18.5 12.4 –

Astroloy . . . . . . . . . . . . . . . . . . . . . 55.5 17 15 —

Waspaloy . . . . . . . . . . . . . . . . . . . . 58 13.5 19.5 —

Rene-95 . . . . . . . . . . . . . . . . . . . . . . 61.3 9 14 —

IN-718 . . . . . . . . . . . . . . . . . . . . . . . 53 — 19 18

IN-901 . . . . . . . . . . . . . . . . . . . . . . . 45 — 12.5 34

A-286 . . . . . . . . . . . . . . . . . . . . . . . 25,5 — 15 55

Case:

Waspaloy . . . . . . . . . . . . . . . . . . . . 58 13.5 19.5 —

IN-718 . . . . . . . . . . . . . . . . . . 53 — 19 18

IN-901 . . . . . . . . . . . . . . . . . . . . . . 45 — 12.5 34

A-286 . . . . . . . . . . . . . . . . . . . . . . . . 25.5 – 15 55

SOURCE Office of Technology Assessment –

of other alloys, such as MAR-M200 (10 percent

cobalt) in turbine vane and blade applications.

Savings of chromium are more difficult to

achieve through substitution than savings of

cobalt. Chromium contents of most superalloys

are in the range of 8 to 22 percent, and those

lowest in chromium contain 10 percent cobalt.

The substitution of IN-718 (19 percent chromium) for MAR-M200 (9 percent chromium)

offset cobalt savings by increased chromium

consumption.

A substitution of cobalt-free IN-713 for alloy

X-40 (56 percent cobalt) in the turbine vanes

of the JT- 9 engine used for wide-body commercial aircraft also occurred as a result of the cobait price increases that followed the Zairian

disturbances. This substitution also resulted in

a 47-percent savings in chromium consumption, although that was not the object of the

substitution. Normally X-40, with its longer

service life, would be the preferred alloy, but

at the higher cost and uncertain supply of cobalt, the substitution was justified.

The potential to reduce critical metal consumption in the near term is limited. Chromium is an essential component of all superalloy, and most of the easy substitutions for

cobalt have been identified as a result of the

price increases that followed the Zairian disturbances. Opportunities for further substitutions are known (and will be discussed in ch.

7), but the time required to complete the qualification and certification process for use in aircraft engines precludes their use as a shortterm response to shortages.

It is clear that chromium will remain essential in superalloy for the aircraft gas turbine

engine. predicting future material needs cannot be done with confidence because of inherent inaccuracies resulting from factors that

vary from the general state of the national economy to advances in engine design and materials processing, However, some sense of future

material requirements is obtained by evaluating alternative scenarios for the growth of the

U.S. aviation industry. Thus, it is estimated

that in 1995 the United States will consume for

the production of superalloy 3,700 tons of

chromium metal and 6,500 tons of chromium

in low-carbon ferrochrome for an increase of

50 percent over 1981. Similar estimates for superalloy production for the year 2010, based

on current technology and trends, are 6,800

tons of chromium metal and 11,600 tons of

chromium in ferrochrome, an increase by a

factor of 2.7 over 1981 demand,

Other Transportation Applications

Other uses of strategic metals in the transportation sector include heat-resistant chromium steels in gas turbines, in steam generators and turbines for railroad and maritime

applications, and in stainless steel containers

for transportation of dairy products and corrosive materials.
Ch. 3—Critical Materials Consumption: Current Patterns and Trends Ž 65

Construction Applications

Almost 20 percent of U.S. chromium consumption is accounted for in the construction

sector, with the most essential applications being in the corrosive environments associated

with oil and gas production and refining and

the high-temperature environment of energy

production facilities. Chemical processing facilities also constitute essential uses of chromium in the construction sector.

Energy Production Facilities for Fossil Fuels

The annual chromium requirements for the

construction of energy-related facilities, including oil and gas wells, coal mines, electricity

generating plants, and other energy facilities

were estimated in a 1979 report to the Department of Commerce. Reported consumption of

chromium in 1977 by the energy industry was

20,400 short tons. When taken with the scrap

generated during processing and fabrication

of energy-related equipment, this sector alone

accounts for 3 to 5 percent of U.S. chromium

consumption. Similar estimates were made for

chromium usage in a 1978 study by the National Materials Advisory Board (NMAB).

These estimates are reported in table 3-4.

In its 1978 study, the NMAB estimated that

90 percent of the chromium consumption of

the energy sector should be considered essential. Of the consumption in 2000, approximately 60 percent will be for stainless steel,

with another 25 percent being for alloy steels.

The remainder will be used in a variety of applications, including superalloy, plating, and

nonferrous alloys.

Table 3-4.—Estimated Requirements for Chromium for

Energy-Related Facilities, 1977-2000

(thousand short tons)

Department of

Commerc e NMAB low NMAB hig h

1977. , ... , . . -

20.4 — —

1985 ..., ... , 24.7 — —

1990 . . . . . . . . . 27.3 — —

2000 ...., ... 33.2 — —

Average. .. . ——. .

27.2 19.5 33.7

SOURCES U S Department of Commerce, 1979 Nat!onal Materials Adwsory

Board 1978

Chemical and Process Applications

Production facilities of the chemical and

process industries, manufacturers of acids, organic compounds, alkalies, and other corrosive

materials, are major consumers of chromium,

principally in the form of stainless steel. These

steels are used because they combine strength

with exceptional resistance to corrosion and

oxidation. They are also used in applications

where it is essential to prevent contamination

of products by the process equipment.

The bulk of chromium consumption in chemical and process applications is accounted for

by a few popular alloys: the wrought alloys;

AISI types 304, 316, and 430; and the cast

alloys, ACI types CF-8, CF-8M, and CN-7M. All

of these steels contain approximately 18 percent chromium. In many cases, it appears possible to develop substitute steels with chromium content as low as 12 to 14 percent,

although users would have to accept a lower

resistance to corrosion unless additions of

molybdenum were made to counteract the effects of chromium reduction, This class of

steel, however, is not currently available, and

several years of effort will be required before

such steel could be ready for widespread use.

Even if such substitutions were made throughout the industry, however, no more than onethird of the chromium consumption in this sector would be saved. Substitution by surfacetreated materials, including coated, clad, and

plated steels, could also be used in some applications, but limitations of cost, abrasion resistance, and corrosion resistance at welds and

other joints restrict the opportunities to use

these materials in the chemical and process industries.

Machinery Applications

Machinery applications of chromium include tool steels, spring steels, and alloy steels

for gears, shafts, and bearings, Chromium is

used largely for its contribution to hardness

and wear resistance. The chromium content

ranges from as low as 0.5 percent in some

steels used for gears and bearings to as high

as 12 percent in some tool steels.
66 Ž Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Opportunities for reduction of chromium

consumption in machinery applications include the use of sintered carbides in place of

tool steels and alternative alloys containing

manganese and molybdenum for the manufacture of gears, shafts, and bearings. Barriers to

the use of these substitutes are economic rather

than technical; in particular the high cost of

sintered carbides relative to tool steels suggests

that this would be an unlikely area of substitution except in extreme emergency.

Chromite Refractories

Chromium, in the form of chromite, is used

in refractory applications such as liners for

steam generator fireboxes and ladles for molten steel because of its ability to provide thermal insulation, resist stresses resulting from

sudden changes of temperature, and remain

chemically inert in metallurgical applications.

The chromite used in refractories differs from

that used as a raw material for the production

of ferrochrome because of its higher aluminum

content. While the high aluminum content

makes chromite undesirable for ferrochrome

production, it improves the refractory characteristics. Chromite sand is also used in molds

for ferrous castings.

Refractories account for about 7 percent of

U.S. chromium demand. Current data are not

available but perhaps as much as 19,000 tons

of chromium were lost in spent, unrecycled

refractory bricks in 1974; additional chromite

is contained in accumulated refractory wastepiles around steel mills, copper smelters, and

other refractory-using facilities,

Steelmaking continues to account for most

use of chromite-containing refractories, although its consumption has declined precipitously since 1965. Phase-out of open hearth

steelmaking with basic oxygen furnaces that

use virtually no chromite refractories is the primary cause. This decline was moderated, and

partially offset, in the early 1970s by using

chromite-containing refractories in electric

steelmaking furnaces and in argon-oxygen-decarburization (AOD) vessels for stainless steel

production. However, since the mid-1970s,

chromite refractories have been replaced rapidly by water-cooled panels in electric furnaces.

In addition, dolomite, which is readily available domestically, now accounts for about twothirds of the refractory material used in AOD

vessels, according to the major U.S. producer.

Electrical and Chemical Uses

In the electrical sector, chromium is used in

shafts, bearings, and other applications requiring wear resistance and in decorative applications, Requirements for chromium are similar

to those of the machinery sector.

Chemical applications accounted for 15 percent of total U.S. chromium consumption in

1980, principally in pigments, metal treatments, and leather tanning, Based on data compiled in 1976, the National Materials Advisory

Board estimated 40 percent of the chromium

use in chemical applications to be essential.

Cobalt

In contrast to the breadth of applications for achieve. The principal uses of cobalt are in

chromium, uses of cobalt are limited. This is superalloy (for the beneficial properties cobalt

due, in part, to the availability of alternative imparts at high temperatures), magnets, cemetals that provide similar properties at lower mented carbides, and catalysts in petroleum

cost, The current uses of cobalt are, therefore, refineries. Other uses include tool and alloy

those in which substitutions are difficult to steels, and salts, driers, and other chemicals,
Ch. 3—Critical Materials Consumption: Current Patterns and Trends ● 6 7

In 1982, the NMAB surveyed the uses and

made estimates as to the essential needs of cobalt, in comparison to actual consumption. The

results of these estimates are reported in table

3-5. The overall estimate of the NMAB was that

50 percent of the cobalt now consumed is essential, with over 58 percent of the essential

consumption being accounted for in superalloy and another 14 percent of the essential

uses going into cemented carbides.

Transportation Applications

The aviation industry accounts for the majority of cobalt consumption in the transportation sector. As shown in table 3-3, cobalt is

an important constituent in many alloys in the

jet engine. Superalloy may contain anywhere

from no cobalt to 65 percent cobalt. The selection of a particular alloy is based on a range

of properties, including yield strength, creep

resistance, oxidation resistance, formability,

and cost,

The beneficial properties that cobalt can impart to superalloys and its availability at reasonable prices (until the market disruptions of

1978-80) led to the current level of use of cobalt. The F-100 engine, used in F-15 and F-16

aircrafts, contains approximately 150 pounds

of cobalt. The JT9D commercial aircraft engine

contains approximately 165 pounds.

New engines may be designed to use cobaltfree alloys. The new General Electric F101 and

F404 engines use Inconel MA 754, a mechanically alloyed, cobalt-free alloy, for the turbine

vanes.

Superalloy accounted for 6.3 million pounds

or 41 percent of the 1980 reported domestic cobalt consumption. Under current trends, it is

anticipated that 8.3 million pounds of cobalt

will be used in the production of superalloy

in 1995 (for all applications, not the aircraft engine alone), and 12.9 million pounds of cobalt

will be required for these uses in 2010.

Cobalt use in other parts of the transportation sector is small. Applications include hardfacing alloys used on the surface of exhaust

valves in automobile engines.

Machinery Applications

Cobalt use in the machinery sector includes

drill and cutting bits made for high-speed and

high-temperature applications, surface coatings for hardness and wear resistance, and

high-strength steels for rocket motor casings,

and dies and structural uses in large machinery. These applications are met primarily

through the use of three materials: cemented

carbides, tool steels, and maraging steels.

Cemented Carbides

Cutting tools used for machining of steel and

cast iron, mining and drilling bits, small- and

medium-sized dies, cutoff tools, and screwmachine tools, all of which require qualities of

abrasion resistance, hardness, impact resistance, and heat resistance, depend on cemented

carbides for their demanding properties. Cemented carbide tools may account for as much

as 75 percent of the metal removed in domestic metal-cutting operations and for over 50

Table 3-5.—Uses of Cobalt, 1980 (thousands of pounds)

Reported Essential Essential

Category consumption consumption fraction

Superalloys . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,300 4,500 71% 

Magnets . . . . . . ., , ... , . . . . . . . . . . . . . . . . . . . . . . . 2,300 400 17

Cemented carbides , . . . . . . . . . . . . . . . . . . . . . . . . . 1,300 1,100 85

Hardfacing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 600 300 50

Steel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 400 200 50

Other metallurgical. . . . . . . . . . . . . . . . . . . . . . . . . . 400 200 50

Catalysts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,700 100 6

Salts, driers, and other chemicals . . . . . . . . . . . . . . 2,200 200 41

Total ., ... , . . . . . . . . . . . . . . , . . . . . . . . . ... , . . 15,300 7,700 50%

SOURCE National Materials Advisory Board, Coba4t Cortserva//on Through Tec/rno/og/ca/ A/terna//ves, NMAB-406, p 2
68 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

percent of the cutting and crushing functions

in mining, oil and gas drilling, and construction activities.

Cemented carbides are formed from a mixture of tungsten carbide powder, which provides the hardness and wear resistance, and

cobalt powder, which acts as the cement that

holds the carbide particles together. The cobalt,

carbon, and tungsten produce a synergistic effect that allows relatively easy production by

sintering (heating the powder shape) to the

point where the surface of the cobalt powder

melts, dissolving some of the tungsten carbide

to form an exceptionally strong bond,

Materials other than cobalt, notably iron and

nickel, with some chromium when needed for

corrosion resistance, have been used with some

success as substitutes for the cobalt binder, but

only with some sacrifice in performance. Since

the applications of cemented carbides are in

uses essential to the economy, and since there

are no satisfactory substitutes for either the carbide tools or for the cobalt used in the binder,

the use of cobalt in this application must be

considered to be critical to the United States.

Tool Steels

Tool steels are used in a variety of metal cutting and forming applications, but it is only in

the high-speed, high-temperature applications

that cobalt-containing tool steel is of particular importance. These steels are classed as Mtype and T-type. Past consumption of cobalt

in these classes of tool steels is summarized in

table 3-6,

Table 3-6.—Cobalt Consumption in Tool Steels

(short tons)

1979 1980 1981

Domestic production:

M-Type . . . . . . . . . . . . . . . . . . . . . . . 2,905 2,941 2,344

T-Type. . . . . . . . . . . . . . . . . . . . . . . . 639 552 479

Subtotal . . . . . . . . . . . . . . . . . . . . 3,544 3,493 2,820

Imports. . . . . . . . . . . . . . . . . . . . . . . . . 815 559 1,042

Total . . . . . . . . . . . . . . . . . . . . . . . . . 4,359 ‘4,052 3,892

Approximate cobalt content

(8°/0 average) . . . . . . . . . . . . . . . . . . 349 324 311

SOURCE Off Ice of Technology Assessment, based on data In Naiional Mater!.

als Advisory Board, Cobalt Conservation Through Techno/ogica/ 4/fer

natives, NMAB 406, p 107

Cobalt-containing tool steels have been a target for substitution research, which has produced alternative alloys with little or no cobalt

through the use of powder metallurgy. For example, a new alloy, CPM Rex 20, is a replacement for the high-speed tool steel M42, and

CPM Rex 25 may replace alloy T15.

Cobalt-based, hardfacing alloys have been

used as wear-resistant materials for over 60

years. Applications include cutters, knives, and

surfaces of unlubricated bearings, Representative hardfacing alloys include Stellite 1, 6, 12,

and 21, all from Cabot Co., which range from

53.5 percent to over 67 percent cobalt content.

A substitute alloy containing less than 14 percent has reportedly been developed, but it is

not yet in commercial use.

Maraging Steels

Maraging steels are high-strength alloys that

may be heat-treated in large sections and thicknesses to increase their strength further. They

run from a low of 7.5 percent to a high of 12

percent cobalt. The major maraging steels are

designated as 18 Ni200, 18 Ni250, 18 Ni300, and

18 Ni350. The composition of these alloys are

listed in table 3-7, The last three digits of the

specification (200, 250, 300, and 350] refer to

the strength level of the steel, i.e., the 18 Ni250

has a yield strength of 260,000 psi. These steels

are noted for their ultrahigh strength with high

toughness. The steels were developed for aerospace applications, but they are now also used

in structural applications. Maraging steels

achieve full strength and toughness through

simple aging treatment (3 hours at 9000 F or

480° C). Hardening and strengthening do not

depend on cooling rates, so properties can be

developed uniformly in massive sections with

almost no distortion. Exact figures on consumption of maraging steels are unavailable,

but during the 1976-78 period, annual consumption was in the range of 1,000 to 2,000

tons per year of steel, requiring 180,000 to

360,000 pounds of cobalt, Of this consumption,

only part is included in the machinery sector.

The remainder is consumed in aviation applications and is included in the transportation

sector.
—

Ch. 3—Critical Materials Consumption: Current Patterns and Trends ● 6 9

Table 3-7.—Composition of Maraging Steels

Ni c o Mo Ti Al Zr B

18Ni200 . . . . . . . . . . . . . . . . . . . . . . . . . 18.5% 5 % 3.25% 0.2% 0.1% 0.01% 0.003%

18Ni250 . . . . . . . . . ... . . . . . . . . . . . . 18.5 7,5 4.8 0.4 0.1 0.01 0,003

18Ni300 . . . . . . . . . . . . . . . . . . . . . . . . 18,5 9.0 4.8 0.6 0.1 0.01 0.003

18Ni350 . . . . . . . . . . . . . . . . . . . . . . . . . . . 18.5 12.0 4.8 1.4 0.1 0.01 0,003

Ni nickel Al = aluminum

c o cobalt Zr = zirconium

Mo molybdenum B -boron

T i titanium

SOURCE National Materials Advisory Board, Cobalt Comervat(on ~hrough Techno/og/ca/ A/terr?afives, NMAB 406, p 110

Chemicals and Catalysts

Cobalt is an essential material in catalysts for

the refining of petroleum and for the production of chemicals. In 1982, about 1.5 million

pounds of cobalt (down slightly from 1.7 million pounds in 1980) were used in petroleum

refining and chemical production, of which all

but 426,000 pounds were recycled.

In refining, cobalt-molybdenum catalysts are

used to remove sulfur and heavy metals from

petroleum, with molybdenum being the more

active of the two metals. Substituting nickel for

cobalt has proved somewhat successful, but opportunities are limited because nickel-molybdenum catalysts operate at higher temperatures

and pressures than do cobalt-molybdenum

catalysts. Without modification of the process

equipment, the use of nickel catalysts would

result in a decline in the processing efficiency

and production rate of the refinery. Even

accepting this drawback, cobalt cannot be

entirely substituted because some reactors

were not designed to operate under the more

severe conditions required by nickel-containing catalysts.

Over 97 percent of the approximately 225 domestic petroleum refineries use some form of

catalytic process. Hydroprocesses, which upgrade the quality of crude oil, are increasing

in importance with the greater use of lower

quality feedstocks. There are five important

processes which are grouped as hydroprocessing: hydrotreating, hydrorefining, hydrocracking, residual hydrosulferization, and hydrogenation of pyrolysis gasoline. All use substantial

quantities of cobalt-bearing catalysts. The annual consumption of cobalt in the petroleum

industry is 970,000 pounds, Some cobalt is

recycled, but about 340,000 pounds of highquality cobalt are required every year for replacement of spent catalysts, principally for

hydroprocessing catalysts which are not recycled. Although processes exist for recovery

of cobalt, molybdenum, and other metals from

spent catalysts, the majority is disposed of in

landfills and dead storage while a small amount

is exported.

Approximately 565,000 pounds of cobalt

were used in catalysts for the production of

feedstock for polyvinyl chloride and of unsaturated polyesters in 1982. Of this amount,

479,000 pounds, or 89 percent, was recovered

through recycling. Generally, the particular

processes have been designed around the

cobalt catalyst, so substitution of alternative

catalysts is not feasible. Only through the use

of alternative chemical processes would it be

possible to use a different catalyst.

Electrical Applications

Cobalt is used in the electrical sector because

of its magnetic properties. Cobalt-containing

magnets have many applications in electric

motors and generators and in acoustic equipment, although a significant share of the market was lost to ferrite magnets as a result of the

cobalt price increases in 1979 and 1980.

Cobalt is used in three principal types of

magnets: the aluminum-nickel-cobalt (Alnico),

iron-chrome-cobalt (Fe-Cr-Co), and rare earthcobalt magnets. A fourth cobalt-containing

magnet utilizes amorphous cobalt-base alloys

that are rapidly cooled from a molten state to

obtain a glassy, noncrystalline structure. The
70 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

conventional Alnico and Fe-Cr-Co magnets account for 90 percent of the market for magnets,

with the remainder being accounted for by the

rare earth-cobalt magnets.

The price increases of the 1978-79 period initiated major efforts at substitution of noncobalt

magnets (principally ceramic-hard ferrites) in

magnetos and loudspeakers. These efforts were

largely successful, to the point that even though

the price of cobalt declined, the ferrite magnets retained control of their newly captured

markets.

Most substitutions that could be made were

made during the period of high cobalt prices,

and further substitutions are unlikely, except

in the event of an extremely severe shortage

or major price increase.

The outlook for the future use of cobalt in

magnets is for an extended period of relatively

low growth, as shown in figure 3-I. The total

Figure 3-1.- Current and Projected Cobalt

Consumption in Magnets, 1981.90

2,000 I

1,500

1,000

500

0

1981 1990

Year

Other

El Motors

Loudspeakers

growth for the 9-year period 1981-90 is estimated at 18 percent, or an annual rate of 1.9

percent. Most striking is the precipitous decline in cobalt magnets in the telecommunications area. This decline is due to increasing

miniaturization, digital signaling, and largescale integration.

The importance of cobalt in its present applications is indicated by Bureau of Mines’ estimates that a threefold increase in cobalt price

would only produce a lo-percent reduction in

consumption, to about 1,8 million pounds in

1990. A much more drastic increase, a factor

of 10, could cause a much more significant decrease, to approximately 400,000 pounds,

which would be mostly in the loudspeaker and

motor applications. This fraction (20 percent)

of the normal consumption is viewed by the

NMAB as the essential requirement for cobalt

in magnetic applications,

Other Cobalt Applications

There are two principal uses of cobalt in the

production of refractory and ceramic products.

First, cobalt is used to prepare the surface of

metals for binding by ceramic layers. In this

application, cobalt, in the form of cobalt oxide, is added to the glasses that are applied to

the steel base. Second, cobalt oxide is used as

an intense blue pigment in ceramic products

and as a decolorizer to offset the effects of iron

and chromium in glass.

Organic salts of cobalt, which can be manufactured from any variety of cobalt metal or oxide, are used as driers in inks, varnishes, and

oil-based paints. Inorganic salts and oxides are

used in pigments, animal feed, and a variety

of other applications, all of which consume

relatively minor amounts of cobalt.

Em Telecommunications

c1 Indicators

SOURCE” U S. Bureau of Mines, 1982
.

Ch. 3—Critical Materials Consumption: Current Patterns and Trends Ž 71

Manganese

Over 90 percent of manganese is consumed

in the production of metals, mostly by the steel

industry. The remainder is used within the

chemical industry and the battery industry, and

for various other uses, Table 3-8 shows the distribution of consumption among the metallurgical industries.

Manganese is used by the iron and steel industry in two forms: ore and ferroalloy. Ore

is generally added during the ironmaking process, while ferroalloys may be added to the ladle after crude steel has been produced.

The function of manganese in the production

of steel is to improve the high-temperature

characteristics of steel by replacing harmful

iron sulfide by the more benign manganese sulfide. When allowed to form, iron sulfide migrates to the boundaries between grains in the

steel, where it remains liquid or extremely plastic after the rest of the steel has solidified. As

the hot steel is rolled into useful forms, cracking results along grain boundaries, a characteristic known as “hot shortness. ” To control

iron sulfide formation manganese is generally

added at a ratio of 15 or 20 times the content

of sulfur. In “resulfurized” steels, where sulfur is added to improve the machining properties, a minimum ratio of 7.5 parts manganese

to I of sulfur may be acceptable.

Manganese is also added to steel to improve

the steel’s strength, hardness, or toughness. Although other elements may be capable of imparting the same properties, manganese is

often preferred because of its low cost and the

past experience with manganese in similar

uses,

One steel product with a high percentage of

manganese as an alloying agent is the impactand abrasion-resistant steel known as “hadfield” steel. This use accounts for approximately 70 percent of all high manganese steel.

Total production of these steels is about 100,000

tons per year. The hadfield steels are noted for

the property of work hardening where the

strength of the material increases as it is used.

Hadfield steels are extremely useful in applications where equipment is repeatedly subjected to high impact, such as earth-moving

and excavation equipment.

Another steel with a high proportion of manganese is the 200 series of stainless steels.

These steels were developed in the 1950s and

1960s in response to uncertainties over the

availability of nickel. The addition of about 6

percent manganese to the 300 series of stainless

steel allows the reduction of nickel content

from 8 to 4 percent. The resulting steel has

performance characteristics similar to the 300

series and enjoys a slight price advantage.

However, compared with the widespread experience with the 300 series, satisfactory data

on the performance of the 200 series in extended use is lacking, Moreover, producers

have not promoted the 200 series. Thus, the use

of the 200 series has been limited, and there

is no expectation for any change in this pattern.

Manganese is also used in nonferrous applications. The largest of these is the 3000 series

aluminums, which contain about 1.5 percent
72 • Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

manganese. Estimated manganese consump- teries. Manganese ore is used to produce potion by the aluminum industry is between tassium permanganate, drying agents for inks,

10,000 and 15,000 tons per year, possibly grow- paints, and varnishes, and as fuel additives.

ing to 20,000 by 1990. Manganese use in cast Manganese is also used to a small extent in ferand wrought copper alloys is much less, on the tilizers, animal feed, ceramics, and uranium

order of 1,500 tons per year. processing.

Manganese, in the form of manganese dioxide, is used in conventional carbon-zinc batPlatinum Group Metals

The platinum group metals (PGMs) are noted

for their stability in extreme environments.

Resistant to high temperatures and to chemical attack, PGMs are used in furnaces for growing single crystals of oxide compounds, in the

manufacture of glass fiber and high-quality optical glass, and in thermocouples and electrodes in electrical applications, PGMs are

used as catalysts in the production of nitric

acid, in the refining of petroleum, and in the

treatment of exhaust gas from automobile engines. Contacts of both low- and high-voltage

switches employ PGM alloys, as do integrated

circuits and resistors. Other uses are in jewelry

and in medical and dental applications.

The consumption of PGMs grew by a factor

of 2.7 between 1950 and 1970. Consumption

in the chemical industry more than doubled,

petroleum refining grew to account for onetenth of consumption, the electrical uses quadrupled, dental and medical uses doubled, and

glassmaking became another important consumer. In that 20-year period, the only decline

was in the jewelry and decorative sector. This

was the single largest end user in 1950 accounting for 35 percent of consumption; in 1965 it

accounted for only 5 percent.

With the passage of the Clean Air Act in the

1970s (Public Law 91-604 and amendments), a

new use for PGMs developed: the automobile

catalytic converter, The catalytic converter was

first used nationwide in 1975. Annual consumption of PGMs almost doubled within a

decade. By 1980, the mix of end uses had

shifted so that autos accounted for 33 percent

of consumption,

ical, 13 percent;

electrical, 24 percent; chemdental and medical, 12 percent; petroleum, 8 percent; and glass and

jewelry, 3 percent each (see fig. 3-2].

Consumption patterns of PGMs differ among

the metals. While the major use of platinum is

in the automotive catalytic converter, the major uses of palladium are in the electrical and

dental/medical sectors. The other metals are

used largely in the chemical and electrical

sectors.

Transportation Applications

The imposition of standards for automobile

emissions resulted in the use of catalysts in automobiles, starting with the 1975 model year.

As a result, the automotive industry quickly became the major consumer of platinum, the key

element in the catalytic converter. In 1975, approximately 80 percent of all new cars were

equipped with the converter. This converter,

intended to promote the complete combustion

of carbon monoxide and unburned hydrocarbons in the hot exhaust gas, averaged approximately 0,062 troy ounces of PGMs per car, of

which about 70 percent was platinum and the

remaining 30 percent was palladium. By 1983,

virtually all new gasoline-powered cars and

light trucks were equipped with catalytic converters, Tighter restrictions on the emissions,

including oxides of nitrogen, lead to the development of a new three-way catalyst that uses

more PGMs, including rhodium, an element

not found in earlier converters. A typical con-
Ch. 3—Critical Materials Consumption: Current Patterns and Trends ● 7 3

Figure 3-2.— Distribution of Platinum Group

Metal Consumption by Applications

2,000

0

0

El ● a Decorative

Glass

172if Petroleum

❑ Dental/medical

SOURCE U S Bureau of Mines

E

1950 1955 1960 1965 1970 1975 1980

Year

Miscellaneous

Automotive

E!is Chemical

Electrical

verter on a 1983 car contains, on the average,

0.079 troy ounces of PGMs, of which about 70

percent is platinum, 22 percent is palladium,

and the remaining 8 percent is rhodium. The

historical consumption of PGMs by the automotive industry is reported in table 3-9.

The future consumption of PGMs in the catalytic converter will be determined by two factors. First is the outlook for domestic production of cars and trucks. Forecasts of auto

production are dependent on a number of factors, including the price of fuel, the general

state of the economy, and the competitiveness

of domestic producers with foreign producers.

As a basis for estimating future PGM requirements, a range of forecasts, based on projections made for the Department of Energy, have

been made and the baseline results are presented in figure 3-3.

Table 3-9.—Annual Consumption of Platinum Group

Metals in Domestic Automotive Catalytic Converters

Sales of gasoline PGM

cars and trucks (1,000s of

Year (1,000s) troy ounces) ——

1975 . . . . . . . . . . . . . . . . . 9,346 443

1976 . . . . . . . . . . . . . . . . 11,202 502

1978. , . ... . . . . . . 11,979 491

1979 . . . . . . . . . . . . . . . . . 13,255 618

1980 .., . . . . . . . . . . . . . . 10,431 704

1981. , . . . . . . . . . . . . . . . 9,827 722

1982, ... ... , . . . . . . 9,512 685

1983 .., ... , . . . . . . . . . . 10,715 770

SOURCE Sierra Research

The second factor to affect critical metal consumption is the design of the catalytic converter itself. Despite predictions made at the

converter’s introduction, neither improvements

in engine design nor research into alternative

catalysts have resulted in the decline in impor-
74 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Figure 3-3.— Estimated Future Vehicle Sales in the United States

1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995

Model year

tance of the PGM-containing converter as the

principal means of meeting air quality standards. This will probably continue to be the case

for some time. While it appears possible to design an engine that could meet the air quality

standards, it seems unlikely that any new design will soon be able to compete economically

with the gasoline or diesel powerplant.

Based on the medium-growth projections for

future sales of cars and trucks, and on the

assumption that the catalytic converter will

remain essentially unchanged, the projected

annual consumption of PGMs in 1995 is estimated to be 1.4 million troy ounces. Consumption estimates for 1995 based on the high auto

sales forecast are 1.7 million troy ounces of

PGM, and the low forecast results in 1.1 million troy ounces of PGM. Estimated metal consumption for the period 1984-95 is shown in

figure 3-4.

Construction Applications

Petroleum production accounts for approximately 9 percent of U.S. platinum consumption as measured by sales of new metal and refined scrap to industry. PGMs are used by the

petroleum industry in two processes: reforming and hydrocracking. Unlike the case of cobalt catalysts, these metals are subject to tight

monitoring and control, with the result that less

than 10 percent of the annual consumption of

these metals is lost in the petrochemical industry,

Chemical Applications

Chemical industry applications include the

manufacture of nitric acid from ammonia. The

PGMs contained in catalysts in these applications are largely recovered for reuse, New material is required for increases in processing

capacity and to make up losses in recycling.

Electrical Applications

For many years, PGMs, particularly palladium, have been used in telephone switching

systems, a use which is declining as a result

of the rapid introduction of solid-state switches.

In turn, the increased use of integrated circuits

is resulting in increasing demand for PGMs.

In integrated circuits, PGMs are used as contacts between the circuit itself and its outer

package.
Ch. 3—Critical Materials Consumption: Current Patterns and Trends ● 75

Figure 3-4.—Estmated PGM Requirements in Catalytic Converters for

Domestic Automobile Production, 1984.95

-- ----

1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995

Year

I ❑ flhodi.rn ❑ Palladium ● platin.rn I

SOURCE Sierra Research, 19&3

Electrical Contacts

An essential property of electrical contacts

in mechanical switching systems is low contact resistance, or low resistance to the flow

of electricity through the surfaces of the contacts. This property is greatly influenced by the

condition of the surfaces. Resistivity is increased either through the wear of the surfaces

or through the creation of insulating films,

If contacts are to have high reliability and

long life, they must be resistant to adhesive and

abrasive wear. Adhesive wear occurs where

the mating surfaces adhere to one another during sliding, resulting in the transfer of metal

to the opposite contact, the edge of the contact

area, or to debris. Adhesive wear is determined

by the material’s hardness and ductility and by

the strength of the adhesive bonds which form

between surfaces.

Resistance to corrosion is critical in electrical contacts. Most metals form insulating polymer or oxide films on their surfaces. Generally,

although not always, these films have lower

conductivity than the surface metal. Even films

only a few angstroms thick can cause substantial increases in contact resistance, so the selection of a surface material for contacts must

consider the corrosive elements in the operating environment, the chemical products that

may be formed by the contact metal, and the

physical and electrical properties of those

products.

Of the total consumption of PGMs in the electrical and electronics industries in 1981, approximately 50 percent went into the production of electrical contacts, mainly in devices

for opening and closing circuits in telecommunications systems. Although gold contacts

generally offer superior performance, cost considerations have resulted in the use of palladium and palladium-silver alloys. As a result

of the increasing use of solid-state switching

by the telecommunications industry, the consumption of palladium in this application will

be declining for the rest of the century.

Ceramic Capacitors

Ceramic capacitors now constitute the major market for palladium in the electronic sector. The ceramic capacitor industry alone con-
76 Ž Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

sumed approximately 500,000 troy ounces of

palladium in 1983, which is expected to have

doubled to 1 million troy ounces in 1984, Unit

shipments of multilayer ceramic capacitors

(MLCs), the largest and fastest growing class

of ceramic capacitors, are expected to grow at

nearly a 20-percent annual rate through the

1980s.

Multilayer ceramic capacitors are rapidly

replacing the single-layer capacitor, MLCs are

built of many thin layers of ceramic material,

with electrodes made of gold, silver or PGM

alloys separating each of the several thin layers.

The electrodes exit on alternate ends of the capacitor, so the plates act in parallel, giving a

larger effective area and a higher capacitance.

The manufacturer controls the final capacitance of an MLC by varying the area, the thickness of the ceramic layers, the number of

layers, and the dielectric constant of the ceramic. The end result is a sturdy, highly compact capacitor.

In creating MLC conductive layers, manufacturers use a metallic ink to print electrodes

on a tape of ceramic material, which is then

assembled into a capacitor prior to baking or

firing into the finished component. The firing

temperature necessary for the typical ceramic

material (alkali-earth titanates)—about 1,3500

C—is too high for silver alone to serve as the

electrode material, Gold or platinum could be

used but their high cost, several hundred dollars per troy ounce, leads manufacturers to use

palladium or a palladium-silver alloy as the

electrode material.

Driven by a need for lower costs, manufacturers have advanced MLC technology from

the use of platinum electrodes in the early

1960s, to gold-platinum-palladium electrodes

(which are still the most desirable, but most expensive, electrode material) in the late 1960s,

to pure palladium in the 1970s, and most recently to silver-palladium, Even with this savings, however, the electrodes still account for

40 percent of the total material cost in the capacitor, In moving to the 70 percent silver

alloy, manufacturers accepted some compromise in the properties of capacitors, The use

of the high-silver electrodes, which have a

lower melting point than the pure palladium

electrodes they replace, requires a lower firing

temperature to prevent oxidation of the silver

during processing and to avoid reactions between the electrodes and the dielectric layers.

The silver also tends to migrate into the ceramic during firing, which can lead to various

electrolytic reactions, causing inconsistencies

in performance and, possibly, failure of the capacitor.

With a higher melting point, nickel appears

to have greater potential as a substitute material in the MLC electrode. Producers currently

find nickel’s properties difficult to control, but

the Japanese are starting to use nickel in limited

applications. The use of nickel requires expensive processing in an oxygen-free atmosphere,

but the lower cost of nickel may provide incentive for further development.

A developing alternative to palladium electrodes is a lead alloy, In this process, known

as the advanced Corning electrode, or ACE, the

ceramic is printed with an ink made of a mixture of carbon-like powder and dielectric powder. During firing, the carbon material burns

away, leaving the layers of ceramic separated

by pillars of the dielectric powder, After firing, lead is injected into the voids left by the

carbon powder. This process was introduced

in 1983 by Corning [the sixth largest U.S. ceramic capacitor manufacturer), with encouraging results. If this process is able to produce

consistently high-quality products, the lower

cost of lead relative to palladium and silver will

provide the driving force to encourage its widespread use.

Acceptance of new manufacturing technologies is often a long process. However, in the

MLC industry, which is pressured by Japanese

competition and by a growing demand for palladium that is certain to force prices upward,

new processes may be accepted as quickly as

they can be shown to provide the essential high

reliability with reduced materials cost. Although the growing consumption of palladium

in ceramic capacitors will continue for the next

several years, technical advances spurred on
Ch. 3—Critical Materials Consumption: Current Patterns and Trends . 77

by limited supplies of this metal are likely to

provide lower cost alternatives that will eventually be accepted by the electronics industry,

resulting in a slow, but long-term decline in palladium consumption in this sector.

Refractory Applications

PGMs are used as crucibles in the production of single crystals of certain oxide compounds that can only be manufactured at

extremely high temperature, The high-temperature resistance, combined with the chemical

stability, allows the production of crystals without danger of contamination by the crucible

and tools used in the growth process.

PGMs are also used in the melting tanks,

stirrers, and crucibles for melting high-quality

glass and as dies and forming devices for glass

fiber.

As with the catalytic uses of PGMs, the refractory and glass applications are largely recovered for reuse.

Other Applications

A variety of chemical compounds are used

in cancer chemotherapy. In addition, PGMs

are used in dental applications in dental crowns

and bridges. These are all considered unrecoverable applications of PGMs.

Use of PGMs in jewelry has been relatively

limited in the United States, but it is quite popular in Japan. Platinum alloys make good jewelry

material, but they are easily replaced by gold.

Future Applications for Strategic Materials

Nonconventional Energy Systems

In recognition of the limited domestic reserves of petroleum and the limitations on the

uses of coal in its natural form, the United

States has devoted considerable effort to technological approaches to make efficient use of

its energy resources and facilities. Some of this

work has resulted in new energy systems that

may have significant effect on U.S. needs for

strategic materials. Several of the technologies

that may have major requirements for strategic materials (particularly the PGMs) are discussed below.

Large-Scale Fuel Cell Stations

In order to make most efficient use of electrical generating capacity, a number of power

storage systems have been examined. In one

system now in use, electricity generated in offpeak hours moves water above a hydroelectric

plant, allowing additional generation during

peak hours without the need for expensive additional capacity. Another system being considered for the future is based on the fuel cell.

The fuel cell is an electrochemical device that

directly converts chemical energy into electric

power, It can also reverse the process, converting electrical energy into chemical energy, storing it, and then converting it back into electricity when needed.

An example of current fuel cell technology

is the phosphoric acid cell, In this system,

hydrogen, which is obtained from methane or

naphtha, is reacted with oxygen from the

atmosphere to produce electricity and water.

The phosphoric acid, which serves as the electrolyte in the cell, is kept at about 350° F. In

order for the reaction to proceed, a platinum

catalyst is necessary. Demonstration models of

the fuel cell now require approximately 6.3

grams of platinum per kilowatt (kW) of power

output. At a production level of 750 to 1,000

megawatts (MW) per year, as suggested by one

developer as a target for 1995—in 2000, the annual platinum requirement of fuel cells could

be as high as 6.3 metric tons (tonnes). This

would be reduced to 1.9 tonnes per year if developers reach their target for reduced platinum loading of 1.9 grams per kW. The need

for platinum may be eliminated if current research leads to development of alternative
78 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

catalysts or alternative fuel cell designs that do

not require platinum catalysts.

Synthetic Fuels

Currently, there is little synthetic fuel production from coal, oil shale, or biomass. Over the

next 25 years, production of synfuels is expected to increase. Cobalt and PGMs will play

a role in the development and growth of these

energy sources,

Liquid and gaseous fuels from coal are expected to be the first large-scale synthetic fuels.

Two processes for liquefaction of coal are

known: direct and indirect. In the direct process, coal is hydrogenated to form a liquid in

the presence of a catalyst, usually containing

iron, although one process, the H-Coal process, uses a cobalt-containing catalyst. In any

case, the liquid products obtained from coal

and from oil shale will require substantial

hydroprocessing of a type similar to that used

with petroleum.

In the indirect process, coal is reacted with

steam and oxygen to produce syngas, a mixture of carbon monoxide and hydrogen gas.

The syngas is converted catalytically to methane (using a nickel catalyst) or to gasoline

(using an iron or a cobalt-containing catalyst).

Critical Metals in Automobiles

The automobile of the future will certainly

differ from those of today. With the large capital investment required to manufacture the

millions of automobiles sold every year, it can

be assumed that changes in design will not be

radical, but even gradual changes may have significant effects on the consumption of strategic metals. One example is dual-fuel vehicles.

These vehicles use a mixture of gasoline and

methanol (from 3 percent up to 10 percent

methanol). The methanol content requires a

more corrosion-resistant material for the fuel

tank, fuel line, and carburation system than is

now used in automobiles. Stainless steel now

offers the best performance characteristics for

much of the fuel system when a gasoline/methanol mixture is used. However, auto manufacturers hope to develop alternative materials

that will have lower raw material and fabrication costs.

Summary: Essential Uses of Strategic Metals

Attempts to predict future requirements for

materials are fraught with difficulties, owing

both to the uncertain growth of industrial and

consumer needs and to unforeseen changes in

manufacturing technology. Discussions of future essential requirements for specific materials are even more difficult since essentiality is not a simple yes-or-no characteristic. The

need for a material in a particular application

depends on the cost and performance of alternative materials and on the time available to

replace the material, to redesign the component in which the material is used, or even to

eliminate the need for the application altogether.

Despite the difficulties, however, it is necessary to estimate future materials requirements

and to identify the applications in which chromium, cobalt, manganese, and PGMs are most

essential. As a starting point, it is helpful to

consider extrapolations of current materials requirements. The U.S. Bureau of Mines has

made statistical projections of future materials

requirements based on current patterns and

trends; these are presented in table 3-Io.

While these projections are useful as a starting point, there are a number of important

modifications and clarifications that arise from

a detailed study of the major uses of strategic

metals. The major points are as follows:

● Chromium consumption for most applications, other than chemical and refractory

uses, will require high-carbon ferrochrome.

In the aviation industry, however, the requirement for low carbon content and high
Ch. 3—Critical Materials Consumption: Current Patterns and Trends ● 7 9

Table 3-10.–U.S. Bureau of Mines Estimates of Probable Demand for Strategic Metals in the Year 2000

NOTE 1 Statistlcson useof cobalt in glass and ceramics were combined wflh thoseon paint and chemical uses In 1983

SOURCE U.S Bureau of Mines, Mineral Commodity Profdes, 1983

purity will mean that the industry will

need substantial amounts of low-carbon

ferrochrome (6,500 tons of contained chromium in 1995) and chromium metal (3,700

tons in 1995).

• Requirements for PGMs in the electronics

sector are likely to be considerably higher

than projected by the Bureau of Mines

owing to the rapid increase in palladium

consumption in ceramic capacitors. Estimated consumption in 1983 of 500,000

troy ounces of palladium already exceed

the Bureau of Mines’ forecast of 300,000

troy ounces in 2000. Anticipated consumption of 1 million ounces in 1984 and a projected annual growth rate of 20 percent per

annum indicate that estimates of PGM requirements for the electronic sector are

low and in need of further study.

● Requirements for platinum, palladium,

and rhodium in the automotive sector do

not include PGMs contained in the catalytic converters of imported automobiles,

Other factors, including the use of platinum-containing particulate traps will also

result in higher consumption of PGMs.

Estimated requirements for PGMs in catalytic converters in 1995, made by Sierra

Research for OTA, are for 1.4 million troy

ounces, almost 50 percent greater than the

Bureau of Mines’ forecast.

● Estimated consumption of cobalt, chromium, and PGMs do not distinguish between primary metal, produced directly

from mined ore, and secondary metal ob-

●

tained from prompt industrial and obsolete scrap.

Estimates of future manganese requirements are based on the assumption that the

ratio of manganese to iron used in steelmaking will decline by only 10 percent by

the year 2000.

Although it is difficult to estimate the specific quantities of strategic metals that can be

deemed to be essential, it is possible to identify the principal applications that are essential to the United States and that use chromium,

cobalt, manganese, and PGMs to fulfill their

functions. These applications, and their strategic materials requirements, are summarized

below,

Superalloy

Chromium, in the form of both chromium

metal and low-carbon ferrochromium, is an essential element in superalloy. In addition, cobalt is currently used in a number of superalloy, particularly in the applications of

highest temperature and stress. To meet future

requirements for superalloy in gas turbine

engines, jet aircraft, and other applications, the

chromium requirements for 1995 are estimated

to be 3,700 tons of chromium metal, 6,500 tons

of low-carbon ferrochrome, and 8.3 million

pounds of cobalt. Similar estimates for the year

2010 are 6,800 tons of chromium metal, 12,000

tons of chromium in ferrochrome, and 13 million pounds of cobalt.
80 Ž Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Stainless Steel for Construction

Stainless and other alloy steels are used in

the energy and chemical process industries to

provide resistance to high temperature, corrosion, and oxidation and to limit contamination

of chemicals that could occur from the use of

less resistant materials in tanks, piping, and

process vessels. In 1979, the Department of

Commerce estimated chromium requirements

for the energy industry at 27,000 tons in 1990

and 33,000 tons in 2000. NMAB estimates were

lower (see table 3-4). The bulk of the chromium

will be used as high-carbon ferrochrome, but

a small percentage of the applications will be

in special alloys that require low-carbon ferrochrome or chromium metal.

Automobiles

In automotive applications, the catalytic converter accounts for about 85 percent of the essential uses of chromium and all of the uses

of PGMs. The estimated essential requirements

for chromium in automotive applications will

be 15,000 short tons in 1990 and 16,000 short

tons in 1995. Requirements for PGMs are 1.3

million troy ounces in 1990 and 1.4 million troy

ounces in 1995. Estimates for both chromium

and PGMs are for all automobiles sold in the

United States. Direct U.S. requirements for

chromium and platinum metal will be reduced

by the degree of market penetration made by

foreign automobiles.

Cemented Carbides

Cemented carbides are one of the most essential applications of cobalt. There are no acceptable alternatives to cobalt for binding the carbide particles together, so virtually all cobalt

in this use is essential. Estimates for 1995 cobalt requirements in cemented carbides are

about 1.3 million pounds, rising to about 2. I

million pounds in 2010.

Industrial Catalysts

The use of catalysts in the petroleum and

chemical industries is expected to grow at a

high rate, more than doubling by the year 2000.

Although in some cases there are alternatives

to the processes that utilize cobalt and PGM

containing catalysts, once facilities are constructed there is little opportunity to substitute

an alternative process that reduces cobalt or

PGM demand unless large investments are

made to modify plant designs.

Manganese in Steelmaking

Manganese is essential to the manufacture

of steel. The amount that is essential to the

United States depends on the essential needs

for steel, the mix of steel products (i.e., carbon

steel; alloy steel; high-strength, low-alloy steel;

and stainless steels), the sulfur content of the

raw steel, and the efficiency of the steelmaking process.

Palladium in Electronic Components

Over the next few years, the use of palladium

alloys as electrodes in ceramic capacitors will

cause palladium consumption in the electronic

sector to increase to a level substantially greater

than indicated by the Bureau of Mines’ estimates. However, the development of new technologies, which will be spurred by the limited

availability of palladium relative to the needs

of the manufacturers of ceramic capacitors,

will then cause a decline in the demand for palladium,
CHAPTER 4

Security of Supply
Page

Factors That Affect Security of Supply . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84

Depletion of World Resources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84

Demand Surges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . + . . . . . . . . . . . . . . . . . . . 85

Cartels . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86

Political Embargoes and the Resource War. . . . . . . . . . . . . . . . . . . . . . . . . . . 87

Civil Disturbances, Local Wars, Internal Troubles . . . . . . . . . . . . . . . . . . . . . 90

Materials Supply Interruptions Since World War II . . . . . . . . . . . . . . . . . . . . . 91

Soviet Embargo of Manganese and Chromium, 1949 . . . . . . . . . . . . . . . . . . 91

U.S. Embargo on Imports of Rhodesian Chromium, 1966-72 . . . . . . . . . . . . 92

Canadian Nickel Strike, 1969 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94

The Cobalt Panic, 1978-79 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97

The Effects of Supply Interruptions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..102

Materials Policy. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..................104

Self-Sufficiency v. Interdependence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...105

Commission Studies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ............106

Congressional Actions and Government Policies . .....................112

The Range of Solutions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .............119

List of Tables

Table No. Page

4-1. World Reserves of Selected Materials, 1950 and 1981.. . . . . . . . . .......84

4-2. Mine Production of Cobalt in the Non-Communist World . ...........100

4-3. U.S. Consumption of Cobalt by Use . .......................,......100

List of Figures

Figure No. Page

4-1. Selected Mineral Resources of Central and Southern Africa . . . . .......89

4-2. Transportation Routes for Minerals in Central and Southern Africa ....98

4-3. Estimated Price Effects on U.S. Cobalt Demand . ...................101
CHAPTER 4

Security of Supply

Import dependence—i.e., the proportion of

demand supplied by foreign sources–is not the

same as import vulnerability. The stability and

reliability of foreign sources of supply, plus

their number and diversity, are major factors

in gauging whether or not this Nation is vulnerable to disruptions in the supply of a given

imported material.

The preponderance of U.S. minerals imports

comes from reliable sources—allies and close

neighbors. Canada is this country’s leading provider of nonfuel minerals, accounting for onethird of the total value of U.S. minerals imports.

Of the 34 minerals shown in chapter 2 (fig. 2-

1), Canada is the largest supplier of 12, including iron, nickel, zinc, tungsten, selenium, cadmium, asbestos, and potash. Australia is by far

the United States’ biggest source of rutile ore

for making titanium (one of the essential metals for airplane parts and engines) and is a significant supplier of alumina and cadmium,

Mexico is a dominant or major supplier of a

dozen minerals, including strontium, fluorspar,

natural graphite, silver, cadmium, and zinc;

and Brazil sells the United States large amounts

of manganese. Venezuela is a major provider

of rich iron ore.

For a few specific minerals, however, the

United States is highly dependent on a limited

number of sources that could prove unstable.

It may fairly be said that vulnerability of supply for some of these materials has increased

over the past 30 years. Suppliers that were once

colonial dependencies of Western European

countries and reliable hosts to international

mining companies are now struggling new nations. Many of them are experiencing difficulties in running their own nationalized minerals

industries, and some are quite vulnerable to

civil disorder and local wars.

Supplies even from sources regarded as reliable can be interrupted. Such was the case in

1969, when a months-long strike of the International Nickel Co. in Ontario sent nickel

prices soaring and users scrambling for supplies. In addition, the security of imports from

a friendly trading partner like Australia may

be called into question because the supply lines

are so long. Nor is domestic production proof

against interruption of supply. For example,

molybdenum was in short supply, here and

abroad, from 1974 to 1979, even though the

United States is the world’s largest producer

and exporter of this mineral. The shortage

came about because of a world depression in

copper production, of which molybdenum is

often a byproduct, and because the large new

Henderson mine in Colorado was not yet in

operation. Moreover, in 1979, after the Henderson mine was producing, a 9-month strike

at Canada’s Endako mine kept world production of molybdenum flat. That year, spot market prices shot up to triple the mining companies’ contract price.

It should be noted that the decline of the

American steel industry may be said to increase the vulnerability of the entire U.S. economy, and to make the Nation less self-sufficient

in defense. This troubling problem goes to the

heart of U.S. economic strength and international competitiveness, and it is receiving

sustained attention from analysts and policymakers. However, it involves many issues that

are outside the scope of this report. Readers

interested in these issues are referred to a prior

OTA assessment, Technology and Steel Industry Competitiveness.1

Altogether, security of minerals supply hinges

on a broad variety of factors. One concern, very

much to the fore in the early 1970s but less so

now, is the depletion of world resources in the

face of escalating demand. An impermanent

but recurring difficulty for many minerals is

boom-and-bust cycles, with surges of demand

coming from the most volatile parts of the

IOffice of Technology Assessment, Technology and Steel Industry Competitiveness, OTA-M-122 (Washington, DC: US. Government Printing Office, June 1980).

83
84 • Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

economy during the time when users of the

minerals are experiencing tight supplies, shortages, and high prices. In the bust side of the

cycle, minerals investments in everything from

exploration to modernization may decline

precipitously, and some mines and plants that

are closed down may never reopen.

Recently, concerns about security of supply

have centered around the possibility of a cartel gaining control of critically needed

minerals, of a Soviet-inspired squeeze on

minerals from central and southern Africa, or

of unplanned, unpredictable civil disturbances

or local wars.

Factors That Affect Security of Supply

Depletion of World Resources

The Earth’s resources are, of course, finite,

But the minerals that underpin industrial society seem to be in no immediate danger of

“running out” in the physical sense, at least

for the next 30 to 50 years. Technology has continually extended both reserves—the identified

inventory that can be mined profitably under

present economic and technical conditions—

and the larger body of known or potential resources, Table 4-1 shows the changes in proven

world reserves of 13 minerals over 30 years.

Most of them increased by at least 100 percent,

and several by more than tenfold, even while

world demand shot upward, especially in Germany and Japan.

The reason for the continued growth in reserves of the world’s minerals is that the means

Table 4-1 .—World Reserves of Selected Materials,

1950 and 1981 (tonnes unless otherwise stated)

Material

Bauxite . . . . . . . . . . ~¥Î••¦Î• .

Chromite a 

. . . . . . . . . . .

Cobalt . . . . . . . . . . . . . . .

Copper . . . . . . . . . . . . . . .

Iron . . . . . . . . . . . . . . . . . .

Lead . . . . . . . . . . . . . . . . .

Manganese . . . . . . . . . .

Molybdenum . . . . . . . . . .

Nickel. . . . . . . . . . . . . . . .

Platinum groupb 

. . . . . . .

Tin ., . . . . . . . . . . . . . . . .

Tungsten . . . . . . . . . . . . .

Zinc . . . . . . . . . . . . . . . .

1950

1.4 x 1 0

9

1.0 x 108

7.9 x 105

1.0 x 108

1.9 x 1010

4.0 x 107

5.0 x 108

4.0 x 106

1.4 x 107

2.5 X 107

6.0 X 106

2.4 X 106

7.0 x 107

1981 1981/1950 — ——

2.2 X 10 10 16

3.4 x 109 34

3.1 x 106 4

5.1 x 108 5

2.7 X 1011 14

1.7 x 108 4

4.9 x 109 10

9.8 X 106 2

5.4 x 107 4

1.2 X 109 48

1.0 x 107 2

2.9 X 106 1

2.4 X 108 3

~hromlum ore

b

Troy ounces

SOURCES For all 1950 figures except platinum group, John E Tilton, The Fu

ture of Norrfue/ Minera/s (Washington, DC Brooklngs Institution,

1977), p 10 For 1981 f!gures and 1950 figures for plat!num group,

U S Department of the Interlot, Bureau of Mines

of discovering them, mining them, and processing them have steadily improved. For example, through technological advances, many

lower quality ores are now just as usable as the

richer ones were before them. An important

instance is chromium, where the distinction

between the metallurgical grade of chromite

ore, with its higher chromium content, and the

lower chemical grade has lost most of its significance just in the last 10 years, Thanks to

a steelmaking advance (called the argon-oxygendecarburization or AOD process), high-carbon

ferrochromium (made with the chemical grade

of chromite ore) can be used in place of lowcarbon ferrochromium (made with the metallurgical grade) in the production of stainless

steel.

Another point about physical depletion is

that nonfuel minerals, unlike fuels, are generally not consumed with use, Many can be recycled. In some instances, recycling may not be

economical because the mineral ingredients in

finished products are widely scattered, degraded, or inconveniently combined with other

materials. Yet recycling is already an important source of supply for many minerals and

could become more so with advances in technology.

How long technology can extend the life of

the Earth’s resources is, of course, a serious

question. Just because it has done so satisfactorily in the past is no guarantee that it will in

the future, especially when world population

is growing at a staggering pace and soaring demands for resources may follow. Minerals

economists generally argue that depletion

would make itself felt as a persistent long-term
Ch. 4—Security of Supply ● 8 5

rise in materials costs rather than an abrupt

physical running out of stocks.2 This expectation may be too optimistic. According to one

geophysical theory, most metals have a “mineralogical barrier” beyond which the energy

needed to release them from the rocks in which

they are bound leaps 100 to 1,000 times. The

barrier may be reached for all “geochemically

scarce” metals—which is to say, all but five—

within a century. 3

The Earth’s crust contains just 12 “geochemically abundant” elements, which account for

over 99 percent of the mass. Five of these elements are metals: aluminum, iron, magnesium,

titanium, and manganese, A steadily increasing amount of energy will be needed to produce even these metals from progressively

leaner ores. But for all the other metals, a

mineralogical barrier may exist, usually at

ore concentrations of about one-tenth to onehundredth of 1 percent, past which the metal

is no longer concentrated in an ore body. Instead, it is dispersed as atoms, isomorphically

replacing atoms of the abundant elements in

common rocks. Once the mineralogical barrier

is reached, the energy needed to release the

scarce metals will be so great, and the prices

so high, that according to the theory, new supplies of these metals will no longer be produced. According to this theory, a “Second

Iron Age” will begin when “it will be simply

cheaper to substitute iron and aluminum and

put up with penalties, such as lower efficiencies in machines, that we do not now countenance.”4

Analysts of the “cornucopian” persuasion

concede that minerals depletion is in fact occurring, but they do not regard the loss as crucial. 5 The ultimate raw material, they say, is

energy. Assuming that world population stabi2

See, for example, Hans H, Landsberg and John E, Tilton, with

Ruth B. Haas, “Nonfuel Minerals, ” in Current Issues in Natural Resource Polic~r, Paul R. Portney with Ruth B, Haas (eds. )

(Baltimore: The Johns Hopkins University Press, 1982), pp. 83-84.

3 For a succinct statement of the theory, see 13 ria n J. Skinner,

“A Second Iron Age Ahead?” American Scientist, May-June 1976,

pp. 258-69.

4

1 b]d,, p. 267.

5 H

, E. Goeller and Alvin M. Weinherg, “The Age of Substitutahil ity, ” Science, Feb. 20, 1976, p. 688.

lizes, decent standards of living can be sustained indefinitely “provided man finds an inexhaustible nonpolluting source of energy.”6

They envision a new “Age of Substitutability,”

in which society would be based largely on

glass, plastic, wood, cement, and the “inexhaustible” minerals: iron, aluminum, and magnesium. Whether societies have the capacity

and foresight to plan a smooth transition from

the present age of fossil fuels and materials

abundance to the Age of Substitutability is a

harder question. But, from the cornucopian

point of view, there are no technical bars in

the way so long as energy is available.

Demand Surges

Temporary shortages and price spikes for

materials in response to peaks of demand have

sometimes been interpreted as signs of resource depletion, Two major studies of materials policy were started, in fact, at a time of

demand surge and materials shortages, one in

the early 1950s during the Korean war, and

another in 1973-74, when all the world’s industrial countries were riding a wave of prosperity together. In both cases, the shortages proved

short-lived. With a downturn in business activity, minerals industries found themselves with

excess capacity, as they typically do after a

boom is over.

Copper is an example.7 Like many minerals,

it is used in construction, transportation, capital equipment, and consumer durables, all of

which react in exaggerated form to the peaks

and valleys of economic activity. In 1973 and

early 1974, with the economies of the United

States, Japan, and Western Europe on a simultaneous upswing, there were serious copper

shortages, aggravated by attempts of industrial

users to build up inventories for security of supply, Within 2 years, the situation reversed.

——.

61bid., p. 688.

‘Copper is not generally regarded as a strategic material todaj’

because the United States is a large producer, and supplies are

currently more than ample, The copper industry does clearly

ill ustrate the cyclical nature of minerals ?]roduction, whether

of strategic minerals or ]CSS critical ones In genera], througtlout this chapter, minerals that ma~ not be strategic are used for

illustrative purposes.
86 • Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Prices slumped. Copper mines and smelters in

the United States, the world’s largest producer,

were shut down. As industry revived in 1976-

77, copper followed. With the recession of

1982, copper once more hit bottom, with prices

dropping 30 percent in 2 years and mines closing throughout the American West. At the end

of 1982, all of Anaconda’s* mines and smelters

in Montana were closed down or scheduled for

closing. The huge Phelps Dodge open pit mine

in Morenci, AZ, was shut down for several

months in 1982—the first such closing due to

a business slump since the Great Depression.9

Instability in the minerals industries is an old

story, but some forces in recent years may be

making it worse. One detailed study of fluctuations of industrial production in the United

States, Japan, and several European countries

concluded that the ups and downs of business

cycles are now more pronounced than they

were in the 1950s and 1960s, and that they are

also more synchronized among the world’s industrialized nations.10 Other recent evidence

suggests that stocks of copper held by U.S. industry are smaller than they were 20 or 30

years ago, and are not being used to counter

swings in the business cycle as they once

were, *l The same may be true of other minerals. Another possible factor: U.S. copper

mines and smelters seem to have suffered more

than a proportionate share of the loss in times

of low world demand in recent years, because

nationalized mines in some developing countries have been kept open to save jobs and precious foreign exchange even when prices did

not cover the costs of production.

Related to the surges and drastic drops in demand that are typical of minerals industries is

lagging investment in mines and processing facilities. Inadequate investment while prices are

‘3 Now owned by The Atlantic Richfield Co,

@’Arco Unit to End Copper Mining in Butte, Mont.” Wall Street

Journal, Jan. 10, 1983; Jay Mathews, “U.S. Copper Industry, Beset

by High Costs, Low Prices, Losing Out to Foreign Producers,”

Washington Post, June 22, 1982,

IODa~d Chjen, “Bwjness Cycles and Instability in Metal Markets,” Materials and Society 5(3), 1981, pp. 257-265. llTirnOthY J. GrUbb, “Metal Inventories, Speculation, and Stability in the U.S. Copper Industry, ” Materials and Society 5(3),

1981, pp. 267-288,

low and facilities idle sows the seeds of future

shortages. To be sure, such shortages tend to

correct themselves, because the high prices

they bring induce the needed investment. But

lead times for opening new mines, processing

plants, and support facilities are from 2 to 7

years, and meanwhile, industries dependent on

the minerals may suffer hardship and dislocations for several years.

Cartels

The success of the Organization of Petroleum

Exporting Countries (OPEC) cartel convinced

many people that producers of other raw materials—bauxite, chromium, copper, phosphates,

and perhaps tungsten—would get together to

seize control of their markets. So far, it has not

happened. One of the classic conditions for

monopoly control does exist for quite a few

nonfuel minerals; that is, a limited number of

suppliers. In addition, some minerals are essential for certain industries with, at least for

the present, no very good substitutes, Often,

these same minerals account for a very small

share of total production costs. These two factors make for inelasticity of demand and favor

the success of cartel control of production and

prices, at least in the short run.

There are several reasons why these conditions have not been enough to create a mineral

cartel like the oil cartel. As noted earlier, the

total costs of U.S. nonfuel minerals imports,

compared with oil imports, are small. Also,

most nonfuel minerals are far less bulky than

oil and therefore much easier to store. Minerals-using industries generally keep a stock on

hand, and the U.S. Government (although not

European or Japanese governments) has a 1-

to 3-year reserve of many critical materials to

meet national defense needs in an emergency,

Significantly, markets for most nonfuel minerals have been soft since mid-1974. And for

many producer countries (e.g., Zaire, Zambia)

minerals exports are the mainstay of the economy. Considering the state of the market, the

existence of government and private stocks, the

existence of substitutes for many materials, the

potential for development of substitutes for
Ch. 4—Security of Supply ● 8 7

others, and the threat of new, alternate suppliers to any cartel, these producers could not

risk supply stoppages. Most importantly, producer countries as diverse in ideology and

goals as Zimbabwe, South Africa, and the Soviet Union might find it difficult indeed to cooperate in an OPEC-like organization that sets

production controls and prices.

Producers of copper and bauxite did take

steps to restrict supply and raise prices in 1974

and 1975. The copper effort, undertaken by

members of the International Council of Copper Exporting Countries (CIPEC) was a failure,

The CIPEC agreement to reduce copper exports by 15 percent had no effect on prices,

Copper exporters thus turned to urging price

stabilization agreements, which require the

consent of purchasing countries. These efforts,

made through the United Nations Conference

on Trade and Development, also failed.

More successful was Jamaica’s imposition of

sharply higher taxes on bauxite. U.S. aluminum

producers tolerated the higher price resulting

from the tax because they had no alternative

supplier as convenient as nearby Jamaica, and

the cost of bauxite is a small fraction of the cost

of finished aluminum. Nonetheless, during the

aluminum recession of 1974-76, Jamaican output of bauxite dropped 30 percent, while bauxite production expanded in Australia, Guinea,

and Brazil, none of which had imposed high

taxes.

Because producer countries in the developing world had little success in the 1970s in creating minerals cartels does not guarantee that

cartels will never succeed, Arguing against success is the distinct lack of common goals among

producing countries and the deterrence exerted by stockpiles and substitutes. Arguing for

it, in the short run at least, is the fact that a

few important minerals are produced in a very

few countries, It is worth keeping in mind that

most minerals cartels in the past have fallen

apart because consumers conserved or found

substitutes, other suppliers got into production,

and cartel members were tempted to cheat,

raising output or lowering prices in the attempt

to maintain their own income or foreign exchange. OPEC itself has been under severe

strain for several years as a result of these

factors.

Another point to consider is that monopolistic control of the market for economic purposes does not necessarily imply shortages or

price leaps. Monopolies are certainly not unknown in minerals history. Past examples include Canada’s Inco, formerly preeminent in

world nickel production, and the Union Miniere

of Belgium for cobalt in the days before Zaire’s

independence. In these instances, monopoly

control resulted in rather reliable levels of

production and prices that remained stable, although prices probably were higher than they

would have been under competitive conditions.

Political Embargoes and the Resource War

As fears of cartel control over nonfuel minerals have faded somewhat, a new fear has

grown that the supply of critical materials may

be choked off for political reasons. Governments, including that of the United States, restrict both imports and exports to serve political goals. From 1966 to the end of 1971, the

United States cooperated with United Nations’

sanctions against the former British colony of

Rhodesia, refusing to buy Rhodesian chrome

because the colony resisted greater participation by blacks in the government. The United

States has also prohibited nickel and other imports from Cuba since the 1960s.

Now, some analysts believe that the Soviet

Union is carrying out a grand, long-term strategy to gain control of both Mideastern oil and

African minerals, and to threaten the West

with the loss of these critical materials. They

believe that the Soviet invasion of Afghanistan,

Soviet influence and the presence of Cuban

troops in Angola and other African nations,

and the buildup of the Soviet navy are all pieces

of the strategy.12 In their view, “state domiIzSome publications expressing this view are Council on ECOnomics and National Security, Strategic MineraIs: A Resource

Crisis (Washington, DC: 1981); and World Affairs Council of Pittsburgh, The Resource War in 3-D–Dependency, Diplomacy, Defense (Pittsburgh: 1980).
88 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

nance," rather than commercial ownership, of

mineral resources in Third World countries

gives the Soviet Union access to these minerals

through political agreement, backed up by Soviet military power.13 Figure 4-1 shows the

mineral-rich part of Africa which has prompted

the greatest concern about possible Soviet control of resources.

A variation of the resource war argument is

that the traditional Soviet self-sufficiency in

minerals is crumbling, and that the Soviet Union plans to rely on political and military domination of Africa rather than on costly economic

competition with Western nations to get the resources it needs, Proponents of this idea point

to Soviet and Eastern bloc purchases, beginning in 1978, of chromium, cobalt, manganese,

tantalum, titanium, and vanadium, together

with halts or large cutbacks in exports of platinum, gold, and titanium.14

Other observers of this situation find the picture of a full-scale resource war unpersuasive.15

While not discounting “the desire and ability

of the Soviet Union to create mischief for the

United States and its allies,”16 they see little evidence so far that Soviet activities in Africa are

part of a grand design to grab minerals for

themselves and deny them to the West. If the

Soviet Union wanted to mount a direct challenge to the Weston resources, these observers

say, it would be far more likely to choose the —.—

lawilliam casey, Director, Central Intelligence Agency, Speech

to U.S. Chamber of Commerce, Apr. 28, 1981, reprinted in Congressional Record, June 23, 1981, S6779.

1

4 Daniel 1, Fine, “Mineral Resource and Dependency Crisis:

Soviet Union and United States” in World Affairs Council of

Pittsburgh, The Resource War in 3-D, cited in note 12. For a more

moderate view of increasing Soviet dependency on minerals imports, with no conclusions drawn as to the consequences for

a “resource war, ” see Daniel S. Papp, “Soviet Non-Fuel Mineral

Resources: Surplus or Scarcity?” paper prepared for the School

of Advanced International Studies (SAIS), The Johns Hopkins

University, May 1981.

IsSee for examp]e, Hans H. Landsberg, et al., “Nonfuel Minerals, ” cited in note 2; and Robert Legvold, “The Strategic Implications of the Soviet Union’s Nonfuel Minerals Policy”; Herbert Howe, “The Soviet Union and Southern Africa: A

Patron-Client Relationship?” Michael Moodie, “The Soviet Navy:

A Weapon in the ‘Resource War’?” Robert E. Osgood, “The Security Implications of Dependence on Foreign Nonfuel Minerals, ”

papers prepared for the SAIS, cited in note 14,

16Hans H. Landsberg, “Minerals in the Eighties: Issues and

Policies, An Exploratory Essay,” paper prepared for the Oak

Ridge National Laboratory, Oak Ridge, TN, 1982.

Mideast than southern Africa. The Mideast is

nearby and has the oil that is the West’s

lifeblood.

The actual behavior of African nations with

Marxist governments and strong ties to the Soviet Union so far has not resulted in efforts to

disrupt minerals supply to the West. All of

them maintain economic relations with the

West. They are keenly aware of their need for

income and foreign exchange from minerals

exports. Angola, for example, even with its

thousands of Cuban troops, protects Gulf Oil

facilities and encourages further foreign investment. Likewise, Zimbabwe is trying to expand

its minerals exports, and Mozambique has

growing American investment. One contributor to a series of scholarly papers on the Soviet Union and the resource war, prepared for

the School of Advanced International Studies

of the Johns Hopkins University, said:

The vocabulary of the resource war, when

addressing Southern Africa, mentions possible

Soviet desires; often it neglects to examine Soviet abilities to realize their desires , . . Today,

despite sizable military aid for the region from

Moscow, probably all of the states harbor a

healthy distrust of Soviet tactics and methods . . . Along with Soviet economic and political failings, [the region’s] growing dependency

upon Western economic institutions should

preclude southern African states from becoming Soviet clients .17

This analyst believes the danger from Soviet

influence will be greatest if South Africa continues its support of insurgent groups in neighboring black African states, including nonMarxist Zambia as well as Angola and Mozambique. The danger is that, to repel the insurgents, these nations might become increasingly

dependent on Soviet military aid and might

then be forced into a client-state relationship.18

Several observers report that they see little

evidence of rapidly increasing Soviet dependence on imports of strategic materials. They

believe that the recent Soviet buying forays for

some minerals and the cessation of the sale of

1

7 Herbert Howe, “The Soviet Union and Southern Africa, ”

cited in note 15, pp. 2, 5.

*eIbid., pp. 17-19.
Ch. 4—Security of Supply ● 8 9

Figure 4-1 .—Selected Mineral Resources of Central and Southern Africa

GABON:

Manganese

ZAIRE:

Copper

Cobalt

Industrial diamonds

Chromium

BOTSWANA:

Industrial diamonds

Cobalt

Nickel

Copper

SOUTH AFRICA:

Chromium

Manganese

Platinum group metals

Vanadium

Industrial diamonds

Nickel

SOURCE ~ff!ce of Technology Assessment, based on U S Department of the Inter! or, Bureau of Mines data

38-844 0 - 85 - 4 : QL 3
90 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

others signify “the consequences of poor Soviet planning, shoddy maintenance of facilities,

and low production efficiency, ” not an “emerging minerals shortage that could lend a common rationale to these actions.”19

Indeed, as the quality of Soviet ores declines,

and as new minerals exploration moves north

and east into the forbidding Siberian environment, Soviet leaders may gradually abandon

self-sufficiency as a top priority goal and may

look to the outside world for cheaper, more

convenient supplies of some minerals. But this

does not necessarily imply that they will resort

to strong-arm methods or a resource war to get

those supplies.

One Soviet specialist asks: “Even were the

Soviet Union shortly forced to import 5 to 10

percent of its lead, zinc, or titanium needs,

what in that circumstance would begin to

justify the risks of plundering Western sources

of supply?”20 Instead, he suggests, Soviet leaders

wishing to buy a greater share of minerals

abroad would use the conservative commercial

approach they already use in foreign trade, possibly relying heavily on barter arrangements,

or on development aid in which they are repaid

in minerals.21

In sum, this school of thought holds that Soviet actions affecting the price and availability of African minerals is a matter of seizing

opportunities rather than carrying out a strategic plan. They do agree, however, that the Soviet Union will go on trying to gain political

power and influence in Africa by exploiting

tribal conflicts, strong anticolonial feelings,

and the opposition of black majorities to the

rule of white minorities. Furthermore, they

agree that mineral imports to this country and

its allies from the richly endowed but troubled

regions of central and southern Africa are definitely vulnerable.

——

leLandsberg, “Minerals in the Eighties, ” cited in note 16. See

also, William R. Severin, “Soviet Non-Fuel Minerals: Recent

Trends and Prospects, ” prepared for the SAIS cited in note 14,

and Legvold, cited in note 15.

ZOLegvold, cited in note 15, p. 17.

ZIIbid., pp. 18-21

Civil Disturbances, Local Wars, Internal Troubles

Civil strife, insurrections, difficulties of management, and breakdowns in mine production

have, in the past, threatened the security of

minerals supply from Africa. In many people’s

judgment, these are the kind of events most

likely to cause interruptions of minerals imports in the foreseeable future.

The supply of Zairian cobalt, never actually

cut off, has been threatened by insurrection

and civil war in central and southern Africa.

Angola’s Benguela railway was the major route

between central Africa’s copper and cobalt

mines and the rest of the world until the civil

war shut it down in 1975. Zaire and Zambia

had to scramble to find other exit routes for

their minerals, including through South Africa,

and are still relying on these less satisfactory

routes, If the Angolan railway had shut down

at a time of strong demand for minerals, the

interruption might well have driven up prices

and disrupted markets, In fact, the 1978 invasion of Zaire’s Shaba province, with a brief occupation by the insurgents of the mines and

processing facilities, had more serious consequences for the world cobalt market, as described later in this chapter.

In the future, the state of domestic peace and

stability in central and southern African nations such as Zaire, Zambia, Zimbabwe, and

Gabon, will strongly affect minerals production

and export. Nor is South Africa exempt from

the possibility of trouble. It is unknown how

long South Africa can resist pressure for change

and a possibly difficult transition to a new form

of government with black participation. Even

now, with white minority rule still firmly in

place, the potential for disruption exists, as

shown by the 1980 bombing of SASOL, South

Africa’s synthetic oil project.

A general war would, of course, be more profoundly disruptive than any of the circumstances described here. This report does not

explicitly consider the contingency of general

war. However, as a part of preparedness, the

U.S. Government’s stockpile goals are set with

a 3-year conventional war in mind. Advanced
Ch. 4—Security of Supply ● 9 7

technologies that reduce import vulnerability— fense in peace, but will not obviate the need

the main focus of this report—are as valuable to fulfill stockpile goals as a means to assure

to the national interest in wartime as they are adequate supplies in the event of war.

protective of U.S. economy and national deMaterials Supply Interruptions Since World War II

In the years since World War II, supplies of

several critical materials have actually been cut

off quite abruptly on a few occasions. It is instructive to look at the reasons why the cutoffs

occurred, how the economy and defense industries coped with shortages, and how the imbalance of supply and demand was eventually

righted.

Soviet Embargo of Manganese and

Chromium, 1949

When the Soviet Union blockaded Berlin in

1948, cutting the city’s land links with the West,

the United States clamped down on exports of

industrial goods to the Soviet Union. Among

the goods embargoed were machinery, tools,

trucks, and scientific instruments. In retaliation, the Soviet Union cut off shipments to the

United States of raw materials critically needed

by U.S. industry, mainly manganese, and chromium. 22

The loss could have been serious. The Soviets

at that time were supplying one-third of U.S.

manganese consumption and one-quarter of

U.S. chromium. Soviet exports of manganese

ore to the United States dropped from 427,229

tons in 1948 to 81,459 in 1949, and their chromium ore exports dropped from 393,966 tons

to 107,131 tons, In both cases, much of the ore

was shipped early in the year, Within a few

months of the embargo, however, the United

States had made up the loss with supplies from

other countries.

For manganese, substitute supplies came

mainly from the Gold Coast (now Ghana), India, and the Union of South Africa. These substitute supplies came from the expansion of already producing mines. Enough capacity of

this kind was available so that U.S. imports of

manganese in 1949 actually increased 23 percent over 1948, despite the embargo,

Actual use of manganese dropped in 1949,

a recession year, but demand remained strong

because industries added 45 percent to their

inventories, probably as insurance against any

possible shortages from the embargo. In fact,

manganese prices rose about 15 percent in

1949 (compared with 8 percent the year before)

despite the recession. At the same time, the

recession probably softened any additional

damage the embargo might have caused.

The U.S. Government, together with industry, swung into action to encourage the opening of more manganese mines outside the Soviet Union. India got steel from the United

States to improve her rail system for transporting ore, Canada and the United States sent ore

rail cars to South Africa, and the Gold Coast’s

railway and port equipment were improved.

With the help of loans from U.S. banks and the

World Bank, South Africa improved railways

to mines and improved harbors for shipping

ore. India got a World Bank loan to build an

electric power project in the Damodar Valley,

where manganese and other minerals were

produced. 23

The answer to the Soviet embargo of chromium was the same as for manganese: alternate suppliers, Turkey and the Philippines increased their chromium ore exports to the

United States, and the Union of South Africa

ZzContemporary accounts of the Soviet cutoff of manganese

and chromium include Bureau of Mines’ publications; Business

Week, Sept. 10, 1949, p. 125; and U.S. News and World Report,

Dec. 16, 1949, p. 26.

ZsThe President’s Materials Policy Commission, Resources for

Freedom (Washington, DC: U.S. Government Printing Office,

1952), VO]. 1, p. 74,
92 Ž Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

remained a major supplier. At the same time,

because of the recession, U.S. chromium consumption fell by nearly one-quarter. Chromium

imports dropped as well, prices fell, and industries added 20 percent to their inventories,

In the aftermath, the United States continued

to diversify its suppliers of manganese and

today buys none from the Soviet Union. The

principal suppliers of manganese ore to the

United States are South Africa, Gabon, Brazil,

Australia, and Mexico. These countries are all

large producers of manganese, and important

suppliers in the world free market. While manganese ore producers are today quite diverse,

the Soviet Union and South Africa together

hold the great bulk of the world’s reserves

(known deposits, commercially minable) and

of its identified (but subeconomic) resources.

As for chromium, U.S. imports from the Soviet Union resumed in the 1960s and for a time

the Soviets were among the principal U.S. suppliers. That story is told next.

U.S. Embargo on Imports of Rhodesian

Chromium, 1966-72

The British colony of Southern Rhodesia

(now Zimbabwe) unilaterally declared its independence in November 1965, setting a course

of continued white minority rule. The next

year, the United Nations (U. N.) passed a resolution prohibiting member nations from buying any of a dozen export commodities from

Rhodesia. On the embargoed list was chromium ore.

Before the ban, Rhodesia was one of the big

four suppliers of chromium ore to the United

States, second to South Africa and ahead of the

Philippines and the Soviet Union.24 Together,

these four countries contributed five-sixths of

chromium ore imported by the United States,

Rhodesia and the Soviet Union each supplied

about 35 percent of this country’s imports of

high-grade metallurgical ore, and South Africa

supplied 17 percent. At that time, the metal-

%onternporary accounts of the Khodesian chromium embargo

include Bureau of Mines’ reports and Business Week, NovF. 27,

1971, p. 23.

Photo credit” George C Coakley, US. Bureau of M!nes

An aerial tramway is one link of the transportation system

that carries manganese ore from mines in Gabon to

deepwater ports on the West Coast of Africa

lurgical grade of chromium ore was essential

for making stainless steel. (In the last decade,

as mentioned above, technological advances

have blurred the distinction between the metallurgical and chemical grades of chromium ore

in stainless steel production.)

When the United States complied with the

U.N. ban on buying Rhodesian chromium, the

Nation could have felt a real shock. Nothing

so dramatic happened. First, the shock was

cushioned by large sales from the U.S. Government stockpile. A long-range plan to rid the

government stockpile of 1.9 million tons of

‘‘excess” metallurgical grade chromium ore

had already been authorized before the man-
.—

Ch. 4—Security of Supply Ž 93

datory ban on Rhodesian chromium took effect. In late 1966 and 1967, industry contracted

to buy 666,000 tons of this stockpiled ore for

future delivery. Deliveries of high-grade ore

from the stockpile amounted to 66,237 tons in

1966 and 62,980 tons in 1967, These quantities

compare with Rhodesian imports of 144,000

tons of metallurgical grade ore in 1966, before

the embargo took effect. Large amounts of

lower grade chromium ore were also available

from the stockpile, but found no industry

takers.

Other factors also eased the effects of the ban

on Rhodesian imports. Chromium-using industries had built up their stocks during 1966,

when storm warnings from Rhodesia were

apparent. Furthermore, deliveries of Rhodesian

ore already purchased tailed off gradually over

1967,

At the same time, U.S. imports of metallurgical-grade chromium ore from the Soviet

Union—and a year or two later from Turkey—

began to increase, So did prices. For its exceptionally high-grade ore, the Soviet Union repeatedly raised prices, from around $32 per ton

in 1966 to about $70 per ton in 1971, The price

of Turkish high-grade ore rose comparably.

Steelmaker throughout the industrialized

world were competing for the more limited

supplies of metallurgical-grade chromium ore

available on the world market, and the suppliers took full advantage.

Nonetheless, it appeared that the ban on Rhodesian ore was being evaded. News accounts

in 1971 reported that Rhodesian mines were

going full blast and that chromium ore from

Rhodesia was finding ways out despite the

U.N. sanctions. France, Japan, and Switzerland, in particular, were accused of buying the

Rhodesian high-grade ore under the guise of

shipments from South Africa and Mozambique

and of paying lower prices than for Russian

and Turkish ore. There were suggestions,

though no certain confirmation, that the Soviets were buying Rhodesian ore and reselling

it at premium prices.

Members of Congress and the steel industry

angrily protested that the embargo was forcing American steelmaker to pay higher prices

for chromium than their European and Japanese competitors had to pay, Another theme

in the protest was that the sanctions against

Rhodesia had caused the United States to become dangerously dependent on Soviet chromium. Imports of Soviet metallurgical-grade

ore had risen from 35 percent of total imports

of that grade to 58 percent in 1970. (For total

imports of chromium ore, of all grades, the Soviet share amounted to 29 percent in 1970, up

from 16 percent before the embargo.)

The national defense argument was perhaps

less telling than the economic one, because the

U.S. Government still held large stockpiles of

chromium ore, including the metallurgical

grade, Moreover, a number of new suppliers

had entered the market as chromium prices

rose. Iran and Pakistan, as well as Turkey, became important alternate suppliers to the

United States. Other countries raised production too. South Africa became the world’s

second largest chromium producer after the

Soviet Union; and the Philippines, Turkey, Albania, India, Finland, and the Malagasy Republic (now Madagascar) all gained importance in

the world market.

In November 1971, Congress passed legislation removing the President’s authority to ban

the import of strategic or critical materials

from a non-Communist country. This ended

U.S. participation in the U.N. sanction. During the next year, prices of Soviet and Turkish ore dropped 15 percent, rising only gradually with inflation over the next few years.

The position of the Soviet Union as a chromium supplier to the United States rapidly declined, from 40 percent of chromium ore imports in 1972 (the peak year) to 12 percent in

1981. But the reasons were more complex than

simply the end of sanctions against Rhodesia.

Changes in the steelmaking industry were

probably at least as important.

As technology advanced through adoption of

the argon-oxygen-decarburization (AOD) process, making it possible to use the chemical

grade of chromium ore for making stainless

steel, the Soviet high-grade ores were no longer
94 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

at a premium. By 1981, metallurgical-grade

ores amounted to only 17 percent of chromium

ore imports to the United States, compared to

50 percent or more 10 years earlier. Another

change is that U.S. imports of chromium ore

are giving way to imports of ferrochromium,

just as ferromanganese is displacing manganese ore. South Africa led in changing its exports to the United States from chromium ore

to ferrochromium alloys. Also, all of recent

U.S. imports of chromium from Zimbabwe

have been in the form of ferrochromium. As

U.S. demand for raw chromium ore declined—

particularly for the high-grade ore that was a

Russian specialty—the Soviet Union no longer

commanded preferential buying by American

purchasers.

Today, South Africa is the United States’

dominant supplier, contributing 55 to 60 percent of all U.S. chromium imports (including

alloys as well as ore). The Soviet portion (of alloys plus ore) was 8 percent in 1981, with the

Philippines supplying a like amount. Other substantial suppliers are Yugoslavia, Zimbabwe,

Finland, Turkey, and Brazil.

Canadian Nickel Strike, 1969

Strikes in Canada’s nickel mines in 1969 had

a brief but jolting effect on nickel-using industries in the United States and Great Britain. Unlike the politically inspired embargoes described above, the 4-month strike at Canadian

nickel mines caused actual shortages and acute

price hikes. Yet military and essential civilian

production were never interrupted in the United

States, which was then at war in Vietnam. At

the height of the shortage, scrap nickel was the

main substitute for Canadian supplies, supplemented by larger nickel imports from Norway

and the Soviet Union and ferronickel from

New Caledonia (a French Territory in the Pacific) and Greece. A month after the strike was

over, a large release of nickel from the government’s stockpile helped refill the pipelines,

while Canadian production geared up again.

Within a year, prices and supplies were back

to normal.25

The reasons for the acute effects of the cutoff of Canadian nickel supply were twofold:

first, Canada’s commanding position as a producer and exporter of nickel, especially to the

United States; and second, tight supplies of

nickel worldwide before the strike. In 1968

Canada supplied half the nickel for the nonCommunist world, and was overwhelmingly

the largest supplier of U.S. nickel imports, contributing over 90 percent. Imports were then

90 percent or more of U.S. nickel consumption.

In addition, world demand for nickel had

grown steadily from 1966 through 1969, while

supplies lagged behind. The industrialized

countries, increasingly prosperous, were demanding more nickel for stainless steel, alloys

for jet engines and space hardware, long-life

batteries, and dozens of uses requiring hard,

strong, corrosion- and heat-resistant materials.

Furthermore, the United States increased its

nickel demands to satisfy military needs, In

several countries, especially New Caledonia

and Australia, mining companies were digging

new mines and building new processing plants,

but world production was only beginning to

rise. There was practically no slack.

The big International Nickel Co. (Inco) mines

in the Sudbury district of Ontario were struck

in July 1969, and a month later strikes closed

the mines of Canada’s second largest producer,

Falconbridge Nickel Mines Ltd. Immediately,

prices on the dealer market (as opposed to producer prices charged by the mining companies]

soared, rising from Inco’s producer price of

$1.03 per pound to $7 and even $9 per pound.

Nonessential industrial users without a ready

substitute for nickel suffered real hardship. In

particular, small electroplating companies

using nickel for trim had to scramble for maZsContemporary accounts of the nickel shortage include Bureau of Mines’ reports; Business Week, Oct. 25, 1969, pp. 42-44;

Anthony F. W. Liversidge, “The Beguiling New Economics of

Nickel,” Fortune, Mar. 1970, pp. Iooff.
.-

Ch. 4–Security of Supply ● 9 5

terial and pay the high prices or stop producing. Cobalt is an adequate substitute for nickel

in electroplating, but usually sells at twice the

price. During the shortage it was hard to find

because most cobalt was sold by producers

under contract to their regular customers.

Nickel-using industries that were able to use

substitutes did so. For example, phosphor

bronze was used in place of 12 percent nickel

for electric powerplant hardware, and steelmakers offered chrome-manganese stainless

steel instead of nickel-bearing stainless steel,

The manganese stainless steel technology was

already on the shelf. Steelmaker had developed it in response to fears of nickel shortages

that arose in World War II and the Korean War;

another motive was to have a substitute on

hand in case nickel prices rose prohibitively.

The shift to high-manganese stainless steel did

not last past the nickel shortage, partly because

nickel stainless steel has some superior prop-
96 Ž Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

erties (greater corrosion resistance) and partly

because, at the time, the process of making

high-manganese stainless steel was exacting

and hard to control.26

The British, also 90 percent dependent on

Canada for nickel, suffered shortages at least

as severe as those in the United States. Looking back in 1982, spokesmen for the British Institute of Geological Sciences called the 1969

nickel shortage “perhaps the gravest metal crisis in the United Kingdom since the Second

World War.”27 British steelmaker, like their

American counterparts, offered customers a

variety of steels in place of nickel steel.

Use of scrap nickel jumped 64 percent in the

United States during 1969. Of the 23,300-ton

drop from the previous year in Canadian imports, recycled nickel made up more than 9,000

tons. Everyone scrounged for scrap. Even new

nickel products lying idle in inventories, such

as pipes and fittings, were sometimes melted

down for reuse. Some desperate electroplates

collected ferronickel scrap and swapped it for

pure nickel, trading with foundries which had

assured allocations from producers. z*

As Canada’s production slid nearly 20 percent from its 1968 level, several countries

stepped up their nickel production, with New

Caledonia, Australia, the Soviet Union, South

Africa, and Rhodesia the leaders. The main

substitute suppliers for the United States were

Norway, which sold us 1,700 tons of nickel

processed from ore obtained earlier from Canada, and the Soviet Union, which continued

its expansion of nickel mining and increased

exports to the United States by 700 tons. The

Soviets also supplied additional nickel to hardpressed Britain. The Soviets were reported to

z6To eliminate nickel completely in high-manganese stainless

steel, nitrogen must be added as an alloying element. With the

technology in use in 1969, it was difficult to add controlled

amounts of nitrogen, Today, the argon-oxygen-decarburization

(AOD) process is used almost universally in stainless steelmaking, and with this process it is easy to add controlled amounts

of nitrogen.

ZTInstitute of Geological Sciences, Strategic Minerals, memorandum submitted to the Parliament, House of Lords, Select

Committee on the European Communities (Subcommittee F),

Feb. 18, 1982.

~8Liversidge, op. cit., p. 100.

be the source of three-quarters of the highpriced dealer market nickel sold during the

shortage.

The blow to the United States from the drop

in Canadian imports was also softened by a

large increase in ferronickel imports (from

about 9,500 to 15,700 tons). Most of this came

from Greece and New Caledonia. New Caledonia had a growing nickel minerals industry

based on laterite ores.

Altogether, with additional imports from

other countries and with the rapid rise in recycling, consumption of nickel in the United

States dropped only 5 percent from 1960 to

1969, down from 173,700 tons to 165,400. However, it must be remembered that supplies had

been tight since 1966. A better indication of the

degree of shortage might be the U.S. consumption of primary and scrap nickel in 1970, which

was 182,500 tons.

Throughout the shortage, defense industries

continued to get nickel supplies. Three years

before the strike, with nickel already in short

supply, the government ordered the three principal U.S. nickel importers to set-aside 25 percent of their shipments for defense-related

orders. The set-aside was continued after the

strike, with the proviso that defense industries

must use these supplies for current production,

not for hoarding in inventories. Also, the government embargoed nickel exports. Most importantly, President Nixon directed the release

of 10,000 tons of nickel from the government

stockpile at the end of 1969. The strikes were

over in November, but by this time the nickel

supply pipeline was depleted, Without the

stockpile release, shortages might have continued for several months.

By the end of January 1970, U.S. civilian as

well as defense industries had all the nickel

they needed. In fact, with rapidly rising

production in several countries, nickel shortages disappeared entirely in 1970. Dealer market prices plunged from over $6 per pound at

the first of the year to $1.33, the same as the

producer price, at the end.

A lasting effect of the 4-year period of tight

supplies in the late 1960s was to encourage
.—. -—.

Ch. 4—Security of Supply ● 9 7

more nickel production and greatly expand the

number of suppliers. In the classic mode of the

minerals industries, demand for nickel dropped

off in the late 1970s, and some of the new capacity lay idle. Nearly half of Canada’s mining capacity was unused in 1978, and New

Caledonia, another big producer, had only

about 60 percent of its mines in production.

The world’s reserves and identified resources

of nickel are not nearly so concentrated as

those of chromium and manganese. Some of

the Pacific islands (New Caledonia, parts of Indonesia) appear to be very well endowed, and

there are also large deposits remaining in

North America, the Soviet Union, Cuba, and

Australia. Thus, the present diversity of

producers can be expected to last for many

years.

The Cobalt Panic, 1978-79

During the cobalt “shortage” of 1978-79,

there was never any real interruption of supply. On the contrary, production in Zaire and

Zambia—by far the largest cobalt producers for

the world market—rose 43 percent during 1978

and 12 percent in 1979.29 But the combination

of rapidly rising world demand and fears of a

supply cutoff, triggered by a rebel invasion of

Zaire’s mining country, set off a wave of buying that sent cobalt prices through the roof. Cobalt users turned to cheaper substitutes and

recycling wherever they could, relieving some

of the pressure. By 1982, with worldwide recession, cobalt prices plunged below the 1978

price.

Zgun]ess otherwise noted, data on cobalt production, consumption, uses, recycling, and prices in this section are drawn from

Charles Ri\er Associates, Inc., Effects of the 1978 Katcmgese Rebellion on the V$’orld Cobalt Market, final report to the Office of

Technology Asiessrnent, December 1982. The data in the Charles

Ri\er Associates’ report are largely based on 13ureau of Mines’

figures, but with some adjustments. The account of events in

Zaire and Zambia from 1975 on and of the cobalt panic of 1978

is also largely drawn from the Charles River Associates’ report.

Other sources were Bureau of Mines’ publications, officials of

the Amax Mining Co., and Patti S. Litman, “The Impact of

Minerals Scarcity on Technological Innovation: Cobalt, A Case

Study,” an unpublished M.S. thesis presented to the Sever institute of Technology, Washington University, St. Louis, MO,

1981.

Cobalt is a specialty metal, produced in small

quantities (only about 27,650 tons worldwide

in 1982),30 but has a number of specialized uses

for which it is highly suited, or even irreplaceable, at current levels of technology. Cobalt is

critical for making certain high-strength, heatresistant superalloy used in jet engines, and

has highly desirable properties as a material

for permanent magnets, wear-resistant tools,

and catalysts for refining oil and making petrochemicals.

The threat of interruption of world cobalt

supply surfaced in 1975 when the civil war in

Angola shut down that country’s Benguela railway. The Angolan railway had been the major artery for transporting copper, cobalt, and

other minerals out of central Africa to the industrialized world. Central African cobalt is

pivotal. In a typical year, Zaire accounts for

60 percent of cobalt production in the nonCommunist world; Zambia, usually the second

largest free world producer, contributes 10 to

15 percent. Thus, if cobalt cannot get out of

Zaire and Zambia, world supply is in trouble.

This situation of extreme world dependence on

central African cobalt is aggravated by the fact

that cobalt is a byproduct of mining for other

higher volume minerals, mainly copper and

nickel. In case of a supply cutoff in central

Africa, it might be uneconomical in the short

run, at least, for producers in other parts of the

world to expand cobalt mining as such.

Because the Angolan railway shutdown of

1975 occurred during a world business recession, with demand low and industry stocks

fairly high, Zaire and Zambia were able to find

alternate routes for shipping metals from their

mines without causing immediate distress. As

of mid-1984, the Benguela railway was still

closed because of guerrilla attacks (related to

civil war in neighboring Angola and Namibia),

and the makeshift exit routes were still being

used. They are not very dependable. One alternate route to the port of Beira in Mozambique

was closed when Mozambique shut its border

to what was then white-ruled Rhodesia. (Now

that Zimbabwe has a largely black, elected gov-

—.. ———

sOThe figure cited is from Bureau of Mines’ data.
98 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

ernment, negotiations may reopen this route,

although it too has been subjected to guerrilla

attacks.) Meanwhile Zaire and Zambia ship

their minerals out through the inadequate,

backed-up port of Dares Salaam in Tanzania,

or take a long, expensive route through Zambia, Zimbabwe, and South Africa. Zaire uses

its own western port of Matadi at the mouth

of the Zaire River for some copper and cobalt

shipments, but getting there requires arduous

transshipment by rail and river, and the river

is not always navigable. Figure 4-2 shows the

routes and location of ports.

With economic recovery in 1976 and 1977,

U.S. and world demand for cobalt rose moderately, but not enough to cause real pressure

on prices. In fact, Zaire was stockpiling cobalt

hydroxide, an intermediate material produced

in the processing of copper, to avoid building

up unsalable inventories of cobalt. In 1977, a

brief invasion of Zaire by insurgents based in

neighboring Angola caused some concern for

cobalt supply because Zaire’s copper mines,

from which cobalt is a byproduct, are in the

southern Shaba province where the invasion

took place. The rebels were emigres who had

fled Zaire after losing a bid in the 1960s to create an independent state of Katanga in Shaba

province. The invaders were quickly routed.

The incident had no effect on cobalt production or prices,

In 1978, the situation was different. With

world business activity on the upswing, and

the market for new jet planes particularly

strong, demand for cobalt began to heat up rapidly. Unable to expand production as fast as

demand was climbing, Zaire announced in

April 1978 an allocation scheme by which cusFigure 4-2.—Transportation Routes for Minerals in Central and Southern Africa

SOURCE: U.S. Department of the Interior, Bureau of Mines, Mineral Perspective: Zimbabwe, 1981
Ch. 4–Security of Supply ● 9 9

tomers would be limited to 70 percent of their

purchases of the previous year.

Aggravating the tight world supply was a recent turnabout in U.S. policy for stockpiling

cobalt. For 8 years, until 1976, the U.S. Government sold 6 million to 9 million pounds of

cobalt each year from its strategic stockpile because holdings in the stockpile were far above

what was then the official goal of 11 million

pounds. During the years of the stockpile sales,

these sales amounted to as much as one-half

of U.S. cobalt consumption and 10 percent of

consumption in the non-Communist world.

In 1976, after the Angola civil war cut the

Benguelan railway, U.S. stockpile sales of cobalt came to a halt. With cobalt holdings then

down to about 40 million pounds, the government set a new stockpile goal of 85 million

pounds. Overnight, the United States went

from being a major supplier of the world’s cobalt to a potential major purchaser. Zaire, Zambia, and other cobalt-producing countries were

unprepared for the change and had not geared

up to higher production levels. But it was not

until demand suddenly boomed in 1978 that the

loss of U.S. stockpile sales began to pinch.

Shortly after Zaire announced its allocation

scheme, insurgents from Angola reinvaded

Shaba province. This time they succeeded in

taking the mining headquarters town of Kolwezi,

but after 2 weeks they were once again driven

out. The only damage done to mining facilities

was the flooding of one mine. But the publicity

surrounding the invasion, the reported killing

of 130 foreign workers, and the subsequent

flight of several hundred skilled mineworkers

and professionals raised the alarm about continued availability of cobalt. Around the world,

industries tried to stock up, buying all the cobalt they could find.

Prices skyrocketed from $6.85 per pound (the

producer price) in February to $47.50 per pound

(dealer market spot price) in October. The producer price reached $25 per pound in early

1979. With this kind of demand and at these

prices, Zambia airlifted its cobalt out, and Zaire

also sent some out by air.

The typically slow response by the minerals

industries to a surge in demand was aggravated

in the case of cobalt because it is usually a byproduct, Nonetheless, producers responded to

the cobalt price spike, as shown in table 4-2.

Zaire raised output by producing from its

stockpiles of cobalt hydroxide. Zambia opened

a new refinery that was already under construction, improved cobalt yields, and pushed

ahead with plans for new mines and refineries, Zaire and Zambia accounted for most of

the added cobalt production in 1978 and 1979,

but small increases occurred elsewhere. Two

Canadian nickel companies added capacity to

their cobalt refineries, and others made plans

to recover cobalt from nickel slag. Recently

opened nickel-cobalt mines in Australia and

the Philippines raised their output as they

solved technical problems and responded to

demand.

The more remarkable response to high prices

and tight supplies came from the industries

that consume cobalt. A switch to substitutes

or recycled materials swept some industries.

By 1980, use of cobalt in the United States was

estimated to be 19 percent below what it would

have been without the price rise.31 Demand for

cobalt continued to drop in 1981, partly because of the weak economy and high interest

rates. Consumption in 1981 was 11.7 million

pounds—41 percent below the 1978 high of 20

million pounds. According to another informed

estimate, 1981 consumption would probably

have been 13 million to 15 million pounds if

there had never been a “shortage.”32 Figure 4-

3 depicts this estimate of the effect of the price

rise in U.S. cobalt demand.

Where effective substitutes were ready on the

shelf, the decline in cobalt use was steep. As

table 4-3 shows, cobalt use in permanent magnets dropped by one-half in 3 years. Probably

four-fifths of this reduction was due to the price

spike. ’s Before the shortage, permanent magSICongressiona] Budget Office, CobaJt; POLC}F OPfjons fo~ (I %utegic h4ineraJ (Washington, IX: U.S. Government Printing Office, 1982), p. x.

Szchar]es River Associates, Jnc., op. cit., p.1-6.

asIbid., p. 3-I 2.
100 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

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. . .

. . .

. . .

. . .

. . .

. . .

. . .

,..

. . .

. . .
—. . .

Ch. 4—Security of Supply ● 101

Figure 4-3.— Estimated Price Effects on

U.S. Cobalt Demand

— Reported demand

--- Adjusted demand

I I I I I I I I

1972 1973 1974 1975 1976 1977 1978 1979 1980 1981

Years

SOURCE Charles River Associates, Inc , Effects of the 1978 Katangese F?ebe///on

on the World Cobalt Market, report prepared for the Off Ice of Technol.

o9Y Assessment December 1982

nets for such items as television, radio, and

phonograph loudspeakers, telephone receivers

and ringers, electrical meters, and automobile

speedometers were an important use of cobalt,

accounting for 20 percent of U.S. consumption.

By the end of 1979, ceramic magnets had replaced 70 percent of cobalt-bearing Alnico

magnets in loudspeakers. Moreover, the Bell

system announced in 1979 that it was changing to alloys with lower cobalt content for

telephone equipment, with savings of 100,000

pounds of cobalt per year. Much of the change

in material for magnets is probably irreversible. Ferrite (ceramic) magnets are cheaper

than cobalt, and now that the redesigning and

retooling for the change has been done, there

is little reason to change back.

On the other hand, demand for cobalt for

superalloys in jet engines did not decline at all.

Despite the high prices, superalloy demand

continued to rise for 2 years until dampened

by the recession in 1981. The boom in aerospace had led the 1978 surge in demand for cobalt, and jet engine manufacturers led the

scramble for supplies when fears of a shortage

rose. These manufacturers could do little in the

short run to substitute other materials for cobalt superalloys in gas turbines for jet engines.

Only after the most exacting, expensive qualification program can new alloys be used in jet

engines. In some cases, however, different alloys had already been tested, and were adopted.

For stationary gas turbines (e.g., for electrical

power and pumping engines) the requirements

are not so stringent, and some manufacturers

were able to use other alloys for turbine parts.

These substitutions, adopted over 3 years, probably saved about 10 percent of the cobalt that

would otherwise have been used for superalloy, and the changes were probably permanent. 34

Another leading use of cobalt in the United

States is for hardfacing material, which, welded

to a base material, provides a layer resistant

to corrosion and wear (e. g., in engine valves,

chainsaws, and earth-moving equipment). Some

users of cobalt for hardfacing switched to

nickel alloys. In Europe, where cobalt is used

much more extensively in tool steels than it is

here, users changed to cobalt-free tool steels.

Consumption of cobalt for driers of inks and

paints dropped 10 to 30 percent as users switched

to manganese and zirconium as partial substitutes for cobalt. Substitutions for cobalt as a

binder for carbide cutting materials were not

very successful, but recent technological advances had made recycling more feasible, and

these users did recycle. No replacements were

immediately available in the short run for cobalt catalysts, although nickel-molybdenum

catalysts may eventually displace some cobalt

consumption for catalysts in the future. 35

Recycling rose dramatically during the cobalt shortage. Everyone in the superalloy pipeline, from alloy producer to gas turbine manufacturer, began to recycle cobalt. This meant

carefully segregating scrap by alloy specification, sending it back to the alloy melter and reusing it in the same grade. Possibly 10 to 25

percent of cobalt used in superalloys was recycled in this fashion. At the same time, methods for recycling all the materials in cemented

341bid,, pp. I-4 and 3-10.

aSIbid., p. 1-6.
102 • Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

carbide cutting materials (including cobalt) had

just been brought to a state of economic feasibility. Methods widely adopted in 1978-79 continue to be used. It is estimated that most

“new” carbide scrap (recovered from fabricators) is now recycled, and more old scrap (recovered from used products) is reused.36

Altogether, according to Bureau of Mines’

data, recycling of cobalt increased 100 percent

in the year 1978, and quickly rose from 4 percent of consumption in 1977 to nearly 11 percent in 1980, before tapering off to the 1982

level of about 8 percent. These figures understate the real extent of recycling, because they

are limited to scrap that is purchased, and not

all recycling is reported.

The U.S. Government never released cobalt

from its stockpile throughout the period of high

prices and tight supplies, since defense and essential civilian industries were getting what

they needed and the stockpile, by law, can be

used only to aid these industries during a

national emergency. Cobalt-using industries

added to their stocks during the 1978 panic and

began drawing them down the next year.

—.———

t61bid., pp. 3-14 to 3-16.

The cobalt bubble burst in 1981. World production, spurred by high prices, continued to

rise for the third year in a row in 1980. But with

the 1981 recession, world cobalt demand fell

drastically; in the United States, consumption

dropped 24 percent. The producer price, pegged

at $25 per pound in January 1981, was cut to

$12.50 per pound in early 1982. Meanwhile,

Zaire had contracted to sell the U.S. Government 5.2 million pounds of cobalt, for replenishment of the stockpile, at $15 per pound. Sixteen other producers had vied with Zaire to

supply the government’s stockpile purchases.

By the end of 1982, the dealer market price

sank below $5 per pound—considerably below

the price in 1978 when the boom began. Cobalt prices stayed in the $5 to $6 per pound

level until early 1984, when the producer price

was increased to $11 to $12 per pound.

A modicum of diversity had entered the market between 1978 and 1982. A number of suppliers with new or expanded operations now

stand ready to compete with Zaire. The bulk

of world cobalt reserves are still in Zaire and

Zambia, but Cuba, the Soviet Union, the Philippines, New Caledonia, and Australia all hold

important reserves that are currently known

and economic to mine. The United States also

has substantial resources that are not now profitable to mine without a production subsidy.

The Effects of Supply interruptions

These accounts of the few instances when

U.S. imports of critically needed materials have

actually been interrupted or threatened are interesting in their variety. The causes of interruption were different in each case, and the

coping reactions, both by industry and by government, were varied enough to illustrate a

wide gamut of responses to abrupt deprivation

of supply.

The Soviet cutoff of manganese and chromium exports in 1949 was a Cold War political action, a response to the U.S. clampdown

on export of manufactured goods, which in

turn was a response to the Soviet blockade of

Berlin. The Rhodesian chromium embargo in

1966, also political, was imposed by the United

States in conformance with a United Nations

resolution. The nickel strike of 1969 shut down

supplies from the quintessentially “safe” foreign source—Canada—at a time when world

nickel supplies had already been straightened

for 3 years and Canada was then almost the

sole U.S. supplier. The cobalt shortage of 1978-

79 was a superheated case of a world surge in

demand, combined with the abrupt removal of

an important source of world supply (sales

from the U.S. stockpile), which was aggravated
Ch. 4—Security of Supply ● 103

by fears of insurrection and collapse of Zaire’s

mines (which never happened).

The response in the first two cases was, essentially, to find other foreign sources of supply, After the 1949 Soviet embargo, the U.S.

Government actively sought alternate suppliers, offering loans for mine development,

sending rail cars and providing steel for improved transportation. With the Rhodesian

chromium embargo of 1966, the government

sold excess chromium from the national stockpile, but otherwise took little active part, leaving industry to find alternate suppliers. That

industry was able to do so quite readily, with

little evidence of shortage, was due to several

factors besides the stockpile sales: The Soviets

promptly volunteered to serve as alternate suppliers of chromium to the United States (despite

the Vietnam war which they opposed) and the

United States was willing, for a time, to buy

from them. Prices rose, drawing other suppliers like Turkey and the Philippines into

production. The rapid adoption of the argonoxygen-decarburization (AOD) process in stainless steel production allowed the substitution

of South African chromium ore for Rhodesian

ore. Finally, the Rhodesian embargo leaked, If

France, Japan, Switzerland, and others had not

bought what was probably Rhodesian chromium from South Africa and Mozambique, the

alternate suppliers might have been hard put

to provide the whole industrialized world with

chromium.

The acute shortage of nickel that followed the

Canadian strikes necessitated changed behavior from U.S. nickel users, They substituted

other materials where they could, for example,

replacing nickel stainless steel with chromemanganese stainless steel (a technology that already existed). Users turned to nickel recycled

from scrap, and they paid high prices for “gray

market” nickel—once more supplied largely by

the Soviets, despite the continuing Vietnam

war. (In both the Rhodesian chromium and

Canadian nickel episodes, it will be noted the

Soviets behaved much more like enterprising

capitalists than like ideological resource warriors.) An important factor in stopping the

acute nickel shortage was the U.S. Government’s release of a large quantity of nickel from

the stockpile. The government had also responded to 3 years of tight nickel supplies by

allocating what was needed to military users,

and the set-asides were continued during the

acute shortage.

As for the cobalt “shortage,” users turned

very quickly to substitutions and recycling, Under the spur of high prices, nonessential uses

made way for essential, Government allocation

was not needed to reserve cobalt for superalloys for military jet engines. Superalloy

producers and users paid high prices and they

recycled, while use of cobalt in magnets dropped

by half. Ceramic magnets, for which the technology was ready, were substituted.

In all four cases, a long-lasting effect of the

supply interruption was that new producers

entered the market, and supply became more

diversified. In the case of manganese, the U.S.

Government and the World Bank deliberately

encouraged new producers. In the other cases,

shortages, rising prices, and eager buyers provided enough market incentive to draw new

sources into production, Some substitutions

(ceramic magnets) and some recycling (carbide

cutting materials) adopted during the shortages

appear to be permanent.

Another conclusion is worth noting: There

is no one single answer to import vulnerability. In the episodes described above, multiple

responses—some by government and some by

industry—helped avoid a crisis or end shortages. On the government’s part, there were active assistance to alternative suppliers, stockpile sales, and allocations to defense needs. On

the private side, there were substitutions of

materials (based on previous research and development [R&D]), recycling (also based in part

on previous R&D), and a search for new sources

of supply. In some cases, government and private actions were not so helpful—in fact, they

were contributing causes, not solutions to the

problems. The obvious example is the government’s abrupt halt to sales of cobalt from the

stockpile, and industry’s panic buying of cobalt

after the invasion of Zaire’s Shaba province.
104 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

One response to import vulnerability that has

rarely been used, except when begun in wartime, is government subsidies to high-cost domestic minerals producers. During the Korean

war, which began just a year after the 1949 Soviet embargo of chromium and manganese, the

government subsidized U.S. production of a

number of minerals, including the two embargoed by the Soviets and cobalt. The last of the

subsidies expired in the early 1960s. No one

seriously suggested reviving subsidies for domestic producers of chromium in the late

1960s, when U.S. imports of Soviet chromium

were once again rising following the Rhodesian embargo. The reason was the low-quality

and limited supplies of domestic chromium ore

and the high cost of producing it. Then, as now,

even the best deposits of U.S. chromium would

probably have cost two to three times as much

as chromium mined abroad, with less favorable U.S. deposits still more costly.37

sTInformation provided by John Morgan, Bureau of Mines, U.S.

Department of the Interior. See also C.C. Hawley & Associates,

Inc., subcontractor to Charles River Associates, Strategic Mineral

Markets and Alaska Development Potentials, Policy Analysis Paper No. 82-12, prepared for the State of Alaska, Office of the

Governor, Division of Policy Development and Planning (Juneau:

1982), vol. II, p. 1. This study estimated that the world chromium

price would have to rise sixfold to stimulate production from

known deposits in Alaska.

During the cobalt panic, subsidies for U.S.

cobalt production were considered by Congress.38 U.S. cobalt resources are considerably

better than chromium resources, though they

are still subeconomic. At congressional hearings in 1981, representatives of firms owning

the most promising domestic sites estimated

that cobalt prices ranging from $20 to $25 per

pound would be needed to stimulate domestic

production through government purchase contracts. Before any subsidies were decided on,

the cobalt bubble had burst. By the end of 1982,

the world cobalt price of $6 per pound (or less)

was far below the estimated cost of producing

U.S. cobalt. World prices have subsequently

risen again (to $11 to $12 per pound in 1984),

and one company has revised downward its

estimate of the price needed for it to produce

cobalt to about $16 per pound. Further discussion of subsidies for U.S. minerals production,

in the context of broader materials policy, appears in the following section, as well as in

chapters 5 and 8.

SBU. S. Congress, Senate Committee on Banking, Housing, and

Urban Affairs, Hearing on the Defense Production Act and the

Domestic Production of Cobalt, 97th Cong,, 1st sess., Oct. 26,

1981 (Washington, DC: U.S. Government Printing Office, 1982);

Congressional Budget Office, Cobalt: Policy Options for a Strotegic Mineral, cited in note 31.

Materials Policy

Over the past three decades, as episodes of

tight supplies and high prices have come and

gone, concern about a national materials policy has risen and ebbed. Three major commission studies, many other scientific and policy

studies, three Federal laws stating materials

policy, and several other relevant laws have addressed the question of how to assure a reliable supply, at reasonably stable prices, of the

materials needed for this Nation’s economy

and defense,

All of the commissions recommended that

the Nation seek materials wherever they may

be found, at the lowest cost consistent with national security and the welfare of friendly nations. A policy of self-sufficiency was considered and rejected, most emphatically by the

Paley Commission in 1952, and again quite explicitly by the Commission on Supplies and

Shortages in 1976.

On the whole, the commissions’ counsel in

favor of interdependence has been heeded. The

United States has, by and large, adhered to the

“least cost” principle for materials supply for

35 years, The government has not only tolerated, but encouraged, US. consumption of

minerals produced abroad. With low-cost

loans, tax credits for taxes paid to foreign countries, and insurance against expropriation, it

has helped U, S.-based firms to open mines in
foreign countries, such as Australia, Brazil, and

Peru. It has usually resisted proposals to protect the domestic mining industry by import

quotas or other restrictions on trade and has

subsidized domestic mining only rather briefly,

For security of supply, U.S. policy has been

to rely mainly on stockpiles rather than on permanent subsidies of domestic production—

again, a course which was urged by the commission reports. The first Federal law authorizing stockpiling of critical materials goes back

to 1939, but actual accumulation of stocks was

put aside during World War II and began in

earnest during the Korean war. Large-scale

purchases continued through the 1950s. Despite changes back and forth since then in

stockpile policy, the Nation still has substantial amounts of many critical materials stored

away.

Another recurring recommendation in the

past three decades of studies, reports, and laws

on materials policy has been to establish a focal point in the Federal Government for making comprehensive materials policy. This advice has been difficult to follow. One reason

may be that materials shortages have been quite

fleeting, and supplies are usually available

when needed. Another is that materials policy

is connected with other important policies—

foreign, defense, taxation, environment, energy—which it is part of but does not dominate.

Moreover, it is difficult to establish an overall

“materials” or “nonfuel minerals” policy when

the materials it is meant to cover are so numerous and so different from one another in the

needs they meet, in critical importance, in

availability of substitutes, and in the diversity

and security of supply,

With the rising level of concern over U.S. import vulnerability, Congress (in 1980 and again

in 1984) called on the Executive Office of the

President to develop a coordinated materials

policy, Questions of interdependence, selfsufficiency, and stockpile policy are also being reexamined. The following sections briefly

survey the findings of the three major commissions on materials policy in the past 30 years

and outline the main features of government

Ch. 4—Security of Supply Ž 105

policy and congressional actions on materials

during the period.

Self-Sufficiency v. Interdependence

Many of those who believe that self-sufficiency is desirable subscribe to a broad-scale

remedy of materials independence. They favor

intensive exploration of most of the federally

owned public lands, including wilderness, for

minerals; tax breaks and government subsidies

to encourage U.S. mining and minerals processing; and relaxation of strip mine controls,

mine health and safety regulations, and clean

air and water standards, which they blame for

putting U.S. mining industries at a disadvantage vis-à-vis foreign competitors. On the other

hand, critics of minerals independence say that

an effort to replace imports with high-priced

domestic minerals would raise the cost of finished goods, escalating prices at home, and

making it harder for American products such

as steel and autos to compete with foreign

goods.

Despite the low quality of some U.S. mineral

resources, the Nation could probably achieve

significant domestic production in most minerals if it were willing to pay a high enough

price, Part of the price might be greater environmental degradation and higher energy use,

as well as higher dollar costs. Another cost

might be a greater degree of government management of the minerals market and strains

with European and Japanese allies, whose import dependence for 36 important nonfuel

materials is considerably greater than that of

the United States.

U.S. import dependence is often compared

unfavorably with the Soviet Union’s high degree of self-sufficiency in minerals, The Soviet

Union has long followed a deliberate policy of

supplying its own resource needs and, when

forced to rely on foreign sources, has imported

mainly from allies and neighbors. The result

s~The office of Technology Assessment ana]yzed some aSpeCts

of the U.S. steel industry in its 1980 report, Technolog~ and Steel

lndustr~ Competitiveness, OTA-M-122 [Washington, DC: U.S.

Government Printing Office, June 1980].
106 . Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

is that the Soviets are net importers of only 11

of 35 important nonfuel minerals, and for only

four—bauxite and alumina, barium, fluorine,

and cobalt—is import dependence as high as

40 to 60 percent.

If the United States opts for a policy of

minerals self-sufficiency instead of the traditional one of interdependence in a world free

market, such a policy could require the United

States to isolate itself from that market. Unless

the government imposed export controls to

keep domestic supplies inside the United States,

U.S. trading partners could bid up the price

and buy “U. S.” minerals in times of shortages.

In times of minerals abundance and low world

prices, either U.S. mines would have to be subsidized or import controls imposed (like the

pre-1973 oil import quotas) or both. In all these

cases, economic and political stresses can be

foreseen,

Commission Studies

President’s Materials Policy Commission

(Paley Commission)

The President’s Materials Policy Commission, named for its chairman, William S. Paley,

was established by President Truman in January 1951 during the early months of the Korean

war. It was a time when a precipitate rise in

military demands, added to an expanding postWorld War II civilian economy, had caused

tight supplies and shortages. The realization

had dawned that materials usage worldwide

was on an upward spiral. Reflecting a sense

of crisis about the continued supply of enough

materials to sustain the Nation’s military security, civilian welfare, and economic growth,

President Truman said in his charge to the

Commission:

By wise planning and determined action we

can meet our essential needs . . . We cannot allow shortages of materials to jeopardize our national security nor to become a bottleneck to

our economic expansion.40

The Commission’s report, Resources for

Freedom, published in June 1952, was colored

~he President’s Materials Policy Commission, op. cit., p. IV.

with the same tone of strenuous response to

a serious challenge. The Commission set for

itself this question: “Has the United States the

material means to sustain its civilization?” Al It

noted that the United States had already outgrown its resource base and had become a

“raw materials deficit” Nation. At the core of

the materials problem it put “growth of

demand”—growth not only in the United States

but also among the free world allies and in the

former colonies seeking to industrialize rather

than export raw materials.

To assure the material basis for security and

growth the Paley Commission saw interdependence as the best answer. “The United States

must reject self-sufficiency as a policy, ” the

Commission said, “and instead adopt the policy of the lowest cost acquisition of materials

wherever secure supplies may be found: selfsufficiency, when closely viewed, amounts to

a self-imposed blockade. . . “42

The Commission emphasized policies that

would encourage investment by American

business in mineral development in foreign

countries and would remove barriers to trade.

It also urged U.S. loans and technical assistance, in addition to international help, for indigenous investment in mining, especially in

poor countries. Besides these policies to promote “least cost” production worldwide, the

Commission also stressed the value of greater

efficiency of use, substitution of more abundant materials for scarce ones, and the expansion of domestic supplies by “pushing back the

technological, physical, and economic boundaries that presently limit supply.”43

Even to protect national security, the Commission regarded a quest for self-sufficiency as

“fallacious and dangerous. ” For many materials, the Commission said, “self-sufficiency is

either physically impossible or would cost so

much . . . that it would make economic nonsense.” 44 Instead, the Commission suggested

a range of policies to raise the Nation’s pretllbid., pp. 1, 6, and passim.

tZIbid., p. 3.

4sIbid., p. 8,

t’Ibid., p. 157.
Ch. 4—Security of Supply . 107

paredness against a possible cutoff of materials

critical to the Nation’s defense.

To assure supply, the Commission strongly

urged stockpiling, Also, it recommended several measures to prepare emergency sources

of production, including: setting aside “in-theground” domestic reserves of key minerals,

especially limited or low-grade deposits; developing and maintaining ready-for-use technology to produce low-grade deposits; and preparing processing facilities and transportation for

the in-the-ground reserve. On the demand side,

the Commission recommended the design of

military products to use abundant rather than

scarce materials, and the preparation of “standby” designs for use in extremity, substituting

available materials for scarce ones that would

otherwise be preferred. As

The Paley Commission report noted the lack

of a coordinating body for materials policy, and

suggested that the National Security Resources

Board, in the Executive Office of the President,

undertake the role.46 However, the Board was

soon abolished by Congress as fears of “running out” of material, which had prompted the

establishment of the Paley Commission, died

down. No other body was given the policy coordination task.

Indeed, after a brief burst of public attention,

the Commission’s report fell into obscurity.

True, the interdependence policy strongly

urged by the Commission has generally guided

the government’s actions since then. One administration after another has followed the

Commission’s advice in such matters as negotiation of treaties to support freer trade and

provision of government insurance for private

businesses investing in resource development

abroad. But for the most part, the detailed recommendations of the Commission’s report

were ignored. One of the very few concrete responses by anyone was the creation of a nongovernment institution to monitor materials

supply and demand—Resources for the Future,

which is largely funded by the Ford Foundation.

——.——— islbld., ~h. xT.30,

i61bid., p. 171,

Photo credit U S Navy

One mission of U.S. Navy frigates such as the USS Antrim

(FFG-20) is to protect the flow of strategic materials to

the United States

The reasons for the report’s neglect are not

hard to find. First, the party in power changed;

President Eisenhower won the 1952 election,

and the Republicans took control of Congress

for the first time in 20 years. More important,

wartime shortages of materials turned to glut

with the end of the Korean war. When President Eisenhower appointed a Cabinet committee in 1954 to examine minerals policy, the

question was not how to assure enough supply,

but how to help rescue the ailing domestic mining industries, (As discussed below, the Eisenhower Administration’s response was to guarantee purchases of minerals for an expanded

strategic stockpile,)

National Commission on Materials Policy

For most of the 1950s and 1960s, adequacy

of materials supply was a quiescent issue, despite some bottlenecks and shortages as Viet-
108 . Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

nam war needs expanded. Supplies of minerals

rose comfortably with demand, and real prices

generally remained stable or fell throughout

most of the period. Production of aluminum

rose enormously (over fourfold) relieving pressure on other structural and electricity-conducting materials, and petrochemical-based

plastics replaced a number of the conventional

metals.

Toward the end of the 1960s, Congress and

the public began to look at materials issues in

a new perspective—i. e., in relation to conservation of resources and environmental quality.

In 1970, Congress created a new materials policy commission as a direct outgrowth of its

work on recycling of materials and recovery

of energy from waste. Former Senator J. Caleb

Boggs was a sparkplug of the renewed congressional interest in materials policy and its connections with energy and the environment. A

series of biennial National Materials Policy

Conferences was begun in 1970 at his request,

and he introduced the legislation creating a

new materials commission.47

The background of the commission’s formation was this: While considering an innovative

Federal law on solid waste (The Resource Recovery Act of 1969), the Senate Committee on

Public Works asked for a study on a national

policy for handling materials, from extraction

to disposal. The ad hoc committee doing the

study recommended a fresh look at materials

problems as a whole and a new national commission. 48 The next year, Congress amended

the Resource Recovery Act, incorporating in

it the National Materials Policy Act of 1970 and

creating the National Commission on Materials

Policy (NCMP) with this objective:49

4TIn response to a request by Senator Boggs, the late Dr. Franklin P, Huddle, Senior Specialist with the Congressional Research

Service of the Library of Congress, organized a series of biennial National Materials Policy Conferences. The conferences,

under the auspices of The Engineering Foundation, were held

at New England College, Hemiker, NH. They are widely known

as “the Henniker Conferences. ”

MU .s. Congress, Senate Committee on Public Works, Toward

a National Materials Policy, committee print, 91st Cong., Ist sess.

@Tifle II of the Resource Recovery Act of 1970 (Public Law

91-152), entitled the National Materials Policy Act of 1970, sec.

202.

.,. to enhance environmental quality and conserve materials by developing a national materials policy to utilize present resources and

technology more efficiently, and to anticipate

the future materials requirements of the Nation

and the world, and to make recommendations

on the supply, use, recovery and disposal of

materials.

The Commission’s report, Material Needs

and the Environment Today and Tomorrow, issued in 1973, recommended striking a balance

between the need to produce goods and the

need to protect the environment. In particular,

it urged that environmental costs be included

in reckoning the costs and benefits of materials

production. While calling for “orderly” development of resources, the Commission also

strongly urged conservation through recycling

and greater efficiency of use. To carry out these

policies, the NCMP made 198 detailed recommendations in 10 major areas.50

The “traditional U.S. economic policy” of

buying materials at least price was reaffirmed

by this Commission, The policy was given

credit for providing reasonably priced goods

to consumers and keeping U.S. goods competitive in world markets. However, the Commission qualified its support of the least-cost interdependence policy to a degree, It argued that

some U.S. minerals industries might need a

limited amount of protection from competition

with “subsidized” foreign producers.51 

As for national security, the Commission recommended that where problems of supply are

foreseen, the United States should foster domestic production, diversify sources of supply,

develop special relations with reliable foreign

sources, increase the dependence of supplying

countries upon continuing U.S. goodwill, and

find substitute materials.52 The Commission

gave little attention to stockpiling, possibly because the imported material of greatest concern at the time was oil, and stockpiling oil is

far more expensive and cumbersome than storsONational commission on Materials Policy, MateriaIs Needs

and the Environment Today and Tomorrow (Washington, DC:

U.S. Government Printing Office, 1973), pp. 1-4, 1-5, and ch, 6,

SIIbid., pp. %8 through 9-10.

bZIbid., p, 9-26,
Ch. 4—Security of Supply ● 109

ing most nonfuel minerals, (The NCMP’s charge

included energy; it defined materials as all natural resources intended for use by industry, except for food.)

Like the Paley Commission 20 years earlier,

the NCMP urged that a high-level government

body oversee Federal materials policy. It proposed a Cabinet-level agency—possibly a new

Department of Natural Resources—to plan and

execute comprehensive policy for materials,

energy, and the environment. 53

While the Department of Natural Resources

was not created, the report of the NCMP received considerably more official attention

than its predecessor had. At the time the report came out, interest in materials issues had

quickened. A world economic boom was on the

upswing, and some shortages of materials had

begun to appear. The Club of Rome’s widely

read report The Limits to Growth (published in

1972), 54 suggested that world demand for materials, increasing exponentially, would outrun

the planet’s finite supplies, leading to a devastating collapse of world economies in the 21st

century. In this atmosphere, interest in the

Commission’s report ran high.

The Commission’s report was the springboard for hearings before the Senate Subcommittee on Minerals, Materials, and Fuels,55 and

materials issues were the subject of other congressional hearings and reports;56 the Office of

Technology Assessment added a program to

assess materials issues. Other congressional

agencies—the General Accounting Office and

the Congressional Research Service—undertook studies on materials issues.57 The National

~slbid,, p, I% and ch. 11.

sqDone]]a H, Meadows, et al., The Limits to Growth [New York:

Universe Books, 1972).

55u, s. Congress, senate, Committee on Interior and Insular

Affairs, Subcommittee on Minerals, Materials and Fuels, Hearings, Oct. 30, 31, and Nov. 1, 1973, committee print.

‘See, for example, U.S. Congress, Senate, Committee on Public

Works, Resource Conservation, Resource Recovery, and Solid

Waste Disposal, committee print, 1973.

sTSee, for example, the reports of the biennial Henniker conferences, which were organized by the Congressional Research

Service, and U.S. Congress, House of Representatives, Committee on Science and Astronautics, Industrial Materials: Technological Problems and Issues for Congress, committee print, 1972,

prepared by Dr. Franklin P. Huddle of the Congressional ReAcademy of Sciences issued numerous reports

commenting on and related to the NCMP report. 58 Finally, a most concrete result was the

hearings and work done by the Senate Committee on Public Works on resource recovery and

recycling, 59 which eventually led to passage of

the Resource Conservation and Recovery Act

of 1976.

National Commission on Supplies and Shortages

When the National Commission on Materials

Policy issued its report in mid-1973, OPEC was

a name known only to specialists. Oil prices

had just begun to rise as a result of cartel control. Within a year, OPEC had not only quadrupled prices, but for a time had denied its

members’ oil to the United States and The

Netherlands. In addition, the world economic

boom, by then 2 years old, had created shortages of many industrial materials. Prices of

commodities from rubber and oil to scrap steel

and copper bounded upward, and industries

had real difficulty in getting the aluminum,

copper, chemicals, petrochemicals, steel, and

paper that they needed. The influence of The

Limits of Growth, with its projections of world

resource exhaustion and economic collapse,

was at its height, To some people, the shortages of 1973-74 seemed early indications of just

such a collapse.

search Service. The General Accounting Office undertook

studies that led to such reports as Federal Materials Research

and De~’elopment: Modern ia”ng Institutions and Nlanagemtmt

(Washington, DC: U.S. Government Printing Office, 1975). The

Office of Technology Assessment Materials Program undertook

a broad range of studies too numerous to cite. s8RepOrtS produced by the National Academy of Sciences and

affiliated organizations included: National Academy of Sciences/

National Academy of Engineering, National Minerals Polic}r,

Proceedings of a Joint Meeting, Oct. 25-26, 1973 (Washington,

DC: The Academy, 1975); National Academy of Sciences, Man,

Materials, and the Environment, report of the Study Committee

on Environmental Aspects of a National Materials Policy (Washington, DC: The Academy, 1973); National Academy of Sciences,

Committee on the Survey of Materials Science and Engineering, Materials and Man’s Needs (Washington, DC: The Academy, 1974); National Academy of Sciences, Committee on

Mineral Resources and the Environment (COMRATE), Mineral

Resources and the Environment [Washington, DC: The Academy, 1975).

WU. S, Congress, senate Committee on Public Works, Hearings, June 11-13, July 9-11, 15-18, 1974, committee print.
110 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

In this crisis atmosphere, national attention

again fastened on the adequacy of material supplies. While two House committees were preparing reports on the subject—one on America’s resource needs and import dependence

and the other on world resource “scarcities”60

–former Senators Mike Mansfield and Hugh

Scott formed a joint Executive Congressional

Leadership group to discuss threatened shortages of natural resources, raw materials, and

agricultural commodities. Out of this group

emerged legislation (an amendment to the Defense Production Act of 1950, in September

1974) creating the National Commission on

Supplies and Shortages.

The Commission was instructed to look at

four principal issues: the possibility of resource

exhaustion, the consequences of the Nation’s

growing dependence on imported materials,

the ability of the free market to deal with shortages, and the adequacy of government mechanisms for handling materials problems.

The Commission’s report, Government and

the Nation’s Resources, issued in 1976, concluded that the country’s ability to meet its material needs was in no imminent danger.61 It

said that:

●

●

●

✎ ✎ ✍

resource exhaustion was not a serious

threat to economic growth for the next

quarter century “and probably for generations thereafter”;

U.S. dependence on imported materials

other than oil was growing only gradually

and manageably;

cartel control of nonfuel minerals was unlikely and embargoes directed against the

United States “only remotely conceivable, ”

and that neither was any real threat to the

American economy; and

—.—— eou,s. Congress, House of Representatives, Ad HOC Committee on the Domestic and International Monetary Effect of Energy

and Other Natural Resource Pricing, Meeting America’s Resource

Needs, a report to the Committee on Banking and Currency

(Washington, DC: U.S. Government Printing Office, 1974); U.S.

Congress, House of Representatives, Committee on Foreign Affairs, Global Commodity Scarcities in an Interdependent World

(Washington, DC: U.S. Government Printing Office, 1974].

61Nationa] Commission on Supplies and Shortages, Government and the Nation’s Resources (Washington, DC: U.S. Government Printing Office, 1976).

● the widespread severe shortages of 1973-

74 were a temporary phenomenon due to

the world surge in demand, to lagging investment in materials industries for a few

years before the boom, and to a “shortage

mentality” that led to panic buying and

hoarding of materials by industries in

many countries.

These conclusions added up to strong, continued support for the principle of free trade

and interdependence.62

The Commission stated that it found no instances of import dependence that would

justify the costs and rigidities of placing restrictions on imports. Instead, to cope with interruptions of supply that might result from civil

disorders in producing regions or, possibly,

from price-gouging by producers, the Commission recommended stockpiling as “the universal antidote.”63 The Commission supported a

strictly limited use of the strategic stockpile for

economic purposes during a sudden disruption

of supply of critical materials to keep the civilian economy as well as defense industries

on an even keel. However, the Commission

said, stocks should not be sold simply to influence prices in the absence of a supply disruption (as the Johnson Administration had done

in the 1960s—see the discussion below). 64

Underlying many of the Commission’s conclusions was confidence in the ability of market forces to bring forth adequate materials for

the world’s economies and to right imbalances

within a reasonable time. Many of the recommendations amounted to “hands off” the market. For example, in its consideration of recycling, the Commission suggested the removal of

depletion allowances for minerals, which favor virgin ore over recycled materials-but no

subsidies for recycling either. es In a similar

vein, the Commission was cautious about recommending government funding for R&D for

alternative supplies, conservation, and substitute materials. Recognizing that government

@Z1bid., pp. x-xii, chs. z, 3, and 4, especially pp. 22-23 and 38-39.

6sIbid., p. 39.

841 bid., ch. 7.

6SIbid., p. 166.
Ch. 4—Security of Supply ● 111

does have a role to play [especially in basic research), the Commission suggested that more

knowledge is needed of what motivates industry to commit R&D funds before government

rushes in to fill the breach. 66

The Commission recognized political obstacles to private investments in the world’s

minerals, such as the threat of expropriation,

but called attention to existing measures to

lessen the obstacles—measures such as government insurance for foreign investment, international disputes settlement and investment

codes, and World Bank investments in developing countries. The Commission also expressed

confidence “that private investors and Governments will find ways to adjust to political and

economic realities.”67

The Commission noted that complicated

problems, like the rapid growth of world population, the unequal distribution of world resources, and the sometimes unexpected and

unwanted byproducts of technological advance

might require an increasing degree of government sophistication and management. It found

room for improvements in the adequacy of the

U.S. Government institutions to deal with

materials issues. It also proposed practical

changes in data collection and analysis and

suggested the creation of a small, high-level

corps of professionals to monitor specific industries and economic sectors and to develop

a comprehensive picture of how government

policies combine to affect basic industry and

the national interest. However, the Commission recommended against seeking a “coordinated materials policy” as an end in itself, because materials policy affects and is affected

by many other policies on matters of equal or

greater importance .

68

By 1976, when the Commission published its

report, the materials shortages that were so

worrisome at the time of its creation had disappeared. Minerals activity had slid from the

peak of high prices and tight supplies of the

first half of 1974 to the trough of a world busi-

—.—

661bid., pp. 182-184.

6

7

1 bid., p. 46.

eEIbld,, ~h~. 5 and 6.

ness recession, following the OPEC oil price

hike.

Under the circumstances, the Commission’s

more astringent suggestions for “hands off the

market (e.g., removal of the percentage depletion allowance for new minerals) were coolly

received. In fact, there was some sentiment in

Congress (especially among members from the

western mining States) for much more active

government support of the now-depressed and

always volatile domestic mining industry than

anything suggested by the noninterventionist

report of this Commission, Some were also dissatisfied with the limited backing the Commission had given to the idea of “comprehensive”

or “coordinated” materials policy.69 Altogether,

the report got little official response. Changes

in the Commerce Department’s economic analysis toward stronger analysis by the industrial

sector was perhaps the principal result.

Once again, a Commission report on materials coincided with a change of the party in

power, Within a month of President Carter’s

taking office, former Representative James Santini and 42 other members of the House of Representatives wrote to the President expressing

concern that the Nation’s policies were adversely affecting nonfuel minerals production,

asking for a “balanced” national minerals policy, and proposing a special minerals advisor

in the Executive Office of the President. In December of that year, the President ordered a

government review of nonfuel minerals policy.

The results, as noted below, were minimal; the

policy review was never completed. At the end

of the Carter presidency, demands by the industry and interested members of Congress for

a “national minerals policy, ” support for the

minerals industry, and a special minerals advisor to the President were stronger than ever.

As the brief history outlined here suggests,

Commission reports on materials policy and

government actions have not always meshed.

This is perhaps predictable, given the cyclical

nature of the minerals industry. When commis- —.-—e9FOr this point of view, see U.S. Congress, House of Representatives, Committee on Interior and Insular Affairs, Subcommittee on Mines and Mining, U.S. Minerals Vulnerability: National Policy Implications, committee print, 96th Cong., 2d sess.
112 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

sions are formed, one set of problems may be

dominant (e.g., shortages and high prices); but

economic conditions may be quite different a

year or two later when the report is issued, so

that the problems may look quite different (e.g.,

idle domestic capacity, inadequate investment,

“unfair” foreign competition). Also worth

noting is that commissions may be rather insulated from political concerns, while the government that responds to them is not.

Thus, it is not too surprising that of the hundreds of detailed recommendations made by

the three major materials commissions, Congress and the various administrations of the

past three decades have specifically adopted

only a few. By and large, both the executive

branch and the Congress have steered a course

—from tax laws to international trade treaties—

that is consistent with the interdependence policy recommended by the commissions. But

there have been exceptions. And in general,

congressional and other government actions

have followed their own agendas, rather than

responding directly to commission recommendations. Thus, government actions on materials

issues over the past 30 years are discussed

separately from the story of the commissions

reports.

Congressional Actions and

Government Policies

Two strands in materials policy, besides the

general support for free world trade, have won

consistent backing from Congress over a number of years. One is the building of a strategic

stockpile, a policy that is now nearly 45 years

old. The other is high-level government oversight of a “comprehensive” materials policy,

an idea at least as old as the Paley Commission,

but insistently put forward by Congress since

about 1970.

A program that promoted and subsidized domestic minerals industries—an exception to the

least-cost, interdependence policy—began during the Korean war and was actively pursued

for a few years thereafter. The program died

out in the 1960s, but the law that authorized

it, the Defense Production Act of 1950, remained on the books and interest in the program has been revived as a means to reduce

import dependency. TO Congress has repeatedly

extended the law, most recently in 1984. Production subsidies for cobalt were considered

in deliberations about this extension, but are

considered unlikely in fiscal years 1985 and

1986. (See chs. 5 and 8 for further discussion.)

Stockpiling and Subsidies

Stockpiling originated in 1939, when, on the

eve of world war, Congress passed the Strategic Materials Act, The Act authorized the government to list materials essential for industry and defense and to buy them for a strategic

stockpile. Wartime needs soon overwhelmed

the stockpiling program. The postwar Strategic and Critical Materials Stock Piling Act of

1946 restated the goal of preparing for an emergency by building stockpiles, and by 1950 some

$1.6 billion worth of stocks had been acquired.

This was less than halfway to the objective then

in effect of $4.1 billion. With the outbreak of

war in 1950, Congress provided funds for further major additions to the stockpile.

The Korean war prompted the passage of the

Defense Production Act of 1950. Besides authorizing government priorities and allocations

of materials, the Act provided financial assistance for expanding domestic productive capacity, including facilities to produce critical nonfuel minerals. During and after the Korean war,

purchase agreements, floor prices, and loans

or loan guarantees under the Act promoted a

doubling of U.S. aluminum production, a 25-

percent increase in U.S. copper mining, and

a fourfold expansion of tungsten mining. Assistance under the Act also encouraged the

startup of U.S. nickel mining and titanium

processing and fostered domestic production

of other minerals, including manganese, cobalt,

and chromium. The gross outlay of the government for these programs was $8.4 billion; with

the payback of loans, the ultimate direct cost

has been estimated as $900 million. 71

— Tocertain pads of the law that were tailored specifically to wartime needs (authorization for price, wage, and credit controls

and for settlement of labor disputes) lapsed in 1951.

71 U.S. congress, senate Committee on Banking, Housing, and

Urban Affairs, Defense Production Act Extension of 1981, report

to accompany S.1135 (Washington, DC: U.S. Government Printing Office, 1981), p. 3.
Ch. 4—Security of Supply • 113

With the end of the war, many of the minerals supported by government programs were

being produced in greater quantities and at

higher prices than the civilian economy could

absorb. Purchases for the strategic stockpile

drained off some of the excess. The Eisenhower Administration continued to build

stockpiles throughout most of the 1950s, partly

to bolster mining industries the government itself had created, but also because President

Eisenhower strongly believed in stockpiles as

insurance. 72

Government support proved to be a mixed

blessing for some mining industries. Companies drawn into production by the combination of subsidized loans, purchase agreements,

and large stockpile purchases were left stranded

when stockpiles became filled, government

purchases ceased, and subsidies were withdrawn. Tungsten mining in particular was on

a roller coaster .73

A vital constituent for many superalloy and

a widely used material for cutting tools, tungsten was selected as a critical material to be

stockpiled, with a goal of 146 million pounds

set in 1950, By 1955, government financial

assistance, combined with stockpile purchases

at high prices, had drawn more than 700 U.S.

mines (mostly small ones) into operation. The

government stopped stockpile buying of tungsten in 1957, after stocks had swollen to 210

million pounds-enough for 6 years consumption by the entire Western World, or 10 years

of U.S. consumption.

In 1958, the Eisenhower Administration reduced the requirement for stockpiled materials

from the amount needed to sustain the Nation

for a 5-year war to enough for 3 years. Threequarters of the tungsten holding was thereupon

declared excess. In 1962 the Government began

to sell tungsten stocks. Prices tumbled by two-

‘Ti~~a~lin P. Huddle, “The Evolving National Policy for

Materials, ” Science 191, p. 655 (Feb. 20, 1976); also, A. E. Eckes,

Jr,, The United States and the Global StruggJe for Minerals (Austin: University of Texas Press, 1979), p. 215.

TgMost of the material that follows on the tungsten industry

from 1950 to 1970 is drawn from Konrad J, A. Kundig, “The

Tungsten Market–From Chaos to Stability,” Journal of Metals,

May 1981, pp. 42-47.

thirds, and all but 2 of the 700 domestic mines

ceased operations, Not until the late 1970s did

the domestic tungsten industry resume growth.

In the 1960s, during the Kennedy and Johnson

years, the government sold a number of commodities from the stockpile that were now in

excess of the 3-year requirement—often using

the sales as part of a strategy to control inflation or reduce budget deficits. In 1973, the

Nixon Administration further reduced the stockpile requirements, from 3 years’ sustenance to

one, with the result that still greater quantities

of stockpiled material were now officially

declared excess,

At this point, Congress balked. The House

Subcommittee on Seapower and Strategic Critical Materials questioned the new policy,

threatened to block sales of stockpiled materials, and demanded a thorough study of stockpile policy. The Ford Administration complied,

conducting an interagency review under the

White House National Security Council. In

1976 the Administration announced a new

stockpile policy based on planning to support

defense and essential civilian needs for the first

3 years of a national emergency of indefinite

duration. A few months after taking office,

President Carter reaffirmed the Ford policy.

In 1979 Congress took stock. At this point,

40 years after the stockpile was established, the

publicly owned stockpile was large but out of

balance. The inventory was valued at $10.5 billion, of which $4.9 billion (or 47 percent) was

excess to goals based on the 3-year requirement. But needs for acquisition amounted to

$12.9 billion–more than the value of stocks on

hand, ”

Dissatisfied with the fluctuations in stockpile

policy over the 40 years, Congress now wrote

more explicit policy guidance and stockpile requirements into law. In the Strategic and Critical Materials Stock Piling Revision Act of

1979, Congress stated that the purpose of stockpiles is for the defense of the United States, not

to control commodity prices. It also wrote into

TqInformation on stockpile holdings was provided by the Federal Emergency Management Agency,
114 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

law that stockpiles should be sufficient to sustain the country’s military, industrial, and essential civilian needs for at least 3 years, and

that goals based on this requirement cannot be

changed without prior notice to Congress. Finally, Congress set up a stockpile transaction

fund, so that the proceeds from the sale of excess materials can be used to buy materials that

are needed, rather than going back into the general Treasury funds.

A “National Materials Policy”

Meanwhile, at the end of the 1960s, Congress

also turned its attention to the question of a

broad Federal responsibility for materials policy, acting initially in the area of minerals policy. The Mining and Minerals Policy Act of

1970 was inspired by the National Environmental Policy Act of 1969, and was intended

to provide similar guidance and goals in its

own area.75

The Act declared it the national policy to foster and encourage: 1) the development of economically sound and stable domestic mining,

minerals, and minerals reclamation industries;

2) the orderly and economic development of

domestic mineral resources, reserves, and

reclamation of minerals to help satisfy industrial, security, and environmental needs; 3)

mining, mineral, and metallurgical research,

including use and recycling of scrap; and 4) the

study and development of methods for disposal, control, and reclamation of mineral

waste products and mined land to lessen adverse impacts. The Secretary of the Interior

was put in charge of advancing national minerals policy, as set forth in the law. He was required to report each year on the state of the

domestic mining and minerals industry, and

to recommend any laws needed to carry out

the national policy. Beyond that, the law called

for no specific actions.

TSHouse subcommittee on Minerals and Mining, U.S. Minerals

Vulnerability, pp. 18-18. See the Committee’s comparison of environmental laws with the Mining and Materials Policy Act of

1970, which it viewed as the victim of neglect by the executive

branch.

Few identifiable actions were undertaken in

response to the act. The Bureau of Mines used

the language of the law to support funding requests for research in recycling and safe disposal of mine wastes, but no remarkable changes

in funding priorities resulted. The Secretary of

the Interior’s first two annual reports (in 1972

and 1973) viewed with alarm problems of the

U.S. minerals industry and the increasing U.S.

import dependence on fuel and nonfuel minerals, but made few recommendations for

changes in the law to carry out a national

minerals policy. (One of the few changes recommended was to amend the antitrust laws to

allow joint ventures for mineral research.)

Later annual reports took a less alarmist view

of the rising import dependence for fuel and

nonfuel minerals, most of which was actually

due to oil imports. The 1975 report, for example, said that problems arise from increasing

imports “only when foreign sources become

unreliable. ” Especially in 1978 and 1979, the

document failed to advocate the strong government support of the domestic minerals industry that sponsors of the law had evidently envisioned.

By the mid-1970s strong supporters of the

mining industry in Congress had become concerned about what they saw as continuing neglect of national minerals policy by the executive branch. Displeased with the rather

laissez-faire conclusions of the Commission on

Supplies and Shortages, they urged the new

Carter Administration to undertake a fresh review of national nonfuels mineral policy, President Carter responded in December 1977, appointing Secretary of the Interior Cecil B.

Andrus chairman of an interdepartmental policy review committee.

The nonfuel minerals policy review gave

even less satisfaction to advocates of a “national minerals policy.” The review ultimately

foundered, going no further than a partial draft

report in 1979.76 It had suffered a fate common

for interdepartmental task force efforts—conT13u. s. Depafiment of the Interior, “Report on the Issues Identified in the Nonfuel Minerals Policy Review, ” draft for public

review and comment, August 1979.
Ch. 4—Security of Supply • 115

signment to lower rungs of the bureaucratic

ladder and a watering down of controversial

issues, In hearings held around the country on

draft portions of the report, the document was

criticized by all sides—industry, environmental

groups, and consumer organizations.

A number of congressional and industry

critics criticized the document on national

security grounds. They linked together the issues of import dependence, the health of the

domestic minerals industries, the Nation’s

need for strategic materials, and the threat of

a “resource war.”77

Aside from mining and minerals, Congress

had yet to declare a statutory national materials

policy. The Paley Commission, in 1952, had

spoken of “a national materials policy for the

United States” with an overall objective of insuring “an adequate and dependable flow of

materials at the lowest cost consistent with national security and with the welfare of friendly

nations. ” But the difficulties entailed in translating such recommendations into meaningful

policy were formidable—given the diverse role

that materials play in all aspects of society.

When Congress, in 1970, enacted a National

Materials Policy Act, it was for the purpose of

developing such a policy (through Commission

recommendations) rather than articulating one.

Nonetheless, throughout the 1970s, materials

advocates both inside and outside the Congress

had been laying the groundwork for a materials

policy that would encompass a broad range of

concerns—yet not be so broad as to be all inclusive. Some material policy concerns that

were prominent in the early part of the decade became themselves the subject of separate

legislation, thus making the task of what to emphasize in an overall national materials policy

more manageable. Solid waste disposal—a

dominant materials policy issue in the early

1970s—was perhaps the most conspicuous example. It still attracted considerable attention,

‘T~u.s. COng~SS, House of Representatives, Committee on Interior and Insular Affairs, Subcommittee on Mining and Minerals, Hearings, Oct. 18, 1979 (Washington, DC: U.S. Government Printing Office, 1979), statement of Representative James

D. Santini, Chairman. See also the testimony of E. F. Andrews,

Vice-President, Allegheny I.udlum Industries, Inc,

but with enactment of the Resource Conservation and Recovery Act of 1976 its earlier prominence in the hierarchy of material policy concerns began to decline. Other concerns, such

as import vulnerability, and the competitiveness of basic U.S. industry, had moved to the

forefront.

Meanwhile, the House Committee on Science

and Technology was working on legislation

which emphasized the role of research and development in resolving material problems.

Since the early 1970s, the Committee had become increasingly involved with the issue, releasing a series of background reports and

holding hearings on various legislative proposals which had a science and technology

component in implementing materials policy.

By the 95th Congress, these legislative concepts had begun to crystallize, so that one member of the committee could speak, in mid-1977,

of acting in “concert with other committees of

both Houses” to begin “to establish an orderly,

effective national materials policy.”78 Several

members of the committee had introduced bills

which, while differing in detail, had themes in

common. 79 First, the bills proposed a statutory

materials policy. Second, implementation of

the policy would be achieved through focusing Federal materials R&D activities. Third,

they emphasized the need for greater involvement of the Executive Office of the President

(through the Office of Science and Technology

Policy (OSTP) or a new organization in the

EOP) in materials decisionmaking.

None of these bills passed the 95th Congress,

but the hearing process helped to further refine

the basic legislative concepts and build a greater

degree of consensus about components of national materials policy legislation. While expressing agreement with the overall objective

of these bills, the Carter Administration was

TLIU. S. Congress, House Committee on Science and Technology Subcommittee on Science, Research and Technology, Hearings on a National Policy for Materials; Research and Resources,

95th Cong., 1st & 2d sess., June 29, July 13, 14, 1977; Feb. 28,

Mar. 1, 2, and 6, 1978 [Washington, DC: U.S. Government Printing Office, 1978], pp. 1-2.

~Material policy bills introduced in the 95th Congress included

H.R. 10859, H.R, 11203, and H.R. 13025.
116 . Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

not convinced that new legislation was necessary. OSTP, it said, already had the authority

to achieve those goals, and moreover its nonfuel mineral policy review, and other initiatives

in areas of basic innovation and improved coordination of R&D would provide the needed

direction for Federal policy without additional

legislation.

The Administration’s position became less

persuasive in the 96th Congress, when its draft

nonfuel mineral policy review came under considerable congressional criticism. With the

reverberations of the cobalt price spike still

shaking U.S. industry, the issue of import dependency was very much on the minds of legislators. Sponsors of materials legislation in the

House saw an emphasis on science and technology as an important step toward reducing

import vulnerability. At the end of 1979, the

House, by a 398 to 8 vote, passed H.R. 2743,

called the Materials Policy, Research and Development Act. The bill, originally introduced

by Representative Don Fuqua, Chairman of the

House Science and Technology Committee,

reflected many of the basic concepts considered by the Committee in the 95th Congress—

including a broad-based material policy, to be

implemented through an improved executive

branch decisionmaking process in regard to

R&D activities.

After it was sent to the Senate, the House

bill’s basic framework was maintained, but its

scope was enlarged as the bill moved through

two Committees (Commerce, Science, and

Transportation; and Energy and Natural Resources) to the Senate floor. New provisions

were added which placed greater emphasis on

materials import vulnerability, and the Departments of Defense, Commerce, and Interior

were given important supporting roles in identifying vulnerability problems. In general, the

Senate bill placed greater emphasis on minerals—thus bringing together in one piece of legislation the sometimes disparate concerns of

the materials and minerals communities.

The bill was signed by President Carter on

October 21, 1980, in the closing days of the 96th

Congress. 80 The National Materials and Minerals Policy, Research and Development Act

of 1980 (Public Law 96-479) declared:

. . . it is the continuing policy of the United

States to promote an adequate and stable supply of materials necessary to maintain national

security, economic well-being and industrial

production with appropriate attention to a

long-term balance between resource production, energy use, a healthy environment, natural resources conservation, and social needs.81

The law spelled out a number of activities

in furtherance of this national materials policy, to be undertaken by the President, his Executive Office, and various departments. It

directed the President to submit a plan to Congress that would assure: policy analysis and

decisionmaking on materials in the Executive

Office of the President; interagency coordination of material policy at the Cabinet level; continuing long-range analysis of the use and supply of materials to meet national needs; and

continuing consultation with the private sector on Federal material programs.

The law designated the Office of Science and

Technology Policy, in the Executive Office of

the President, to coordinate Federal materials

R&D, emphasizing R&D to meet long-range material needs through annual assessments. Responsibility for several specific tasks was

placed in various departments: Commerce, to

do case studies of material needs (the aerospace

industry was selected for the first study and

the steel industry the next); Defense, to assess

material needs critical to national security; and

Interior, to improve the assessment of international minerals and to make better minerals

data and analysis available for decisions on

Federal land use, and to report on its activities in these areas,

eOFOr legislative history of Public Law 96-479, see House Report 96-272, Nov. 29, 1979 (House Science and Technology Committee); Senate Report 96-897, Aug. 13, 1980 (Senate Commerce,

Science and Transportation Committee); Senate Report 96-937,

Sept. 12, 1980 (Senate Energy and National Resources Committee; House debate and passage, Congressional Record, Dec. 4,

1979; Oct. 2, 1980; Senate debate and passage, Congressional Record, Oct. 1, 1980.

Blpub]ic Law 96-479, sec. 3.
Ch. 4—Security of Supply ● 117

In April 1982, President Reagan submitted

the plan called for by the Act.82 Dominating the

plan was its emphasis on opening more of the

federally owned public lands to minerals prospecting and development in order to “achieve

a proper balance between wilderness and

mineral needs of the American people, ” Another

major theme was renewed and improved stockpiling. The President took credit for the first

major stockpile acquisitions in 20 years—purchases of cobalt and acquisition of Jamaican

bauxite by purchase, barter of agricultural

products, and swap of excess stockpile materials. The President’s report promised a thorough review of the quality of stockpiled materials, some of which are decades old.

Despite efforts by Congress to assure highlevel coordination of national materials policy,

the plan offered little that was new in this regard. National materials policy, it said, would

be coordinated through the Cabinet Council on

Natural Resources and Environment (as it had

been since the early days of the Reagan Administration). No budget for a coordinated materials program was presented (even though the

law requires one); the Cabinet Council needs

only a “minimum administrative staff, ” said

the report. For coordination of governmentsponsored R&D, the plan proposed to resurrect

the interagency Committee on Materials

(COMAT). COMAT had been disbanded in the

early days of the Carter Administration, then

resurrected before Carter left office, and then

was again disbanded in the early days of the

Reagan Administration.

The President’s report had little discussion

of the potential for smoothing materials supply

problems by developing advanced technologies

for more efficient use of materials, recycling,

or substitution of abundant materials for scarce

ones—themes emphasized in the 1980 Act and

its legislative history. While the Administration

actually proposed to fund strategic materials

R&D at a fairly high level, the President’s plan

offered few specifics, stating that “favorable

tax incentives” in the 1981 tax law would stimulate private R&D of essential materials activ- —.—

aZl~u~iOnu] ~la~~rjajs and Minerals Program Plan and Report

to Congress, submitted hy President Reagan, Apr. 5, 1982.

ity. Any government-financed R&D, the report

said, “will concentrate on high-risk, high potential payoff projects with the best chance for

wide generic application to materials problems

and increased productivity. ” The exception to

this policy was mission-specific projects of the

Department of Defense.

Although the President’s plan was seen by

many as an important first step, its lack of emphasis on materials issues other than those

associated with mining and the public lands,

as well as the choice of the Cabinet Council on

Natural Resources and the Environment to coordinate policy, drew strong criticism from the

House Committee on Science and Technology,

By mid-August 1982, the Committee had reported a bill—the proposed Critical Materials

Act of 1982—to establish a Council on Critical

Materials “under and reporting to” the Executive Office of the President. “It is no accident, ”

the Committee report said, “that the Cabinet

Council on Natural Resources and Environment, headed by the Secretary of Interior,

placed primary emphasis on minerals, mining

and related public land policies with almost no

attention to basic material processing, conservation, substitution, or new materials development." 83 Only an entity within the Executive

Office of the President, the Committee report

reasoned, would be able to transcend “normal

interagency competitiveness and provide the

necessary balance in materials policy considerations.” The Administration disagreed, arguing that a new layer of bureaucracy would

impede—rather than enhance—materials and

mineral policy coordination,

Although the hill did not pass in the 97th

Congress, the House Science and Technology

Committee continued the push for a critical

materials council in the 98th Congress. Its Subcommittee on Transportation, Aviation, and

Materials held hearings in May and June of

1983, focusing on implementation of the 1980

Materials Act.84 Administration witnesses,

esHOUSe Report 97-761, Part 1, Aug. 18, 1982, p. 9.

84u .s. congress, House Committee on Science and Technology, Subcommittee on Transportation, Aviation, and Materials,

Hearings on Material Research and Development Policy, 98th

Cong. 1st sess., May 17, 18, 19; June 24, 1983 (Washingtonf DC:

U.S. Government Printing Office, 1984),
118 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

while supporting the need for effective coordination, maintained that the Cabinet Council on

Natural Resources and Environment and

COMAT would fulfill this need. However, the

U.S. General Accounting Office, which had

been asked by full Committee Chairman Fuqua

to monitor implementation of the 1980 Act,

identified several areas in which additional attention would be needed to meet the goals of

the 1980 Act, including more effective coordination.85 While its final report was not released

until March 1984,86 GAO’s preliminary findings (as reflected in its testimony) supported

the contention of those who held that implementation of the 1980 Act was not adequate.

GAO pointed out that the Cabinet Council on

Natural Resources and the Environment did

not include all agencies with important materials responsibilities, such as the Department

of Defense and the Federal Emergency Management Agency, which coordinates stockpile

planning. COMAT, assigned R&D coordination

by the President’s plan, had apparently not

been involved in determining the need for a

major new materials research initiative proposed in the President’s budget for fiscal year

1984. The Act called on OSTP to prepare and

annually revise an assessment of national material needs related to scientific and technological changes over the next 5 years; while no date

was specified for the initial assessment, none

had been prepared. Finally GAO noted that the

1980 law did not require the administration to

periodically revise and resubmit to Congress

its overall materials program plan. Hence, the

President’s material plan would not necessarily

be revised. (Key findings from the GAO report

are summarized in box 4-A.)

Another issue taken up at the hearings concerned the potential role of advanced materials

in U.S. industrial competitiveness, and in easing import vulnerability. In 1981, Japan had announced a 10-year program giving considerable prominence to advanced ceramics and

@slbid., p. 23.

‘U.S. General Accounting Office, implementation of the National Minerals and Materials Policy Needs Better Coordination

and Focus, GAO—RCED-84-63 (Gaithersburg, MD; Mar. 20,

1984).

other “high technology” materials in its industrial goals. Concern had been mounting that

U.S. primacy in advanced materials research

was in danger of being supplanted as these

materials increasingly found commercial application.

By late October 1983, the subcommittee had

reported a measure (H. R. 4186) to the full

Science and Technology Committee which

called for the establishment of a national critical materials council and for increased emphasis on advanced materials R&D. When a Senatepassed arctic research measure that had been

endorsed by the Administration was referred

to the Committee, it emerged from mark-up

with a new Title II, the National Critical Materials Act of 1983, The measure was signed

into law by President Reagan on July 31, 1984.

The National Critical Materials Act (Title II

of Public Law 98-373) has three major components. First, it establishes a National Critical

Materials Council in the Executive Office of

the President, to advise the President on materials policy, and define responsibilities and

coordinate critical materials policies among

Federal agencies. The Council, to be composed

of three presidentially appointed members who

will need Senate confirmation if they do not

already serve in a Senate-confirmed office, is

to prepare a report on critical materials inventories, and projected use, including a longrange assessment of prospective critical materials problems.

Second, it calls for the establishment of a national Federal program for advanced materials

research and technology, with the Council

assuming key responsibilities for overseeing

and collaborating with other agencies on the

program. The Council is directed to establish

a national Federal program plan for advanced

materials R&D, and to review authorization

and budget requests of all Federal agencies to

ensure close coordination with policies determined by the Council. The Office of Management and Budget, in turn, is to consider

Federal agency authorization requests in the

materials area as an “integrated, coherent,

multiagency request” to be reviewed with the
Ch. 4–Security of Supply Ž 119

Council for adherence to the Federal materials technology, authorized by the Stevenson-Wydler

program plan then in effect. Technology Innovation Act of 1980 (Public

Third, the law seeks to promote innovation Law 96-480), as a means to encourage such inand improved productivity in basic and ad- novation. It is also called on to establish an “effective mechanism” for efficient and timely dis- vanced materials industries. The Council is to

evaluate possible use of centers for industrial semination of materials property data.

The Range of Solutions

Thirty years of debate have drawn attention bly less attention. That is the purpose of this

to a very wide range of political responses to report. Chapters 5, 6, and 7 present in detail

materials supply problems. The promise of ad- the principal subjects of this report—supply

vanced technologies, both in expanding supply alternatives, conservation, and substitution.

and in promoting more efficient, more flexi- Chapter 8 discusses policy issues and options

ble use of materials, has received considera- related to these subjects.
120 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

—

Box 4-A.-GAO Evaluation of Executive Branch Implementation of the National Materials

and Mineral Policy, Research and Development Act of 1980

Soon after passage of the National Materials and Minerals Policy, Research and Development Act of 1980, the U.S. General Accounting Office (GAO) was asked to monitor

and review the Administration’s implementation of the Act by the Chairman of the House

Science and Technology Committee. GAO’s

final report, issued in April 1984, draws the

following conclusions:

●

●

●

The President assigned overall responsibility for coordination of materials policy

to the Cabinet Council on Natural Resources and Environment, but the council has not provided the “continuous decision and policy coordination required”

by the Act. The Cabinet Council is restricted to Cabinet members; therefore,

representatives from the Federal Emergency Management Agency (FEMA),

which oversees stockpile policy, and the

Environmental Protection Agency (EPA),

which regulates the activities of mining

and mineral processing industries, are

not included. The Council cannot completely address minerals and materials issues with this lack of membership. In

fact, several material-related decisions

have been made by independent agencies

or individuals with little or no coordination with the Council or sister agencies.

The President’s program plan focused on

one of the three policy goals included in

the Act—national security. However,

almost no attention was given to the Act’s

other two policy goals-economic wellbeing and industrial production, except

to address domestic minerals extraction

problems. No consideration was given to

the long-term implications of the decline

in domestic minerals processing capacity for the U.S. economy and industrial

base.

The Act required the Office of Science

and Technology Policy (OSTP) to prepare

an assessment of national materials needs

related to scientific and technological

changes over the next 5 years and to re-

●

●

●

vise such assessment on an annual basis.

The Act, however, did not specify a

reporting date, Agency officials told GAO

that they consider this a low-priority task,

and have not prepared the report.

The Department of Defense was to prepare a report assessing critical materials

needs related to national security and to

identify steps to meet these needs. This

report was to be made available to Congress on October 21, 1981. According to

officials in the Defense Department, the

report had been sent to the Cabinet Council on Material Resources and Environment in time for it to be used in the preparation of the President’s material plan in

April 1982. However, the report was still

under review within the Administration

as of February 1984, and had not been

sent to Congress.

Similarly, the Department of the Interior

did not submit a report due to Congress

on October 21, 1981, until November 10,

1983. The report was submitted only after the Chairman of a House subcommittee indicated that “legislative action”

would be pursued if the report were not

submitted. (The Interior report summarizes actions to improve the capacity of

the Bureau of Mines to assess international mineral supplies, to increase the

level of mining and metallurgical research by the Bureau in critical and strategic minerals, and to improve the availability of mineral data for Federal land use

decisionmaking.)

The only Federal agency to comply consistently with the Act’s requirements is

the Department of Commerce. (Commerce

has completed two materials case studies

on critical materials requirements of the

steel industry and of the aerospace industry; a third dealing with domestic minerals industries is in progress.)

GAO concluded that the Executive Office

should develop an expanded program plan

which takes into account Congress’ three pol-
Ch. 4—Security of Supply ● 121

icy goals of national security, economic wellbeing, and industrial production. Specific recommendations were:

● The plan should clearly define the terms

“strategic” and “critical” to focus attention on those mineral and material markets where the United States is most

vulnerable to price increases or supply

disruptions and should develop a plan to

measure the magnitude of the potential

problem in a given market. The benefits

and costs of various alternatives such as

stockpiling, expanding domestic productive capacity and supply, and developing

substitutes should be weighed in this

long-term plan which should be geared

towards specific minerals or materials.

● The program plan should reach beyond

the goal of national security and include

issues affecting the law’s goals of economic well-being and industrial production, which are now being addressed in

an uncoordinated fashion by the Departments of Interior, Commerce, Defense,

and others.

The program plan should address the future role of high technology materials

R&D. This alternative should be developed within the report that OSTP is required to prepare under the 1980 Act, and

the recommended redirection resulting

from COMAT’s inventory of Federal material R&D programs.

GAO offered the opportunity for the various agencies to comment on their conclusions and recommendations. The agency responses are as follows:

The Department of the Interior disagreed

on the need to develop an approach to

measure U.S. minerals and materials vulnerability. Interior felt it was not necessary to quantify the magnitude or degree

of vulnerability in a given nonfuel

minerals or materials market.

The Department of Defense agreed with

GAO that the report assessing critical national security materials needs and the

steps necessary to meet those needs required by the Act should be made available to Congress. Defense was in agreement with the Department of the Interior

regarding measuring U.S. vulnerability.

The Office of Science and Technology

Policy did not comment on the GAO proposal that it prepare the assessment of national materials needs related to scientific

and technical changes over the next 5

years as required by the Act. Interior,

however, stated that the administration

intended that COMAT would constitute

the primary means through which OSTP

would carry out the Act’s reporting requirements. In the opinion of GAO, neither the program plan or COMAT’s activities to date assess national materials

needs related to scientific and technological changes over the next 5 years; therefore, this requirement has not been met.

38-844 0 - 85 - 5 : ~1, 3
— . . —.

CHAPTER 5

Strategic Material Supply

Page

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..........................125

Summary of Supply Prospects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ............125

Factors Contributing to Change in Supply . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..126

Technological Advances in Mine Production and Processing . . . . . . . ...........127

Strategic Material Environments, Mineral Activity, and Technology . ............128

Geology of Strategic Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..........128

Prospecting to Production . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 129

Exploration Technology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .................131

Mining Technology. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ....................131

Potential for Change in the Supply of Strategic Materials . . . . . . . . . . . . . . . . .. ...132

Processing of Strategic Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .......135

Production and Processing of the First-Tier Materials . .......................136

Chromium Production and Processing . . . . . . . . . . . . . . . . . . . . . . . ...............,137

Foreign Production of Chromium . . . . . . . . . . . . . . . . . . . . . ....................139

Domestic Production of Chromium . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .........148

Foreign and Domestic Chromium Processing . ..............................154

Cobalt Production and Processing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. ...159

Foreign Production of Cobalt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ............160

Potential Sources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..........................166

Domestic Production of Cobalt . . . . . . . . . . . . . . . . . . . . . . . . . . . . ................167

Domestic and Foreign Cobalt Processing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ....174

Manganese Production and Processing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. ....177

Foreign Production of Manganese . . . . . . . . . . . . . . . . . . . . . ....................178

Domestic Production of Manganese. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ....184

Domestic and Foreign Manganese Processing . ..............................187

Platinum Group Metals Production and Processing . . . . . . . .....................190

Foreign Production of Platinum Group Metals . .............................192

Processing of Platinum Group Metals . . . . . . . . . . . ...........................201

Exploration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..201

Land-Based Resources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..................201

Ocean-Based Resources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ................209
_ -— —

Contents–continued

Table

5-1.

5-2.

5-3.

5-4.

5-5.

5-6.

5-7.

543.

5-9.

5-10.

5-11.

5-12.

5-13.

5-14.

5-15.

5-16.

5-17.

5-18.

5-19.

5-20.

5-21.

5-22.

5-23.

5-24.

5-25.

5-26.

5-27.

5-28.

5-29.

5-30.

5-31.

5-32.

5-33.

5-34.

5-35.

5-36.

5-37.

5-38.

List of Tables

No. Page

Deposit Types and Locations of First-Tier Strategic Materials . . . . . . . . . . . . 129

Mineral Activity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 130

First-Tier Strategic Materials Supply Prospects . . . . . . . . . . . . . . . . . . . . . . . . . 134

World Chromate Reserves and Production by Country. . . . . . . . . . . . . . . . . . . 139

Ferrochromium Production by Country . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 140

Chromate Mining Industry by Country . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 140

Historical Production—Chromite, 1960-80, by Country. . . . . . . . . . . . . . . . . . . 141

Chromate Mine Capacity and Usage in 1981 by Country . . . . . . . . . . . . . . . . . 142

U.S. Chromate Deposit Resources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 149

U.S. Chromate Laterite Deposit Resources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 149

Proposed Mining and Processing Methods U.S. Chromate Deposits . . . . . . . . 150

Potential U.S. Chromate Production . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 151

Composition of Chromium Ferroalloys and Metal.... . . . . . . . . . . . . . . . . . . . 154

Ferrochromium Capacity, 1979. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 158

Production Capacities for Chromium Metal in the Non-Communist

Countries—1981. ....., . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 158

Chromium Ferroalloys and Metal: Imports and Consumption . . . . . . . . . . . . 158

World Cobalt Reserves and Production by Country . . . . . . . . . . . . . . . . . . . . . 160

Cobalt Mining Industry by Country. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 161

World Refined Cobalt Production, 1982, by Country . . . . . . . . . . . . . . . . . . . . 162

Historical Production—Cobalt, 1960-80, by Country . . . . . . . . . . . . . . . . . . . . . 162

Potential Foreign Cobalt Sources, . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 163

Potential U.S. Cobalt Production . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169

U.S. Cobalt Processing Capacity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 176

World Manganese Ore Reserves and Production by Country . . . . . . . . . . . . . 178

Manganese Mining Industry by Country . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 179

Ferromanganese and Silicomanganese Production by Country. . . . . . . . . . . . 180

Historical Manganese Ore Production, 1960-80, by Country . . . . . . . . . . . . . . 181

Manganese Mine Capacity and Usage in 1981, by Country . . . . . . . . . . . . . . . 181

Definition of Manganese-Bearing Ores . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 185

U.S. Manganese Resources and Potential Production. . . . . . . . . . . . . . . . . . . . 186

Composition of Manganese Alloys . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 188

Manganese Ferroalloys and Metal Production Capacity—1979 . . . . . . . . . . . . 189

Manganese Ferroalloys and Metal: U.S. Imports and Consumption . . . . . . ,. 190

Distribution of Platinum Group Metal Production by Metal and Country,

1981. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 192

Platinum Group Metals: World Reserves and Production by Country . . . . . . 192

PGM Mining Industry by Country, . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 193

Potential U.S. PGM Production . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 196

Outlook for Development of Ocean-Based Resources of Strategic Materials. 210

List of Figures

Figure No. Page

5-1. Simplified Flowchart, Chromium Ore to Industrial Use . . . . . . . . . . . . . . . . . . . 155

5-2. Submerged Arc Furnace . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 155

5-3. Total U.S. Cobalt Production, 1945-71 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 167

5-4. Simplified Flowchart for the Production of Cobalt . . . . . . . . . . . . . . . . . . . . . . . . 175

5-5. Simplified Flowchart, Manganese Ore to Industry Use . . . . . . . . . . . . . . . . . . . . 188

5-6. Comparative PGM Production, 1981 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 191

5-7. PGM Processing, Simplified Flowchart . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 202

5-8. Time Chart of Some First-Tier Strategic Material Deposits . . . . . . . . . . . . . . . . . 203

5-9. Exposure of Precambrian Rock in North America. . . . . . . . . . . . . . . . . . . . . . . . 205
CHAPTER 5

Strategic Material Supply

Introduction

Strategic material supply vulnerability could

be reduced by developing domestic sources of

ores and maintaining domestic processing capability or by sufficiently diversifying foreign

suppliers to reduce the likelihood that any supply disruption would adversely affect U.S. national security or industrial stability. Prospects

for changes in the existing distribution of

mineral supply sources depend primarily on

whether future demand for various commodities encourages expansion by current suppliers or the opening of new mines in new

areas. Other factors include shifts in consumption patterns in the developing nations—e.g.,

a growth in internal use of resources that result in fewer or higher processed forms of

exports—and the decline of production as reserves are depleted. Although market forces

and, increasingly, government action in mineral-rich developing countries determine which

mineral deposits are chosen for exploitation,

neither has contributed or will necessarily contribute to a lessening of vulnerability by

promoting either domestic or diversified foreign production.

This chapter discusses the existing lack of

diversity of supply and the corresponding lack

of adequate domestic supply of the first-tier

strategic materials. It also presents an overview

of the technology employed in strategic materials supply. (International political factors,

which relate to the likelihood of disruptions

and their possible durations, are not discussed.)

The first section of the chapter considers mining and processing in general and is followed

by sections on the specific ore production and

processing environments and supply patterns

of each of the first-tier strategic materials. The

prospects for reduction in vulnerability are

assessed. The last section discusses, in terms

of U.S. lands and the ocean floor, the possibilities for new mineral finds and improved exploration technology and their effects on expanding the knowledge and availability of

strategic materials.

Summary of Supply Prospects

While today’s pattern of supply for chromium, cobalt, manganese, and platinum group

metals (PGMs) will not change in any appreciable way in the near and, most likely, longterm future, there are some opportunities for

direct and targeted government action to diversify foreign sources of these materials away

from politically sensitive areas. A concentrated

push to diversify foreign sources of supply,

however, would inevitably open marginally

economic deposits and, in the long run, might

do nothing more than simply delay an even

greater reliance on the abundant deposits—e.g.,

those in southern Africa.

Of the first-tier strategic materials, only

PGMs are now produced from domestic ores;

and in 1982 the amount produced represented

less than 1 percent of that year’s consumption.

Other domestic PGM and some cobalt resources

have been under consideration for commercial

exploitation. Known chromium and manganese ore resources in the United States are considered improbable candidates for commercial

production at any time in the near or long-term

future. Without Federal subsidies, production

may be possible for larger amounts of PGMs,

but is less likely to initiate production of cobalt, and appears unlikely for chromium and

manganese even under supply disruption conditions when market prices can rise dramatically. In all cases, only a portion of U.S. needs

could be supplied by domestic production. All

of these resources, though, represent important

in-place stockpiles of strategic materials.

125
126 Ž Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Chromium

Foreign alternatives to the major chromium

producers, South Africa and the Soviet Union,

are limited in number and in the amount of

chromium they could provide. Prospects include the expansion of output from producing

deposits in the eastern Mediterranean and the

Philippines and the development of laterite and

beach sand deposits in the Western Pacific region. These sources might provide an additional 10 to 20 percent of U.S. needs.

Domestic resources could provide up to 50

percent of needs (in a low consumption year

such as 1982) for 11 years if four deposits were

simultaneously developed at costs about double prevailing rates. One of these deposits,

which could supply up to 4 percent of U.S.

chromium consumption, has been under recent consideration by a private firm, but

production would be contingent upon significant increases in the prices and demand for

nickel and cobalt.

Cobalt

If foreign production of cobalt is to diversify,

it will most likely result from the opening of

cobalt-containing nickel laterite deposits in

such countries as New Caledonia and Papua

New Guinea, possible expansion of output

from the Philippines, and production of cobalt

as a byproduct from iron ore mining in Peru.

Four cobalt deposits in the United States

could supply up to 10 million pounds annually,

if producing simultaneously; this production

rate would decline after about 20 years, Private

firms investigating three of these properties

have suggested that Federal subsidies in the

form of price guarantees could assist them in

overcoming a prime barrier to production—

low and volatile market prices for cobalt. The

fourth deposit is not under consideration for

production.

Manganese

The greatest opportunities for diversifying

the foreign supply of manganese lie in increased

production of manganese ore in Australia and

Mexico. Mexico’s ores require more extensive

processing than Australia’s and would represent a larger investment to promote increased

production. Neither producer will decide to increase production without clear market signals

of increasing and sustained demand. Increases

from these producers plus Gabon (with transportation improvements) might be able to meet

U.S. needs.

The cost of producing ores from known domestic manganese deposits ranges from 2 to

18 times the market price; commercial activity is nonexistent. Simultaneous development

of eight domestic deposits could theoretically

cover most of U.S. needs over a 10-year period.

Platinum Group Metals

There are no known foreign alternatives to

PGMs. South Africa, the Soviet Union, and to

a much lesser extent, Canada, will continue to

supply the world.

Private development of and production from

the Stillwater Complex in Montana appears

possible given slight increases in market prices

for platinum and palladium and evidence of

increased, sustained demand. Initial production would supply about 9 percent of domestic needs, based on 1982 consumption of PGMs.

Exploration

The relatively low economic value of many

strategic materials and ample foreign supplies

combine to inhibit any domestic commercial

exploration for new deposits of these materials.

Advances in exploration technology are not

specifically directed at finding strategic materials, but general improvements could increase

the likelihood of locating deposits, if they exist.

Processing and the Ferroalloy Industry

U.S. ferroalloy production capacity has declined over the last decade. This erosion is expected to continue at a slower pace, resulting

in a lean domestic industry that can supply a

portion of domestic needs.

Factors Contributing to Change in Supply

It is a consequence of the economics of mining that there are no known “world class”
Ch. 5—Strategic Material Supply . 127

mineral deposits that are not producing. Known

deposits that are not producing, whether foreign or domestic, are small in size and/or contain low-grade material. These factors, plus

others such as labor and energy costs, accessibility, the effect of perceptions of political risk

on investment, and environmental concerns,

contribute to these deposits’ marginal economic value. Some producing deposits are not

considered to be economic by free market

standards. The less developed nations that own

many of the known deposits consider them

such critical sources of jobs and foreign exchange that they are often exploited even if

operations must be subsidized.

Mineral activity encompasses a time-consuming, sequential chain of activity: exploration, mine development, ore production and

processing, and international trade. Normal

changes in supply patterns evolve slowly. Dramatic changes, when they do occur, are the result of perturbations to the system, Two ongoing evolutions in international mineral trade

are now affecting mineral supply and the ways

in which vulnerability is measured, The first

is a shift from export production to domestic

consumption. Many producer countries (e.g.,

Brazil and India) are increasingly using their

mineral resources, just as the United States did,

as a contribution to their own industrial development. Internal demands for these resources

affect the trading relationship these nations

maintain with their mineral customers by the

reduction of market supplies during high internal growth periods and the dumping of excess supplies on the world markets during

recessionary times.

A second and related factor is that producing nations are deciding that it is in their own

best interests to promote the export of processed ores rather than raw materials. Since

their newer facilities appear to have a competitive edge over traditional processing facilities

in industrialized centers, the vulnerability of

the West to imported materials is shifting from

ores to higher processed forms of strategic

materials.

This shift in trade from ores to ferroalloys

and from semiprocessed ores to cobalt and

PGMs is accompanied by a change in transportation requirements. Ferroalloys contain double to triple the chromium or manganese content of the mined ores, so that shipping the

same amount of chromium or manganese as

ferroalloys rather than as ores requires less

space, fewer ships. While prior processing allows the shipment of a greater amount of chromium or manganese in fewer vessels, PGM and

cobalt metal products can be shipped by air at

no great increase in cost to the consumer, The

growth in cobalt and PGM refining capability

in mining countries increases the flexibility of

transportation systems (and reduces the overall processing time), resulting in a lowering of

the vulnerability of cobalt and PGMs to sea and

land transportation problems,

Concern about the vulnerability of transportation routes from producing to consuming nations usually focuses on the problem of open

sea lanes in time of war. Consideration must

also be given the less dramatic problem of

whether land transportation services are and

will remain adequate. Mines are often located

far inland, in isolated areas. Transportation of

ores to a shipping port usually involves an initial overland route (by railroad, truck, aerial

tramway). The costs of developing and operating such systems can be a significant factor

in the economics of a potential source of minerals. Transportation bottlenecks could prove

the most time-consuming aspect of any rapid

expansion required in a supply emergency. In

addition, land transport is a weak link between

producer and consumer in terms of possible

terrorist operations,

Technological Advances in Mine

Production and Processing’

Into the 1990s, the overall picture for mining technology applicable to first-tier strategic

‘See the following section for a description of various exploration, ore mining, and processing procedures and technologies.
128 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

material resources should differ only in a few

respects from that of today.

Technology will only marginally enhance the

likelihood for domestic production. Changes

in technology affect the cost of materials by reducing the capital investment and the unit cost

of mining and processing operations. However, low-grade domestic resources of strategic materials are not unique geologically, and

any innovations would apply to foreign deposits of higher grades, as well. New technology

would not be likely to make domestic sources

more competitive. Unless there are discoveries

of higher grade ore bodies in the United States

or the development of mining and processing

technologies that selectively improve the economics of low-grade deposits, marginally economic deposits will remain as such.

If foreign supplies were restricted or unavailable, new technology could provide for domestic production at lower costs than would be

possible otherwise. Development costs in open

pit and underground mines might be reduced

by as much as 15 percent with the use of rapid

excavation and continuous material-handling

methods and in situ (solution) mining could

realize savings of up to 50 percent over today’s

conventional open pit and underground mine

installations. Mine operating costs per unit of

material could be reduced by as much as 20

percent in relation to the costs of applying current technologies, with in-situ operation costs

perhaps 40 percent below those of conventional methods.2

—..—

2A. Silverman, et al., Strategic and Critical Mineral Position

of the United States With Respect to Chromium, Nickel, Cobalt,

Manganese, and PJatinum, contractor report prepared for the

Office of Technology Assessment, June 1983.

Mechanization of age-old mining methods is

the key change now underway in production.

Open pit mining, which employs technology

to drill, blast, and load rock is expected to use

more continuous conveying systems in deeper

and steeper pits, and continuous bucket-wheel

excavators will come into use. Hard rock

underground mining will still be a cyclic operation of drilling, blasting, and loading but there

should be increased remote control, rapid conveyor haulage, and mining methods that break

rock on remote levels. Machines used to bore

shafts (called “raise-boring”) will be in general

use, but other continuous mining innovations

in shaft sinking, tunnel boring, and mining

methods will probably be used in only a few

mines.

In specific instances, new mining concepts

could be applied. Solution mining of manganese deposits is now under investigation and

is being conceptualized for other strategic

materials. Bioengineering, which uses bacteria in leach treatment of ores, may provide a

mining innovation for the future. It is expected,

however, only to supplement existing mining

and processing techniques.

The low grades of domestic deposits and the

attendant costs involved in processing their

ores to produce the high-grade industry standard material is a major contributor to their uneconomic status. There are no major changes in

processing technologies expected to be available in the future to alter that picture substantially. Domestic cobalt and PGM ores, if in

production, are expected to be processed with

modifications of today’s technologies,

Strategic Material Environments, Mineral Activity, and Technology

Geology of Strategic Materials

Chromium, cobalt, manganese, and platinum

group metals are found in greatest concentration in certain classes of rocks (called “mafic”

and “ultramafic”)3 which were formed eons

ago by solidification from a molten state. TatRocks that are dominately composed of iron and magnesia

silicate (SiOJ minerals. Ultramafic rocks contain less than 45

percent Si02.
Ch. 5—Strategic Material Supply Ž 129

ble 5-1 identifies by deposit type and location Moreover, the degree of information and comthe major worldwide known deposits of the mitment to maintaining current estimates of

first-tier materials. The significance of the resources and reserves varies greatly among

different deposit types is explained in each of nations. Countries with limited mineral assessthe individual mineral sections below. ment programs may, for instance, not distinA troublesome aspect of any discussion of guish between resources and reserves, estimate

mineral supply is in establishing agreement only from operating mines, or fail to conduct

over the meaning and use of the basic terms, economic analyses.

—

“resources” and “reserves. ” Reserves include Reserves and resources are often given in

deposits that were known and were technically terms of ore tonnage. An important qualifier

and economically feasible to mine at a profit is the “grade” of the desired mineral, the

at the time the data was analyzed. Reserves are amount of that mineral that is estimated to be

the only deposits that are immediately avail- contained within the ore. Grades are usually

able to be developed to meet the need for presented in percentages or parts per million

materials. Resources, on the other hand, in- (ppm).

elude reserves and deposits that are known but

are not currently economic to mine, as well as

deposits that are merely inferred to exist from

geologic evidence. Numbers for both are estimates and should be used only with caution.

The Bureau of Mines and the U.S. Geological

Survey, which calculate and report the numbers, rely on their own research, the reporting

of private data that is often purely voluntary,

and data from various publicly available sources.

Table 5-1 .—Deposit Types and Locations of

First-Tier Strategic Materials

Chromium:

Stratiform . . . . . . . . . . South Africa (Bushveld Complex),

Zimbabwe (Great Dyke), Finland,

Brazil, U.S. (Stillwater Complex)

Podiform . . . . . . . . . . Albania, New Caledonia,

Philippines, Turkey, Zimbabwe

Laterite . . . . . . . . . . . U.S. (Gasquet Mountain),

Philippines, New Caledonia

Cobalt:

Stratabound . . . . . . . . Zaire, Zambia

Laterite . . . . . . . . . . . .Australia, New Caledonia,

Philippines, Cuba

Hypogene. , . . . . . . . .Australia, Botswana, Canada

(Sudbury), Soviet Union (Noril’sk),

U.S. (Duluth Gabbro)

Hydrothermal . . . . . . . U.S. (Blackbird, Madison)

Manganese:

Sedimentary . . . . . . Australia, Brazil, Gabon, India,

Mexico, South Africa (Transvaal)

Platinum group metals:

Strati form . . . . . . . . . . South Africa (Bushveld), Soviet

Union, Canada (Sudbury), U.S.

(Stillwater)

Placer . . . . . . . . . . . . .Colombia, U.S. (Goodnews Bay)

SOURCE Off Ice of Technology Assessment

Prospecting to Production

Mineral activity4 can be divided into successive mineral exploration, development, and

production phases, all accompanied by ongoing analysis of information accumulated during these phases. The full sequence of activity

occurs for only a few projects, as a project will

be shelved or abandoned at any stage if the results are not encouraging or if economic conditions become unfavorable. The full sequence,

subdivided into six stages, is shown in table 5-

2. Although there may be some overlap between stages, they each involve a decision by

mining companies or other investors to expend

time and resources that grow significantly with

each stage. Revenue is not generated until the

activity reaches the production phase.

Exploration involves the identification and

investigation of target areas with the intent to

discover an economic mineral deposit. An

analysis of exploration findings of the mineral

deposit, combined with a determination of the

applicability of mining procedures and capability of ore processing techniques, and marketing studies will determine the initial economic viability of a mineral project. After this

qFor more information on this subject, see U.S. Department

of Agriculture Forest Service, Anatom~’ of a Nfine From Prospect tO ProductJon, General Technical Report INT-35, June 1977;

and U.S. Congress, Office of Technology Assessment, A4anagement of Fuel and Nonfuel Mjnerals in Federal Lands, OTA-M88 (Washington DC: U.S. Government Printing Office, April

1979).
130 ● Strategic Materials: Technologies to Reduce U.S. /report Vulnerability

Table 5-2.—Mineral Activity

Phase ‘- Stage Activity

Exploration

Target identification

1. Regional appraisal

2. Reconnaissance of region

Target investigation

3. Detailed surface investigation

and chemical analysis of

samples

4. Detailed 3-dimensional analysis

of site by drilling, testing of

samples. Project feasibility

studies

Development 5. Drilling to block out deposit.

Construction of mine workings,

ore processing plants, support

facilities

Product ion 6. Operation of mine, ore

processing, and shipment of

material to market

SOURCE: US. Congress, Office of Technology Assessment, Wmagernent ot Fue/

and Nonfue/ Mlnera/s in Federa/ Larrds, (Washington, DC: U.S.

Government Printing Office, April 1979), p. 47.

determination has been made, development

work proceeds to bring a deposit to the point

of production —the actual mining, ore processing, and shipment of material to market.

During target identification (stages 1 and 2),

a large area is surveyed to locate areas of promise. Research is based largely on previously collected industry and government data and geologic theory and is supplemented by field

inspection by air or on the grounds Successful conclusion is marked by a decision, usually

made by the exploration experts, to focus on

particular areas of high potential,

The objective of target investigation (stages

3 and 4) is to locate a deposit of a desired

mineral that has potential for commercial exploitation. This involves the gathering of data

from the region selected during the previous

stages and proceeding with sampling and mapping of geologic features, geophysical surveys

(usually conducted from the air), limited drilling to determine the nature of the layers below the surface, and laboratory analysis of samples obtained in the region. If a promising

‘Remote sensing (exploration by satellite), while it has not yet

located ore deposits, is a tool which provides basic scientific

data which can be coordinated with geologic concepts to assist

in the process.

deposit is found during stage 3, then a decision

is made as to whether the potential of the deposit justifies the expenditure of further funds

for stage 4. If so, a process begins to define the

grade and extent of the deposit and to determine the detailed composition of the minerals

in the deposit. It is at this stage that sufficient

information is obtained to determine whether

the deposit is of commercial value and whether

development activities are advisable. Threedimensional mapping of the deposit, with

drilling samples taken at close intervals, provide detailed maps of the ore and the surrounding rock. This information and analysis of

mineral content of the ore are used to develop

mine plans. Samples are used to test prospective ore processing systems. In addition to providing the information for the design of the

mine and the ore processing plants, feasibility studies during this stage provide the basis

for the final company decision to commit funds

to a mining project and provide investment

groups with the information they need to justify loans for or equity involvement in a project,

Mineral activity then moves into the development stage during which the mine and ore

processing plant are constructed and transportation and other support facilities are installed.

This stage is the greatest expense of the mineral

activity process. Once the final production

stage commences, it continues for as long as

the project can produce on commercial terms.

Should economic conditions change, perhaps

due to depressed market prices or depletion of

high-quality ore, the facilities are closed either

temporarily (“placed on care and maintenance”)

or permanently. In addition, the mining industry is quite accustomed to delaying partially

completed projects when market conditions

change. There can be a considerable time gap

between the end of the exploration and the beginning of the development stages.

This process of mineral activity is long-term,

risky, and expensive. In general, each successive stage is more expensive and takes more

time than prior stages. The costs and time involved vary and are dependent on a number

of factors. For instance, both will increase if

a deposit is buried rather than exposed on the
Ch. 5—Strategic Material Supply ● 131

surface. In 1977, according to an earlier OTA

report,

6 estimates of average U.S. exploration

costs per mineral project ranged from $1.7 million to $5.4 million and took up to 5 years to

complete; mine development costs varied from

millions to several hundred millions of dollars

with times ranging from less than 1 up to 13

years. A 1980 report 7 stated that major international mining projects take at least 7 to 8

years after the time of discovery and often cost

up to $1 billion to reach the production stage.

Once production begins, mining ventures may

need years of continuous operation to show an

adequate return on the capital investment.

Exploration Technology

The geologist’s search for a specific mineral

is aided by knowledge of the environment in

which it is likely to be found. Thus, expected

host rock, trace metal, and gangue8 mineral

associations, wall rock alteration occurrences,

and the age of a mineralization can all be keys

to discovery. Exploration technologies which

help to identify these environments as well as

the mineral itself include three types: visual,

geophysical, and geochemical. Visual methods

are the oldest, simply being the surveying of

an area for geologic formations and features

known to be favorable to the desired minerals,

Such methods are still used in the first stage

of mineral activity in the search for regions

deserving of more detailed study.

Technology has now taken the explorer beyond the powers of eyesight to advanced geophysical methods. Physical properties of mineral formations such as density, magnetic

behavior, electrical conductivity, and radioactivity provide characteristic patterns which can

be used for identification. Some of these measurements are taken on the ground, some “down

hole” and others can be conducted by air. Geochemistry involves trace metal analysis of air,

fiManagement of Fuel and Nonfuel Minerals in Federal Lands,

op. cit.

7The Brandt Commission, North-South.” A Program for Survival (London: Pam Books, 1980), p, 156.

‘Gangue is that part of an ore body which contains the undesirable minerals–i.e., waste material.

water, soil, and rock materials in the region of

mineral exploration.

Mining Technology

The mining method selected for a particular

project will vary according to the size, type,

and position of the deposit; the grade of the ore,

its strength and the strength of the surrounding waste rock; and the unit value of the desired mineral.

There are two general classes of mineral deposit: surface and vein. Vein deposits are

formed by the deposition of minerals by molten rock as it moves upward from deep below

the surface through cracks in the surface rock.

As the molten rock cools, the contained metals

(under the action of pressure and heat) can concentrate in particular locations to form veins

of minerals. Although some vein deposits may

be accessible by removing the surface rock,

generally such deposits must be mined by

underground methods.

Surface deposits are found at or near the surface. Some, known as placer deposits, occur

as concentrations of mineral or metal particles

that have washed away from an exposed deposit to mix with sand and gravel in river beds

or ocean beaches. (Placer deposits have been

an important source of PGMs and gold.) The

metals are recovered by dredging river beds or

beaches and using flowing water and gravity

to separate the heavier precious metals from

the lighter sand and gravel.

Another important class of surface deposit

is formed by the weathering of surface rock

that contains dispersed metals such as nickel

and chromium. Through a continual process

of changing temperatures and rainfall, these

metals are washed to lower levels of the rock

formation where they concentrate in amounts

that are attractive for commercial exploitation.

(Deposits of nickel, known as nickel laterites,

are formed in this way. Such deposits may also

contain concentrations of chromite, the mineral from which chromium is obtained.) Laterite deposits are generally mined from the surface by open pit methods.
132 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Mining processes thus fall into two general

classifications: underground and surface mining. In underground mines a complex system

of shafts are sunk and tunnels bored which

selectively follow the ore veins or pockets of

minerals with highest grade material. Blasting

techniques must be used to remove the ore,

which is often crushed within the mine prior

to hauling above ground, Underground mining methods (called “stoping” by American

miners) are age old and highly varied. They include open stoping (room and pillar, for instance, is a form of open stoping), shrinkage,

cut and fill, and square-set stoping and block

caving. Today, underground mining is becoming increasingly mechanized in order to improve productivity.

Placer and open pits are surface mining techniques, both of which take advantage of large

and efficient earthmoving machinery. In dredging operations, a form of placer mining, the

gravel containing minerals is scooped up by

bucket lines or a dragline onto a floating plant

which separates the gravel into a mineral concentrate and tailings (waste product). In an

open pit mine access to the ore body is accomplished by removal of the waste overburden

(upper layer of earth lacking in economic concentration of metals). The material in the ore

body is then removed, as the pit is formed, top

to bottom by sequentially blasting (in hard rock9

mines) and then mechanically loaded int o

equipment for hauling up out of the pit for

processing, A choice whether to use open pit

or underground mining methods is based, in

part, on the cost of removing the overburden

and whether the waste rock can sustain the

sloping sides of the pit.

Solution mining techniques are now used for

extracting soluble materials such as potash and

salt in situations where conventional mining

methods would not be economic. There are

two general versions. In the first, “heap leaching,” ores are mined and spread on the surface.

9Hard rock refers to material that has a strong bonded structure and must be excavated by using blasting techniques in which

an explosive charge is placed in a hole bored in the rock and

detonated, Most first-tier strategic materials are mined from

hard-rock ore bodies.

A solvent is then applied and the resultant solution of minerals is collected and processed,

The second version — “in situ leaching”- -

involves the introduction of the solvent into the

orebody in place, followed by pumping out of

the resultant mineral solution. The application

of in situ leaching in hard-rock mining requires

an initial fracturing of an ore body before

leaching solvents can effectively produce a solution of the desired minerals to be extracted

from the ground. These techniques for hardrock mining are under active research but have

not yet been attempted on any virgin deposits. They may offer a possible solution to the

problem of the poor economics of low-grade

domestic deposits if they can reduce the overall recovery costs of producing a high-grade

material. Research areas include equipment,

solvents, technologies for fracturing ore bodies in place and for controlling the movements

of fluids through them.

Bioengineering may provide mining with a

technique to recover metals from ores too low

in grade to process conventionally or from existing tailings dumps .

10 Certain bacteria will

liberate and concentrate small grades of metals, and natural bacterial leaching is used currently to recover copper and uranium from sulfide deposits. A major drawback of bacterial

leaching is the slow rate of the process compared with chemical extraction. The hope is

that genetic manipulation can enhance the natural leaching properties of bacteria.

Potential for Change in the Supply

of Strategic Materials

Once a mineral activity moves into the development stage, its details are generally widely

known. Given the time-consuming development process, it is not difficult to project world

ore production (a total of existing and developing new sources) at least a decade into the

future. Even beyond 10 years, potential new

IOSee U.S. Congress, Office of Technology Assessment, Commercial Biotechnology: An International Analysis, OTA-B-218

(Washington DC: U.S. Government Printing Office, January

1984), pp. 226-228; Joann Dennett, “Microbe Miners, ” AMA4

Magazine, July 2, 1984; and Joseph Alper, “Bioengineers Are

Off to the Mines, ” High Technology, April 1984.
-—

Ch. 5—Strategic Material Supply ● 133

sources can be readily identified because there

are only a limited number of known deposits,

undergoing investigation, that could be opened

or expanded to capture a share of the ore market. Discoveries of major, new deposits are possible but unpredictable. Thus, projections of

production beyond about 20 years become unreliable.

Any change in the existing mine production

of strategic materials will be determined by

market demand and by the efforts of mineral

producer governments to provide employment

for their citizens, obtain foreign currency, and

promote industrial development. Extraordinary conditions, such as a prolonged supply

disruption of a substantial portion of any one

mineral, could also encourage increase d

production from existing or the development

of new sources of supply.

Table 5-3 presents a summary of the supply

prospects of the first-tier strategic materials,

a picture of the geographic distribution of the

United States’ major sources of the first-tier

strategic materials along with the relative

present and estimated future contribution of

the producers. (The ranking system is based on

the magnitude of each producer’s output combined with the extent of its participation in

Western trade.) The table also identifies the major barriers to expansion of production and initiation of new sources of supply.

constraints include limited knowledge about

the extent of the resource base; the equipment

and skilled labor needs to mine, process, and

refine the ores; and the limits of support systems such as energy sources and transportation facilities. Direct economic constraints include the need for massive capital to finance

development work and uncertainty about future markets. Political risk (contractual instability, threat of nationalization without compensation, uncertainty over guarantees o f

sufficient mine life to attain expected rate of

return) is a component of the economic analysis of any mining project located in a developing country.

Available mine capacity for chromium, cobalt, manganese, and PGMs has been highly

underused in the early 1980s, the effect of several years of worldwide economic recession.

While the fortunes of the mining industry have

historically been cyclical, the recent sustained

oversupply and low prices have adversely affected new investment in these commodities.

Although some new mining ventures for these

materials are being evaluated, few are going

forward. It is expected that any increase in demand in the near future will be supplied by current mines operating at capacity and the reopening of recently shut mines.

Even under healthy market conditions, the

ample reserves and resources of the South African mines for chromite, manganese, and PGMs

and of the Zairian/Zambian mines for cobalt

serve as impediments to investment in the development of new mining areas. All new ventures must compete for markets against the

strength of the existing producers and their

ability to increase production easily to meet

any new market demands.

The immediate response capability of existing producers to a supply disruption depends

on the status of mining at the time and the corresponding extent of development needed. For

instance, during such periods as the early

1980s, when mining operations generally were

operating at as little as 50 percent of capacity,

an expansion to full capacity could be simply

a matter of hiring personnel for more shifts in

a mine or for reopening mines. This could be

done in a matter of weeks, or at most, in a few

months. On the other hand, a mine already

operating at full or close-to-full capacity during a tight market would require substantially

more time to expand production, even though

the plans for expansion would be available.

Any producing mine is continually upgrading

its reserves and blocking out future production

areas to open, given a change in market conditions. In an underground mine, however,

new shafts might have to be prepared by extensive blasting and boring, a time-consuming

process. An open-pit mining operation with

simple ore concentrating equipment can increase output much more rapidly by adding

blasting and hauling equipment. Ultimately,

however, limitations could be imposed by avail-
134 • Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table 5-3.—First-Tier Strategic Materials Supply Prospects

Country Importance bPrimary constraints to

Regions Minerals producers Now Potential increased availabilityc

North America. . . . . . Chromium

Cobalt

Manganese

PGM

South America . . . . . Chromium

Cobalt

Manganese

PGM

Australia and

Oceania . . . . . . . . . Chromium

Cobalt

Manganese

PGM

Eurasia . . . . . . . . . . . . Chromium

Africa . . . . . . . . . . .

Eastern Bloc . . . . .

Cobalt

Manganese

PGM

Chromium

Cobalt

Manganese

PGM

Chromium

Cobalt

Manganese

PGM

NA

CANADA

United States

MEXICO

CANADA

United States

NA

Peru

BRAZIL

NA

PHILIPPINES

Pacific rim

PHILIPPINES

AUSTRALIA

New Caledonia

Papua New Guinea

AUSTRALIA

Pacific rim

FINLAND

ALBANIA

GREECE

TURKEY

INDIA

FINLAND

INDIA

NA

SOUTH AFRICA

ZIMBABWE

MADAGASCAR

ZAIRE

ZAMBIA

Morocco

BOTSWANA

SOUTH AFRICA

GABON

SOUTH AFRICA

SOVIET UNION

SOVIET UNION

CUBA

SOVIET UNION

SOVIET UNION

2

—

3

3—

—

2

2

—

2

2

—

—

2—

3

2

3

3

3

2-3

3

1

2

3

1

1—

3

1

2

1

2

3

3

3

1

nickel demand, refinery limits

high cost deposits, demand for various

primary metals

customer acceptance of quality

nickel/copper demand, refinery limits

demand for PGMs, competition

processing facilities

local demand

infrastructure

proof of feasibility

demand for nickel

demand for nickel

demand for nickel

demand for cobalt/chromium

hauling equipment

proof of feasibility

possible resource limits

unknown

resource limits

improved knowledge of resources and

technology

resource limits, infrastructure, local

demand

possible resource limits

resource limits, infrastructure, local

demand

transportation

transportation

seasonal operation, infrastructure

processing, refinery limits

processing, refinery limits

resource evaluation

transportation

transportation

transportation

refinery limits

unknown

unknown

unknown

unknown

unknown

NA—Not applicable.

aUppERCASE indicates a current producer.

bKey: 1 = major

2= medium

3 = minor

7 = unkno~

Based on assessment of relatlve production levels and contributions to Western trade.

CAny expansion/d@elopment would require capital investment, to a varying degree, in mining, Processing, and refinin9 infrastructure.

SOURCE: Office of Technology Assessment, 19S4.
Ch. 5—Strategic Material Supply ● 135

able processing facilities, such as smelting and

refining operations ,

Processing of Strategic Materials

Once removed from the ground, all ores

undergo some level of processing. Technologies chosen will be based on the extent of

processing required due to the condition of the

ore (e.g., the amount of upgrading necessary

to produce a salable product and the level of

difficulty involved in separating out the unwanted minerals) and the intended end use of

the mineral.

At the mine site, preliminary processing will

take place in order to separate the desired

minerals from the unwanted rock (gangue) that

accompanies them, thereby, increasing the

grade and value of the sought-after mineral.

These “beneficiation” techniques to produce

“ore concentrates” include simple hand-sorting, mechanical crushing, and gravity concentration methods, A more sophisticated and

widely used method is flotation. Crushed ore

is passed through vats of water containing reagents which make one or more of the ore

minerals water repellent. These particles attach

to air bubbles and float to the top of the vats

where they can be selectively removed.

Even after the minerals are concentrated, further processing steps are required to alter their

form. Manganese carbonate minerals, for instance, must be heated to convert them into

manganese oxides . Manganese oxides and

chromite (chromium ores) are smelted into ferroalloys .

11 Cobalt and PGMs, once in metal

form, must be highly purified before they are

useful for certain applications. Finally, metal

alloys such as stainless steels and superalloy

are manufactured from ferroalloys or relatively

pure metals and used in applications such as

hubcaps and jet engines .

1 2

I I Ferroa]]oys, a]]oys of iron, contain a sufficient amount of one

or more other chemical elements (in this case, chromium or manganese metal] to be used as an agent for introducing these elements into molten metal, usually steel. Ferroalloys are produced

by smelting ores in electric arc furnaces. See the chromium and

manganese sections that follow for more discussion on processing.

IZFor a discussion of metal processing, such as steelmaking,

see U.S. Congress, Office of Technology Assessment, Technology and Steel Industry Competitiveness, OTA-M-12Z (Washington, DC: U.S. Government Printing Office, June 1980).

This multistep processing of ores into useful forms of metals takes a variety of paths; the

appropriate choice depends on the nature of

the ore and the type of product desired. Processing facilities are often tailored to a particular ore body or type, production rate, and metal

production. Other than the initial beneficiation

steps, processing does not necessarily take

place at the mine site. However, there is an increasing tendency to combine mine production

and downstream processing of minerals. This

tendency and the consequences to U.S. import

vulnerability is discussed more fully below and

in the appropriate mineral sections which

follow.

Processing Technology

Extractive metallurgy involves the recovery

of metals and metal compounds from ores and

mineral concentrates. Either a pyrometallurgical or hydrometallurgical method is used, followed in some cases by an electrolytic refining process .

In pyrometallurgy, heat is used to melt the

concentrate and, in some cases, to promote a

chemical reaction that will change the ore

mineral into an alternate chemical compound.

Metals are separated out in gaseous form, collected as they rise from the “melt” or in their

liquid state, by differences in densities. Smelting—the technique used to produce ferroalloys—is a pyrometallurgical process.

Hydrometallurgy is chemical processing i n

which metals are selectively leached (dissolved)

from ores and concentrates. The variety of

minerals to be separated determines whether

an acid or alkaline solvent is applied. Hydrometallurgical processes are increasingly selected over pyrometallurgical processes because they use considerably less energy and

produce less air pollution.

In an electrolytic process, a metal is “won”

(separated out) from a solution and deposited

on a cathode (the negative side of an electrical flow) in a relatively pure form.

No technology ever completely recovers all

the desired metal contained in the ores in

which they are found. Recovery rates (the

amount of contained metal that is liberated)
136 • Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

can range from about 25 to 95 percent and depend on both the physical limits of the processing methodology and value attached to each

specific metal in an ore body.

Production and Processing of the

First-Tier Materials

The United States is not a producer of chromium, cobalt, manganese, or PGM13 ores, although this has not always been the case. At

some stage, however, domestic plants still enter the processing chain of such ores.

The worldwide chromium industry is characterized by a large number and variety—big

and small, public and private sector—of ore

producer firms. Chromite deposits also vary

widely in size and are mined by underground

and surface methods and concentration methods range all the way from simple manual sorting to flotation systems.

Manganese deposits are fewer in number

and the producing industry is more concentrated than that for chromium. The deposits are

generally abundant and can be relatively easily

expanded in bulk terms. Often their expansion

capabilities are restricted by equipment and

transportation systems, rather than the size of

their reserves. The majority of the world’s producing manganese deposits are oxide, rather

than carbonate minerals, and are mostly mined

by surface methods. Oxide ores need only to

be concentrated; while carbonate ores must be

reacted with oxygen to form manganese oxide

compounds prior to the ferroalloy stage of

processing.

Most of the chromium and manganese mined

is consumed by the steel industry. Manganese

is a processing agent, and both are used as

alloying agents. Producers of these ores have

traditionally engaged in the initial processing

of the ores they mine—sorting and concentrating them by grades of mineral, chemical content, and physical condition—and leaving the

downstream processing to the steel industry.

Iacurrent domestic production of PGMs evolves from the refining of copper ores.

World trade in both chromium and manganese,

however, has been shifting in the past decade

from concentrated ores to ferroalloys.

The growing ferroalloy production capacity

of ore producers (and the steel industries of developing nations) competes with rather than

supplements traditional ferroalloy plants in the

United States, Western Europe, and Japan. Important factors identified as contributing to this

shift are lower labor and energy production

costs and lower transportation costs for higher

metal content ferroalloys. It is not clear whether

the competitive edge of new producers offerroalloys is due to free market economics or

whether government subsidies have promoted

economically unsound competitors, In any

case, as ore producer countries receive the benefits of exporting a higher value product, the

shift in production away from the industrialized West is forcing adjustments (due to

unemployment from plant closings, and reduced availability of capital for modernization

which further diminishes competitiveness) and

resulting in a reduction in U.S. ferroalloy

production capability.

It is not clear whether trend toward the importation of higher processed material increases

the import vulnerability of the United States.

At the same time this processing shift is occurring, Western Europe and the United States are

importing increasing amounts of final steel

products from ore producer nations and others,

and their needs for raw and semiprocessed

forms of chromium and manganese are decreasing. It is true that, as integration increases

in ore-producing countries, system dependencies increase—i.e., concern now must include

not only the assurance that a foreign mine will

continue to produce and concentrate ores, but

also maintain the operation of a smelting plant,

Lack of adequate domestic ferroalloy processing capacity could complicate and add considerably to the costs involved in efforts to cope

with any emergency ore supply disruption and

would probably increase the response time to

an emergency, On the other hand, the higher

value of processed ores means that an overt act

of a supply interruption becomes more costly

to producers and a growing number of proc-
.

Ch. 5—Strategic Material Supply Ž 137

essors and might affect such an event’s likelihood, In addition, processed ores contain

higher amounts of metal per unit volume than

ore concentrates and therefore larger amounts

can be transported at a time. It is economically

feasible to airship refined cobalt and PGMs and

avoid supply disruptions caused by surface

transport interdictions. Ferroalloys, like ore

concentrates, are still confined to ocean shipment due to their weight and volume.

Cobalt is only a secondary product of any

current mining operation, therefore, its supply

is tied to the demand for the nickel and copper with which it usually occurs. The ore

producers control a substantial amount, but not

all, of the downstream processing of cobalt,

PGMs are primary products, coproducts, or byproducts; and the industry is highly concentrated and is expected to remain so. Almost the

entire downstream processing of PGM ores is

controlled by the ore producers, As cobalt and

PGMs often occur in the same ore bodies, their

processing paths are often the same.

Cobalt and PGMs are consumed in metal or

chemical form. The ores for both materials usually contain a variety of metals in either oxide

or sulfide forms, and their processing paths are

complex and tailored to the mineral content of

the individual mines, The United States has always had a limited ability to process cobalt and

PGM ores, relying instead on importing these

materials in their usable forms. (An increasing

interest in recycling catalytic converters, however, is promoting the development of domestic refining capacity for platinum that may be

usable for virgin PGM ores. ) Europe, the first

consumer of these metals, was also the home

of companies that controlled most mining operations during the colonial era; semiprocessed

forms of the ore were physically transferred

from the ore-producing countries to northern

Europe for the final refining processes. This

flow still occurs, but mining countries are gradually developing refining capability. This new

capacity does not yet appear to be replacing

the existing refining capacity, but is absorbing

growth in demand, Meanwhile, more diversified sources of refined cobalt and PGM products are being created and the overall time required to process the ores and produce the

metal forms is being shortened.

Chromium Production and Processing

The chromite industry is concentrated in the

Eastern Hemisphere and includes a large number and variety of firms–big and small, public and private sector. These producers are now

shifting from simply mining and trading chromium ore to producing and trading ferrochromium as well.

The only mineral form of chromium ore is

chromite. Most of the chromite resources of the

world occur in stratiform deposits—layered,

long continuous seams that are often visible on

the surface. Podiforms are the second major

geologic deposit type for chromite. They are

small in comparison with stratiform deposits

and are discrete, lens-shaped, and usually undetectable without the use of sophisticated exploration tools unless a portion of the deposit

happens to appear on the surface. Lesser deposits of chromite are found in laterite formations and alluvial (placer) deposits. Laterites are

principally found in tropic or warm temperate zones and are not exploited today as a

source of chromite due to general low grades

of contained chromite and its granular form.

Any analysis of chromium production is

complicated by the multiplicity of ways in

which the commodity is reported: chromite,

chromite concentrates, contained chromic oxide or chromium, recovered chromic oxide or

chromium, etc. Chromite is primarily iron,

chromium and aluminum oxides with varying

amounts of silica and magnesium.14 Chromite

ore is usually defined in terms of its chromic

14Natu ra]]}. occu rrj ng ch rorn ite is a combination of m inera]s

described bj the chemical formula (Fe, Mg)Os(Cr,Al, Fe), O,.
138 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

oxide (Cr2O3) content (rarely more than 50 percent), as well as its chromium-to-iron ratio and

aluminum oxide content. Once mined, chromite is usually concentrated to increase its

chromic oxide (or, chromium) content. These

“chromite concentrates” are sold, in part, on

the basis of their chromic oxide content. The

chromium content of chromic oxide is 68 percent by weight, and the Bureau of Mines defines its chromite data as 22 to 38 percent contained chromium.15 Throughout the following

discussion, an attempt has been made–wherever possible—to convert data into chromium

units so that comparisons can easily be made

by the reader. In addition, the reader should

note that the chromium contained in chromite

ores and concentrates (“chromium content”)

is greater than that which will ever be extracted

from the ores by any metallurgical process.

Thus, “recovered chromium” is the true estimate of the amount that would be available for

use.

Each chromite mine differs in the type of

product it offers: the ore grade and its chemical composition and physical characteristics.

Historically, the ores have been classified into

three groups, reflecting primary end uses:

“metallurgical” (minimum 46 percent chromic

oxide with a chromium-to-iron ratio greater

than 2:1), “chemical” (40 to 46 percent chromic

oxide and chromium-to-iron ratio of 1.5:1), and

“refractory” (high aluminum content). Other

considerations affecting end use feasibility of

various ores are their other chemical characteristics (e.g., silica content) and physical characteristics (e.g., size and condition). South African ores are of both refractory and chemical

grades, and tend to be friable (i.e., breakup easily). The Philippine deposits are principally

refractory grade, but its ores are used for other

applications by blending. Turkey’s and Zimbabwe’s deposits primarily provide metallurgical ores.

The distinction between chemical and metallurgical grades has become less important due

to the adoption of the argon-oxygen-decarburilsu.s. Department of the Interior, Bureau of Mines, hfinerd

Commodity Summaries, 1984.

zation (AOD) process for producing stainless

steel. This process allows the use of highcarbon ferrochromium (made from chemical

ores) rather than low-carbon ferrochromium

(from metallurgical ores) and has boosted the

importance of the South African deposits at the

expense of higher priced metallurgical ores

from Zimbabwe and Turkey.

Foreign sources supply all of the U.S. requirements for chromite (there has been no domestic mine production since 1961) and supply an increasing share of its ferrochromium

needs at the expense of the domestic ferroalloy

industry. In 1971 the United States obtained

87 percent of its chromium imports in the form

of chromite and 12 percent in the form of ferrochromium; by 1981, the imports were roughly

equal. 16 Because no Western Hemisphere ore

producer supplies chromite or ferrochromium

in substantial quantities to the United States,

most imports must transit the Atlantic or Pacific Oceans.

While 19 countries contributed to the production of chromite in 1982, almost 75 percent of

the world’s total was provided by South Africa,

Zimbabwe, the Soviet Union, and Albania.

Table 5-4 lists 12 major producers and their reserves and production for 1982. South Africa

is the principal source of ore for the United

States, Western Europe, and Japan. Other major suppliers to the United States are the Soviet Union, the Philippines, and Albania. Turkish and Greek ores are shipped primarily to

Western Europe. France is Madagascar’s major customer. Brazil, the only substantial Western Hemisphere producer, exports mainly to

Japan.

The Soviet Union long played a significant

role as chromite supplier to the world. In the

mid-1970s, however, its exports to areas outside the Eastern bloc began to decline, until by

1982 they were a fraction of those a decade

earlier. Decreasing reserves, increased costs of

production, and political control over export

policies are the major reasons that have been

suggested for this change.

leu.s, Department of the Interior, Bureau of Mines; iVfineral

Commodity Profiles 1983: Chromium, p. 4.
Ch. 5—Strategic Material Supply ● 139

Table 5-4.—World Chromite Reserves and Production by Country

(thousand short tons, gross weight)a

Producer countries currently export between

35 and 100 percent of their chromite as ores

with ferrochromium production taking an increasing share for consumption by local steel

industries, as well as export. From South

Africa, exports of chromite ore, as opposed to

ferroalloys, were 76 percent of production in

1969 and only 35 percent in 1980. South Africa

is now the major supplier of ferrochromium

to the free world market and provided 49 percent of U.S. imports in 1982. Of the ore producers listed in table 5-4, only Madagascar and

New Caledonia have not yet developed ferrochromium production capability. The majority

of Zimbabwe’s ores are now converted to ferrochromium before export to the United States,

Europe, and Japan. In 1982, Yugoslavia—which

must import most of its chromite feed—supplied 11 percent of the United States’ ferrochromium imports, placing it a distant second to

South Africa. Soviet exports of ferrochromium

products, like those of ores, are primarily to

the Soviet bloc countries.

Extending this vertical integration trend, several South African firms and one Finnish firm

now mine ores, process ferrochromium, and

produce stainless steel. Greece’s recent ore expansion and ferrochromium plant development is aimed at achieving a similar vertically

integrated industry, Table 5-5 shows how the

ferrochromium industry has shifted over 6

years between 1974 and 1980. For the most

part, the traditional centers of ferroalloy

production in the industrialized West have declined

shares

in total output and have lost market

to vertically integrated ore producers,

Foreign Production of Chromium

In market economy countries, as shown in

table 5-6, chromite production is spread among

many private and some public sector firms.

Central economy countries (the Soviet Union,

Albania, and Madagascar) operate their mines

and market production through a central agency.

In South Africa, Turkey, and Zimbabwe there

is considerable multinational firm involvement. South Africa’s ore is produced by 10

companies, operating some 20 mines along

parallel seams in the Bushveld Complex, The

combined production of Transvaal Mining,

Transvaal Consolidated, and Samancor dominates South African output, and the majority

interest in these firms is held by four of the six

local investment houses (“groups”). U.S. firms

engaged in South African chromite mining are

Union Carbide, Metallurg, and International

Mineral & Chemical. Great Britain is represented in South Africa by investors with longterm interests in the group houses, while West

Germany’s Bayer Group owns and operates

one mine. Eighty percent of Zimbabwe’s out-
140 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table 5-5.—Ferrochromium Production by Country (thousand tonnes, gross weight)

Percent Percent Percent change

Country a

1974 of total 1980 of total 1974-80

BRAZIL ... , . . . . . . . . . . 38.1 2.0 93.4 3.2 145

FINLAND . . . . . . . . . . . . . 48.1 2.6 49.9 1.7 4

France . . . . . . . . . . . . . . . 111.6 6.0 86.2 2.9 –23

INDIA . . . . . . . . . . . . . . . . 15.5 0.8 16.3 0.6 5

Italy . . . . . . . . . . . . . . . . . 39.9 2.1 40.8 1.4 2

JAPAN . . . . . . . . . . . . . . . 541.6 29.1 427.3 14.4 –21

Norway. . . . . . . . . . . . . . . 30.8 1.7 11.8 0.4 –62

SOUTH AFRICA . . . . . . . 193.2 10.4 565.2 19.1 193

Spain . . . . . . . . . . . . . . . . 20.9 1.1 19.1 0.6 – 9

Sweden . . . . . . . . . . . . . . 100.7 5.4 188.7 6.4 87

United States . . . . . . . . . 305.7 16.4 216.8 7.3 –29

SOVIET UNION . . . . . . . . 184.1 9.9 698.5 23.6 279

YUGOSLAVIA ., . . . . . . . 39.0 2.1 64.4 2.2 65

ZIMBABWE ... , . . . . . . . 181.4 9.7 199.6 6.7 10

Other b . . . . . . . . . . . . . . . 12.0 0.6 282.2 9.5 2,252

Total . . . . . . . . . . . . . . . 1,862.5 100.0 2,960.2 100.0 59

aupper case indicates country was ore producer in both years, but did not necessarily cover its needs.

bin 198cI: ALBANIA, Czechoslovakia, East Germany, West Germany, PHILIPPINES, Poland, and TURKEY.

SOURCE Charles River Associates Processing Capacity for Critmal A4akvials, OTA contract report January 1984

Table 5-6.—Chromite Mining Industry by Country

Ownership

Primary national

Country Major firms Sector Major holdersa

identity

Brazil . . . . . . . . . . .

Finland . . . . . . . . .

Greece . . . . . . . . .

India . . . . . . . . . . .

Madagascar . . . . .

New Caledonia . .

Philippines . . . . . .

South Africad 

. . . .

Turkey . . . . . . . . . .

Zimbabwe . . . . . . .

Cia. de Ferro-Ligas da Bahia S.A.

(Ferbasa)

Outokumpu Oy

Hellenic Ferroalloys S.A.

Various

Kraoma

Societe de la Tiebaghi

Acoje Mining Co.

Consolidated Mines Inc.b

Trident Mining & Industry Corp.

Phil chrome

Transvaal Mining and Finance

Transvaal Consolidated Land and

Exploration

UCAR Chrome Co.

Cromore Ltd. & Bathlako Mining

Ltd.

Waterkloof Chrome Mines

Chrome Chemical S.A.

Lavino S. A., Ltd.

Etibank

Egemetal Madencilik A.S.

Turk Maadin Sirketi

Zimbabwe Mining & Smelting

Private

Government

Private

Private and

government

Private and

government

Government

Private

Private

Private

Private

Private

Private

Private

Private

Private

Private

Private

Private

Government

Private

Private

Private

Various

(81)

(balance)

Hellenic Industrial Mining &

Investment (HIMIC) (96)

(loo)

Inco (55)

Various

c

Kawasaki (15)

Gencor (100)

Barlow Rand

Union Carbide

Samancor e (100)

Metallurg

Bayer Group

International Minerals &

Chemical Corp. (100)

(loo)

Metallgesellschaft

Metallurg

Union Carbide (100)

Local

Local

Local

Local

Local

Local

Canada/U.S.

French

Local

Local

Local

Japan

Local

Local

U s .

Local

Us .

W. Germany

U s .

Local

W. Germany

Us .

., U s .

awith approximate percentage of control, if available.

boperated by Benquet Corp. (local Philimdne flrrn).

CA u,s firm invested in Trident’s OperatiOn in lg~.

d T here are six finance houses (the ,GrOUps”) which dominate the south African industry: The Arrglo Arnerlcarl Corp. of S,A. Ltd. (AngioAmer), Gold Fields of S,A Ltd.,

General Mining Union Corp. Ltd. (Gencor); Rand Mines/Barlow Rand; Johannesburg Consolidated Investment Co. Ltd (JCI); and Anglo-Transvaal Consolidated Investment

Co. Ltd. (AngloTC).

esamancor is owned by Gencor, Anglo American, and Iscor, which iS a state-owned, integrated steel cOrPOratiCJn.

SOURCES” E&MJ 1983 International Wectory of Mining; Bureau of Mines, Mineral Commodity Profile 198.3: Chromium; Office of Technology Assessment
Ch. 5—Strategic Material Supply ● 141

put is generated from two mines east of the

Great Dyke deposit by a firm owned by Union

Carbide. Albania’s government operates more

than a dozen mines located in four areas along

its eastern border with Greece and Yugoslavia.

Among the middle-level producers, Turkey

has three major firms with eight mines, along

with numerous smaller (many one-person)

operations. Half of Turkey’s output, however,

comes from mines operated by a state-owned

firm. U.S. (Metallurg) and West German (Metallgesellschaft) firms are involved in the other

two important Turkish ventures. There are 125

chromite deposits scattered among the islands

of the Philippines, but only 12 mines were operating in 1980. The majority of these are locally

owned and operated; two are considered major producers. (Japan’s Kawasaki Steel has a minority interest in a recently initiated beach

sand operation on Palawan Island in the Philippines. An American firm operates the mine for

Kawasaki.) Madagascar’s government firm has

two open pit mines, one of which is a primitive

operation accessible only in the dry season.

Finland’s government-controlled firm produces

from a mine along a stratiform deposit. Greece

has one major, primarily government-owned

operation. Three of India’s four firms are private and locally owned; the fourth is a state

government firm. Canada’s Inco has a controlling interest in New Caledonia’s new chromite

mining firm, Societe de la Tiebaghi.

In the past 20 years, there have been shifts

in the relative output among chromite producer

countries, as shown in table 5-7. Overall, the

group of 12 major producers has steadily increased its share of the world market. By 1980

it was providing 98 percent of the world’s total production of chromite, up from 90 percent

in 1960. During this period, two new producers

(Finland and Madagascar) appeared; they now

hold 5 percent of the world market. While

Albania, Brazil, South Africa, and the Soviet

Union have increased their production shares,

the shares of the Philippines, Turkey, and Zimbabwe have decreased. The shift from Turkey

and Zimbabwe to South Africa is due to the advent of the AOD process and to the accompanying development and aggressive sales by

South African firms of “charge chrome, ” a

form of high-carbon ferrochromium particularly suited to South African ores.17

The major producer and exporting countries

are likely to maintain their current positions

in world production for the near future and can

be expected to continue reducing the export

of ores in favor of ferroalloys. The integration

of ore mining with ferroalloy production and

the accompanying decline of independent ferroalloy producers may force the remaining

nonintegrated ore producers, witnessing shrink1 TSee tab]e 5.13 for a compa risen of various ferroc hrom iu m

products.

Table 5-7 .—Historical Production—Chromite, 1960-80, by Country

(thousand short tons, gross weight, percent of world total)

1960 1965 1970 1975 1980

Producer country Tons Percent Tons Percent Tons Percent Tons Percent Tons Percent

Albania. . . . . . . . . . . . . . . 319 7 342 6 516 8 859 9 1,190 10

Brazil . . . . . . . . . . . . . . . . 6 <1 19 <1 30 <1 191 2 919 7

Finland. . . . . . . . . . . . . . . 0 0 0 0 133 2 365 4 376 3

Greece . . . . . . . . . . . . . . . 38 1 56 1 29 <1 39 <1 47

India . . . . . . . . . . . . . . . . .

<1

110 2 66 1 299 4 551 6 354 3

Madagascar. . . . . . . . . . . 0 0 3 <1 144 2 214 2 198 2

New Caledonia . . . . . . . . 43 1 0 0 0 0 2 <1 2 <1

Philippines . . . . . . . . . . . 810 17 611 12 624 9 573 6 547 4

South Africa . . . . . . . . . . 851 17 1,038 20 1,573 24 2,288 25 3,763 30

Turkey . . . . . . . . . . . . . . . 531 11 625 12 572 9 790 9 431 3

Soviet Union , . . . . . . . . . 1,010 21 1,565 30 1,930 29 2,290 25 3,748 30

Zimbabwe . . . . . . . . . . . . 668 14 646 12 400 6 650 7 608 5

Subtotal . . . . . . . . . . . . 4,386 90 4,971 94 6,250 93 8,812 96 12,183 98

Other . . . . . . . . . . . . . . . . 499 10 330 6 422 6 3,324 4 203 2

Total . . . . . . . . . . . . . 4,885 100 5,301 100 6,672 100 9,136 100 12,386 100

SOURCE U S Department of the Interior, Bureau of Mines, kfirterals Yearbooks 1964, 1968, 1972, 1977, and 1982
142 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

ing markets, to integrate. Turkey, India, Greece,

Albania, and Madagascar, among other countries, are currently expanding or planning to

expand or introduce ferrochromium capacity.

While some construction has been held up by

weak worldwide demand for ferroalloys, expansion will probably resume as the steel industry recovers from the early 1980s recession

period. Given chromium’s primary use in steelmaking, certain producer countries with growing domestic and export-oriented steel industries—e.g., India and Brazil—may reduce their

participation in both ore and ferroalloy export

markets.

The 1981-82 worldwide recession caused

low-capacity usage in chromite mines (see table

5-8) and ferroalloy plants, and low world

prices. These market conditions and the competitive strength of the South African producers inhibit the pursuit and development of

new sources of chromite ore. In addition, the

only known, nonproducing deposits of chromite are considered marginally economic even

under more favorable market conditions due

to low grades and/or smallness of overall deposit.

In 1982 one new chromite source entered the

world market when a firm resumed production

at a previously abandoned area in New Caledonia. A project in Papua New Guinea has

been fully explored and evaluated by an international mining firm but is not considered economically viable and will not be developed in

the near future. Together, these new producers,

while diversifying the world’s sources of chromium, will add only about 5 percent, at maximum output, to the world’s total production.

More important, perhaps, is that new sources

of chromite will be unconventional unless new

stratiform or podiform deposits are discovered.

The Papua New Guinea project, for instance,

may undertake mining from a sand and laterite

deposit.

In the long term, two developments could

alter the current pattern of chromite production. Almost 90 percent of the world’s known

reserves of chromium are contained in stratiform, as opposed to podiform, deposits. This

is explained in part by the fact that stratiform

chromite deposits are continuous over large

areas, making estimation of reserves relatively

easy and the exploration costs to prove large

tonnages of reserves small compared to those

for podiform deposits. Scattered, discontinuous podiform deposits, on the other hand, are

difficult and therefore expensive to locate, even

using the most sophisticated geophysical exploration techniques.18 This implies that areas

lau.s. International Development Cooperation Agency, Trade

and Development Program, The Chrmnite Project Definition

Mission of the Philippines, February 1983; Charles J. Johnson and

Jean A. Brady, Chromite Potential of the Southwest Pacific, a

summary of research in progress at the Resource Systems Institute of the East-West Center, Honolulu, Hawaii. August 1982,

p, 13.
Ch. 5—Strategic Material Supply ● 143

of podiform deposit concentration—e.g., in

Turkey, Albania, and the Philippines—that

have not been systematically surveyed are potential locations for increased reserves. Location of these podiform deposits could benefit

from developments in the use of geochemistry

as a prospecting tool and an infusion of funding to finance exploration efforts.

The other possible development is exploitation of two deposit types found in the southwest Pacific Basin area—the Philippines, Indonesia, New Caledonia, New Guinea; that is,

nickel laterite deposits overlain by low-grade

chromite, and alluvial deposits of chromite

sands in shallow offshore areas. No laterites

have yet been exploited for chromite, and only

one beach sand operation has been opened (in

the Philippines). The mining and extraction of

chromium from either type of deposit is prevented not by a lack of technology, but by economics. An American mining company studied the possibility of joining in the Philippine

beach sand operation and decided that the economics, based on South African competition,

did not warrant the investment. The U.S. Bureau of Mines has conducted successful research

up to the pilot plant stage on processing laterites ores (from U.S. sources) and concluded

that existing technologies, with adjustments for

the different minerals encountered in foreign

ores, could be applied. Analyses at the EastWest Center concluded19 that economic mining of some known laterite resources would require a chromite concentrate price of $100 to

$150 per tonne, f.o.b.20 (The 1984 price for

South African 44 percent chromic oxide chromite ore was $40 to $55 per ton, f.o.b., or $44

to $60 per tonne.)21 Ongoing work by the U.S.

Geological Survey on PGMs contained in laterites (see the PGM section) offer a possibility of

changing the economics of laterite deposits if

PGMs could be mined as a primary or coproduct.

While expansion of chromite production

awaits increased steel industry production,

~gchar]es J. Johnson, personal communication, August 1983.

zOFree on board, means price at embarkation—i. e., without

transportation charges,

2]’’AMM Closing Prices, ” American Metal Market, June 21,

1984.

many ore producers have announced plans to

add ferrochromium capacity. In some countries, such as Zimbabwe, this would require additional ore production, but in many it could

simply mean a greater diversion of ore production from exports into ferroalloy production.

Some of the constraints to increased production, such as lack of energy sources and transportation facilities, are given below in brief

country-by-country reviews.

Albania

Chromite is one of Albania’s chief export

commodities and most important sources of

foreign exchange.” Since 1976, Albania’s production has been steadily increasing. The nation now ranks as the world’s third largest producer. The last completed 5-year plan period

(1976-80) called for an output of 1.25 million

tonnes (1.14 tons) by 1980, a goal that was not

quite met. The 1981-85 plan calls for a 9.7-

percent annual increase in chromite output.

Albania has one ferrochromium plant in operation, with total estimated capacity of 30,000

tons per year.

Albania’s chromite trade patterns have shifted

over the past 30 years. Its production once

served as a supplemental source for Eastern

European nations that relied primarily on exports from the Soviet Union. China bought half

of Albania’s output from the mid-1950s to 1978,

when relations were broken due to ideological

conflicts. Since then, an increasingly large portion of Albania’s exports have gone to Western countries, Recently, relations with China

have improved, and renewed ties could bring

resumed chromite trade. Yugoslavia has been

an important buyer of Albanian ores for conversion into ferroalloys for the world market.

While Albanian ore reserves and resources

are not known with great certainty, current

estimates are considered too low to support

current and planned production levels. The

possibility of finding new deposits is likely because large areas have yet to be explored for

ZZU. S. Department of the Interior, Bureau of Mines, Minerals

Yearbook, 1981, VO]. 111, p. 42.
144 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

the discontinuous, podiform deposits common

to Albania.

Brazil

Due to the volume of unexplored area in Brazil, the potential exists for improved chromite

reserves but the uncertainty factor is high. Ferbasa is Brazil’s major producer of ore and its

sole producer of ferrochromium. Brazil exports

more of its chromium as ferrochromium than

as ore. Most has been destined for Japan, which

assisted Ferbasa in the development of its ferrochromium facilities, In 1972 a Japanese consortium formed a joint venture (Mineracao

Serra de Jacabina S. A.) with Ferbasa to mine

another deposit, in the state of Bahia. The mine

was opened in 1976 and was Japan’s first captive overseas chromite mine. Heavy losses

forced the Japanese to sell their 48-percent interest to Ferbasa in 1980.

Finland

Finland’s sole producer of chromite, Outokumpu Oy, is a highly integrated firm that

mines, explores, trades, smelts, and refines a

variety of minerals and produces both ferrochromium and stainless steel. In addition, it is

involved worldwide in the development and

sale of mineral industry technology. Currently,

all of Outokumpu’s chromite production comes

from its Kemi deposit, located in northwestern

Finland near the Gulf of Bothnia. Another deposit is being developed for future production

and would allow, under the proper economic

conditions, a 25-percent increase in Finland’s

output. A constraint on expansion is the need

to import energy resources—mainly petroleum.

Shipping during the winter months is often

hampered by frost and ice conditions.

Greece

An expansion in chromite mining and in development of a ferrochromium industry has

been underway in Greece since 1976, when

government geologic research verified that

chromite resources were adequate for ferrochromium production. Hellenic Ferroalloys

S.A. has expanded an underground mine at the

Skoumtsa deposit in the Mt. Vourinos region

(northern Greece, near the Albanian border) to

serve as feed for a new ferrochromium plant

at Tsigeli. This plant, which began operation

in February 1983, was constructed by Outokumpu Oy. Until Hellenic Industrial Mining

& Investment Co. (parent firm of Hellenic

Ferroalloys) follows through with plans for a

steel plant at Tsigeli, the ferrochromium output (potential total capacity of about 90,000

tons per year) is destined for the export market, primarily other European Economic Community (EEC)23 countries.

India

The principal ore-producing area in India is

in the state of Orissa. In recent years, the Indian government has actively encouraged the

development of the ferrochromium industry to

increase the value of its exports and to reduce

its dependence on imported ferroalloys for

growing domestic steel needs. Four new plants

were under construction in 1982 for two private firms and one public firm. Ongoing mining industry upgrading and geological survey

work to improve the ore reserve base is intended to support the ferroalloy industry rather

than increase ore exports. production has been

hindered at times in recent years because of

power shortages caused by droughts. Indian

power needs are heavily dependent on the

monsoon rains to provide necessary energy.

Transportation bottlenecks and production inefficiencies are traditional constraints to India’s assuming a greater role in providing

world needs.

Madagascar

Chromite is this country’s most important

mineral commodity, and all production is for

export. Although feasibility studies have been

conducted, no ferrochromium plant has yet

been built, owing to unresolved financial and

technical problems. The necessary power

source, a hydroelectric dam, was completed in

1983. Two open pit mines, each with a capacity of 300,000 tons of chromite ore per year,

are operated. The Adriamena mine was developed by the French firm Comina before it was

Zscommon Market.
Ch. 5—Strategic Material Supply ● 145

nationalized in 1976. Its ores must be processed

to reduce an unacceptably high phosphorus

level. The newer mine, Befandriana, is a primitive setup consisting of several small open pits

and no concentrator, Ores from this mine do

not have a high phosphorus level and are simply screened to produce two separate grades,

During monsoon season, December to April,

the Befandriana pits cannot be operated.

Transportation from Adriamena is by truck

and railroad to the port of Toamasina (Tamatave).

From Befandriana, ores are trucked about 100

miles to Narinda Bay for shipment, Due to the

shallowness of the bay, ores must be transferred by small vessels to ocean freighters;

loading of one shipment can take 3 weeks.

The area has the potential to expand production easily by 50 percent due to the extent of

the reserves. Transportation is the weakest

link; lack of sufficient railroad cars, poor roads,

and the undeveloped port at Narinda Bay impede expansion. While France is Madagascar’s

major customer for chromite, one U.S. ferroalloy firm, Interlake, had a 2-year contract, ending in 1982, to take all of the annual output of

the Befandriana mine. The contract has not

been renewed due to the weak market for ferroalloys.

New Caledonia

All of New Caledonia’s lateritic nickel deposits contain chromite. Much of the chromite,

however, occurs in low grades and is currently

considered uneconomical. Two firms operate

mines from podiform deposits in New Caledonia. Societé de la Tiebaghi started full-scale

production in 1982, with an output of 50,000

tons of chromite concentrates (containing 51

percent chromic oxide), eclipsing Calmine’s

2,000 tons-per-year operation. Capacity of the

Tiebaghi mining operation is 85,000 tons per

year of concentrates. The new mine, for which

development work began in 1976, underlies a

Union Carbide operation that closed in 1962.

The island has no domestic energy source, creating a potential barrier for any expansion.

Societe le Nickel (SLN), the large nickel producer on the island, already consumes 85 percent of the country’s industrial electricity in its

mining and smelting operations. A hydroelectric powerplant has been considered but is not

yet planned.

Philippines

The Philippines is the principal source of

refractory grade chromite for the Western

world. The Coto deposits in the Zambales district on the main island of Luzon are the largest

such group in the world. Reports on the Philippines continually predict reserve depletion, but

further exploration has always extended mine

life by another 10 years. Two major firms conduct operations at Zambales. Consolidated’s

Masinloc mines are operated by the Benquet

Corp. and contribute 95 percent of the country’s refractory ores; Acoje Mining is the country’s major metallurgical ore producer. A third

firm, Trident Mining & Industrial Corp., has

produced metallurgical ores from mines on the

southern Palawan Island. Its operations have

been shut down since 1981 due to financial

problems. Representatives from Trident were

in the United States in 1983 seeking new capital to resume production and reportedly secured it. In late 1983, Acoje was seeking debt

relief from the Philippine government and the

private sector in order to maintain operations.

These financial difficulties will delay plans for

exploration and new mine development.

Two ferrochromium plants in the Philippines

produce primarily for the Japanese market. The

newest plant began operating in 1983, and

some startup problems caused by erratic power

supplies and ore quality were reported.

Theoretically, the extensive ultramafic formations of the Philippines could hold up to 105

million tons of 32-percent chromic oxide in

laterite formations.24 Extensive, systematic geological field and exploration work, however,

must be completed in order to prove the theory.

South Africa

The Bushveld Complex in the Transvaal

Province is the largest known chromite deposit

Z4The Chromjte Project Definition Alission of the Phili/]pines,

op. cit.
146 . Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

in the world. Most of the chromite is produced

in two districts within the complex: the Eastern Belt (Lydenburg district, five mines) and

Western Belt (Rustenburg district, eight mines).

Competition among the many firms and mines

for increased market shares is strong. The

slackness in world chromite markets, rising

costs, and stable prices in recent years have

caused some of the least efficient mines to be

placed on “care and maintenance” status.

The UG2 (upper group seam of the Bushveld)

chromium-platinum reef in Rustenburg is currently mined for PGMs by Western Platinum

and has chromite resources estimated by South

Africa to total 650 million tonnes. Tapping certain sections of this reef for chromium requires

new metallurgical and smelting techniques in

order to separate and recover the individual

minerals. The South African government’s

Mintek (Council for Mineral Technology, a research arm of the Ministry of Mines and Energy) has conducted research and development

and plasma technologies, which provide hightemperature processing, have been tested.

Western Platinum has reportedly opened a

smelter in 1984 capable of processing these

complex ores and is considering the addition

of a ferrochromium plant.

As in many areas, transportation bottlenecks

could limit any effort to rapidly increase output from the Bushveld. Ores from the mines

are currently trucked 5 to 10 miles to a railhead. Once there, the ores are moved to the

heavily used port of Maputo in Mozambique

(480 miles from the Western Belt and 350 miles

from the Eastern Belt). Perennial congestion

at the port has been relieved by recently installed mechanized facilities. The port can now

handle 2,500 tonnes of chromite per hour and

store up to 1.1 million tonnes. Alternate ports

in South Africa, at Durban and Richards Bay,

could be used if Maputo was not available (for

instance, due to transborder conflicts) although

significant lead-time would be required to accommodate chromite at these ports. It has been

estimated that for a typical underground South

African mine, 50-percent expansion would require little more than 1 year; however, port expansions to handle such increased output

could take 4 years.25

Soviet Union

The Soviet Union is still the world’s second

largest chromite producer, although its ore exports have declined during the past decade.

Most of its deposits are podiform and located

in the Ural Mountains. Virtually all its metallurgical-grade ores originate in the Western

Kazakhstan (southern Ural region). Ninety percent of production comes from the Donskoye

mining and concentration complex in KhromTau. A new underground mine there started

producing in 1982 with an expected ore capacity of 2 million tons per year by 1985.

Turkey

Exports of ore from Turkey have declined in

recent years as a result of increasing internal

consumption, world market oversupply, and

an inability to meet price competition. Turkish podiform deposits are widely scattered

(occurring in 40 of the country’s 67 provinces),

limiting the output and mechanization potential of many mines. The presence of podiform

rather than stratiform deposits, however,

makes the total resource picture uncertain because such pockets are difficult to locate. With

economic incentives, a 50-percent increase in

production (a return to the 1975 production

level) could take place in 3 to 12 months. Any

further increase would be limited by available

and willing investment and would require an

increase in reserves. Constraints would include

lack of mining equipment and transportation

bottlenecks. The main ports (Mersin and Iskenderun, on the Mediterranean Sea) are 400 miles

from the mineheads and have maximum loading capacities of 3,000 tonnes per day, each.

Several ferrochromium plants are now online in Turkey, and additional capacity (to a

total 150,000 tons per year) is expected by 1986.

Etibank, the state-owned mining company that

Zschar]es River Associates, Processing Capacity for Crjtjca!

Materials, contractor report prepared for the Office of Technology Assessment, January 1984.
Ch. 5—Strategic Material Supply Ž 147

supplies half of Turkey’s chromite output and

all of its ferrochromium, has a reputation for

making policy decisions removed from political influence, Under the most recent government it has become very active in seeking investment partners from the private sector,

Owing to market conditions, most of Turkey’s

existing private producer mines, which mainly

contribute ores for export, were closed during

1982. Overall, Turkey’s chromite industry

could improve its position in the world market with an infusion of capital and substantial

technology transfer to upgrade its mining and

processing procedures.

Zimbabwe

Most of the chromium reserves in Zimbabwe

lie in the Great Dyke, an elongated, elevated

geological structure that runs 300 miles or

more in a northeast-southwest direction across

the country, However, about 80 percent of current output comes from the Selukwe mines in

related lode deposits along the Great Dyke’s

southern section. The Dyke’s thin seams require labor-intensive mining methods and are

underdeveloped due to high costs. The Selukwe

mines are operated by Union Carbide’s Zimbabwe Mining & Smelting Co. Since Western

trade sanctions against the importation of Rhodesian (now Zimbabwean) chromium were

lifted in 1979, the emphasis has been on exporting ferrochromium rather than ores. Union

Carbide and Anglo American (of South Africa)

own the two ferroalloy plants in Zimbabwe.

Their combined ferrochromium capacity in

1980 was 240,000 tons per year, and expansion

plans have been announced. As with most

chromite mining areas, transportation is a major physical barrier to increased production.

Zimbabwe would prefer to use direct rail

routes through black Mozambique, but while

the border was closed between 1975 and 1980,

the rail link deteriorated, forcing reliance on

routes through the ports in South Africa.

Potential Producers

PAPUA NEW GUINEA-RAMU RIVER

A nickel laterite deposit containing chromite

and cobalt has been under development at

Ramu River, The mineral deposit is in three

layers, with chromite in the top two layers,

Estimates give a reserve of 80 million to 100

million tons of ore with about 9 percent metallurgical grade chromite in the first, sandy clay

layer, and about 81.5 million tons at 6 percent

in the second. These 14 million tons of chromite would place Papua-New Guinea alongside

most of the major ore-producing countries, if

classified as a reserve and assuming a chromic

oxide content of 46 percent. Nickel (1.14 percent] and cobalt (0.16 percent) are concentrated

in the third layer of the deposit. In 1983 Nerd

Resources Corp. (U. S.) held a 69.5-percent

share of the mining concession and Mount Isa

Mines Ltd. (Australia), the balance. (Mount Isa

Mines is owned by the Australian corporation

M.I.M. Holdings, in which Asarco Inc. holds

a 49-percent interest.) Technical viability of the

project has been confirmed, and economic

studies were conducted in 1982. An executive

of Nerd Resources stated in early 1984 that the

earliest possible date to start the development

phase of the project was 2 years away due to

the depressed markets for both chromite and

cobalt, and that once a decision to go ahead

was made—if ever—it would take 5 years to

reach the production phase.26

The first phase of production will be to mine

the chromite, which can be recovered from the

ore by gravity concentration methods, Nickel

and cobalt, which will require a hydrometallurgical acid leaching process for recovery, will

be mined in the second stage of the project. Annual production of chromite concentrates has

been estimated at 500,000 tons. Japan, Australia, and the United States are considered the

most probable markets. The U.S. Bureau of

Mines tested the chromite concentrate product and, using conventional technology, produced high- and low-carbon ferrochromium.27

CANADA–BIRD RIVER

Of hundreds of documented chromite occurrences in Canada, few contain measured reZ13R ichard Steinberger, Executive Vice-President, Nerd Resources, Dayton, OH, personal communication, February 1984.

27’’More on Ramu Ri\er,” Mining JournaI, h4ar. 19, 1982, p.

211 and U.S. Department of the Interior, Bureau of Mines,

Minera]s Yearbook 1982, \ol. IJl, p. 1237.
148 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

sources. One deposit, considered the most

likely candidate if development plans arise, is

Bird River in Manitoba, Resources for the four

Bird River properties total 4 million tons at 18

to 25 percent chromic oxide and 15 million

tons at 5 to 7 percent chromic oxide.

The low grade and chromium-to-iron ratio

of these deposits have mitigated against their

development in the past. Research into technologies to process the ores has determined

that only with high-cost chemical treatment

can a sufficiently high-grade product be attained to meet conventional specifications. Recent research by the Ontario Research Foundation has produced a chromium carbide that

could be used to produce chromium metal or

be used as an alloying agent.

Domestic Production of Chromium

Known resources of domestic chromite are

the stratiform deposits in the Stillwater Complex of Montana and the small podiform bodies in northern California, Oregon, and Alaska.

Chromite is also associated with nickel-cobalt

laterite ores of northern California and southern Oregon and found in placer beach and

stream sands located in Oregon, Maryland, and

Pennsylvania.

As tables 5-9 and 5-10 show, the United

States has an estimated 337 million tonnes (371

million tons) of identified resources28 of chromite with chromic oxide grades ranging from

1 to 25 percent (or, 13.8 million tons of contained chromium). Of these identified resources, 80.4 million tonnes (88.6 million tons)

of chromite are considered to be demonstrated

resources (a subdivision of identified resources

with the highest degree of geologic certainty)

containing 3.9 million tons of chromium. As

a comparison, South Africa is credited with a

“reserve base” (total demonstrated resources

but excluding the subeconomic tonnages) of

———— ——.——

‘“’’Identified” resources are those for which location, grade,

quality, and quantity are known or estimated from specific geologic evidence. Identified resources include economic, marginally economic, and subeconornic components. To reflect ~arying degrees of geologic certainty, identified resources are divided

into “demonstrated” [both measured and indicated) and “inferred” resources.

910 million tons of shipping grade chromite

ores normalized to 45 percent chromic oxide,

or 279 million tons of chromium.

In a Minerals Availability Appraisal29 published in 1982, the U.S. Bureau of Mines concluded that none of the U.S. identified resources of chromite in stratiform or podiform

deposits were economically recoverable at January 1981 market prices ($128 to $144 per

tonne for a metallurgical grade product, CIF30

in the Eastern United States), Instead, production at that time would have required a minimum price of $237 per tonne, almost double

the prevailing market price.

Laterite deposits were not analyzed in the

Bureau of Mines’ study in terms of potential

production because of “technological and cost

uncertainties.“ 31 Unlike laterite deposits, the

other deposit types have previous production

history in the United States.

The mining and beneficiation methods upon

which the study was based were those methods used in past domestic production of chromite ores; no new technologies were considered. For each deposit included in the appraisal

(table 5-11), the engineering and cost (capital

and operating) analyses were followed by an

economic evaluation using a 15 percent rate

of return on the capital investment. Some costs

were not considered—e.g., the time lags involved in filing environmental impact statements, receiving necessary permits, financing,

etc., as it was felt that such delays “would be

minimized in consideration of strategic availability.”32

Up to 235,000 tons per year (table 5-12) of

contained chromium could theoretically be

produced from the most probable U.S. sources.

This assumes simultaneous production and

would most likely require government incentives, Mine lifetimes range from 3 to 46 years.

28Jlm Lemons, Jr., et a]., U. S. Department of the Interior, Bureau of Mines, Chromium Availabilit~~—Domestic: A Minerals

AvailabiliteV System Appraisal, Information Circular No, 8895,

1982, p. 1.

Socost, insurance, and freight paid by the shipper.

3] Ibid., p. 1.

szIbid., p. 7.
Ch. 5—Strategic Material Supply • 149

Table 5-9.—U.S. Chromite Deposit Resources

State

Alaska . . . . . . . . . .

California . . . . . . .

Georgia . . . . . . . . .

MarylandPennsylvania . .

Montana . . . . . . .

North Carolina . . .

Oregon . . . . . . . . .

Pennsylvania . . . .

Wyoming. . . . . . .

Total d

Grade

Property (percent Cr2O2

)

Claim Point ., . . . . . . . . . . 17.6

Red Bluff Bay . . . . . . . . . . 12,0

Red Mountain . . . . . . . . . . 25.8

Bar Rick Mine . . . . . . . . . . 7.6

McGuffy Creek . . . . . . . . . W

North Elder Creek b 

. . . . . . 11.9

Pilliken Mine . . . . . . . . . . . 5.0

Seiad Creek/Emma Ball . . 5.0

Louise Chromite ., . . . . . . .4

West Placer Areac 

. . . . . . 1.4

Stillwater Complex:

Mouat/Benbow . . . . . . . W

Gish Mine . . . . . . . . . . . 15,0

North Carolina Areab . . . . 1.9

Southwest Oregon

Beach Sands . . . . . . . . . 5.6

Renshaw Placer . . . . . . . . 1.7

Casper Mountain . . . . . . . 2.5

. . . . . . . . . . . . . . . . . . . . NA

Demonstrateda

(thousand tonnes)

Mineralized Contained

material C r2 0 2

267 47.6

30 3.6

0 0.0

5,065 384.9

w w

o 0.0

0 0.0

4,546 227.3

131 .6

Identified

(thousand tonnes)

Mineralized Contained

material C r2O 2

267 47.6

30 3.6

183 47.2

44,512 3,382.9

w w

104 12.4

30,975 1,548.8

10,826 541.3

131 .6

729 10.1 729 10.1

w w w w

500 75.0 854 128.1

108 2,1 178 3.5

10,827 604.1 45,772 2,554.1

209 3.5 209 3.5

3,774 92.5 3,774 92.5

46,604 5.620,6 –7194.019 19.333.2

W—Withheld to avoid disclosing Individual company proprietary data, included In total

NA—Not applicable

a Dome s tlc chromlte reserve base

blncludes 3 deposits that have been combined fOr anal Ysls

clncjude~ 13 deposits that have been combined for analYsls

dlnc~udes resources withheld to avoid disclosing Ind!vldual cOm Pany ProPrletaV data

SOURCE U S Department of the Interior, Bureau of Mines Information Circular No 8895, 1982, Chrorn(um Ava//abf/ify—CJomes flc A M/nera/s System Appra~sa/, tables

1 and 2, pp 4 and 5

Table 5.10.—U.S. Chromite Laterite Deposit Resources

Demonstrated Identified

(thousand tonnes) (thousand tonnes)

Grade Mineralized Contained Mineralized Contained

State Property (percent Cr2O2

) material Cr2O2 material Cr2O2

California ... , . . . Gasquet Laterite , . . . . . . . W w w w w

Little Rattlesnake ., . . . . . W w w w w

Lower Elk Camp . . . . . . . . W w w w w

Pine Flat Mountain . . . . . . 2.8 6,382 178,7 15,052 421.5

Red Mountain . . . . . . . . . . W w w w w

Oregon . . . . . . . . . Eight Dollar Mountain . . . 1.1 0 0 13,023 145.9

Red Flat . . . . . . . . . . . . . . . W w w w w

Rough and Ready . . . . . . . 1.5 0 0 5,931 90.7

Woodcock . . . . . . . . . . . . 1.3 0 0 8,587 112.5

Total . . . . . . . . . . . . . . . . . . . . NA 33,813 640.0 143,126 2,995.4

W—Wtthheld to avoid disclosing Individual company proprietary data, Included In total

NA—Not appllcab(e

SOURCE U S Department of the Interior, Bureau of Mines Information Circular No 8895, 1982, Ctrromfum Avai/abi/ity—Domestic A L4inerals System Appra~sa/, tables

1 and 2, pp 4 and 5
150 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table 5-11 .—Proposed Mining and Processing Methods U.S. Chromite Deposits

Annual

Minimum capacity

Type of lead time tonnes Mining Beneficiation

Property State deposit years of ore method method

Claim Point . . . . . . . . . . . . . . Alaska

Red Bluff Bay . . . . . . . . . . . .Alaska

Red Mountain . . . . . . . . . . . .Alaska

Bar Rick Mine . . . . . . . . . . . . California

McGuffy Creek . . . . . . . . . . . California

North Elder Creeka

. . . . . . . .California

Pilliken Mine. . . . . . . . . . . . . California

Seiad Creek/Emma Bell. . . .California

Louise Chromite. . . . . . . . . . Georgia

West Placer Areab . . . . . . . . MarylandPennsylvania

Stillwater Complex:

Mouat/Benbow . . . . . . . . . Montana

Gish Mine . . . . . . . . . . . . . Montana

North Carolina Areaa . . . . . . North Carolina

Southwest Oregon Beach

Sands . . . . . . . . . . . . . . . . . Oregon

Renshaw Placer . . . . . . . . . . Pennsylvania

Casper Mountain . . . . . . . . .Wyoming

Podiform

Podiform

Podiform

Podiform

Podiform

Podiform

Podiform

Podiform

Placer

Placer

Strati form

Strati form

Placer

Placer

Placer

Strati form

4

2

2

2

2

1

2

3

1

1

3

2

1

2

1

3

18,000

9,000

18,000

350,000

787,000

25,000

2,100,000

562,500

25,000

50,000

525,000

175,000

25,000

1,000,000

50,000

377,260

Open pit

Open pit

Overhand shrinkage

Sublevel slope

Open pit

Open pit

Open pit

Open pit

Open pit

Placer mining

Shrink slope

Shrink slope

Open pit

Strip

Open pit

Open pit

Gravity

Gravity

Gravity

Gravity

Gravity

Gravity

Gravity-magnetic

Gravity

Gravityelectrostatic

Gravityelectrostatic

Gravity

Gravity

Gravityelectrostatic

Gravity-magneticelectrostatic

Gravityelectrostatic

Gravity

alncludes 3 deposits combined in the analysis

blncludes 13 deposits combined in the analYsiS.

SOURCE: US Department of the Interior. Bureau of Mines Information Circular No. B895. 1982, Chromium Avai/abi/iW-Domestic: A hf/riera/s Avai/ab//ifv. Svstem . ADpraisal, ’tables 1 and 2, pp. 4 and 5.

All of these areas, with the exception of Gasquet Mountain in California, have been mined

previously, providing a backlog of information

and infrastructure upon which to base operating decisions. Gasquet Mountain has benefited from considerable recent commercial

evaluation.

The most recent U.S. production of chromite

was from the Gish and Mouat/Benbow Mines

at Stillwater from 1953 until 1961, subsidized

by the Federal Government under the Defense

Production Act. The contract with the American Chrome Co. called for 900,000 tons of

chromite ore (36 to 38 percent chromic oxide)

over an 8-year period (an average annual rate

of 113,000 tons), during which the government

advanced $1.8 million for machinery and

equipment and guaranteed the company a

price of $34.98 per ton of ore (about $140 per

ton of chromium). (During the period 1954-61,

the weighted average yearly price ranged from

$124 to $147 per ton.)33 Approximately 400,000

tons of the ore produced—half of the contract—

remained unused and was sold by the government to Metallurg, Inc., in 1974 for $7.64 per

ton. In 1984, this “stockpile” sat in the town

of Columbus, nearby the Stillwater mine site.

Chromite was also mined from Stillwater and

from podiform deposits in Alaska under World

War II production subsidies. At Stillwater, development efforts began in 1941 under the Reconstruction Finance Corp. ’s Metals Reserve

Co. After spending $15 million on the development of two mines (only one of which actually

started producing), all operations were closed

down in 1943 when foreign trade routes became more secure. Domestic chromite production reached a historic peak of about 140,000

tons in 1943, and consumption that year was

—.-

ssu.s. Department of the Interior, Bureau of Mines, ~jnera]

Facts and Problems, 1975 edition, p. 248.
Ch. 5—Strategic Material Supply . 151

Table 5-12.—PotentiaI U.S. Chromite Production

Demonstrated resources Estimated annual production

Chromium Chromium

Ore content Ore content Estimated

Known resources by Grade (thousand (thousand (thousand (thousand minelife

deposit type (percent Cr2O3

) tonnes) tonnes) tonnes) tonnes) (years)

Stratiform:

Stillwater Complex:

Mouat/Benboe . . . . . . . . . w w w 525 72a

46

Gish . . . . . . . . . . . . . . . . . . 15.0 500 51 175 16 3

Pod/form:

California:

Bar Rick Mine . . . . . . . . . 7.6 5,065 262 350 16 13

McGuffy Creek. . . . . . . . . w w w 788 NA 4

Pilliken Mineb. . . . . . . . . . 5.0 30,975 1,053 2,100 65 4

Seiad Creek/Emma Bell . . . 5.0 4,546 155 563 17 9

Beach Sands:

Southwest Oregon . . . . . . . 5.6 10,827 412 1,000 35 11

Proven Chromite

Grade reserves concentrates

(percent (thousand (thousand

Laterite chromium) tonnes) tonnes)

Gasquet Mountain. . . . . . . . 2.0 16,000 320 50 14 18

aEStim’tedassuming Is percent wade

blnferred resources only

W—information withheld for proprietary reasons

NA—Date not available

SOURCES Resources, ore grades, proposed mining rate, mlnelifes from US Department of the Interior, Bureau of Mines, Chromium Avai/abi/ify–Domestic, lC8895/1982

Gasquet Mountain data provided by California Nickel Corp; balance calculated by OTA.

Chromium data 1979 1982

Reported chromite

consumption (tons) (22 to

38 percent chromium) . . . . . 1,209,000 545,000

Apparent chromium

consumption (tons) . . . . . . . . 610,000 319,000

SOURCE U S Department of the Interior, Bureau of Mines, M/nera/ Commodity

Summaries, 1984

965,000 tons. More than 200,000 tons has been

reported as domestic “shipments” for 1956, but

some 45,000 tons of this amount came from

government stockpiles.

Before 1958, scattered small chromite deposits were mined in California, Oregon, and

Washington. The Pilliken Mine near Sacramento, CA, for instance, was operated intermittently from 1950 to 1957. Total production

from these mines was, however, never more

than 45 percent of the Stillwater Complex production in the same years.34

sqFor more information about past domestic production see,

Silverman, et al., op. cit., and The StiHwater Citizen-Sun, Apr.

26, 1974, sec. 2, p, 8.

Stillwater Complex

The chromite deposits at the Stillwater Complex in Montana are the largest known, single

potential U.S. source of chromium. Although

there are no current plans to resume commercial production of chromite at Stillwater, these

deposits would most likely be the first to be

considered for production during any emergency situation. Several companies, including

Anaconda Minerals Co., which has patented

mineral holdings on the Mouat/Benbow Mine,

have been involved in the area since the late

1960s in investigating various Stillwater properties for their potential mineral values. (See

the domestic PGM section, p. 196 for details.)

Available resource data for the two chromite

deposits, the Gish and Mouat/Benbow mines,
152 Ž Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

are not complete since for proprietary reasons

only the numbers for the Gish mine have been

published (see table 5-9). The Mouat/Benbow

deposit is reportedly the much larger of the

two. This is evident from the fact that the Bureau of Mines projected a mine life for the

Mouat/Benbow deposit of 46 years with a

production rate of 525,000 tonnes (477,000

tons) of ore per year; whereas, production at

the Gish mine was projected at a third of that

rate for only 3 years.

Combined potential output of 65,000 tons of

contained chromium (table 5-12) from these

Stillwater mines amounts to about 11 percent

of U.S. needs when compared with a peak consumption year such as 1979 or 20 percent when

compared with 1982.

Gasquet Mountain Project

California Nickel Corp. has proposed to produce nickel, cobalt, and chromium from a

lateritic deposit at Gasquet Mountain in northern California, The project’s economic viability

is dependent on the market prices of all three

metals, and in 1982 the firm was using a chromite price of $40 per ton in its economic evaluations, The estimated output (50,000 tons per

year of chromite concentrates with 14,000 tons

of contained chromium) would be small relative to the other metals involved in the project

and in relationship to Stillwater as analyzed

by the Bureau of Mines. However, this is the

only domestic mining project which includes

chromium that has been under recent scrutiny

by a mining firm, Perhaps of greater importance is the processing technology that this

firm is developing for recovery of metals from

laterite ores, Such ores have the possibility of

being a future worldwide source of metals such

as chromium, nickel, cobalt, PGMs, etc. (The

Gasquet Mountain Project is discussed in more

detail in the cobalt section on p. 170, See also

the following chromium mining and processing technologies section on p. 153.)

Lateritic deposits generally offer one of the

lowest metal grades, and chromite at Gasquet

is thought to be extremely erratic. Exploitation

thus requires considerable movement of ore in

order to reclaim any substantial tonnages of the

desired metal.

Other Potential U.S. Sources

Other chromite deposit types in the United

States are the podiform bodies in northern California, southern Oregon and Alaska and beach

sands in Oregon, Maryland, and Pennsylvania.

Table 5-12, using the Bureau of Mines’ analysis, shows the estimated production from the

most likely candidate areas, California’s podiforms and Oregon’s beach sands.

Although the chromium content of the possible output of the Pilliken Mine was calculated

as the largest, the information base is the

weakest since all resources fall into the “inferred” category. Except for the Bar Rick Mine,

these podiform properties have short mine lifes

which reduces their economic viability,

The Oregon beach sands contain a comparatively large amount of identified resources.

These resources are dispersed over a large area

(some 5,000 acres) which is now either public

beaches or land used in Oregon’s forestry industry, The low grades present means that a

lot of material would need to be displaced in

order to acquire the contained chromite, disturbing not only the beaches but an established

Oregon economic base.

The Alaskan podiform deposits are considered the most expensive to mine, due to their

location, low grades and short mine lifes. One

area of podiform deposits, stretching south

from Anchorage through the Kenai Peninsula

along the Chugach Arch, may contain sufficient chromite for several years supply, but is

not of commercial interest due to the high cost

of production. as Anaconda Minerals explored

one such deposit area, Red Mountain near Seldovia, as a possible PGM resource but results

have proved disappointing. Conceivably, chromite might be a byproduct of any future PGM

production there, Other potential occurrences

of chromite in Alaska are at Kanuti River, Red

Bluff Bay, Baranof Island, in southeastern

ssrohn Mulligan, Chief, Alaska Field Operations Center, Bureau of Mines, persona] communication, July 9, 1984,
Ch. 5—Strategic Material Supply ● 153

Alaska, and the western Brooks Range deposits. Present information on these occurrences

is inadequate to suggest any level of expectation.36 After surface occurrence investigations

in the Kanuti River area, the Bureau of Mines

recommended in 1983 that subsurface exploration be employed to establish the extent of chromite occurrences .37

Domestic Mining and Processing Technology Prospects

Rather straightforward mining and beneficiation technologies are applicable for the exploitation of U.S. chromite deposits, and their

composition —while primarily chemical grade

—is suitable for a variety of current uses.

Future breakthroughs in beneficiation and

smelting technologies might lead to the possibility of mining of lower grade ores common

to the United States. Plasma arc furnace technology (see the following processing section),

for instance, uses finely ground chromite as is

found in laterite deposits. Successful application of new methods would not necessarily

make U.S. deposits more competitive with

other world deposits, unless innovations can

be selectively applied to U.S. deposits.

Improved mining technology offers several

possible applications for chromite ore mining,

In hardrock ore bodies, open pit and underground mining systems would be similar to

those used in other ore bodies; the trends

toward increased mechanization and to continuous mining systems would apply, The new

vertical crater retreat system for underground

mining would be especially applicable in narrow and steeply dipping veins and podiform

bodies, In shallow lateritic material and beach

placer type sands, open pit mining would very

likely involve continuous mining by bucket

wheel machines or by shovels without the need

for drilling and blasting,

Solution mining of chromite is only in the

conceptual stage, but could provide an ap-

—.

3GU.S, ~eI)a~ment of the Interior, Bureau of Mines, Critical

and Strategic Afinerals in Alaska, Information Circular No. 8869,

1981.

sTjeffrek, y, Foley and Mark M. McDermott, U.S. Department

of the Interior, Bureau of Mines, Podiform Chromite Occurrences in fhe Caribou Mountain and Lower Kanufi River Areas,

Central Alaska, Information Circu]ar No. 8915, 1983.

preach to the mining of hardrock chromite

with explosive fracturing or to the mining of

lateritic deposits that are inaccessible by open

pit mining.

The minimum grades required for metallurgical use (at least 46 percent chromic oxide and

a chromium-to-iron ratio greater than 2.5:1)

have not ordinarily been obtained from the

processing of domestic chromite deposits.

Low-cost methods of beneficiating domestic

deposits to an acceptable concentrate have

been studied for a number of years by the Bureau of Mines, The methods have involved

combinations of gravity and electrostatic separation plus flotation to obtain a higher chromium content, and leaching to reduce the iron

content, The Bureau of Mines has recently introduced a chromite beneficiation program

that has provided encouraging results, Research has not yet provided for an economic

method of upgrading, however, A direct smelting process for Stillwater Complex ore has

been investigated; this would provide a highiron alloy, but still not comparable in grade and

cost with imported ferrochromium.

The Albany Research Laboratory of the Bureau of Mines has been exploring the recovery of chromite from the residue of laterites

that have been chemically processed to recover

cobalt and nickel. Lateritic ores containing

chromium are ordinarily roasted and leached,

An experimental plan by the Bureau of Mines

for the recovery of chromium from laterite

ores, as at Gasquet Mountain, involves roasting

and leaching after gravity beneficiation, with

final electrowinning for nickel and cobalt and

final recovery of chromium from the leach residue. The concentrate produced contains about

35 percent chromic oxide. Future research and

experimentation in chromite recovery and

chromium extraction will most probably involve such hydrometallurgical processing.

Another Bureau of Mines project is evaluating the low-grade podiform deposits of California, These ores range from 3 to 10 percent

chromic oxide and contain tonnages that can

potentially be mined by open pit and underground methods. Preliminary results suggest

that these podiform ores can be concentrated

38-844 0 - 85 - (5 : QL 3
154 • Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

to a range of 37 to 45 percent chromic oxide;

and with improved gravity process techniques,

a marketable concentrate might be produced

if smelter facilities were located nearby and

local steel markets were accessible to the

product.

Foreign and Domestic Chromium Processing

The major use of chromium is as an alloying agent in chromium and stainless steels and

in superalloy. In steels, chromium is consumed primarily in the form of a chromium ferroalloy, principally high-carbon ferrochromium or “charge chrome. ” In the production of

superalloys with little or no iron content, a

metallic form of pure chromium is consumed.

The various types of chromium ferroalloys and

metals and their compositions are shown in table 5-13.

Figure 5-I provides a simplified flow chart

of chromium from ore to industrial use. Ore,

as produced from today’s mines, contains from

35 to 48 percent chromic oxide. An exception

is Finland which has the lowest grade economic deposits at 27 percent Cr2O3

. Where necessary, mined chromite is concentrated (gravity or magnetic separation is usually employed

to increase the chromic oxide or reduce the silicon content), sized, and classified at the mine

site. This concentrate, typically 40 to 46 percent chromic oxide (27 to 31 percent contained

chromium), is then processed by smelting into

ferrochromium products or begins a multistep

process for conversion into pure metal.

Table 5-13.—Composition of Chromium

Ferroalloys and Metal (weight percent)

Type Chromium Carbon Silicon

Ferrochromium:

High carbon . . . . . . . . . . . . . 52-72 4.0-9.5 3-14

Charge. . . . . . . . . . . . . . . . . . 58-60 6-7 4-5

Low carbon, . . . . . . . . . . . . . 60-75 .025-.75 1-8

Silicon . . . . . . . . . . . . . . . . . . 34-42 .05-.06 38-45

Metal:

Aluminothermic

Vacuum melting grade . . 99.5 .05 .04

Carbothermic (chrome 98) . z98.5 NA NA

Electrolytic , . . . . . . . . . . . . . 99.1 .02 .01

NA—Not available.

SOURCE: Ferrochromlum content, U.S. Department of the Interior, Bureau of

Mines, L41nerals Commodity Profile 1983.’ Chrormurn.

Metal content, appropriate manufacturers.

Ferrochromium

High-carbon ferrochromium is usually produced in a submerged arc electric furnace.

These furnaces, shown in figure 5-2, use vertical electrodes that are suspended into the

charge material (principally chromite and coke,

a form of coal). A pass of electric current

through the charge provides the heat to sustain

a reaction in which the oxygen content of the

chromite is removed (by combining with the

carbon in the coke) and an iron-chromium alloy is produced.

Low-carbon ferrochromium can be produced

from high-carbon ferrochromium or from chromite ores. In the Simplex process, an oxide material is mixed with the ferrochromium and

heated in a vacuum furnace, where the carbon

and oxide combine and are driven off, reducing the carbon content of the ferrochromium.

In another process, silicochromium (a siliconchromium alloy) is first produced in a submerged arc furnace and then used to reduce

the carbon content of ferrochromium in an

open arc furnace. (In open arc furnaces the

electrodes are not suspended deep within the

charge).

Ferromanganese (see manganese processing

section) is produced in electric submerged arc

furnaces similar to those used for ferrochromium, and there is a degree of convertibility

between chromium and manganese ferroalloy

furnaces. The United States has, consequently,

some flexibility in production capacity for both

ferroalloys. Ferromanganese production requires a wider electrode spacing than that used

for ferrochromium, which has a less conductive slag. Other important differences in design

parameters of the furnaces include electrode

diameter, hearth diameter, crucible depth, and

voltage range of the transformer. A ferromanganese electric furnace could technically be

used to produce ferrochromium. By techniques

such as modifying the composition of the slag

to decrease its resistance, the furnace would

be operating at less than optimum conditions

and would probably not be economic. Modification of these furnaces for alternative uses

may be physically and process constrained by

the existing pollution abatement equipment.
*

SOURCE: Charles River Associates, Processing Capacity for Critica/ Maferia/s, OTA contract report, January 1984

Figure 5-2.—Submerged Arc Furnace

Reaction Charge

gases material

t

4

SOURCE Charles River Associates, Process/rig Capacify for Crltica/ Materia/s,

OTA contract report, January 1984

t +

Sodium

chromate

Sodium

bichromate 4

I

ADVANCED TECHNOLOGY

While the submerged-arc electric furnace

process predominates in the production of ferroalloys, other methods are being explored.

Most attention is directed at the development

of plasma furnaces.38 This furnace is basically

an electric arc furnace in which carbon electrodes are replaced by metallic electrodes and

the electric arcs by plasma arcs.39 An essential

difference in design is the installation of plasma

torches in the wall of the furnace, rather than

SeCharles River As~ciates, Processing CapacitJr fOr critical

Materials, contractor study prepared for the Office of Technology Assessment, January 1984.

39A P]asma is a gas of sufficientl y high energy content that

many of its molecules split into atoms, which then become

ionized and electrically conducting. Such a gas can develop and

deliver heat as high as ZO,OOOC C. Fossil fuels, on the other hand,

limit combustion processes to z,0000 C, See “The Promise of

Plasma, ” 33 Metal Producing, February 1984.
156 ● Strategic Materials: Technologies to Reduce U.S. /report Vulnerability

the roof as with carbon electrodes. A plasma

furnace used for the production of ferrochromium can be used to produce ferromanganese

or other ferroalloys.

The major advantages claimed for the plasma

furnace process are: increased economy due

to longer life electrodes, fewer environmental

problems (e.g., less dust and waste gas are generated, noise level is extremely low), reduced

cost of charge material (e. g., use of small particle–’’fines” –feed material rather than lumps,

eliminating the need for preliminary processes

to compact such material, and fine coal rather

than more expensive coke), higher produc t

quality (e.g., a lower carbon content), and increased product yield due to lower losses into

the waste material.

In the production of ferroalloys, the plasma

furnace can either be used for the reduction

of ore (as in the submerged arc furnace) or for

melting metallic fines. Such a melting operation has been installed by Voest-Alpine of Austria at Samancor (a major manganese ore and

ferroalloy producer) in South Africa, Middelburg Steel & Alloys, a major ferrochromium

producer in South Africa, has been investigating plasma furnace technology for a number of years and in late 1983 installed a Swedish-designed 20 megawatt (MW) reduction

furnace at its plant in Krugersdorp. This is the

first commercial application of plasma technology in the ferroalloys field, 40 and Middelbur g

expects to take 2 years to evaluate the efficiency of the operation before committing to

a conversion of its other furnaces (which could

result in a doubling of its output capacity) to

plasma operation. South Africa appears to be

in an excellent position to adopt the plasma

technology since its chromite ores tend to

break up into fine material, its coal is generally of the lower grade applicable, and electric

power is the main energy source. Plasma technology does not yet appear to be able to compete in areas where fossil fuel is available.

——

40SKF Stee] of Stockholm announced i n June 1984 intentions

of building a 78,000tonne per year ferrochromium plant in

southern Sweden using plasma technology. Overall savings of

SKF’S Plasmachrome process compared to costs of conventional

ferrochromium production in Sweden has been estimated at 15

to 20 percent.

Relative to Western Europe, South Africa

and the Soviet Union, the United States has

seen little activity in plasma technology for

process metallurgy (reduction). Westinghouse

is one U.S. firm involved in developing the

technology, especially the initial torch systems

which were a spinoff of the U.S. space program. 41 Foster Wheeler Corp. holds a U.S.

license for European plasma furnaces and was

involved in setting up the Middelburg furnace.

Its estimates have shown that capital costs for

the system would be 40 percent less than for

a conventional electric arc furnace and operating costs, about 25 percent lower. 42 A major

inhibiting factor to U.S. interest in plasma technology is the relatively high cost of electrical

power compared with fossil fuel in most parts

of the country .43 However, since ferroalloy

processing is an electric power consumer,

plasma technology has the potential to be economically viable in this particular application.

Plasma arc reduction processes have occasioned a good deal of interest, but they have

yet to be proven in full scale for ferroalloy

production, It is not known, for instance, if

they can compete with submerged arc furnaces

on the basis of energy consumed per ton of

ferroalloy produced. They would seem to merit

attention, however, if the high-intensity heat

source used would permit economical operation of smaller scale units (as compared with

the large, 50 MW, submerged arc furnaces).

Small-scale, adaptable units could provide flexible production capacity for a new, lean domestic ferroalloy industry.

Chromium Metal

Aluminothermic, carbothermic, and electrolytic processes are used to produce metallic

chromium. Each process results in a different

quality of product, which determines its possible value to industry. Electrolytic chromium

is the purest and used in the most demanding

4’K. J, Reid, “Plasma Tech Potential Best in High-Value Goods,”

American Metal Market, May 15, 1984, p. 22. Excerpts from a

speech “Plasma Metallurgy in the 80s” given at an international

symposium—Mintek 50—in Johannesburg, South Africa, in April

1984.

4ZChar]es River Associates, op. cit., p. 78.

qaReid, op. cit., p. 22.
Ch. 5—Strategic Material Supply . 157 —

applications. The most widely used method is

the aluminothermic (A-T) process. The same

equipment can be used to produce other alloys

—e.g., ferrovanadium, ferrocolumbium, o r

ferromolybdenum—providing a wide range of

furnace flexibility, but also making it difficult

to estimate total aluminothermic capacity.

The A-T process is relatively simple. Highpurity aluminum powder is mixed with Cr 2O 3

,

charged into a reaction vessel, and ignited, The

reaction of aluminum and oxygen produces

chromium metal and a slag that contains the

oxidized aluminum. The metal is separated

from the slag, cooled rapidly, and crushed to

specified sizes for sale.

Two products are made by the A-T process,

One, known as Chrome 99, is suitable for processes using open vessels in contact with air,

but residual oxygen and nitrogen in Chrome

99 limit its use to less demanding end-use applications. The other product, called vacuum

melting grade (for use in vacuum furnaces), is

produced with excess aluminum to drive down

the levels of oxygen. This high purity grade is

interchangeable with electrolytic chromium in

all but the most stressful applications, e.g., the

rotating hot sections of the jet engine.

The A-T process requires high-purity chromic oxide as feed material. This chromic oxide is produced by roasting chromite. Care

must be taken during this process to minimize

the sulfur, oxygen, and nitrogen content of the

end product. producing this oxide is the capital-intensive phase of chromium metal production,

Another chromium product, Chrome 98, also

uses Cr2O 3 as the input material. Carbon is

mixed with the oxide to form briquettes, which

are then heated in a vacuum furnace at close

to the melting point for several days. The carbon and oxygen form carbon monoxide gas ,

which leaves behind briquettes of chromium

metal, The vacuum furnaces used for this carbothermic process are used for the production

of other alloys (e. g., low-carbon ferrochromium) so that total production capacity is difficult to measure. Chrome 98 competes with

A-T chromium for use in superalloy.

Chromium metal of the highest purity, consumed in the most demanding superalloy applications, is produced by the electrolyti c

method. This process, based on developments

by the U.S. Bureau of Mines in the 1950s, uses

ferrochromium as a feed material. Chemical

processing removes the iron content of the

ferrochromium, and this “chrom alum” (chromium aluminum sulfate) is then dissolved in

water to provide the feed for electrolytic cells.

Chromium, deposited on cathodes, is periodically

removed. This product is sold as regular grade

(99.1 percent chromium) or further purified.

Production Capacity and Distribution

The worldwide distribution of production capacity for ferrochromium and chromium metal

is shown in tables 5-14 and 5-15. In 1979, the

United States had more than 225,000 tonnes

(205,000 tons) of ferrochromium capacity

among seven firms, Of the six firms now

credited with capacity, only two were operating in 1983, functioning at low levels of production or only intermittently, Early in 1984, temporary respite was provided to one bankrupt

firm with the award of a contract from the General Services Administration to upgrade

121,173 tons of chromite in the national defense stockpile to ferrochromium. Table 5-16

shows the increasing U.S. reliance over the

past decade on imports of both chromium ferroalloys and metal.

In the past, the West’s supply of chromic oxide, the precursor for aluminothermic chromium metal production, was supplied almost

entirely by a single firm, the British Chrome

& Chemical Co., which has an annual capacity of 12,700 tonnes of chromic oxide. In 1982,

however, a subsidiary of the British firm, the

American Chrome & Chemical Co., began operating a plant in Texas that produces chromic

oxide, along with various chromium chemicals.

Shieldalloy Corp. has been producing chromic

oxide in the United States, but has used it for

internal consumption in the production of AT metal. It has an annual output capacity of

1,400 tons of chromium metal, with the possibility of expanding capacity to 1,800 tons, if

equipment normally used in the production of
158 . Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table 5-14.—Ferrochromium Capacity, 1979 (in tonnes)

Charge High Medium Low FerroCountry chrome carbon carbon carbon silico

Brazil . . . . . . . . . . . . . . . . . . . . . . 90,000 – — — —

Canada . . . . . . . . . . . . . . . . . . . . 50,000 – — — —

Finland . . . . . . . . . . . . . . . . . . . . 50,000 – — — —

France . . . . . . . . . . . . . . . . . . . . — — — — 2,000

West Germany. . . . . . . . . . . . . . ●

● ● ● 35,000

India . . . . . . . . . . . . . . . . . . . . . . 10,000+ ●

● 5,000 + 1,000

Italy, . . . . . . . . . . . . . . . . . . . . . . — 40,000 — 15,000 —

(incl.

charge)

Japan . . . . . . . . . . . . . . . . . . . . . 172,000 344,100 12,000 106,000 81,400

Mexico . . . . . . . . . . . . . . . . . . . . — — — 6,000 –

Norway . . . . . . . . . . . . . . . . . . . . — 20,000 18,000 — —

Philippines . . . . . . . . . . . . . . . . . — ● ● ● —

South Africa . . . . . . . . . . . . . . . 270,000 30,000 – 10,000 55,000

Spain . . . . . . . . . . . . . . . . . . . . . . — 28,000 – 10,000 —

Sweden . . . . . . . . . . . . . . . . . . . . — 240,000 – 33,000 53,000

Turkey. . . . . . . . . . . . . . . . . . . . . — 50,000 – 15,000 –

United States. . . . . . . . . . . . . . . ● 136,000+ ● 36,000+ 53,000+

Yugoslavia . . . . . . . . . . . . . . . . . — 68,000 – 15,000 5,500

Total . . . . . . . . . . . . . . . . . . . . 642,700+ 956,100+ 30,000 251,300+ 285,900+

● —Capacity notavallable.

SOURCE: Charles River Associates, Processing Capacity for Critical Materials, OTA contract report, January 1984

Table 5-15.—Production Capacities for Chromium

Metal in the Non-Communist Countries-1981

(tonnes per year)

Table 5-16.—Chromium Ferroalloys and Metal:

imports and Consumption (gross weight, short tons)

Ferrochromium Metal a

Country Electrolytic Aluminothermica

France . . . . . . . . . . . . . . . . . . 900-1000

Japan . . . . . . . . . . . . . . . . . . . 3,000-4,000 300-1,000

West Germanyb . . . . . . . . . . 600,1,200

Luxembourg . . . . . . . . . . . . . 0- 500

Great Britain . . . . . . . . . . . . . 2,000-4,000

United States . . . . . . . . . . . . 2,800-3,000 0-1,800

aA.T~apaCity isdifficulttoestirnate Since wmefacilitim that are used for the

production of otheralloys can beused forthe production of A-Tchromium The

wide range of capacity estimates reflecls this difficulty.

bTheTO is an addit~onal “captive” producer of AT chromium in weSt Germany.

Its substantial production is sold directly to two or three companies within West

Germany

SOURCE: Charles River Associates, Processing Capacity for Cri!ical Materia/s,

OTA contract report, January 1984.

other alloys is employed. In addition, Elkem

Metals, which produces Chrome 98 at its plant

in Marietta, OH, offers variable capacity because it uses its vacuum furnaces for other

products, e.g., vanadium carbide and lowcarbon ferrochromium. But briquetting equipment for preparing the furnace feed material

limits production to 1,400 tonnes (1,300 tons)

of chromium metal per year. A small investment in additional briquetting equipment could

easily double output.

1971:

Imports . . . . . . . . . . . . . . . . . . . . 85,187 NA

Consumption . . . . . . . . . . . . . . . 253,193 NA

Imports as percent of

consumption . . . . . . . . . . . . . 34 —

1974:

Imports . . . . . . . . . . . . . . . . . . . . 161,573 1,960

Consumption. . . . . . . . . . . . . . . 472,379 5,479

Imports as percent of

consumption . . . . . . . . . , . . . 34 36

1980:

Imports . . . . . . . . . . . . . . . . . . . . 297,218 4,075

Consumption . . . . . . . . . . . . . . . 388,639 5,635

Imports as percent of

consumption . . . . . . . . . . . . . 76 72

aMetal irnpofl data Include unwrought metal, waste, and SCraP

NA—Not available.

SOURCE: U S. Department of the Interior, Bureau of Mines, Minerals Yearbook,

VOI 1, 1971, 1974, and 1980.

Western production of electrolytic chromium

metal comes from two plants, one each in Japan and the United States. Toyo Soda has a capacity of 4,000 tonnes (3,600 tons) per year, and

Elkem has a 2,800-tonne capacity (2,600 tons).

Plans to expand capacity to 4,500 tonnes at

Elkem were considered but shelved owing to

lack of prospective markets.
Ch. 5—Strategic Material Supply . 159

The United States still has domestic capacity for all types of ferrochromium products, although “practical” (in operating condition) capacity no longer covers its needs. For instance,

estimated practical capacity (1984-85) for highcarbon ferrochromium is placed at 130,000

tonnes (118,000 tons),44 while 1982 consumption totaled 215,000 tons.45 Imports are ex44Char]es River Associates, op. cit., p. 58.

ASU.S. Department of the Interior, Bureau of Mines, Minerals

Yearbook 1982, vol. 1, p. 205.

pected to continue to erode U.S. production capacity. Firms that appear to be able to remain

viable—e.g., Globe Metallurgical Division of Interlake, Inc.—have small, flexible furnaces

which can handle special orders and produce

premium grades. In terms of chromium metal

production, the United States has the ability

to handle all stages of both the electrolytic and

aluminothermic processes and produce a substantial portion of domestic needs.

Cobalt Production and Processing

State-controlled mining operations produce

more than 90 percent of the world’s cobalt supply. The industry is dominated by one such

African producer, Zaire, which directly supplies nearly 40 percent of U.S. imports. Unlike

the other first-tier strategic materials, the number of producer countries has grown in the past

20 years; and these four countries now hold 9

percent of overall output. In addition, a number of cobalt-containing ore deposits—including some in the United States—have been

evaluated in the past decade, but all await improved prospects for primary ores and/or cobalt before any operations will be considered.

Cobalt minerals are oxides, sulfides, or arsenides, and they occur in a number of geological environments. The majority of the world’s

cobalt production comes from a particular

geologic combination (stratabound copper deposits associated with sedimentary rock) that

has only been found in Zambia and Zaire.

Other geological types in which cobalt is located are laterite, hypogene, and hydrothermal

deposits. Hypogene deposits are formed during the crystallization of molten rock in which

minerals separate and accumulate. Hydrothermal deposits are formed when water containing metals circulates through rocks, solidifying along fractures to produce vein deposits.

The principal product derived from cobaltbearing laterites is nickel in combination with

iron; from hypogenes, nickel, and/or copper.

Cobalt is only a secondary product of current mining operations; therefore, its mining

and refining is tied to the primary metals nickel

and copper, Thus, normal market fluctuations

for cobalt do not usually directly influence decisions to alter production rates. Only two

countries have had the capability to produce

cobalt as a primary product: Zaire, partly because of its high cobalt content ores (0.35 percent); and Morocco, whose cobalt arsenide ores

were mined until 1983. For other producers,

increasing cobalt production in the absence of

increased demand for copper or nickel means

either bearing the cost of stockpiling copper

or nickel or running a risk of depressing prices

by creating an oversupply in those markets.

Although 12 countries reported mine production of cobalt in 1982, Zaire supplied 45 percent of the world’s total output (table 5-17).

Zambia contributed another 13 percent. These

two African countries are the major sources

of cobalt for the free world market, the principal consumers being the United States, Western Europe, and Asia. The United States is dependent on imports for all of its primary cobalt

needs. (Eight percent of consumption in 1982

was provided by the recycling of purchased

scrap.) The Eastern bloc’s cobalt needs are supplied by the Soviet Union and Cuba. Little cobalt is consumed by producer countries, except

the Soviet Union.
160 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table 5-17.—World Cobalt Reserves and Production by Country

(million pounds of contained cobalt)

Average Percent

grade Production a

of world

Producer country Reserves percent 1982 production

Australia. . . . . . . . . . . . . . . . . . . 50 0.10 4.8 9

Botswana . . . . . . . . . . . . . . . . . . 20 0.06 0.6 1

Canada . . . . . . . . . . . . . . . . . . . . 100 0.07 3.3 6

Finland . . . . . . . . . . . . . . . . . . . . 50 0.20 2.2 4

Morocco b . . . . . . . . . . . . . . . . . . 0 1.20 1.5 3

New Caledonia . . . . . . . . . . . . . 500 0.05 1.1 2

Philippines . . . . . . . . . . . . . . . . . 300 0.08 1.1 2

South Africa . . . . . . . . . . . . . . . 40 NA NA —

Soviet Union . . . . . . . . . . . . . . . 300 NA 5.2 9

Zaire . . . . . . . . . . . . . . . . . . . . . . 3,000 0.35 24.9 45

Zambia . . . . . . . . . . . . . . . . . . . . 800 0.25 7.2 13

Subtotal . . . . . . . . . . . . . . . . . 5,160 51.9 94

Others. . . . . . . . . . . . . . . . . . . . . 840 3.4 6

Total . . . . . . . . . . . . . . . . . . 6,000 55.3 100

aMine outpui.

boperations suspended in December 1982.

NA—Not available,

SOURCE: U.S. Department of the Interior, Bureau of Mines. Reserve base: Minera/ Commodity Prof//e 1983 Coba/t

Production: Minerals Yearbook 1982, vol. 1, p. 258

Foreign Production of Cobalt

The cobalt industry is divided into two groups:

vertically integrated firms, which mine ores

and process them into cobalt products, and

mine producers, which sell semiprocessed ores

to refiners. Mining is singly controlled in each

producer country, except in Canada, Australia,

and South Africa. As table 5-18 shows, a tangle

of multi-national firms produce cobalt. U.S.

firms have interests in Australia (Freeport and,

indirectly, Asarco), Botswana (Amax), Canada

(Newmont Mines and Superior Oil), the Philippines (indirectly, Superior Oil, through Sherritt Gordon), and Zambia (Amax).

Cobalt flows worldwide in a number of forms

until final products such as metal (electrolytic)

cathodes and powder, cobalt salts, and oxides

are produced for sale to industrial users. Even

within integrated firms, intermediate products

are often shipped from the mining country elsewhere for final processing. However, there is

a growing trend toward complete processing

in the country of origin.

In an emergency, one advantage of vertically

integrated processing in the producing country is that final cobalt products—principally

pure metal—can be air shipped at no great increase in cost. Intermediate products, on the

other hand, have few metal units per pound,

and shipping them other than by sea is costly.

During the Shaba uprising in Zaire in 1978 and

1979, air transportation proved to be a successful export method.

Because of cobalt’s varied and complex processing flows (see the following section on cobalt processing), mine production cannot be

discussed independently from final processing.

Cobalt production and import data often refer

to both the mine producer and the downstream

processing countries. When integrated mine

producers and independent refiners are both

considered, the world’s sources of refined cobalt products appear to be diverse, although

Zaire still dominates. As table 5-19 indicates,

the flow of semiprocessed ores is toward the

consuming nations. Zaire, Zambia, and Finland have integrated firms which can completely process their ores into cobalt cathode

and powder forms. South Africa now exports

both cobalt chemicals (sulfate) and metal powders. Some South African intermediates, however, are still shipped to England and Norway

for processing. Canada’s Inco now has the capability to produce metal from its ores but

maintains the option to ship intermediates to
.—.

Ch. 5—Strategic Material Supply ● 161

Table 5-18.—Cobalt Mining Industry by Country

Ownership

Primary national

Country Major firms Sector Major holdersa

identity

Australia . . . . . . . . . . . . Queensland Nickel Pty. Ltd

Western Mining Corp. Ltd.

Agnew Mining Co. Pty. Ltd.

Botswana. . . . . . . . . . . . . Botswana RST Ltd.

Operated by BCL Ltd.

Canada. . . . . . . . . . . . . . . Inco Ltd.

Falconbridge Ltd.

Finland. . . . . . . . . . . . . . .Outokumpu Oy

Morocco f ... , . . . . . . . . .Campagnie de Tifnout

Tiranimine (CTT)

New Caledonia . . . . . . . .Societe ie Nickel (SLN)

Philippines . . . . . . . . . . . Marinduque Mining and

Industrial Corp.

South Africah 

, . . . ... , . Rustenberg Platinum Mines

Ltd.

Impala Platinum Holdings Ltd.

Zaire . . . . . . . . . . . . . . . . . Generale des Carrieres et des

Mines (Gecamines)

Zambia . . . . . ., . . . . . . . .Zambia Consolidated Copper

Mines Ltd.

Private

Private

Private

Private

Private

Private

Private

Private

Private

Government

Private

Private

Government

Private

Private/

government

Private

Government

Government

Government

Private

Private

Private

Private

Private

Government

Government

Private

Metals Exploration (50)

Freeportb (50)

WM Corp. Holdings (100)

Seltrust Mining (60)

Mount Isa Minesb (40)

Amax (30)

AngloAmer (30)

various (40)

Botswana RST (85)

(15)

d

McIntyre Minese (40)

(81)

(balance)

Omnium (81)

Imetal (15)

SNEA9 (15)

ERAP (70)

(87)

Sheritt Gordon (10)

JCI (33)

AngloAmer (24)

Lydenburg (24)

Gencor (56)

(loo)

ZIMCO (60)

Zambia Copper Investment

(27)’

Private RST International (7)

Local

Us .

Local

Local

Local

U s .

South

Africa/U. K.

Local

(see above)

Local

Canada

Canada

Local

Local

French/

Local

French

French

French

Local

Canada

Local

Local

Local

Local

Local

Local

South

Africa/U. K.

Local

awtth approximate percentage of control, If available

bA wholly owned subsidiary of Freeport McMoran Inc (Us )

CA subsldia~ of MIM Holdings which is (49°/0] owned by Asarco Inc

dThe largest Single.shareholder block of Inco stock Is 4 Percent

eFalconbrldge ,s 327 percent owned bY Superior 011 through Cflrect eqlllty and its COfltrO[[irlg Interest in Mylntyre

fNot ,n production s!nce December 1982

gSNEA IS 67 percent owned by ER,4f’.Entreprlse de f?echerches et cf’Activltes Petrolteres, giwng ERAP about 80 percent control of SLN

hThere are slx finance houses (the Groups,,) Which dominate the South Afr,can Industry, The Anglo American corp of S A Ltd (AngloAmer), Gold Fields Of S A Ltd ,

General Mining Union Corp Ltd (Gencor), Rand Mines/Barlow Rand, Johannesburg Consolidated Investment Co Ltd (JCI), and AngloTransvaal Consolidated Investment

Co Ltd (AngloTC)

‘Owned by Anglo American

SOURCES E&MJ 1983 Interrrat{onal Directory of A4tnmg, Bureau of Mtnes M/neral Commod/ty Profile 1983: Cobalt; Office of Technology Assessment

its plant in Wales, where cobalt salts are produced. Falconbridge exports processed ore

from Canada to its plant in Norway for the production of cathodes.

Firms in Botswana, Australia, New Caledonia, and the Philippines mine and smelt their

ores. This intermediate product (matte) is

traded to refiners for final processing. Two Japanese firms refine intermediates from the

Philippines and Australia. The resulting cobalt

cathodes are either consumed in Japan or exported. Amax, the sole U.S. cobalt refiner, currently holds contracts to receive matte from

one producer in Australia and from its own

operations in Botswana, Output from the major Australian producer, Western Mining, is

shipped to Sherritt Gordon’s refinery in Canada for processing into cobalt powder. New

Caledonia’s small output is processed into cobalt salts by Metaux Speciaux in France.

Four of today’s producer countries, shown

in table 5-20, have initiated production since

1960, causing a redistribution of market shares

despite the commanding hold on the market
162 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table 5-19.—World Refined Cobalt Production—

1982, by Country (million pounds)

Country a

CANADA . . . . . . . . . . . . . . . .

FINLAND . . . . . . . . . . . . . . .

France . . . . . . . . . . . . . . . . . .

West Germany . . . . . . . . . . .

Japan. . . . . . . . . . . . . . . . . . .

Norway . . . . . . . . . . . . . . . . .

SOVIET UNION . . . . . . . . . .

United Kingdom. . . . . . . . . .

United States . . . . . . . . . . . .

ZAIRE . . . . . . . . . . . . . . . . . .

ZAMBIA . . . . . . . . . . . . . . . . .

ZIMBABWE . . . . . . . . . . . . . .

Recovered

metal

Percent

of total

1,730

3,218

11,100

880

4,282

2,184

8,700

1,600

1,016

13,200

5,392

110

4

7

26

2

10

5

20

4

4

30

12

<1

Total . . . . . . . . . . . . . . . . . 43,412 100

aupper case indicates refiner is also an ore producer

SOURCE: U.S. Department of the Interior, Bureau of Mines, Minerals Yearbook

1982, VO[ 1, p 256.

that Zaire has maintained. Until the worldwide

recession abates and steady economic growth

is anticipated by the mining industry, the current producers of cobalt will remain the only

sources.

There has been extensive activity since the

late 1970s on cobalt-related projects around the

world, including in the United States. A number of mining projects are being or have been

evaluated, although none appear economic.

Foreign projects (table 5-21) reportedly evaluated include Gag Island in Indonesia, Kilembe

copper mine in Uganda (processing of coppercobalt tailings), the Windy-Craggy deposit in

Canada, Musongati in Burundi, Ramu River in

Papua New Guinea (see the section on chromium in this chapter), and Goro in New Caledonia. Except for the Ramu River project,

which depends on chromite and nickel, the

economic viability of these projects will be determined by the market for nickel or copper.

(U.S. projects are discussed in detail in the next

section,)

Albania has contracted for the construction

of a nickel and cobalt refinery, which will produce cobalt oxide from domestic nickeliferous46 ores. (A West German government firm,

Saltzgitter Industriebau A. G., and Inco of Canada are involved.) An unconventional source

of cobalt is under investigation in Peru, involving concentration and refining of cobalt-bearing tailings from the Marcona Iron Mine.

These projects represent a potential 20 percent increase in supply for world markets

under improved economic conditions. Bringing any of them into production, however,

would require considerable capital and lead

times of several years to develop the necessary

infrastructure.

q6Bearing or containing nickel.

Table 5-20.—Historical Production—Cobalt, 1960-80, by Country

(thousand pounds, contained cobalt; percent of world total)

1960 1965 1970 1975 1980

Producer country Production Percent Producer Percent Producer Percent Producer Percent Producer Percent

Botswana ., ., 0 0 0 0 0 0 178 <1 498 1

Canada. ~ ~ 3,330 10 3,648 10 4,562 9 2,986 5 3,534 5

Finland ., 0 0 3,292 9 2,800 5 3,090 5 2,282 3

Morocco ~ ~ ., ~ ... 2,802 8 4,038 11 1,332 3 4,324 7 1,848 3

New Caledonia ., ., 0 0 0 0 0 0 4,528 7 400 1

Philippines ., ., ., 0 0 0 0 0 0 234 <1 2,934 4

South Africa ., ., ., ~ NA NA NA NA a

Zaire, ., ., ., ., 18,166 54 18,492 49 30,772 59 30,860 48 34,180 51

Zambia ,.. ~ ~ ~ ~ 4,070 12 3,404 9 5,290 10 5,252 8 9,700 14

Soviet Union . , b 2,800 7 3,400 6 3,900 6 4,960 7

Subtotal ., ., 28,400 85 35,874 95 49,178 94 61,324 94 63,856 95

Other ., ,.. . ., 5,000 15 1,760 5 3,400 6 3,600 6 3,620 5

Total ., .,. . 33,400 100 37,634 100 52,578 100 64,924 100 67,476 100

aE~tlmated 475,000 Pounds in 1981

~Only Free World reported In 1960

NA–Data not availatie

SOURCE U S Oeparfm?nt of the Interior, Bureau of Mines, Mmerak Yearbook, 1961, 1966, 1971, and 1981
Ch. 5–Strategic Material Supply Ž 163

Table 5-21 .—Potential Foreign Cobalt Sources

Estimated cobalt content,

million pounds

Production Estimated Ieadtime

Site per year Deposit to production

Gag Island, Indonesia. . . . . . . . . . . . . 2.8 400 2 to 3 years

Kilembe, Uganda . . . . . . . . . . . . . . . . . NA 784 1 to 3 years

Windy-Craggy, Canada . . . . . . . . . . . . NA 982

Musongati, Burundi . . . . . . . . . . . . . . . NA 160 NA

Ramu River, New Guinea . . . ., , ... , 5.9 NA +5 years

Goro, New Caledonia . . . . . . . . . . . . . 2.0 NA 3.5 to 5 years

Marcona Mine, Peru . . . . . . . . . . . . . . 4.0 NA =2 years

Albania refinery . . . . . . . . . . . . . . . . . . NA NA z 1985

NA—Data not available.

SOURCE Office of Technology Assessment

Following is a brief discussion of each major cobalt mine producer’s operations and the

processing route of the ores. The industry experienced a cutback in mine production and

delay in expansion plans because of the 1981-

82 worldwide recession. In 1984-85 future prospects have been regarded cautiously.

Australia

Only intermediate cobalt products are produced in Australia. The major producer, Western Mining, is also the third largest nickel producer in the world. For cobalt recovery, the

company processes nickel sulfide ores from deposits in western Australia into mixed nickelcobalt sulfides, which are shipped to Sherritt

Gordon in Canada for processing into cobalt

powder. Queensland Nickel in northeastern

Australia also produces a mixed nickel-cobalt

sulfide, but its ores are nickel oxides from

laterite deposits. The intermediate product is

shipped to Nippon Mining’s refinery in Japan

under a life-of-mine contract. Agnew Mining’s

nickel sulfides are smelted by Western Mining

in Australia and refined by Amax at Port

Nickel in Louisiana. Although a minor world

source of cobalt, Agnew is one of Amax’s two

current sources of cobalt intermediates. Internally, Australian producers rely on rail for

transportation between mining, smelting, and

exporting phases of production.

Botswana

The two mines in Botswana, Selebi and

Pikwe, are operated by BCL Ltd. (15 percent

government owned). The smelting furnace at

the mining complex had a production peak of

47,000 tonnes of matte (nickel and copper at

38.5 percent each and cobalt at 0,56 percent)

or, 479,000 pounds of contained cobalt in 1981.

The matte is sent by railroad through South

Africa to the port of East London or through

Mozambique to Maputo for sea shipment to

Amax’s refinery in Port Nickel. The South

African route is preferred because the loading

facilities at East London are more efficient.

Botswana RST has been reevaluating its copper-nickel sulfide ore deposits in recent years.

Preliminary indications are that the reserves

could be increased significantly, but an investment in extensive drilling is needed for confirmation.

Canada

Canada has two integrated mine producers,

Falconbridge and Inco, and one independent

refiner, Sherritt Gordon. Most of Canada’s cobalt deposits are located in the Sudbury area

of Ontario and are classified as nickel/copper

sulfides. Falconbridge smelts its ores into a

mixed metal matte containing nickel, copper,

and cobalt (1 percent). This material is then

shipped to Falconbridge’s refinery in Kristianstad, Norway, where cobalt cathodes are

produced. Inco has produced cobalt oxide at

its own plants in Port Colborne and Thompson, Canada, Recently, an electrolytic plant

with a design capacity of 900 tonnes (1.6 million pounds) of metal per year began operation

at Port Colborne to complete domestic proc-
164 Ž Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Photo credit Inco, f.td

Cobalt is recovered from nickel and copper ores in the

Inco processing pIant at Port Colborne, Ontario

essing of the ores. Cobalt oxide will still be produced at Thompson, with some being shipped

to Inco’s refinery in Wales for final processing. Inco and Falconbridge together normally

have the capacity to mine ores containing 9

million pounds of cobalt per year. Inco’s smelter

has a maximum output capacity of 4 million

pounds of cobalt per year. However, world

market conditions have reduced actual output

by half in the past few years. Sherritt Gordon

stated in 1983 that if the price of cobalt rose

to $10 per pound (signaling improved markets),

the company would triple its output of cobalt

powder. 47

aTAmerjcan Metal Market, Oct. 27, 1983.

Finland

The integrated firm Outokumpu Oy, Finland’s sole producer, derives cobalt from copper sulfide ores containing copper, zinc, and

cobalt; the ores are from the firm’s Keretti and

Vuonos mines in eastern Finland. A cobalt concentrate is subsequently processed at the Kokkola refinery on the west coast. Products include both cobalt powder and salts. Outokumpo

has been conducting exploration and process

development work (a new concentration technique based on leaching technology) at the

Talvivaara deposit near Sotkamo in order to

improve the firm’s reserve figures and develop

a new source of cobalt, as well as nickel, zinc,

and copper. Total resources have been estimated at 300 million tons of ore which, with

a cobalt grade of 0.02 percent, represents

60,000 tons (120 million pounds) of cobalt. If

the processing technique proves feasible, about

10 million tons of ore (containing 4 million

pounds of cobalt) could be produced annually.

Morocco

Cobalt production in Morocco was discontinued in December 1982 because declining reserves and increased mining costs made the

firm’s cobalt production noncompetitive. A

better worldwide economic climate could encourage broadening of the reserve base and reopening of the mines. Morocco’s ores are

cobalt-iron-nickel arsenides, and Morocco is

the only world producer for which cobalt has

been the primary product. The ores were processed in France by Metaux Speciaux, a subsidiary of Pechiney Ugine Kuhlmann, the stateowned metals group. The oxide and metal

products were consumed internally. (Metaux

Speciaux now receives cobalt intermediates

from SLN in New Caledonia for processing

into salts.) Amax considered using Moroccan

ores and ores in the tailings at the Uganda

Kilembe copper mine as a feed for its U.S.

plant. Neither source presents any technical

problems, but it is difficult and costly to transport the ores from either spot in northern

Africa to the Botswana smelter for initial processing.
—.

Ch. 5—Strategic Material Supply ● 165

In 1982, the Trade and Development Program of the U.S. International Development

Cooperation Agency completed a study of the

prospects for Moroccan cobalt production.48

The study reported that, although the reserves

were approaching exhaustion, the potential for

discovering new cobalt deposits in the Bou

Azzer region (site of the closed mines) was very

high, suggesting that extensive geological

studies be undertaken.

New Caledonia

Only 8 percent of the cobalt in SLN’s ores

is recovered because most of its nickel oxide

ores are smelted directly into ferronickel. (See

discussion of cobalt losses due to ferronickel

production in the following processing section.) The cobalt intermediates that are produced by SLN’s smelter are processed in

France by Metaux Speciaux. Cofremmi, S. A.,

a firm controlled by Amax, BRGM (France),

and Patino N.V. (Netherlands), has studied the

feasibility of mining the nickel laterite deposits containing cobalt at Goro, estimating a cobalt output of 1,000 tons (2 million pounds) per

year. A deposit at Tiebaghi has been investigated by Amax. Both deposits could be exploited using existing technology, but eventual

production from either source will depend on

the nickel market.

The Philippines

Some 20 nickel laterite deposits, with varying cobalt content, have been identified in the

Philippines, although only one is in production.

Marinduque derives cobalt from a large deposit

with 0.10 percent cobalt content at Surigao on

Nonoc Island. A mixed nickel-copper sulfide

is shipped to Japan for refining into cobalt

cathodes by Sumitomo Metal Mining. Marinduque planned a cobalt refinery with a rated

output of 1,200 tons (2.4 million pounds) per

year, but current financial problems have prohibited any action. It is estimated that the plant

would take about 18 months to complete.

48u .s. I Hternatlona] r)e~~e]opment Cooperat ion Agenc }’, Trade

and I)e\’elopment Program, Aforocco Cobalt hfission, Februar~r

1982,

South Africa

Cobalt from the Union of South Africa is produced from nickel products separated during

platinum ore beneficiation. Data on actual cobalt production became available only recently.

Production in 1981 has been estimated at

475,000 pounds of recovered cobalt. Two producers, Rustenburg and Impala, are now fully

integrated within South Africa. Rustenburg

processes nickel mattes into cobalt sulfate at

a plant jointly owned with Johnson-Matthey.

Impala’s mattes are processed into cobalt powder at its refinery at Springs in the Transvaal

Province, A third (minor) producer, Western

Platinum Ltd., ships mattes to the Falconbridge

plant in Norway for processing. (Falconbridge,

a Canadian firm, is part owner of Western

Platinum.)

Zaire

The copper oxide and mixed oxide-sulfide

deposits of Zaire have one of the world’s highest concentrations of cobalt (average 0.3 percent). Gecamines (the government mining firm)

recovers cobalt after the last step of the copper

ores processing. This makes cobalt production

relatively inexpensive, but because the operations seek to maximize copper recovery, overall cobalt recovery from the mined ores is only

in the 30-percent range. Mine-to-metal cobalt

production is integrated at the mining area,

Gecamines’ two refineries produce cobalt metal

cathodes.

Metallurgic Hoboken Overpelt in Belgium

has an agreement with Zaire to process refined

cobalt into cobalt chemicals and extra-fine

powder. During the depressed markets of the

past few years, Gecamines has stockpiled cobalt rather than substantially curtail its production rate. Estimates are that, by the end of 1982,

Zaire and its sales agents were holding more

than 20,000 tonnes (36 million pounds) of cobalt products off the world market. This amount

exceeds Zaire’s 1980 production rate of 17,090

short tons (34 million pounds),

Zaire was granted $360 million in loans by

the International Monetary Fund in 1984 to

help compensate for the decrease in export
166 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

earnings due substantially to the depressed

world markets for copper and cobalt. There

have been attempts to open additional Zairian

sources of cobalt by various consortiums of

government and multinational private firms

(e.g., Sodimiza and Societe Miniere de TenkeFungurume), but they have failed because of

market conditions for both copper and cobalt.

After the Shaba crisis ended in 1979, Zaire

continued to use air transportation for cobalt

exports until the price of cobalt dropped dramatically. Land routes from Zaire include a

river barge/rail combination west to the port

of Matadi and rail routes via South Africa and

Tanzania. Negotiations were underway in 1984

to allow Zaire the use of the Mozambique port

of Beira.

Zambia

While Zambia produces from the same ore

belt as Zaire, Zambia’s ores are almost exclusively copper sulfides, and the concentration

of both copper and cobalt (0.15 percent) is

lower than in Zaire. The overall recovery rate

for cobalt is about 25 percent. (The cobalt refinery yield is 75 percent, but only a third of

the mined cobalt containing ores are processed

for cobalt with the rest going to copper.) Sulfide ore processing requires smelting and separate streams for copper and cobalt rather than

the sequential hydrometallurgical extraction

process used in Zaire with oxide ores. The end

product in Zambia is cobalt cathodes, half of

which are of the high purity required for superalloy use.

The major transportation route from Zambia,

especially for copper, is via the Tazara Railroad

to the port of Dar es Salaam in Tanzania. The

railroad was built in the 1970s, with assistance

from the Chinese government, to reduce black

southern Africa’s dependence on rail routes

through South Africa. It has been continually

plagued with equipment and maintenance

problems, reducing its reliability. China agreed

to extend the grace period for repayment of the

railway’s debt, freeing up funds for repairs and

for purchase of additional rolling stock. Several Western European nations have agreed to

assist the rehabilitation effort. The port of Dar

es Salaam tends to be a bottleneck causing extreme delays in shipments.

Potential Sources

The first of the following potential sources

of cobalt is of particular interest because it is

located close by in Peru and because little development would be required to produce cobalt. The time-consuming ground work has

been completed for the second project, and it

awaits economic viability.

Peru/Marcona Iron Mine

It has long been known that the iron sulfide

(pyrite) tailings from operation of the Peru/Marcona iron mine contain cobalt. The Trade and

Development Program (TDP) studied this project in 198249 at the request of Hierro-Peru, the

Peruvian government iron mining concern,

and estimated that at an iron mining rate of 7.2

million tons per year, 2,079 tons (4.2 million

pounds) of cobalt could be recovered annually

from the pyrite tailings. (In 1981, nearly 7.5 million tons of crude ore were mined, although

the mine has an annual capacity of 15 million

tons.) Additional cobalt is contained in the tailings generated over the lifetime of the mine’s

operation. The TDP report proposed that the

cobalt ore be prepared for use in a U.S. refinery, such as the Amax refinery in Louisiana or

one of Hall Chemical’s plants. An evaluation

was underway in 1984, funded by the TDP, to

identify the required processing steps, the necessary infrastructure, and the capital requirements. This cobalt source might provide one

of the quickest new supplies, given any disruption in the normal market, because the iron

mining operation and most of the infrastructure required are already in place. Deepwater

port loading facilities are available nearby.

WU. S. ]nternation~ Development Cooperation Agency, Trade

and Development Program, The A4arcona Iron Mine: A Potential New Source of Cobalt in Peru, November 1982.
Ch. 5—Strategic Material Supply ● 167

Indonesia/Gag Island

After 10 years and a $50 million investment,

further investigation on the nickel laterite project at Gag Island, Indonesia, was halted in 1981

by P.T. Pacific Nikkei Indonesia. The partnership of U.S. Steel, Amoco Minerals, and Ijmuiden

Hoogovens BV of The Netherlands was subsequently liquidated. The reasons given for abandoning the project were the depressed state of

the nickel and cobalt markets and the uncertainty of the future, along with interference by

the Indonesian government, A production rate

of 60,000 tons of nickel and 1,400 tons (2.8 million pounds) of cobalt for the first 10 years of

operation had been projected,

(See also the Ramu River, Papua New Guinea,

project discussion in the chromium section.)

Domestic Production of Cobalt

Currently, cobalt is not produced from domestic mines, but this has not always been the

case. U.S. mine production (fig. 5-3) reached

a high point in 1958, when about 4.8 million

pounds of contained cobalt were produced.

(U.S. consumption of cobalt in 1958 was 7.5

million pounds.) In the 1948-1962 period, a total

of approximately 14 million pounds were acquired by the government through stockpile

purchases and Defense Production Act subsidies, Federal purchases included about 6 million pounds of cobalt from the Blackbird Mine

in Idaho, and about 2.9 million pounds from

mines in the Missouri Lead Belt (including the

Madison Mine). There has been no production

from these mines since the Federal purchase

contracts expired more than two decades ago,

During the period 1940-72, approximately

500,000 pounds of cobalt were produced each

year from iron ore pyrite concentrates taken

from Pennsylvania’s Cornwall Mine.50

Since 1980, Federal subsidies for domestic

cobalt production have again been proposed

as an alternative to stockpiling, These proposSOThe hlstoryr of domestic cobalt production, through 1968, is

discussed in James C. Burrows, Cobalt: An industry Analysis, ”

Charles River Associates Research Study (Lexington, MA: Heath

Lexington Books, 1971], pp. 103-113 and 185-189.

Figure 5-3.— Total U.S. Cobalt Production, 1945-71

(cobalt content of mined ores)

50

48 .

1945 1950 1955 1960 1965 1970 1975

Years

SOURCE W!lllam S Kirk, Commodity Spec!allst, Bureau of Mines, Department

of the Intenor, 1984

als are discussed later in this section, and also

in chapter 8.

Domestic deposits that may yield cobalt to

meet national needs today are the Blackbird deposits, the Madison Mine of Missouri and associated cobalt in the Missouri Lead Belt, the Gasquet Mountain project in California, and in the

Duluth Gabbro of Minnesota. Older, smaller

mines primarily located in the Eastern United

States, such as Pennsylvania’s Cornwall Mine,

are not considered potentially economic sources

by the Bureau of Mines.

Fluctuating metal prices have made it difficult to assess domestic cobalt development

projects, In 1981, spokesmen for the Blackbird,

Madison, and Gasquet Mountain projects all
168 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

stated that sustained market prices of from $20

to $25 per pound would be required to warrant

production. 51 At that time, the market price for

cobalt was $15 per pound, by 1983 it had

dropped to $5 to $6 per pound, and in 1984 was

being quoted at $10 to $12 per pound.

Although large deposits containing amounts

of cobalt too small to be mined for cobalt alone

occur throughout the world, the Madison and

Blackbird deposits could—according to their

proponents —support the mining of cobalt as

a primary ore. Other domestic cobalt resources

can be produced only as byproducts and would

therefore be unlikely to respond solely to

changes in the price of cobalt. The CaliforniaOregon laterite deposits are primarily nickel,

but the Gasquet Mountain project in northern

California is dependent on nickel, chromium,

and cobalt prices for success. The Missouri

lead and zinc mines may have only a small relative incremental cost for producing small

amounts of cobalt, but production at these

mines is dependent on the base metals market.

Moreover, cobalt recovery from these Missouri

ores may require changes in lead and zinc

processing practices and, in some cases, in end

use standards. With present technologies, it is

thought that increased cobalt recovery would

result in higher iron concentration in recovered lead and zinc, which may not be satisfactory for consumers of lead-zinc products.52

The development of deposits in part of the

Duluth Gabbro depends on copper and nickel

markets. At copper and nickel prices at least

double 1983 levels, these Minnesota deposits

could become an attractive venture. Values of

precious metals may also contribute to prospects for development of this area. However,

the considerable excess production capacity of

U.S. copper mines and of Canadian copper and

nickel operations dampen prospects for

production from these deposits.

..—shearings before the U.S. Senate, Committee on Banking,

Housing, and Urban Affairs, Oct. 26, 1981, p. 145, Noranda Mining, the Blackbird Mine owners, now believe that a sustained

cobalt price of $16 per pound would make it feasible to bring

the mine into production due to improved mine planning and

the discovery of higher grade ores. The other mine owners have

not revised their 1981 figures.

Szsi]verman, et al., Op. cit.

Given the proper economic incentives (sustained, higher market prices for primary metals

and/or Government subsidies), domestic sources

(table 5-22) that have seen recent commercial

activity could annually supply 7.7 million

pounds of cobalt. Another 800,000 to 2 million

pounds per year might be recovered from the

Duluth copper-nickel sulfide deposits. (U.S.

consumption of cobalt in 1982 totaled about 10

million pounds.) At current estimated resource

levels, production from these deposits would

range from 12 to 25 years.53

Blackbird Mine

The Blackbird Mine is located in the Salmon

River Mountains of Lemhi County, ID. The

Caldera Co. acquired claims to the Blackbird

District in 1943 after investigations by the Bureau of Mines revealed the presence of commercially feasible deposits of cobalt. Production began in 1950 with subsidies under the

DPA running from 1952 through 1959, when

production ceased.54

Blackbird is now managed by Noranda Mining of Canada, which has proposed reopening

the Blackbird Mine and concentrator to produce 1,200 tons of copper-cobalt ore daily.55 A

final environmental impact statement (EIS)

was published in 1982. Permits currently allow

production of 300 tons daily for a “pilot” operation. However, in 1981 Noranda began laying off employees, and when the final EIS was

issued, only a few workers were still on site.

The project is on hold awaiting improvement

in cobalt demand and prices. The company has

sealed off the mine at the 6,850-foot level, and

the mine is filling with water.

Ore reserves at Blackbird are now given at

7.5 million tons of 0.72 percent cobalt (108 million pounds of contained cobalt) with 1.4 percent copper and 0.01 percent gold. The estiSaproduction ]evels at Blackbird, Madison, and Gasquet Mountain were stated in testimony during U.S. Senate hearings before the Committee on Banking, Housing, and Urban Affairs on

Oct. 26, 1981. They were also confirmed to OTA in telephone

conversations with each mining firm in July 1984. Data for

Duluth Gabbro is taken from the Minnesota study cited in note

67.

SqBurrows, op. cit., p. 187.

Sssilverman, et al., op. cit., P. 67.
Ch. 5—Strategic Material Supply ●

Table 5.22.—Potential U.S. Cobalt Production

Estimated annual production Estimated

capacity (million pounds mine life

Resource/Mine of recovered cobalt) (years) ,, Production dependent on

Blackbird Mine

Idaho . . . . . . . . . . . . . . . . . . . . 3.7 20

Madison Mine

Missouri . . . . . . . . . . . . . . . . . 2 20

Missouri Lead Belt

(tailings) . . . . . . . . . . . . . . . . . 2 ?

Gasquet Mountain

California . . . . . . . . . . . . . . . . 2 18

Duluth Gabbro

Minnesota . . . . . . . . . . . . . . . 0.8-2 25

169

Cobalt price of about $16 per pound (1984)a

Cobalt price of about $25 (1981)a

Cobalt price of about $20-25 (1984)a

Cobalt price of about $20 (1981)a plus Nickel

$2 to $3 per pound

Chromite $40 per ton

Copper, $1.50 per pound

Nickel, $4.00 (1975 data converted to January

1983 dollars)

aYear of estimate

SOURCE Blackb!rd—Noranda Mlnlng, July 1984

Madison—Anchutz Mlnlng, July 1984

Mlssourl Lead Belt —Amax est!mates, July 1984

Gasquet Mountain–California N!ckel Corp , July 1984

Duluth Gabbro—State of Minnesota, l?eg~onal Copper. fV/cke/ Study, 1979

mated cost of production has declined over the

last few years with the discovery of higher

grade reserves and improved mine planning,

and the mine life has almost doubled to 20

years. An estimate provided to OTA by Noranda

holds that about $16 per pound is the price of

cobalt needed to promote the development of

the project, should that occur, 3.7 million

pounds of cobalt is expected to be recovered

per year.

5 8

The Blackbird ores contain high levels of

arsenic, and past mining operations contaminated streams flowing into the Salmon River

drainage, As a condition of reopening the project, Noranda agreed to install a water treatment facility and take other measures to improve and protect water quality. Noranda

negotiated a settlement with the Environmental

Protection Agency in July 1983 that allowed the

company to close the water treatment plant,

evidence of the declining commercial interest

in this project. The cobalt concentrates from

Blackbird also contain a level of selenium

which may or may not be a problem in superalloy use. Noranda officials claim that effective techniques to reduce this element to a

lower level, if necessary, are available. (The

‘BRi~hard Fiorini, Vice-President and General Manager,

Noranda Mining Inc., persona] communication, July 1984.

current maximum allowable limit for selenium

in jet engine superalloy is 5 parts per million. )57

The proposed mining area is surrounded by

private and public lands, approximately 6 miles

from a wilderness area on National Fores t

land. Some of the mining claims (not connected

with the Blackbird Mine, as proposed) extend

into the wilderness area. However, the Act 58

creating the wilderness area made special provisions for exploration for cobalt. No exploration activities have yet been carried out in the

special mineral management area, despite tentative approval granted Noranda by the U.S.

Forest Service.

Large amounts of cobalt are contained in tailings from previous operations at Blackbird;

however, Noranda does not count the tailings

in its reserves, and at present is unlikely to exploit them for their mineral content. The firm

would thereby avoid incurring responsibility

for rectifying water pollution and waste problems caused by past imprudent handling of

sTAmeriCan society for Meki]s, Qua]itv Assessment of National

Defense Stockpile Cobalt Inventory, ~repared for the Federal

Emergency Management Agency (Metals Park, OH, 1983), p. 26.

Sepub]ic Law, 9Ei-31 z., The Central 1daho Wilderness Act of 1980,

authorized exploration for cobalt in special management zone

in the River of NO Return Wilderness area near Blackbird Mine,
170 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

these mine wastes. The State of Idaho filed a

preliminary suit under the Resource Conservation and Reclamation Act against Noranda and

previous owners for environmental damage.

Madison Mine and Missouri Lead Belt Deposits

Mines in the southeast Missouri lead district

produced 5.2 million pounds of cobalt from

1844 to 1961. In 1979, Anschutz Mining ac -

quired the inactive Madison Mine, located near

Frederickstown in part of the old Missouri

Lead Belt, an area where most of the lead and

zinc mines have been depleted. The Madison

Mine produced 2.8 million pounds of cobalt

from 1954 to 1961, before it was closed. The

mine also produced lead, copper, and nickel.

The cobalt mineralization is reportedly high

enough in one zone in the mine to support cobalt production as a primary ore.

If reopened, the mine could have an estimated annual production of 2 million pounds

of cobalt. Recoverable geologic (as opposed to

economic) cobalt reserves at the Madison Mine

are given as 37 million pounds (in 5.6 million

tons of ore and 3.4 million tons of existing tailings). 59 The depressed world price of cobalt and

lack of Government action on proposed price

supports under the Defense Production Act

have led Anschutz to postpone opening the

mine. In 1981, company officials said an estimated guaranteed price of about $25 per pound

would be necessary to promote production

from Madison .

60 Economic studies have not

been revised to reflect any changes in mining

costs since then.

Cobalt in the Madison Mine is a sulfide

mineral. Anschutz Mining has reportedl y

found a previously unrecognized cobalt ore

body that does not contain the lead and zinc

customarily associated with cobalt deposits in

the Missouri Lead Belt. This discovery could

prove to be significant worldwide in identifying an additional geologic environment for cobalt occurrences .

S’JJOhn Spisak, vicepresident for Operations for Anchutz Mining, persona] communication, ]uly 1984.

‘U.S. Senate, Committee on Banking, Housing, and Urban

Affairs, hearings, Oct. 26, 1981, p. 145.

An underground and surface mining operation has been proposed for the Madison Mine

including a smelter to refine its own ores and

process existing tailings from previous mining

periods, as well as the tailings from other lead

belt producers. Perhaps 300,000 to 400,000

pounds of cobalt is recoverable from these tailings given the current technologies used by the

region’s lead mines to produce lead and zinc

from their ores .

61 Up to 1.5 million pounds

might be available, given changes in lead and

zinc recovery practices .

Another analysis 62 of extracting cobalt from

the byproducts of lead-zinc mining in Missouri

estimates that 2 million pounds could be produced per year, based on the recovery of 65

percent of the cobalt content in currently

mined ores. Capital requirements would be in

the range of $40 million to $65 million to install equipment to treat the raw materials (mill

tailings, smelter slags, mattes, copper concentrates and copper-cobalt cakes), This is substantially less than would be required to finance

a new mining venture and would likely yield

an acceptable return if the price of cobalt were

$20 to $25 and if raw materials from several

firms operating in the Lead Belt were pooled

to provide economies of scale. Successful implementation would also require work, in addition to that already done by the Bureau of

Mines Rolla Research Center, on technologies

to recover cobalt from mill tailings and blast

furnace slag.

Gasquet Mountain Project

Cobalt resources are contained in nickel

laterite deposits in northern California and

Oregon.

California Nickel Corp., a wholly owned subsidiary of Ni-Cal Development Ltd. of Canada,

has proposed development of the Gasque t

Mountain mine on unpatented mining claims

it controls in the Six Rivers National Forest in

northern California. The mine, along with assoelsilverrnan, et a],, Op. Cit., P. 111.

eZThiS preliminary analysis was provided to OTA by Amax,

which has extensive holdings in the Missouri Lead Belt from

which it produces lead and zinc.
Ch. 5—Strategic Material Supply Ž 171

ciated milling and processing facilities, as

proposed would annually produce 2 million

pounds of cobalt (cathode), 19.4 million pounds

of nickel (cathode), 50,000 tons of chromite

concentrate (42 to 43 percent chromic oxide),

and 100,000 tons of magnesium oxide, Mine

life has been calculated at approximately 18

years .63

California Nickel has sought production subsidies from the government for the operation, 64

one of several factors that have made the proposal controversial. Viability of the projec t

hinges on the economics of multiple (cobalt,

nickel, chromium) metal production and processing, on successful mitigation of several adverse environmental impacts, and on demonstration that mine areas can be reclaimed, A

draft EIS was published in March 1983, but the

project appears to be in suspension,

Based on a Kaiser Engineers’ mine feasibility study for the project, estimated total ore reserves at Gasquet Mountain are 23.6 million

tons (16.0 million of which are proven reserves

with grade of 0.75 percent nickel, 0.07 percent

cobalt, and 2 percent chromium), Kaiser estimated annual ore production of 1.32 million

tons would be required to generate 2 million

pounds of cobalt per year.

Kaiser also examined several prospective

processing techniques. It concluded that with

the use of a high-pressure acid leach process

(a well-established 20-year old hydrometallurgical technology) maximum extraction of

both nickel and cobalt would occur. In addition, use of this process would make it possible to recover most of the chromite in the ores

using existing gravity concentration methods

and, “might yield another commercial product. ”

6 5

The operation would be a surface mine operating at the crest of 2,000- to 3,000-foot mountains. The mineralization of the Gasquet deposit is shallow, down to about 25 feet; and

8sDOCUrnentS provided to OTA by California-Nickel, March

1983.

134u.s. Senate, committee on Banking, Housing, and urban

Affairs, hearings, Oct. 26, 1981, p. 185.

5~KaiSer Engineers, Interim Report for the Gasquet ~omtain

Project, March 1982, p. 5-10.

mining would consist of scooping up the soil

with backhaulers. Cost to build the project in

1982 was projected at $300 million.

6 6

California Nickel has now split its operations

into two separate units. One oversees the mining project itself and the other, Ni-Cal Technology Ltd., is pursuing the development and

promotion of a modified acid leach processing

technology that was intended for the Gasquet

mine. Six patent applications have been filed

so far, and Ni-Cal intends to build a pilot plant

to test the process on ores from various sources.

Marketing of the process is aimed at laterite

mining operations in the Pacific rim area. No

domestic prospects are in sight.

Duluth Gabbro

The Duluth Gabbro, in northeastern Minnesota, has been suggested as a potentia l

source of cobalt, as well as PGMs. Cobalt production would only be as a byproduct, dependent on the production of copper and nickel.

The area contains an estimated recoverable resource of 20 million tonnes of copper, 5 million tonnes of nickel, 80,000 to 90,000 tonnes

of cobalt (145 million to 164 million pounds),

and lesser amounts of titanium, platinum, gold,

and silver.

67

A Regional Copper-Nickel Study was released by the State of Minnesota in 1979. 68 T h e

study, conducted from 1976 to 1979, assessed

the technical aspects of the development of

mining activities in the Duluth Gabbro and

resultant environmental, economic, and social

impacts. Mining schemes were developed with

the goal of generating representative models,

rather than for predicting or recommending

the choices that might actually be made by a

company developing a specific ore deposit. It

was decided that technology and economi c

conditions required large-scale operations for

Minnesota’s low-grade resource to compete in

late 1970s markets. Thus, the models provided

for a minimum annual production of 100,000

661bid., p. 18.

eTMinnesota Environmental Quality Board (State planning

Agency), The Minnesota Regional Copper-Nickel Stud&y, 1976-

1979, vol. I, Executive Summary, August 1979, p. 10,

6aIbid.
172 . Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

tonnes of metal (85 percent copper and 15 percent nickel). Three hypothetical mine-smelter

complexes were considered, one each with an

underground, open pit or combination underground/open pit mining operation. Assuming

simultaneous development of these three models,

an annual production of 254,000 tonnes (231,000

tons) of copper could be generated over a

period of approximately 25 years.

A report prepared for OTA estimated potential overall cobalt recovery of 25 to 30 percent

from Duluth ores, with significant amounts of

the cobalt lost to mill tailings and during refining .

69 For every 100,000 tonnes of copper

produced, associated cobalt recovery would

be about 4100 to 450 tonnes or about 800,000

pounds. 70

Operation of copper-nickel production at

Duluth would be marginally economic at metal

prices of $1.50 per pound for copper and $4

per pound for nickel, in January 1983 dollars. 71

(In 1983, the U.S. producer delivered price for

copper cathodes averaged 77 cents and the spot

price for nickel averaged $2.20.) 7 2

Other Domestic Cobalt Deposits

Pennsylvania’s Cornwall Mine produced cobalt for many years, yielding 400,000 to 600,000

pounds annually as a byproduct of mining iron

ore. From 1940 until operations ceased in 1972,

the mine produced 100,000 tonnes (182 million

pounds) of cobalt ore. The Gap Nickel Mine

in Lancaster County, PA, has 1 million tons of

remaining ore at grades of 0.1 to 0,3 percent

cobalt. Although these small cobalt deposits are

potential resources, there has been no thorough

examination of the economic and technical viability of mining them. They have usually been

omitted from Minerals Availability System Appraisal studies conducted by the U.S. Bureau

—.--————

eesi]verman, et al., Op. cit., P. 181.

TOThe Mjnnesota Re@ona] Copper-Nickel Study, Op. cit., p. 10.

Plsi]verman, et a]., Op. cit., p. 182. These data are based on

conclusions from a 1975 study, Mineral Beneficiation Studies

and an Economic Evaluation of Minnesota Copper-Nickel Deposit From the Duluth Gabbro by 1. E, Lawver, et al,, for the U.S.

Bureau of Mines.

7ZU . . s Department of the Interior, Bureau of Mines, Minerals

and Materials; A Bimonthl~ Survey, December 1983/January

1984, pp. 25 and 29.

of Mines because their probable cobalt yield

is not considered significant.

7 3

Proposed Federal Subsidies for Domestic

Cobalt Production

As is discussed in chapter 8, proposed renewal of Federal support for domestic cobalt

production has been the subject of considerable debate in Congress and the Administration. Most of this debate has focused on proposed Federal support for domestic cobalt

production, under Title 111 of the Defense

Production Act. (Title 111 authorizes purchase

commitments, loans, and loan guarantees for

materials, services, and facilities considered essential for defense needs. ) president Reagan,

in his April 1982 national materials plan submitted to Congress under the National Materials Policy, Research, and Development Act

of 1980, indicated that analyses were ongoing

to determine whether DPA incentives might be

more cost effective than stockpile purchases

in some circumstances .

The great fluctuation in cobalt prices since

1978 in fact has made it very difficult to make

cost-benefit comparisons among stockpile/domestic production options, as was made clear

in hearings held in early 1983 about an Administration proposal to provide federally guaranteed price supports for domestic cobalt production.

74 In August 1982, the Federal Emergency

Management Agency (FEMA) issued a report

comparing four alternative combinations of

Title III subsidies and stockpile purchases for

cobalt—ranging from exclusive reliance on

government stockpile purchases on the world

market to extensive reliance on a governmentguaranteed minimum price to domestic cobalt

producers—which might be used to realize the

materials availability equivalent of the strategic stockpile goal of 85 million pounds of cobalt .

7 5

——.—

Tssl]Verrnan, et al., OP. cit.

T4U.S. senate, committee on Banking, Housing, and urban

Affairs, Extension of the Defense Production Act, hearing on

Mar. 21, 1983, 98th Cong., 1st sess., Senate Hearing 98-66 (Washington, DC: U.S. Government Printing Office, 1983).

psFedera] Emergency Management Agency, Alternative U.S.

Policies for Reducing the Effects of a Cobalt Supply Disruptiox]—

Net Economic Benefits and Budgetary Costs, August 1982, as

reproduced in its entirety in ibid,, pp. 15-1oo.
Ch. 5—Strategic Material Supply Ž 173

For each scenario, cobalt prices, budget expenditures, and overall economic costs were

projected over a 10-year period (1981-90) under

both a “no disruption” assumption and a peacetime disruption assumption affecting 50 percent of normal U.S. supplies. The disruption

was assumed to occur in 1985. Each of these

scenarios, which addressed the 1981-90 period,

were intended to provide an equal degree of

supply security. FEMA recommended, as the

most cost-effective option, a so-called “hybrid”

alternative entailing a 5-year program of government-stimulated production of 10 million

pounds of cobalt annually from domestic

mines, supplemented by stockpile purchases

of 1,42 million pounds for 10 years. The domestic production would be stimulated through a

federally guaranteed minimum price of cobalt

of about $15 per pound.

When hearings were held on the FEMA proposal in March 1983, cobalt prices had fallen

to about $6 per pound on world markets. The

U.S. General Accounting Office (GAO), which

testified on the FEMA report,76 found that

FEMA’s “stockpile only” analysis in a nondisruption scenario assumed cobalt prices would

rise to over $36 per pound by 1990, more than

double the price projections made by other government agencies. In its hybrid scenario,

FEMA assumed that Federal price guarantees

for domestic production would only be necessary for a 5-year period. This would only be

the case if FEMA’s projected cobalt price is assumed to be accurate. GAO found that, at 1983

prices, buying cobalt on the world market for

the stockpile would be far cheaper than subsidizing domestic production.

Another Defense Production Act issue that

has received considerable attention concerns

a Department of Defense (DOD) proposal for

pilot plant production of domestic cobalt in order to evaluate the quality of this cobalt for defense applications, In 1983, the Air Force issued a draft Request For Proposal (RFP) to

potential domestic producers concerning such

a project. According to DOD, the draft RFP was

T~Statt}m ent of J, Dexter peach, Director, Resources corn munitj’ and Economic Iii\’ision, U ,S. General Accounting Office,

as reproduced in ibid., pp. 3-6.

issued for two reasons: 1) to secure “definitive

data through legal contracting procedures for

a cost/benefit analysis of domestic cobalt production”; and 2) “to determine if domestically

produced cobalt will meet national security requirements.” 77 DOD maintains that the issuance of the draft RFP was simply to evaluate

the costs and benefits of the proposal, in order to support activities of its DPA Title III

steering committee, which has been set up to

evaluate candidate DPA projects. However, the

cobalt pilot plant became an issue in congressional debate about amendments to the Defense

production Act in April 1984. (The DPA amendments are discussed in chapter 8.)

Domestic Mining and Processing Technology Prospects

Lateritic deposits containing cobalt are suited

to open pit mining and to the continuous systems of excavators and conveyor belts that will

gradually become more common in steep pits.

Open pit mining in harder rock would be practicable in the copper-nickel-cobalt deposits of

the Duluth Gabbro, with underground mining

at depths involving open stoping and roomand-pillar methods. In the steeper hard-rock

bodies of cobalt ore such as at Blackbird, cutand-fill mining and the new ramp-in-stope system underground methods could be appropriate.

Process technology has been developed for

recovering cobalt from the Blackbird and

Madison deposits, and preliminary pilot-scale

testing has been completed for both properties

and byproduct cobalt production from Missouri’s

lead mines. Commercial facilities have not

been designed or tested, however. Ore processing systems could be designed for these deposits, plus Duluth Gabbro, that would allow shipment to the existing Amax Nickel refining

plant at Port Nickel for final processing.

The Bureau of Mines has conducted research

into reclaiming the cobalt from Missouri lead

ores which is currently neglected (an estimated

77As discussed in U.S. senate, Committee on Banking, HO Using, and Urban Affairs, hearing: Reextension of the Defense

Production Act, Hearing on S. 1852, Sept. 15, 1983, Senate Hearing 98-400 (Washington, DC: U.S. Government Printing Office,

1983), p. 159.
174 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

2.5 million pounds of contained cobalt per year

is lost) during lead, zinc, and copper processing.78 In other research, the Bureau investigated the extraction of cobalt from the liquid

which remains after dilute acid solutions have

leached copper from its ore. One U.S. copper

mine might be able to contribute 1.3 million

pounds of cobalt per year through this process, which has not yet been economically evaluated. 79

Research on Blackbird complex arsenical

copper-cobalt ores is attempting to find the basis for less costly extraction technology than

currently exists. Investigations have centered

on methods for improving hydrometallurgical

technology because severe sintering and atmospheric pollution problems occur with an alternative roasting procedure. Selective solvent extraction processes are being compared with

conventional precipitation processes for removing iron and recovering cobalt, nickel, and

copper from the resultant leach liquids.80

A comprehensive plan to recover all of the

mineral values in Duluth Gabbro ores (nickel,

copper, cobalt, silver, gold, and PGMs), rather

than concentrate on the primary metals, has

undergone investigation by the Bureau of

Mines Twin Cities Research Center in Minnesota. The approach is a combined pyrometallurgical-hydrometallurgical process to recover

a maximum amount of the byproduct metals

without sacrificing energy or metallurgical efficiency. 81

Laterite ores containing cobalt could benefit from a commercial hydrometallurgical process developed by Ni-Cal Technology Ltd. as a

spin-off of the Gasquet Mountain project in

northern California. After separating out chromite from the mined ores, a slurry of the residual nickel-cobalt-iron minerals is leached,

producing separate nickel-cobalt sulfide and

WI. s. Depaflrnent of the Interior, Bureau of Mines, Research

83, p. 89.

mU. S. Department of the Interior, Bureau of Mines, hfinera]

Zndustry Survey: “Cobalt in February 1984. ”

~Research 83, op. cit., p. 91.

@lNationalMaterials Advisory Board, A Review of the Minerals

and Materials Research Programs of the Bureau of Mines, p.

53; Research 83, op. cit., p. 83.

iron concentrates. Nickel and cobalt are then

produced by standard selective precipitation

and solvent extraction methods, and further

refining is accomplished by electrowinning.

Domestic and Foreign Cobalt Processing

The primary industrial uses of cobalt are in

superalloys, magnetic alloys, catalysts for the

petroleum and chemical industries, and as a

binder in tungsten carbide cutting tool materials. While catalyst producers use chemical

forms of cobalt, superalloy and tungsten carbide makers use pure metal in cathode and

extra-fine powder forms, respectively. Magnetic alloy production uses powder metallurgy

techniques, and fabricators purchase either

cathodes or powder forms.

Cobalt is produced from a variety of ores, and

the processing, tailored for each deposit, depends on the type of ore in which the cobalt

occurs, as figure 5-4 shows. Processes can be

grouped into two general categories, pyrometallurgical and hydrometallurgical. The

pyrometallurgical process is usually conducted

in three stages. First, the minerals in the ore

are concentrated. Second, a smelting or roasting process is used to produce a matte containing cobalt, with associated sulfur and the nickel

and/or copper of the original ores. In the third

step, the matte is treated chemically or electrolytically to separate the cobalt as metallic

powder or cathodes, or as cobalt chemicals. In

hydrometallurgical processes, the concentrated

ore can be chemically processed without the

intermediate smelting step but does require the

application of heat and pressure.

Much of the cobalt content of mined ores is

never recovered, owing to processing technologies and economics or to excessively low

cobalt grades. Processes are such that a high

recovery of the primary metal is often detrimental to the recovery of cobalt. In Zaire, for

instance, the recovery of the cobalt content in

the mined ores is only 30 percent, and in Zambia, 25 percent. (Cobalt is lost into tailings

when the ores are initially concentrated and

again when the concentrates are processed.)

Yields of cobalt could be increased somewhat
.

Ch. 5—Strategic Material Supply ● 175

Figure 5-4.—Simplified Flowchart for the Production of Cobalt

Nickel

sulfide

concentrates

I

Converted

nickel matte

I

Nickel

oxide

ore

by improving the efficiency of producing cobalt from the concentrates,

Nickel laterite ores tend to have cobalt associated with them in very low (0.02 to 0,11 percent) grades. These ores can be leached to

separate out both nickel and cobalt, The economics of nickel production, if energy sources

are available and competitively priced, usually

demand, however, that the nickel ores be smelted

into ferronickel. The cobalt contained in the

smelted ores is either lost into the ferronickel

or the slag. New Caledonia, for instance, produces limited amounts of cobalt from nickel

laterite deposits, because its main effort is concentrated on producing ferronickel. The cobalt

that is produced is a byproduct of some ore

diverted into nickel metal production. Substantially higher amounts of cobalt are produced

by one nickel mining firm in Australia as a result of its ore-matte-nickel metal processing

steps. Other copper and nickel producers totally neglect the cobalt units in their deposits.

In this category are the Hanna Mining operation at Cerro Matosa in Colombia, the Larco

operations in Greece, Bonao in the Dominican

Republic (Falconbridge), and the now-mothballed Inco operation in Guatemala.

Ferronickel was originally developed by New

Caledonia’s SLN and is used in lieu of nickel

metal in the steel industry for the production

of iron-nickel steels. Use of nickel metal is less

energy-intensive than ferronickel, but ferronickel is not so much more expensive that steelmaker will alter their traditional methods.

Nickel metal, however, must be used when the

cobalt in ferronickel would be detrimental to

the final product.

Domestic Processing Capacity

The United States has the operating capacity only to refine imported cathodes and process nickel-cobalt mattes or recycled materials

into cobalt powder (table 5-23). In 1980, only

one-tenth of the 10,825,000 pounds of cobalt

metal consumed in the United States was produced domestically. The United States has no

capacity to produce superalloy-grade cobalt,

This material is all imported.

At its refinery in Louisiana, Amax Nickel

produces cobalt powder, which is sold for applications other than superalloys. The plant,

which mainly produces nickel, was originally

designed with a 5 million to 6 million pound
176 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table 5-23.—U.S. Cobalt Processing Capacity

Source

Product material Firm Annual operating capacity

Superalloy

grade . . . . . . . none

Powder . . . . . . . . Imported smelted Amax Nickel 1 million pounds

ores (matte) Capable of production expansion

to about 3 million pounds; can

add electrolytic circuit to produce

superalloy grade

Extra-fine

powder . . . . . . Cathodes (Zaire) Carol met 2 million pounds

Domestic scrap GTE 32,000 pounds (pilot plant operation)

Salts

(chemical) . . . Recycled Hall Chemical 1 million pounds

catalysts and Plus 3 million to 4 million pounds

scrap from projected plant; could add

circuit to produce superalloy grade

SOURCE Office of Technology Assessment.

U.S. Cobalt Consumption, 1982

Thousand pounds

End use contained cobalt

Superalloys. . . . . . . . . . . . . . 3,319

Steel alloys. . . . . . . . . . . . . . 326

Other alloys . . . . . . . . . . . . . 2,829

Chemical . . . . . . . . . . . . . . . . 2,846

Other ... , . . . . . . . . . . . . . . . 148

Total . . . . . . . . . . . . . . . . . 9,468

SOURCE: U.S. Department of the Interior, Bureau of Mines. Minera/s Yearbook

1982

annual output capacity for cobalt. Available

feed and markets, however, have restricted the

plant to a maximum of just over 1 million

pounds. Estimates are that output could be

raised to some 3 million pounds in a very short

time, provided feed was available. In addition,

all plans and design work have been completed

for adding an electrowinning operation that

would produce cobalt cathodes suitable for superalloy use. This plant modification would

take approximately 2 years to complete. Feed

for the plant is currently imported from Botswana and Australia in the form of mixed metal

mattes. Other sources—e.g., Morocco, Uganda,

and Peru—have been investigated and, while

deemed technically possible, have been dis -

carded as economically unfeasible. Amax’s

operation is a likely candidate to process and

refine any domestic nickel-cobalt ores that

might one day be produced.

At Carolmet, Inc., in North Carolina, an

extra-fine powder for use in tungsten carbides

is produced from cobalt cathodes imported

from Zaire. The plant capacity is 1,000 tonnes

(about 2 million pounds) annually. The other

domestic source of extra-fine powder is the

GTE Chemical and Metallurgical Division at

Towanda, PA. Employing their own process,

tungsten carbide scrap is used as the feed material, and a pilot plant now in operation has

a capacity of 175 tonnes (32,000 pounds )

annually. This process could also be used to

purify substandard grades of cobalt and, if

equipment were added to compact the powder

produced, could possibly provide a source of

cobalt for superalloy use.

Hall Chemical has plants in Ohio and Alabama to recycle catalysts and scrap metals, including cobalt, into chemical products for reuse. (See a discussion about the prospects for

cobalt recycling in chapter 6.) A new plant has

been planned by Hall that would more than

triple its capacity, but the project has been

halted by the recent recession, A large portion

of this new capacity could be used exclusively

for cobalt refining (from ore concentrates) with
—

Ch. 5—Strategic Material Supply . 177

a lead time of 3 to 4 months. Installation of an above. Still, operational domestic capability reelectrolytic circuit to produce cobalt cathodes

suitable for superalloy would require about 18

months .

Unlike the decline in domestic capacity for

processing manganese and chromium, U.S. cobalt processing capacity has increased in the

past 5 years with the addition of the two extrafine powder production facilities mentioned

mains at the last stages of processing only. Initiation of domestic ore production would require the development of smelting and refining

facilities, as well. This could be accomplished

by upgrading the standing plants in order for

the United States to have the greatest flexibility and ability to use the cobalt produced in the

most critical applications (e. g., superalloy).

Manganese Production and Processing

The bulk of the world’s manganese ore is produced in a few countries where large, discrete

deposits of high-grade ore are mined by multinational firms. These deposits offer the possibility for expansion on a large scale, but substantial mine expansion would have to b e

accompanied by expansion of processing and

transportation facilities, The Western Hemisphere has two sources of manganese ores ,

Mexico and Brazil. One new deposit may come

onto the world market soon—part of the

Grande Carajas project in Brazil. How much

this operation will provide in terms of net gain

in the world’s export supply of manganese is

unknown owing to Brazil’s growing domestic

steel industry.

The largest occurrences of worldwide economic manganese deposits are sedimentary in

origin, formed from either volcanic or weathering activity. Residual ores, which make up a

small part of the economic base, are formed

in a concentration process similar to that for

laterite deposits. Manganese is also found in

hypogene deposits and with metamorphi c

rocks, primary sedimentary ores that have been

subjected to changes in mineralogy and texture

due to pressure and/or heat. Manganese is

mined as an oxide and/or carbonate mineral,

and both minerals are often present to varying

degrees in each deposit,

The bulk of the ore mined today, however,

is an oxide mineral. Initial processing of these

ores involves only sorting by size and concentrating to increase the manganese content of

the ores to 40 and 48 percent. (U.S. industry

standard is 48 percent for ferroalloy production), Manganese carbonate minerals, on the

other hand, must be converted to an oxide by

roasting. Currently, only Mexico mines carbonate minerals, but this mineral type may

eventually become a more important source as

the higher grades of oxide ores are exhausted.

Manganese ores are classified as metallurgical, chemical, or battery grades. For metallurgical grade,

82 the iron, silica and especially

phosphorus content are important, In battery

grades the manganese content is expressed in

terms of manganese dioxide, and these ores

typically contain from 70 to 85 percent MnO2

(44 to 53 percent manganese).

The United States imports 99 percent of its

consumption of manganese ore and metal. In

1980, manganese ore accounted for 41 percent

of U.S. imports of manganese, but an ongoing

trend in producer countries to integrate ferroalloy production with ore mining is decreasing the ratio of manganese ore to ferroalloys

in U.S. imports and throughout world markets.

In 1982, manganese ore was produced in 26

countries. Of these, 8 accounted for 98 percent

of total world production. As indicated in table

5-24, the Soviet Union and South Africa produced 64 percent, while five countries (Gabon,

Australia, Brazil, India, and China) each made

a substantial contribution of over a million

azAbout 9CI ~rcent of the world’s manganese ores are destined

for metallurgical uses,
178 Ž Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table 5-24.—World Manganese Ore Reserves and Production by Country (thousand tons)

Reserves

(recoverable metal Product ion Estimated man- Percent of world

Country producer content) 1982 ore output ganese content product ion

Australia . . . . . . . . . . . . . . . . . . . . . . . . 51,600 1,248 37-53 5

Brazil . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,900 1,433 38-50 6

China ... , . . . . . . . . . . . . . . . . . . . . . . . 15,000 1,760 20+ 7

Gabon . . . . . . . . . . . . . . . . . . . . . . . . . . 110,000 1,667 50-53 7

India. . . . . . . . . . . . . . . . . . . . . . . . . . . . 21,500 1,596 10-54 6

Mexico. . . . . . . . . . . . . . . . . . . . . . . . . . 3,500 561 27+ 2

South Africa . . . . . . . . . . . . . . . . . . . . . 407,000 5,750 30-48 23

Soviet Union. . . . . . . . . . . . . . . . . . . . . 365,000 10,140 30-33 41

Other . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,500 599 2

Total . . . . . . . . . . . . . . . . . . . . . . . . . . 1,000,000 24,754 100

SOURCEU.S Department of the lnterioL Bureauof Mines

Resemes—Minera/ Cornrnodltv Profi/e 1983” Manganese, D 8,table3

Production–Minerals Yearbo6k 1982, voI l,tabl;9, p.587

short tons of ore. Mexico is the smallest producer of the eight at half a million short tons.

Major exporters to market economy countries

are South Africa, Gabon, India, Brazil, and

Australia. India’s exports are controlled by a

government quota system and are destined primarily for Japan; the other four nations are the

principal suppliers to the United States, Japan,

and Western Europe.

Foreign Production of Manganese

In general, the manganese mining interests

of each producer country are controlled by one

or two firms, reflecting the concentrated nature

of the deposits in these countries. Two private

firms with primarily local, but also international, investors dominate South African production. Their deposits in South Africa occur

in its northern Capetown Province in the Postmasburg and Kuruman (Kalahari) districts. The

latter provides 75 percent of the total output.

The Soviet Union’s government-controlled

operations produce mainly from two areas in

western Russia: the Nikopol Basin deposits,

which contribute high-volume production; and

those in the Tchiatura Basin, which provide the

highest grade ores. Mexico and Gabon each

have one privately operated firm in which the

government holds a minority interest. Brazil’s

producing firms are a mixture of private and

public sector interests. Brazil’s manganese deposits in the Grande Carajas Development Project are being developed along with iron ore

mines by Cia. Vale do Rio Doce (CVRD), a corporation jointly owned by the Brazilian government and local, private shareholders.

By contrast, manganese production in India

and China is supplied by numerous small- or

medium-sized operations scattered throughout

each country. China’s production is run by the

national government, while India’s ores are

mined by a mixture of local private and state

or national government firms.

U.S. firms participate in a number of foreign

manganese mining operations (table 5-25).

United States Steel has interests in Gabon’s

Comilog and South Africa’s Associated Manganese; International Minerals & Chemical of

New York has a minority interest in South

Africa’s Samancor. Bethlehem Steel owns part

of Brazil’s ICOMI and until the late 1970s was

a partner in Mexico’s Autlan. British investors

are heavily involved with South African producers through traditional ties with the AngloAmerican Corp., Ltd., Anglo Transvaal-Consolidated Co. Ltd., and General Mining Union

Corp. Ltd (Gencor). These investment houses,

or groups, hold interests in Samancor and

Associated Manganese.

Historically, ores have been exported from

producer countries after relatively minor beneficiation. The ore is ultimately moved to consumers by sea, which, along with transportation from a mining area to a shipping port, can

account for a major portion of the cost of the

product to consumers. Approximately two-
Ch. 5–Strategic Material Supply ● 1 7 9

Table 5-25.—Manganese Mining Industry by Country

Ownership

Primary national

Country Major firms Sector Major holdersa

identity

Australia . . . . . . . . . . . . . Groote Eylandt Mining Co.

Brazil . . . . . . . . . . . . . . . . Industria e Comercio de

Minerios S.A. (lCOMl)

Urucum Mineracao S.A.

Gabon . . . . . . . . . . . . . . . Compagnie Minere de

l’Ogooue S.A. (Comilog)

Mexico .

South 

. . . . . . . . . . . . . Cia. Minera Autlan S.A. de

C.V.

Africac . . . . . . . . .SA Manganese Amcor Ltd. of

S.A. (Samancor)

Associated Manganese Mines

of S.A.

Private

Private

Private

Private/

government

Various

Government

Government

Private

Private

Government

Private

Private/

government

Private

Private

Private

Private

Broken Hill Prop. (100)

Bethlehem Steel (49)

CAEMI (51)

CVRDb (47)

Local

BRGM (19)

(15)

Imetal (16)

U.S. Steel (41)

(34)

Various

African Metalsd (40)

AngloAmer (32)

Gencor (7)

Lavino e (10)

Assoc Ore & Metalf (38)

U.S. Steel (20)

Fox Street (34)

Local

Us .

Local

Local

French

Local

French

Us .

Local

Local

Local

Local/U.K.

Local

U s .

Local

Us .

U.K.

awith approximate percentage of control, if aval~able.

bcla. Vale do RIO Doce, which also controls the emerging production at Caralas In Brmil.

CT’here are six finance houses (the ‘, Groups,,) which dominate the south African industry The Anglo Arnerlcan Corp of S,A Ltd (AngloAmer), Gold Fields Of S.A Ltd ,

General M!ning Union Corp Ltd (Gencor), Rand Mines/Barlow Rand; Johannesburg Consolidated Investment Co Ltd (JCI); and AngloTransvaal Consolidated Investment

Co Ltd. (AngloTC)

downed bY Iscor, a state-owned integrated steel firm, (49 750/.) and Gencor (5025°/0)

eVJholly owned by lnternatlonai Minerals and Chem!cal (U.S ).

fowned by AnglOTc and Aml@mer.

SOURCES E&MJ 198.3 frrterrtationa/ Directory of M/rr/ng, Bureau of Mines, M/rtera/ Commodity Profi/e 1983.’ Manganese; Off Ice of Technology Assessment

thirds of the manganese ores traded on the free

market are sold by contracts (generally of 1

year’s duration) between producer and industrial user. Other forms of trade include captive

sales within integrated firms (e. g., between

Gabon and U.S. Steel) and spot market purchases when excess supplies are available.

World trade in manganese is now undergoing a shift from basic ores to the higher processed manganese ferroalloys. This new ferroalloy production capacity competes primarily

with plants close to steelmaking centers in the

United States, Western Europe, and Japan. As

table 5-26 shows, however, not only the oreproducing countries have increased production of ferroalloys. Some other countries have

increased or added local production to meet

the domestic and export markets steel industry demand. While the major manganese ferroalloy producing countries in 1980 were the Soviet Union (23 percent of world’s total), Japan

(14 percent), South Africa (9 percent), and

France (8 percent), the exporting countries

were principally South Africa, France, and

Norway. More recently, Brazil has increased

its exports because its ferromanganese production capacity is far in excess of its domestic

steel demand. South Africa remains the world’s

leading supplier of manganese ferroalloys, and

Western Europe and the United States are the

major importers. In 1982 the United States received 50 percent of its manganese ferroalloys

from South Africa and 21 percent from France.

All of the major ore producers, with the exception of Comilog in Gabon, have the capability to produce manganese ferroalloys. Trade

in manganese ferroalloys may not be replacing trade in ores as rapidly as ferrochromium

is replacing chromite. Gabon is at the discussion stage regarding ferroalloy production, but

any actual projects will depend on development of an energy source, Australia is restrained from increasing its ferroalloy capability by the lack of low-cost energy. Only in
180 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table 5-26.—Ferromanganese and Silicomanganese Production by Country

(thousand short tonnes, gross weight)

Country a

Argentina. . . . . . . . . . . . .

AUSTRALIA . . . . . . . . . . .

Belgium . . . . . . . . . . . . . .

BRAZIL . . . . . . . . . . . . . .

Canada. . . . . . . . . . . . . . .

CHILE . . . . . . . . . . . . . . .

CHINA . . . . . . . . . . . . . . .

France . . . . . . . . . . . . . . .

Great Britain . . . . . . . . . .

INDIA . . . . . . . . . . . . . . . .

ITALY . . . . . . . . . . . . . . . .

JAPAN . . . . . . . . . . . . . . .

North Korea . . . . . . . . . .

SOUTH KOREA . . . . . . .

MEXICO . . . . . . . . . . . . . .

Norway. . . . . . . . . . . . . . .

Peru . . . . . . . . . . . . . . . . .

Poland . . . . . . . . . . . . . . .

SOUTH AFRICA . . . . . . .

Spain . . . . . . . . . . . . . . . .

SOVIET UNION . . . . . . . .

United States . . . . . . . . .

Venezuela . . . . . . . . . . . .

West Germany . . . . . . . .

YUGOSLAVIA . . . . . . . . .

Zimbabwe . . . . . . . . . . . .

Other C 

. . . . . . . . . . . . . . .

1974

Percent

of total

Percent

1980 of total

Percent change

1974-80

34

69

108

124

100

12

NA

587

91

163

133

1,182

0

0

70

577

0

138

400

211

1,075

740

0

353

44

0

13

0.5

1.1

1.7

2.0

1.6

0.2

9.4

1.5

2.6

2.1

19.0

1.1

9.3

2.2

6.4

3.4

17.3

11.9

5.7

0.7

0.2

39

124

94

303

95

6

390

551

57

193

141

969

77

60

172

496

1

183

650

239

1,644

377

4

248

73

3

334

0.5

1.7

1.3

4.0

1.3

0.1

5.2

7.3

0.8

2.6

1.9

12.9

1.0

0.8

2.3

6.6

0.0

2.4

8.6

3.2

21.8

5.0

0.1

3.3

1.0

0.0

4.4

15

80

–13

144

– 5

–50

– 6

–37

18

6

–18

146

–14

33

63

13

53

–49

–30

66

2,469

Total . . . . . . . . . . . . . . . 6,224 100.0 7,523 100.0 16

auPPer ~a~e lndlcates Countv Was ore producer in both years, but did nOt necessarily cover its needs

bproduced ore in 19740niy.

Cln 1974 ,ncludes Thailand and Sweden; In 1980 includes BuLGARIA, Czechoslovakia, East Germany, and portugal All Were

ferroalloy producers in 1974butamountof manganese ferroalloys unknown; thus,total shown for 1974 production ls notaccurate

SOURCE: U.S, Department of the Interior, Bureau of Mines, Minera/s Yearbook. 1976and 1981

Tasmania, south of the Australian mainland,

where hydropower is available, is it economic

to produce ferroalloys. However, ore must be

shipped approximately 3,000 miles from the

north coast of Australia by sea, reducing some

of the cost advantage of integrated ore and ferroalloy production. New manganese ferroalloy

production is being added in Brazil and India.

During recessionary periods this production

appears on the export market instead of being

consumed in domestic steel industries.

As indicated by table 5-27, there have been

shifts over the last 20 years in the relative output of ore producer countries. Most notably,

world production has been increasingly concentrated in the eight producer countries listed.

From 79 percent in 1960, they now supply 97

percent of the world’s total ore needs. The most

recent producer to enter the world market was

Australia’s Groote Eylandt in 1966. There is

one new manganese mining project now under

development; Carajas in Brazil may add export

production by 1986.

Between now and 2000, virtually all of the

growth in total world output of manganese ore

will come from the expansion of existing mines

rather than the opening of new mines. A decrease or cessation of production from one

source would force expansion of production

from the remaining suppliers, Current world

mining capacity is substantially greater than

demand, as shown in table 5-28. In 1981 only

73 percent of existing capacity was used, That

unused capacity was 11⁄2 times South Africa’s

total output. Under such conditions, rapid expansion of production from existing mines is

quite feasible. In times of tighter markets, there

is potential for expansion of current mine ca-
———. ..—

Ch. 5—Strategic Material Supply Ž 181

Table 5-27.—Historical Manganese Ore Production, 1960-80, by Country

(thousand short tons, gross weight)’

(percent of world total)

1960 1965 1970 1975 1980

Producer country Tons Percent Tons Percent Tons Percent Tons Percent Tons Percent

Australia . . . . . . . . . . . . . 68 <1 112 1 828 4 1,714 6 2,226 8

Brazil . . . . . . . . . . . . . . . . 1,101 7 1,539 8 2,071 10 2,376 9 2,515 9

China . . . . . . . . . . . . . . . . 1,323 9 1,102 6 1,100 5 1,100 4 1,750 6

Gabon . . . . . . . . . . . . . . . 0 0 1,411 7 1,602 8 2,444 9 2,366 8

India . . . . . . . . . . . . . . . . . 1,321 9 1,815 9 1,820 9 1,688 6 1,814 6

Mexico . . . . . . . . . . . . . . 171 1 144 1 302 2 473 2 493 2

South Africa . . . . . . . . . . 1,316 9 1,738 9 2,954 15 6,359 23 6,278 22

Soviet Union . . . . . . . . . . 6,473 43 8,351 43 7,541 38 9,324 34 10,750 37

Subtotal . . . . . . . . . . . . 11,773 79 16,212 83 18,218 91 25,478 94 28,192 97

Other . . . . . . . . . . . . . . . . 3,216 21 3,345 17 1,866 9 1,598 6 869 3

Total . . . . . . . . . . . . . 14,989 100 19,557 100 20,084 100 27,076 100 29,061 100

aores Vary widely In contained manganese, see table 22

SOURCE U S Department of the Interior, Bureau of Mines, M/nera/s Yearbooks, 1961, 1966, 1971, and 1981

Table 5-28.—Manganese Mine Capacity and Usage in 1981, by Country

(thousand short tons, contained manganese)

Estimated annual Percent

Producer country

Estimated unused

capacity in use capacity

Australia . . . . . . . . . . . . . . . . . . . . . . . . 1,300 580/o 550

Brazil . . . . . . . . . . . . . . . . . . . . . . . . . . 1,350 76 320

China . . . . . . . . . . . . . . . . . . . . . . . . . . . 550 96 22

Gabon . . . . . . . . . . . . . . . . . . . . . . . . . . 1,300 64 470

India. . . . . . . . . . . . . . . . . . ... . . . . . 800 72 225

Mexico. . . . . . . . . . . . . . . . . . . . . . . . . . 300 81 60

South Africa . . . . . . . . . . . . . ... , . . . 3,000 72 840

Soviet Union . . . . . . . . . . . . . . . . . . . . 3,800 80 760

Other . . . . . . . . . . . . . . . . . . . . . . . . . . . 485 63 178

Total . . . . . . . . . . . . . . . . . . . . . . . . . . 12,885 73 3,610

SOURCE US Department of the Interior, Bureau of Mines, &finera/s Cornrnodify Profr/e 1983 Manganese

pacity, especially in South Africa, Gabon, and

Australia. Given a year or more extra lead time,

Brazil and Mexico could increase their production, as well.

Caracas in Brazil and a site at Tambao in Upper Volta are the only deposits of manganese

ore that might alter future supply patterns. The

Tambao deposit suffers from its location, far

from existing transportation facilities. Activity there was halted at the end of the exploration phase. Although the Carajas project is

proceeding, obtaining capital for development

of such deposits is difficult because they must

produce ore for markets that are already filled

by suppliers with large reserves. Thus, the current ore producer countries will be the major

producers of the future. Among these, the major exporters are expected to be South Africa,

Gabon, and Australia, all of which have substantial resources in relationship to their own

domestic needs .

In contrast, India’s ore production is increasingly tied to its expanding domestic steel production. India is also limited in the export market by the low grade of its manganese deposits

and the inefficiency of its overall operations.

Brazil’s future as a major supplier to the export market is uncertain, Facing the depletion

of its most productive deposit in the 1990s, Brazil has instituted a policy of reserving much

of its ore, including 50 percent of Carajas’ future production, for ferroalloy production and

the domestic steel industry. If the Carajas deposit reaches its planned output of 1 million
182 . Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

tons of ore per year and is the sole source of

exports, this policy will result in an export level

of about 50 percent less than current exports

from Brazilian manganese mines.

The Soviet Union was once a major supplier

of manganese ore to world markets, but since

the 1970s, it has concentrated on trade within

the Eastern bloc. Historically, this provided for

self-sufficiency among this group. In the 1980s,

however, some Eastern bloc countries (e.g.,

Romania, Czechoslovakia, and Poland) have

begun satisfying a portion of their ore needs

by importing from the same sources as the market economy countries. The Soviet Union negotiated with Gabon for supplies of ore in 1984

and has purchased from Gabon, India, and

Australia in the recent past. The assumption

in the West is that, since the ore production

tonnages being reported from the Soviet Union

are not declining, they are experiencing a

depletion of higher grade material. China

produces for internal consumption, and this

policy is expected to continue as the country’s

domestic needs increase.

Following is a brief description of the operations of the producer countries of interest,

with discussion of major factors that may affect future development and production of ore

and ferroalloys.

Australia

Groote Eylandt Mining Co., a wholly owned

subsidiary of the Broken Hill Proprietary Co,

(BHP)-–Australia’s sole integrated steelmaker–-

produces from open pit mines located on an

island 50 kilometers off the coast of the Northern Territory. Beneficiated ore is hauled 16

kilometers to Milner Bay for ocean shipping.

Capacity has recently been increased to 2.6 million tons per year with the installation of a

plant to upgrade ore fines (which were previously discarded). Further expansion plans to

increase capacity to 3 million tons per year

have been delayed because of unfavorable market conditions.

Barriers to expansion are the concentration

plants and loading facilities at Milner Bay.

Company officials have stated that, given an

emergency, significant expansion in these

areas would take an estimated 3 years to complete. With government financial assistance

and guarantees of long-term markets, facilities

could be in place in 2 years. Australia is currently heavily reliant on Japan as an export customer because of high shipping costs to other

major consumers. Its one manganese ferroalloy

plant is located in Tasmania and was originally

constructed to supply BHP steelmaking needs.

Recent expansion, however, has been based on

the export market.

Brazil

There are two principal ore-producing areas

in Brazil, one in the Federal Territory of Amapa

and the other in the Matto Grosso state. The

existing mines’ location, remaining life, or ore

quality limit their attractiveness. The Amapa deposits, owned by ICOMI, are located in northern Brazil, produce half of Brazil’s output, and

are operated mainly for exports because of the

high cost of transporting the ores to the steelmaking center in southern Brazil. The steel

plants are supported by the Matto Grosso operations of Urucum Mineraco S. A., and a small

operation in Minas Gerais. ICOMI’s reserves

are expected to be depleted by the 1990s. Production by Urucum (about 100,000 tons of manganese ore in 1980) is hampered by the quality (high alkali content) of the ores and

accessibility of the deposits, which lie 2,000

kilometers from the nearest port. Future increases in production at Urucum could come

from an underground deposit if manganese

prices were to double.

The Grande Carajas Development Project,

some 900 kilometers from the Atlantic coast

in the state of Para, is a mineral development

that includes iron ore, manganese, copper,

nickel, gold, tin, and bauxite. The project is

financed by national and international loans.

Participants have included the EEC, Japan,

West Germany, and the World Bank.

Three manganese deposits have been identified: Azul, Buritirama, and Serene. Development of the Azul deposits (with reportedly 16
Ch. 5—Strategic Material Supply ● 183

million to 24 million tons of manganese)83 is

the second phase of the project. The initial

phase has included the preparation of iron ore

mines, along with the construction of the necessary infrastructure. A railroad to Sao Luiz

on the coast and new ocean port facilities at

Ponta da Madeira are expected to be completed

in 1986, when manganese production of metallurgical grade ores will begin,

The deposit is currently being exploited for

battery-grade ores which, because of their high

value (grades up to 75 percent MnO2

), can be

economically transported by truck to the coast

for shipment, The metallurgical ores will be

hauled from an open pit mine 20 kilometers to

the railhead at the iron ore mine area. Processing will consist of washing and crushing,

using existing facilities originally constructed

as a pilot plant for the iron ores, It is expected

that the output from the manganese mine will

eventually total 1 million tonnes (900,000 tons)

of about 48 percent manganese ores per year.

With additional beneficiation equipment, the

deposit could support up to 2 million tonnes

per year.84 This extension of facilities, however,

must await favorable market conditions, An onsite ferroalloy plant was included in the original concept but lack of financing has shelved

these plans.

U.S. Steel was involved in the discovery of

the Carajas deposit, but its interest was bought

out by CVRD in 1976. Utah International (previously owned by General Electric but in April

1984 transferred to Broken Hill Proprietary of

Australia) holds the rights to the development

of the Buritirama manganese deposits at Carajas;

however, there are no development plans being considered for the near future. 85 T h e

BsIJ{luis Fuchs of the CVRD office in New’ York, personal communication, December 1983. Total reserves were placed at 65

million tonnes of ore at about 48 percent manganese. Of this

amount, 10 million tonnes consists of battery grade material at

74 to 75 percent Mn02

. The National Materials Advisory Board,

in Manganese Reserves and Resources of the World and Their

Industrial Implications, 1981, reported a crude ore resource of

65 million tonnes that woul{j wash 44 million tonnes of product grading 46.5 percent manganese. Thomas Jones, commodity

specialist at the Bureau of Mines, reports 45 million tonnes of

ore at 40 percent manganese.

r341Jou is Fucbs, op. c it.

85Jean Goity, ~ub]ic Relations, Utah 1nternationa], San Fran -

cisco, persona] communication, Februar]’ 1984.

Sereno deposits are currently unexploited. Together, these deposits have considerably less

identified reserves and resources than does

Azul.

Brazil has five firms involved in producing

various types of manganese ferroalloys for both

domestic and export purposes.

Gabon

Market conditions now hold output from

Gabon’s Moanda mines well below the 1979

peak of 2,5 million tons. These mines are capable of supporting up to 4 million tons per

year but shipments are limited to 3 million tons

per year via the available transportation system.86 This involves the use of a 76-kilometer

aerial ropeway connection to the Congo’s rail

system, followed by a 560-kilometer rail trip to

the port of Pointe Noire. An alternate route,

the Trans-Gabon railway, has been under construction since 1974. Completion to the mine

site near Franceville (500 more km) plus upgrading of the timber port at Owendo, Gabon,

would make possible the shipping of the maximum of 4 million tons per year from Moanda,

although current market conditions would not

make increased shipments economically feasible, Development of ferromanganese facilities

are under discussion, but no firm plans have

yet been made.

Mexico

The Molango district deposits in Mexico are

mined by the Cia. Minera Autlan S.A. de C.V.

and represent significant reserves and resources which could support a substantial increase in production if the market and investment funds were available.87 The deposits

consist of two types, carbonates and oxides.

The carbonate ores represent the bulk of the

minerals present, and Autlan has reported

measured reserves of 28.4 million tons of carbonate ore at 27.5 percent manganese (from a

total estimated resource of 1.5 billion tons at

25 percent).

—.—————

B6ROhert 1,’esperance, U.S. Steel Corp., Pittsburgh, pA, Persona] communication, August 1983.

E7NMAB 81, p. 39.
184 • Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

After mining and beneficiation, these carbonate ores are converted to nodules of manganese oxide (39 to 40 percent manganese) in

a rotary kiln near the mines, One of the difficulties that Autlan manages to overcome is the

rugged terrain of the Sierra Madre Oriental in

which their mines (open pit and underground)

are located. In these precipitous and densely

vegetated mountains, elevations vary from 200

to 2,600 meters above sea level. The export ores

(50 percent of Autlan’s production) must be

hauled 260 kilometers to Autlan’s maritime

terminal at Tampico on the Gulf Coast for

shipment.

The quality of Autlan’s ores has been questioned because of their high silica content and

relatively low grades. The general commercial

standard for ores used in ferroalloy production

is 48 percent manganese. Although Autlan produces ferromanganese with its 40 percent ores,

its customers blend the ores with higher grade

ores in order to produce 78 percent ferromanganese, the U.S. industry standard for a highcarbon product. The high silica content makes

the ores most suitable for the production of silicomanganese.

Several projects are currently being studied

by Autlan to enable them to expand their production. Among them are the opening of a new

open pit mine at Noapa, the installation of a

second rotary kiln, and a new water supply system. Physically, the resources could support a

doubling of production, but manganese prices

and demand in the 1980s will not support such

a change in policy. The Trade and Development Program in the U.S. International Development Cooperation Agency has been active

in studying the manganese deposits in Mexico

and in attempting to interest U.S. investors in

joint ventures with Autlan to expand its production. 88

South Africa

Associated Manganese and Samancor each

own mines in both the Postmasburg and Kuruman (Kalahari) districts. The capacity of these

mines has been estimated to be greater than 9

million tons of ore per year. Even at current

operating rates, the reserves are sufficient to

last hundreds of years, and South African production is capable of rapid expansion. Transportation, however, could be a limiting factor

because ores must be shipped south from both

mining districts by rail to either Port Elizabeth

(950 km directly south) or to Saldanha Bay,

north of Capetown (800 km southwest).

South Africa has four firms engaged in producing various manganese ferroalloys, plus

two producing manganese metal. Ferroalloy

production is integrated within mine producing firms, either directly or through “group”

investment houses.

Potential Source

At Tambao, Upper Volta, a remote area 350

kilometers from a railhead, some 13 million

tonnes (12 million tons) of 52 percent oxide

ores have been identified. Extensive exploration work was done and feasibility studies were

completed during the late 1970s while the project was being considered by a consortium consisting of a number of international firms including Union Carbide, The group subsequently

fell apart owing to the divergent goals and conflicting interests of its members.” It would take

about 5 years to bring the area into production

and provide the infrastructure needed to export the ores (the construction of a railroad and

a port). Since Upper Volta is a landlocked country, arrangements would have to be made with

the Ivory Coast for rail transiting and the development of port facilities.

Domestic Production of Manganese

Domestic manganese has made some contributions to U.S. needs, especially in wartime.

During the latter part of the 19th century, the

United States produced sufficient manganese

from domestic deposits to meet its needs. With

the growth of the U.S. steel industry since 1900,

Sesee U.S. International Development Cooperation Agency,

Trade and Development Program, The Molango Area (Mexico)

Manganese Deposits of Compania Minera Autlan—The Largest

Known Manganese Ore Reserve in North America, June 1983.

8gBenjamin Brittain, Union Carbide Corp., persona] communication, August 1983.
—

Ch. 5–Strategic Material Supply ● 1 8 5

however, domestic manganese production has

not been able to keep up with demand, Despite

a variety of government incentive programs,

domestic production was only 23 percent of

consumption during World War I, 13 percent

during World War II, and 8 percent during the

Korean war. In 1944, manganese ores were

produced in more than 20 States, but Montana,

Nevada, New Mexico, Arizona, and Arkansas

have provided the bulk of the historical production.

Today, aside from minor amounts, the prospects for production of manganese from U.S.

deposits is highly unlikely except during a sustained cutoff of imported ores. And, unless

world prices rose considerably during such a

period, Federal Government production incentives would be required.

There has been no manganese ore (table 5-

29) produced in the United States since 1970.90

The last year of production of ferruginous manganese ores was 1981 and totaled 22,165 tons

of contained manganese from Cuyuna North

Range in Minnesota (20,712 tons) and from

New Mexico (1,453 tons). The only domestic

production in 1984 is of maganiferous iron ores

from South Carolina which are used in pigments (total production in 1982 of this ore type

contained 1,325 tons of manganese). Iron ores

consumed in the United States in 1982 provided approximately one-third of the manganese used in domestic steelmaking. Since 30

percent of those iron ores were imported

(mainly from Canada), domestic sources can

be credited with 23 percent of that input.91

‘Thomas Jones, Jr., U.S. Department of the Interior, Bureau

of Mines, Mineral Commodities Profiles 1983: Manganese, p. 10.

Olsee the discussion on manganese and steelmaking in ch. 6.

Table 5-29.—Definition of Manganese-Bearing Ores

Type Description

Manganese ore . . . . . . . . . . Ores containing more than

35 percent Mn

Ferruginous manganese

ore . . . . . . . . . . . . . . . . . . Ores containing from 10 to

35 percent Mn

Manganiferous iron ore . . . Ores containing from 5 to 10

percent Mn

SOURCE Use of Manganese (n Steefmakmg and Steel Products and Trends (n

fhe Use of Manganese As An A//oy~ng Element in Steels, OTA contract

report, 1983

Eight U.S. deposits of manganese were considered in a Bureau of Mines Minerals Availability System Appraisal92 in 1982 and were

termed “submarginally subeconomic.” The report concluded that incentive prices ranging

from $8 to almost $35 per long ton unit93 of contained manganese would be required in order

to encourage production from these deposits,

as compared with the market value at that time

of $1,70 per long ton unit.94 Annual production

from these sources would peak at 900,000

tonnes (818,000 tons) of recoverable manganese

6 years after simultaneous development began,

declining thereafter (to 578,000 tons per year

within 10 years, for instance) unless additional

resources were located and/or technological

improvements were made in mining or processing of the ores. 95 (U.S. apparent consumption of manganese was 1.25 million tons in

1979 and 672,000 tons in 1982.)

The more significant deposits among the

identified domestic manganese resources are

those of the Artillery Mountains, Arizona;

Batesville, Arkansas; San Juan Mountains ,

Colorado; Aroostook County, Maine; and the

Cuyuna Range in Montana. Collectively this

group is estimated to contain over 70 million

tons of manganese .

96 The average grade o f

manganese in U.S. deposits is generally less

than 10 percent which compares unfavorably

with the major world producers who extract

manganese from deposits with grades of from

27 to 53 percent.

The National Materials Advisory Board in

1976 concluded that:

The U.S. land-based manganese resources of

significant size are very low in grade and should

not be developed except in a dire emergency. 97 

—

Ozcatherine c. Kilgore and Paul R. Thomas, U.S. Depart nlent

of the interior, Bureau of Mines, hfanganese A ~’ai~abi]it~’—

Domestic, A Minerals A~aiJabilit~r S~rstem ,4ppraisal, Infornlation Circu]ar/1982 No. 8889.

‘wA ]Ong ton unit is 22.4 pounds of manganese and is the standard unit for quoting manganese ore prices.

Q4Another study has calculated a cost estimate for IJ. S. production at four times that of South African producers in 1980 dollars. See Processing CapacitJr for Critical Materials, op. cit.

GSKilgore, et a]., op. Cit., p. 1.

913u, s, Bureau of M ines, Mineral Commodit~’ Profile 1983:

illanganese, p. 7,

gTNatiOna] Materials Ad\, isory Board, hfan,ganese l?t?COL’erJ’

7’echnolog~’, NMAB-323 (Washington, DC: National Academ\

of Sciences, 1976), p. 1.

38-844 0 - 85 - 7 , QL 3
186 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

The NMAB study stated that, while there were

no known deposits in the United States of manganese ores that could be exploited at current

or even substantially higher prices, the best

suited deposits for development in an emergency on a significant scale were those of the

Cuyuna Range and in Aroostock County .

9 8

The Bureau of Mines’ appraisal results concur.

In its estimates of mining capacity, as summarized in table 5-30, these deposits could contribute the highest levels of production and be

able to operate from 14 to 61 years.

In analyzing the impact of different variables

(e.g., beneficiation and transportation costs, byproduct prices, State severance taxes), the Bureau of Mines determined that technologic improvements leading to a reduction in the cost

———

Q13NMAB.323, p. 14 and p. 1.

of beneficiation methods would be the single

most significant factor for improving the economic status of these deposits. Substantial increases in byproduct prices, for instance ,

would be necessary to significantly decrease

the incentive price needed for domestic manganese. A 9-percent increase in iron ore prices

would produce a 4-percent decrease in the

manganese incentive price at Cuyuna Range,

for instance. (Iron is also a byproduct of the

Aroostoock area; silver at Hardsell in Arizona;

and silver, lead, and zinc at Montana’s Butte

District.)

99

Domestic Mining and Processing Technology Prospects

Manganese deposits in the United States are

in a variety of environments ranging from rela-

‘Kilgore, et al., op. cit., pp. 9-10.

Table 5-30. U.S. Manganese Resources and Potential Production

Demonstrated resource Estimated annual mine capacity

Contained Contained

Manganese Ore manganese Ore manganese Estimated

grade (thousand (thousand (thousand (thousand minelife

Property name by State (percent) tonnes) tonnes) tonnes) tonnes) (years)

Arizona:

Hardshell Mine. . . . . . . . . 15.0 5,896 804 536 73 11

Maggie Mine

(Artillery Peak) . . . . . . . 8.8 8,441 671 328 26 26

Colorado:

Sunnyside Mine . . . . . . . . 10.0 24,909 2,264 635 58 39

Maine—Aroostock County:

Maple Mtn/Hovey Mtn . . . 8.9 260,000 20,965 4,263 344 61

North District . . . . . . . . . . 9.5 63,100 5,472 2,620 227 24

Minnesota:

Cuyuna North Range

(SW portion) . . . . . . . . . 7.8 48,960 3,490 3,570 254 14

Montana:

Butte District

(Emma Mine). . . . . . . . . 18.0 1,232 202 400 65 3

Nevada:

Three Kids Mine . . . . . . . 13.2 7,230 868 1,050 126 7

Total . . . . . . . . . . . . . . 419,768 34,737

—

13,401 1,174

SOURCES: Resources, ore grades, proposed ore mining capacity from U.S. Department of the Interior, Bureau of Mines, Manganese .4v&V/abi/ity-Dorrrestic, lC8889/1982.

Balance, calculated by OTA using that data

Apparent U.S. Manganese Consumption

Tons Contained metal

1979 . . . . . . . . . . . . . . . . ., . . 1,250,000

1982 . . . . . . . . . . . . . . . . . . . . 672,000

SOURCE: U.S. Department of the Interior, Bureau of Mines, &firrera/ Commodity

Summaries, 1984, p. 98.
Ch. 5—Strategic Material Supply ● 187

tively soft deposits to steeply dipping veins in

hard rock. Thus, standard mining methods

would include both underground and open pit

operations .

Solution mining of manganese ore has been

proposed. Two variations are possible. In one

the ore is mined, spread on the surface, and

a solvent is applied. This “heap leaching” process produces a solution of manganese which

can be collected. In another process, “in situ

leaching, ” a hard-rock ore body is blasted to

induce permeability and the solvent is pumped

into the fractured ore body, The leached solution is then pumped out of the mine, These solution mining techniques for manganes e

100

were under evaluation by the Bureau of Mines

for 2 years but the project was eliminated from

the fiscal year 1984 budget, Preliminary economic analysis indicated that leached manganese could compete favorably with foreign

manganese ores for chemical (battery) industry markets but not for the ferromanganese industry. 101 Conventionally mined metallurgical

ores bound for ferromanganese production require little processing after mining; solution

mined ores are uncompetitive. Another conclusion of the study was that solution mining

applied to domestic manganese-silver or e

bodies would permit the separation of these

minerals not possible by other techniques. The

private sector has expressed some interest in

the process in order to obtain the silver values.

Manganese could be a byproduct of any such

operation. A pilot plant is apparently in operation in the Artillery Peak area of Arizona,

funded by major mining companies, to test a

heap leaching process on manganese ores ,

Most of the U.S. manganese resources are

not amenable to normal beneficiation methods

of gravity and flotation alone owing to their low

. ——.

100S ~e ~,a rlous B u reau of Mines papers including ‘‘ Arizona’s

Artillery Peak Manganese Deposits and Their Potential for In

Situ Leaching” (1981) by Peter G. Chamberlain; “Recovery of

Silver From Manganese Ores” (1984] and “Recent Research on

Leaching Manganese” (1983) b} Peter G, Chamberlain, John E.

l~ah]rnan, and Charles A. Rhoades.

101 u ,s, Department of the Interior, Bureau of Mines, Research

83, op. cit., p. 5. Also National Materials Advisory Board, A Re-

~’ie~~ of the Atincra]s anti hlaterials Research Programs of the

Bureau of ,lfines, op. cit., 1984.

grades. Chemical and roasting processes (e.g.,

the ammonium carbamate leach and sulfur dioxide roast processes) have been developed for

beneficiating domestic manganese. These processes have so far proved to be too costly for

extended use. Grinding and fine-particle concentration processes might improve the economics .

102 A study to identify the three most

promising processes for recovering manganese

from low-grade domestic sources was underway by the Bureau of Mines in 1984.

Domestic and Foreign Manganese Processing

Manganese is used as a processing and alloying agent of steel and an alloying agent in nonferrous materials. Although manganese is used

to some extent in the mineral form in which

it occurs in the ore, for the most part it is useful only after several processing steps convert

it to a metal or metal alloy. Steelmaking requires

manganese ferroalloys with high-, medium-, or

low-carbon content, and silicomanganese. Aluminum alloys are made with additions of pure

metallic manganese. The compositions of these

materials are shown in table 5-31. Figure 5-5

is a simplified flowchart for the production of

these alloys showing the close relationship that

exists between the processes for the various

forms of ferroalloys.

The U.S. steelmaking industry has a standard of 78 percent manganese content for highcarbon ferromanganese, and this product is

traditionally made from 48 percent manganese

ores, It is technically possible to produce steel

from a lower grade ferromanganese, and internationally this standard is not as rigorously applied. This is a possible area wherein diversity

of supply of manganese could be broadened by

turning to lower grade deposits such as those

in Mexico if the need should arise.

Manganese Ferroalloys103

The major manganese commodity is highcarbon ferromanganese, used in the production

of steel. It is now commonly produced in sublozsil~.erm~n, et al., 0p. cit., P. 159.

IOsTh is disr;ussion of manganese ferroallo}’ processes is t ak~: II

primarily from ~harles Ri\er Associates, ;p. cit.
188 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table 5-31 .—Composition of Manganese Alloys

Manganese Carbon Silicon

Ferromanganese:

High carbon . . . . . . . . . . . . . . . . . . . . . . . . . . . 74-82 7.5 1.2

Medium carbon . . . . . . . . . . . . . . . . . . . . . . . . 80-85 1.5 1.2

Low carbon . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80-90 0.7-0.75 1.2

Silicomanganese . . . . . . . . . . . . . . . . . . . . . . . . . 65-68 1.5-3.0 12.5-21

Ferromanganese-silicon . . . . . . . . . . . . . . . . . . . 63-66 .08 28-32

Manganese metal . . . . . . . . . . . . . . . . . . . . . . . . 99.5 .005 .001

SOURCE: U S Department of the Inter! or, Bureau of Mines, Mlrrera/s Cornrnodlfy Profile 1983: Manganese,

SOURCE: Charles River Associates, Processing Capacity for Cr/fica/ Materia/s,

merged arc electric furnaces, similar to those

used for ferrochromium, rather than the original blast furnace method. (See the previous

chromium processing section for a general discussion on ferroalloy production in submerged

arc furnaces, the degree of convertibility between ferrochromium and ferromanganese furnaces, and the applicability of new technology

to ferroalloy production.)

In the United States the blast furnace has

been entirely supplanted by the electric furnace

for the production of ferromanganese. The last

ferromanganese blast furnace was shut down

in 1969 by Bethlehem Steel after being damaged by the Johnstown, PA, flood. Limited blast

furnace capacity still exists in Western Europe

and South Africa, but all new furnace capacity worldwide is of the electric type.

Pig iron blast furnaces can be considered as

alternative capacity for ferromanganese production. As the ferromanganese blast furnaces

OTA contract study, January 1984,

were generally adapted from old pig-iron furnaces, they are smaller than current pig-iron

furnaces, and the hot blast temperatures are

lower (about 1,0000 to 2,0000 F) than for modern iron furnaces. The main disadvantage of

using the blast furnace for the production of

ferromanganese is that the coke requirement

is almost twice that for the electric furnace,

since coke must be used both as a reducing

agent and to supply the thermal energy for the

reaction. Both furnace types require a blend

of manganese ores and dolomite or limestone

as a fluxing agent. Existing small, pig-iron blast

furnaces could readily be converted to produce

ferromanganese at minimal capital cost. Operating costs would be higher than for electric

furnaces.

Silicomanganese is produced in an electric

furnace similar to that used for ferromanganese production. The manganese content in the

slag from a standard ferromanganese furnace
Ch. 5—Strategic Material Supply ● 1 8 9

——

operation normally ranges from 30 to 40 percent and is used as feed for the production of

silicomanganese. Efficient production requires

that both standard ferromanganese and silicomanganese furnaces be located in the same

plant.

The silicomanganese furnace has a smaller

crucible with smaller electrode diameter and

closer electrode spacing than does a standard

ferromanganese furnace. If a furnace designed

for ferromanganese production has the capacity in its environmental control (gas-cleaning)

system, it can be operated at higher power

levels (to compensate for the charge property

difference) to produce silicomanganese.

Medium- and low-carbon ferromanganese is

produced by refining various high-carbon ferromanganese products in open arc furnaces.

These furnaces are different from submerged

arc furnaces in that the electrodes are not suspended deep within the charge.

tion of manganese ore. South Africa,

and the United States are manganese

producers.

Processing Distribution and Capacity

The worldwide distribution of processing

Japan,

metal

 ca -

pacity for ferromanganese, silicomanganese,

and manganese metal is shown in table 5-32.

Although having dramatically declined in capacity in the last decade, the United States still

has the capability to produce all types of manganese ferroalloys and electrolytic manganese

metal. Table 5-33 shows the growth of imports

over the last decade that have eroded the U.S.

industry, ferroalloys having made the greatest

inroads.

Of the six firms in the United States still

credited with the capacity to produce manganese ferroalloys (out of 10 in 1979), three have

shut down their plants, and the others are operating at very low rates. A contributing factor

to this demise—other than import penetration—was the steel industry depression during

the early 1980s. Elkem Metals plant at Marietta,

OH, for instance, in early 1984 had only 3 furnaces of an original 14 in operation; by midManganese Metal

Metallic manganese is commonly produced

by an electrolytic process from an acidic soluTable 5-32.—Manganese Ferroalloys and Metal Production Capacity—1979

(tonnes, gross weight)

Ferromanganese

High Medium Low Silico- Manganese

Country carbon carbon carbon manganese metal

Argentina . . . . . . . . . . . . . . . . . . 2,000

Australia. . . . . . . . . . . . . . . . . .

Belgium . . . . . . . . . . . . . . . . . . .

Brazil . . . . . . . . . . . . . . . . . . . . . .

Canada . . . . . . . . . . . . . . . . . . . .

Chile . . . . . . . . . . . . . . . . . . . . . .

France . . . . . . . . . . . . . . . . . . . .

West Germany. . . . . . . . . . . . . .

India . . . . . . . . . . . . . . . . . . . . . .

Italy . . . . . . . . . . . . . . . . . . . . . . .

Japan . . . . . . . . . . . . . . . . . . . . .

Mexico . . . . . . . . . . . . . . . . . . . .

Norway . . . . . . . . . . . . . . . . . . . .

Peru. . . . . . . . . . . . . . . . . . . . . . .

Portugal . . . . . . . . . . . . . . . . . . .

South Africa . . . . . . . . . . . . . . .

Spain . . . . . . . . . . . . . . . . . . . . . .

Taiwan . . . . . . . . . . . . . . . . . . . .

Great Britain . . . . . . . . . . . . . . .

United States. . . . . . . . . . . . . . .

Yugoslavia . . . . . . . . . . . . . . . . .

40,000

135,000

150,000

117,000

90,000

5,000

580,000

298,000

229,000

130,000

700,800

135,000

370,000

3,600

150,000

493,000

60,000

4,200

80,000

453,000

40,000

50,000

600 61,600

50,000

1,000

60,000

30,000

61,000

50,000

35,000

3,000

15,000

205,820

13,000

5,000 4,000

535,200 6,000

50,000 5,000 220,000

10,000

35,000

122,000 35,000

10,000 45,000

3,000

300

125,000 11 ,000+

5.000

36,000

Total . . . . . . . . . . . . . . . . . . . . 4,263,900 530,820 20.900 1.296.800 , 52,000

SOURCE Charles River Associates Processing CapacltY for Crltlcal Materia/s, OTA contract report, January 1984
190 • Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table 5-33.--Managanese Ferroalloys and Metal:

U.S. Imports and Consumption

(gross weight, short tons)

Ferroalloys Metal

1970:

Imports . . . . . . . . . . . . . . . . . . . . 290,946 NA

Consumption . . . . . . . . . . . . . . . 1,000,611 NA

Imports as percent of

consumption . . . . . . . . . . . . . 29 –

1974:

Imports a . . . . . . . . . . . . . . . . . . . 421,222 2,506

Consumption . . . . . . . . . . . . . . . 1,115,395 34,748

Imports as percent of

consumption . . . . . . . . . . . . . 38 7

1980:

Imports b . . . . . . . . . . . . . . . . . . . 605,703 7,508

Consumption . . . . . . . . . . . . . . . 789,076 25,092

Imports as percent of

consumption . . . . . . . . . . . . . 77 30

aMe@l inlports include unwrought metal, waste and SCraP.

bMetalS irnpofls is unwought metal only; waste and scrap total AOT tons

SOURCE: U.S. Department of the Interior, Bureau of Mines, Minera/s Yearbook,

vol. 1, 1970, 1974, and 19S0

1984 the picture was somewhat brighter owing

to the steel industry revival. (Of the 14 furnaces

some have been permanently decommissioned.)

Elkem was awarded a contract by the General

Services Administration (GSA) in the spring of

1984 to convert 48,476 tons of manganese ore

in the national defense stockpile into ferromanganese. 104 This GSA plan to upgrade stockpiled

ores was developed in late 1982 by the Reagan

Administration to give financial relief to the

domestic ferroalloy industry. The contract

amount will, however, only provide about 6

months work for one Elkem furnace. (See the

chromium processing section for details on a

similar chromite conversion contract.)

Manganese metal, sufficient to cover domestic needs, can be produced in the United States,

although the feedstock is imported manganese

ores. In 1982 domestic production of manganese metal (18,600 tons) was greater than the

consumption rate (17,100 tons),105 while an additional 30 percent was imported. Due to general economic conditions, in 1983 two metal

producing firms were operating at reduced

levels of production and the third had shut

down its facilities.

104’ I Maca]]Oy setsReorganization, American Meta] Market,

Jan. 5, 1984, p. 1.

IOEU. S. Department of the Interior, Bureau of Mines, Minerafs

Yearbook 1982,

Platinum Group Metals Production

PGMs have always come from few locations.

Colombian placer deposits were the original

and only suppliers of PGMs until 1824, when

Russian placer deposits were discovered. Production from Canadian nickel mines followed

in 1919, and South African deposits were discovered in 1924. South Africa, the Soviet

Union, and Canada are today the world’s suppliers of these metals (see fig. 5-6).

The major deposits of this group of metals

have been found in layered formations of igneous rocks among chromite, nickel, and copper, Only in South Africa and, it has been estimated, the United States (Stillwater, MT) can

such vein deposits be mined primarily for their

PGM content. Canada produces PGMs as a byproduct of nickel and copper production; the

Soviet Union’s production may be a coproduct

rather than

VO]. 1, pp. 579-580.

and Processing

a byproduct. Chemical and physical weathering can separate platinum minerals

from these primary ores, creating placer deposits in high enough concentrations to provide

minable ore grades. Such a PGM deposit exists in Goodnews Bay, AK, but it has not been

in production since 1975.

Each PGM deposit produces platinum and

palladium and some of the other four metals

(rhodium, ruthenium, iridium, and osmium) of

the group. Among the similar sulfide deposits

in the three producer countries, there are differences in the proportion of PGMs that each

contributes to the market, as shown in table 5-

34. Platinum and palladium are considered the

most important metals of the group owing to

their predominance and end uses in industry.

While Canada produces roughly an equal
Ch. 5—Strategic Material Supply

100

90

80

70

60

20

10

0

1

Pt

Figure 5-6.–Comparative PGM Production, 1981

By metal and country

1 I I I 1

Pd

I

R h

a

South Africa Soviet Union

aLess than 1 percent produced by other sources

I

lra

Canad a

Ž 191

I

Ru’

Other

1

0s

SOURCE: Bureau of Mines, Mmera/s Commodity Prof~/e 7983 P/atmurn-Grouo Meta/s, figures 1 through 6.

amount of platinum and palladium, the Soviet from a variety of ores. The United States is inUnion’s output is principally palladium (67 percent), with platinum secondary (25 percent), In

South Africa, platinum accounts for 61 percent

of production, and palladium, 26 percent. For

all three countries, the balance of output is in

small amounts of the minor metals of the

group. The proposed Stillwater mine is expected to produce almost 80 percent palladium,

20 percent platinum. Colombia has long been

a relatively small producer from placer deposits. Its output is over 90 percent platinum, Very

small amounts of the metals are produced by

a number of other countries as byproducts

eluded in this group with a contribution from

copper mining and refining,

The world now depends on South Africa for

two-thirds of its platinum and on the Soviet

Union for two-thirds of its palladium. In 1982,

99 percent of the world’s primary PGM supply was produced by five private firms and one

government firm. Mines in South Africa and

the Soviet Union provide 95 percent of the

world’s needs, while Canadian mines provide

another 6 percent (table 5-35). Little change in

this pattern is likely in the future. The most
192 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table 5-34.—Distribution of Platinum Group Metal Production

by Metal and Country, 1981 (percentage)

Producer country Platinum Palladium Rhodium Iridium Ruthenium Osmium

Canada . . . . . . . . . 6 6 8 6 5 10 —

South Africa. . . . . 64 24 44 60 74 38

Soviet Union . . . . 29 69 49 34 21 51

Other . . . . . . . . . . . 1 1 <1 <1 <1 <1

Total . . . . . . . . . 100 100 100 100 100 100

SOURCE U S Department of the Interior, Bureau of Mines, Minerals Commodity Profl/e 1983” P/atinurn-Group Meta/s, figures

1 through 6.

Table 5-35.—Platinum Group Metals: World Reserves and production by Country

(thousand troy ouncesa)

Reserves Production Percent of -

Producer country 1981 1982 world production

Australia . . . . . . . . . . . . . . . .

—

14.0 0.22

Canada . . . . . . . . . . . . . . . . . 9,000 269.8 4.18

Colombia . . . . . . . . . . . . . . . 12.0 0,19

Ethiopia. . . . . . . . . . . . . . . . . 0.1

Finland . . . . . . . . . . . . . . . . . 3.6 0,06

South Africa . . . . . . . . . . . . . 970,000 2,600.0 40.28

Soviet Union. . . . . . . . . . . . . 200,000 3,500.0 54.23

United States . . . . . . . . . . . . 16,000 8.0 0.12

Yugoslavia . . . . . . . . . . . . . . 3.5 0.05

Other b . . . . . . . . . . . . . . . . . . 43.3 0.67

Total , . . . . . . . . . . . . . . . . 1,200,000 6,454.3 100.00

aThere are 1458 troy ounce?. Per pound

bother prOduCt(on>i ref~~Ct~ JaPafle~~ ~efining of Ores originating lfl AU.s~ralla, Canada, Indonesia, F’apua New Guinea, and

the Philippines

SOURCE: Reserve base—U S Department of (he Interior, Bureau of Mines, Mineral Commodity Profile 1983 Platlnum-Group

Metals

Production—U S Department of the Interior, Bureau of Mines, Mirrera/s Yearbook 1982, VOI 1

activity underway in investigating new, diversifying sources is in the United States with the

effort to initiate mining from the deposits at

Stillwater. For possible long-term applicability,

the U.S. Geological Survey is conducting research on the platinum content of nickel laterite deposits in countries along the southwestern rim of the Pacific Ocean.

The principal importing nations are the

United States and Japan, which together consume about two-thirds of the world’s PGM production. Western Europe and the Soviet Union

consume most of the remainder. The Soviet

Union’s position as the important palladium

supplier to the West provides it with one of its

valuable sources of foreign exchange, although

gold sales are more important in this respect,

Foreign Production of Platinum Group Metals

Unlike many other mineral industries today,

PGM production, excluding that of the Soviet

Union, is entirely within the private sector,

Ownership is a complex interconnection of

multinational firms, as shown in table 5-36,

Rustenberg Platinum Mines and Impala

Platinum Holdings control over 90 percent of

South African production, Ownership of both

firms is primarily local shareholders, through

three investment houses. These “group”

houses have connections with British industry

that date back to colonial times. They also hold

interests in American operations: Johnson

Matthey—which jointly owns a South African

refinery with Rustenberg (Matthey-Rustenberg
Ch. 5—Strategic Material Supply ● 193

—

Table 5-36.—PGM Mining Industry by Country

—

Ownership

Primary national

Country Major firms Sector Major holdersa

identity

Canada = ., . . . . . .-; .-. Inco Ltd. Private b Canada

South Africae 

. . . . . .

Soviet Union ., .. .

Falconbridge Ltd. Private

Private

Rustenberg Platinum Mines Private

Ltd. Private

Private

Impala Platinum Holdings Ltd. Private

Western Platinum Ltd. Private

Private

Private

Government

McIntyre Minesc (40)

Newmont Minesd (40)

JCl f (33)

AngloAmer (24)

Ludenburg (24)

Gencor (56)

Lonrho (51)

Falconbridge (25)

Superior Oil (24)

(loo)

Canada

U.S.

Local

Local/U, K,

Local

Local

Local/U. K.

Canada/U.S.

U.S.

United Statesg . . . . . .Goodnews Bay Private Hansen Properties Us.

Stillwater Mining Co. Private Johns-Manville Us.

Private Chevron Resources Us.

(Chevron USA)

Private Anaconda Minerals Us.

(Atlantic Richfield) — ——— .

awlth approximate percentage of control, If available

b T he largest, S i n g le .sha reh o l der block of !nco stock IS 4 Percent

CFalconbr,dge IS 327 percent owned by Superior 011 through direct equ!ty and Its COntrOlliflg Interest In MclnWre

dNewmont Mlnlng (220, ~ ~wned by Consolidated GoldFields (LJ K ), ~h,ch is (290/. ) ~~ned by Minerals & Resources Corp , which is (43° o) owned by Anglo America n

eThere are slx finance houses (the Group~i) Which do~i~ate the south Af~,can ,ndustry The Anglo American Corp of S A Ltd (AngloAmer), Gold F!elds Of S A Ltd ,

General Mlnlng Un{on Corp Ltd (Gencor)j Rand Mines/Barlow Rand Johannesburg Consolidated investment Co Ltd (JCI), and AngloTransvaal Consolidated Investment

Co Ltd (AngloTC)

‘Johannesburg Consol!datecl Investment Co Ltd IS (41) owned by the Anglo American

gNot tn production, pro?, pectlve Onty

SOURCES E&MJ 1983 /nternaf/ona/ D/rectory of Mirr/rtg, Bureau of Mines, Mineral Commod{ty Profile 1983 P/at/nurn.Group Metals Off Ice of Technology Assessment

Refiners)–and Engelhard Corp., both with

refineries in England and the United States, are

connected through Minerals & Resources Corp.

to the Anglo American Corp. of South Africa,

one of the group houses. The third South African producer firm, Western Platinum, is controlled by British, Canadian, and American interests,

Canada’s two PGM-producing firms are primarily Canadian and American owned, Falconbridge, which is a part owner of Western Platinum in South Africa, owns a refinery in

Norway. Inco operates refineries in Canada

and the Mend Nickel Co. refinery in England.

While most of the mining firms are vertically

integrated, from ore mining and processing

through to metal production, processing has

traditionally involved a physical, international

flow of semiprocessed forms of the metals between mining countries and refiners in northern Europe. While Rustenberg now has the capability to process its ores completely within

South Africa, some still follow the traditional

path and are shipped as concentrates or in

smelted form (matte) to England for refining.

Western platinum ships mixed metal mattes to

Norway, where nickel and cobalt are extracted.

Final PGM units (as a “sludge”) are returned

to South Africa for final separation. Canada’s

Inco ships PGM sludge to its plant in England

for refining. Falconbridge’s semiprocessed ores

go to Norway, with final recovery either in

Norway or at the Engelhard refinery in Newark, NJ.

A consequence of this processing flow of

PGMs is that essentially all the United States’

primary PGM needs, even those obtainable

from Canada, must ultimately be shipped from

overseas. Both Ontario and Manitoba provinces in Canada have laws requiring all ores

mined there to be fully processed in Canada,

if possible. Inco and Falconbridge have so far

been granted exemptions allowing them to export semiprocessed ores for refining, following a pattern set more than 50 years ago. Both

expect to continue this system as long as it is

economically feasible to use their northern

European refineries. While semiprocessed ores

are transported by surface, final metal forms
194 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

are normally shipped by air, mitigating potential access problems (on the return journey)

during crises.

Platinum group metals are investment as

well as industrial commodities. Accordingly,

three levels of trade exist: long-term contracts

between producers and consumers, the dealer

market for small and spot purchases, and investment and speculative buying of futures

contracts on various metal exchanges, such as

the New York Mercantile Exchange (platinum

and palladium) and the Japanese Gold Exchange (platinum). At any one time, stocks of

these metals are held by producers, refiners,

investors, dealers, fabricators, and governments. The U.S. Bureau of Mines estimated

that at the end of 1981 there were 900,000 troy

ounces of PGMs (about a 4 to 5 months’ supply)

held by these groups in the United States

alone. 106 The existence of widespread holdings

of these stocks is one factor used to explain

why the producer-set price recently gave way

—after a 50-year dominance—to a market price

for PGMs. In effect, the stocks held by a variety of groups serve as an intermediate supply,

reducing producers’ ability to set prices or control the flow of processed material.

Any near-term increase in demand is expected to come from current sources. South

African producers, who tend to tailor production to their estimates of western consumption,

have proven adept in drawing on their vast reserves to meet increased demand, In the 1970s,

for example, South African firms greatly expanded production to meet demand created by

requirements for automobile catalytic converters in the United States. They would likely

respond similarly in the future, and their ample resources should allow them to do so.107

Most of South Africa’s production of PGMs is

committed to major consumers—including the

automobile industry (for catalytic converters)—

through long-term (approximately lo-year) contracts. While information about contracts is not

IWU, S. Department of the Interior, Bureau of Mines, A4inem)

Commodity Profile 1983: Platinum-Group Metals, p. 10.

lozsee for i~tance, the Bureau of Mines’ Platinum AvailabiJity—MarJcet Economy Countries, Information Circular No.

8897/1982.

made public, Rustenberg reportedly supplies

Toyota, Honda, and Ford; Impala is said to supply General Motors, Chrysler, and Nissan; and

Western Platinum reportedly supplies Mitsubishi.108

While South Africa’s portion of the world

PGM market has steadily increased, Canada’s

production has not kept pace with growing demand. Since the 1960s, its share of the world

market has decreased by 84 percent, while actual output has remained level.

The Soviet Union’s production and marketing techniques cannot be determined accurately;

most of its output is marketed through dealers

rather than directly. Explanations for shortterm changes in the amount of palladium made

available for the market have ranged from pure

political motivations to maximization of longterm commercial advantage. Over the past 20

years, the Soviets have managed to increase

steadily the overall production of PGMs.

The following country-by-country overview

of major producers discusses the current and

projected status of PGM output.

Canada

Inco is the major PGM producer in Canada,

with Falconbridge a distant second, Both derive PGMs as byproducts of nickel-copper sulfide deposits near Sudbury, Ontario. Inco also

has lesser deposits at Thompson, Manitoba.

PGM processing is tied to recovery of nickel,

copper, and cobalt. Inco’s ores are smelted at

Copper Cliff, Ontario, with final recovery of

PGMs at the firm’s Mend Nickel Co. refinery

at Acton, England. Falconbridge smelts ores

in Sudbury; ships a nickel-copper matte to its

plant in Norway for nickel, copper, and cobalt

recovery; and refines the resulting PGM sludge

in Norway or at the Engelhard refinery in Newark, NJ.

South Africa

In South Africa, PGMs are considered the

primary product derived from sulfide depos108’’ Impala, GM Set Long-Term Pact Huddle, ” American

MetaJs Market, June 2, 1983.
—.

Ch. 5—Strategic Material Supply ● 195

its. Rustenberg Platinum Mines produces more

than 50 percent of South Africa’s output, followed by Impala, with some 40 percent, The

balance is produced by Western Platinum,

which now has capacity to produce about

125,000 troy ounces of platinum per year. The

Bushveld Complex in northeastern South

Africa supports the entire PGM production.

PGM deposits primarily occur in its Merensky

Reef section—with concentrations ranging

from 4 to 15 grams per tonne of ore or 4 to 15

parts per million (ppm). (Technically, 9 percent

of South Africa’s PGM reserves lie within the

Bophuthatswana Homeland. Bophuthatswana

actually produced over half of the PGMs

credited to South Africa in 1982 as all of Impala’s mining operations are within the homeland along with part of Rustenberg’s.)

Two other sections of the Bushveld, the Upper Group (UG2) Chromium seam and the Platreef, have lower overall grades of PGMs but

higher proportions of some of the lesser metals,

such as rhodium and ruthenium. The Platreef

is currently unmined. Western Platinum produces from some sections of the UG2. With the

introduction of a new smelting process in 1984,

PGMs can also be extracted from the chromite

seams. The Bureau of Mines has stated109 that

commercial development of the UG2 and Platreef of the Bushveld Complex would more than

double the amount of platinum available from

South African deposits.

Rustenberg and Impala each have facilities

in South Africa to process their ores completely

to metal forms of separated PGMs. Rustenberg

can also ship semiprocessed ores to the Johnson

Matthey plant at Royston, England, for processing. Western Platinum ships all its production as mixed metal mattes to the Falconbridge

(a part owner of Western) plant in Norway for

separation of copper, nickel, and cobalt. A residual PGM sludge is returned to the Lonrho

refinery at Brakpan in South Africa for final

separation of PGMs. Western is currently coning-r, F. A nstett, et a]., U. S. Department of the Interior, Bureau of h4ines, Platinum A \’ailabilit~’—Ma rket Econom~’ Countries, Information Circular No. 8897, 1982, p. 12,

sidering development of its own matte treatment facility in South Africa, which—if established—would eliminate the time-consuming

shipment of matte to Norway, cutting overall

PGM processing time from about 6 to 2 months.

Gold Fields of South Africa Ltd. (partly

owned by Consolidated Gold Fields of London,

which is 30-percent owned by Anglo American) has been investigating a prospective new

PGM mine on the Merensky Reef. The project

was in the exploration phase in 1984. Potential PGM output is expected to total 386,000

troy ounces, including platinum (64 percent),

palladium (27 percent), ruthenium (6 percent),

and rhodium (3 percent). This would add about

5 percent to the world’s output of PGMs (using

1980 as a base year).

Soviet Union

PGMs area coproduct or byproduct derived

from nickel-copper sulfide deposits in Siberia

(with PGM values as high as 10.4 grams per

tonne of ore) and the Kola Peninsula. Limited

amounts are also produced from placer deposits in the Ural Mountains. The mines at the

Noril’sk mining combine in Siberia provide up

to 90 percent of the total output. Ores, extracted

under adverse conditions of an 8-month winter, are smelted and refined to metal within the

Soviet Union. Expansion of capacity at Noril’sk,

reportedly underway in the 1980s, could significantly increase Soviet production capabilities.

Potential Foreign Sources

The U.S. Geological Survey has a study

underway to determine the PGM content of

laterite formations in the Southwest Pacific (Indonesia, the Philippines, and New Caledonia).

These mineralizations are found along with

chromite. The separation techniques using

plasma technologies that are being developed

in South Africa for PGM/chromite deposits

there could be applicable. The economic feasibility of mining PGM in these laterite formations may make it possible to extract the chromite content as a byproduct.
196 • Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Domestic Production of

Platinum Group Metals

In contrast to the other first-tier materials,

the United States is a producer, albeit minor,

of PGMs (8,033 troy ounces in 1982 as a byproduct of copper mining and refining) and

mining firms are actively pursuing the commercial possibilities of exploiting PGM deposits at Stillwater in Montana. These deposits

could initially supply 14 percent of the US. palladium and 4 percent of platinum needs, or 9

percent of overall PGM needs (based on 1982

consumption data). Production from Stillwater

is considered to be the only possible near-term,

worldwide competition for existing PGM producers such as South Africa and the Soviet

Union.

The Goodnews Bay Placer Mine in Alaska

is a past producer of PGMs and was to resume

operations in mid-1981 but did not. There are

no immediate plans to do so. Other U.S. PGM

resources exist in Alaska (Salt Chuck Mine and

the Brady Glacier-Crillion-Le Pousse sulfide deposit) and Minnesota at the Duluth Gabbro.

These latter properties have not been the subject of any recent commercial development

interest. New U.S. mining activity in the development and expansion of gold and silver

properties (the ore bodies of which often contain some PGMs) may result in small amounts

of PGMs being recovered.

U.S. resources of PGM total 300 million troy

ounces (less than 10 percent of world resources)

and are concentrated in Montana, Alaska, and

Minnesota. 110 An estimate of total possible U.S.

production of PGMs from the most likely properties—Stillwater, Goodnews Bay, and the

Duluth Gabbro—is shown in table 5-37.

Stillwater Complex, MT

PGM occurrences in the Stillwater Complex

along the Beartooth Mountains in Montana

have been commercially explored and evaluated over the past 15 years. The deposits are

geologically similar to those in the Merensky

Reef of South Africa and contain nickel, copper and chromite in addition to PGMs. Stillwater is being evaluated on the basis of extracting PGMs from sulfide ores as a primary

product. The Complex is approximately 28

miles long and from 1 to 5 miles wide and is

divided into distinctive mineralized zones with

PGMs present at greater-than-normal concentrations in some bands. Typical PGM grades

at Stillwater have been reported by the Bureau

IyOJ. Roger Loebenstein, U.S. Department of the Interior, 13ureau of Mines, A4inera] Commodity Profiles 1983.’ P]atin um -

Group Metals, p. 3.

Table 5-37.—Potential U.S. PGM Production

Estimated annual production Estimated

capacity (troy ounces of minelife

Resource/mine contained metal) (years) Production dependent on

Stillwater, Montana . . . . . . . . . 10-25 Combined platinum-palladium price of about

Initial:

Additional expansion:

Goodnews Bay, Alaska . .

Duluth Gabbro, Minnesota

Palladium . . . .

Platinum . . . . .

Total . . . . . . .

Palladium . . . .

Platinum . . . . .

Total. . . . . . .

. . .

Platinum . . . . .

. . .

Palladium ., . .

Platinum . . . . .

Total . . . . . . .

136,000 $220 per troy ounce (1984)a ‘

38,000

175,000

340,000

97,000

437,000

unknown Platinum price of $600-700 per troy ounce (1984)

10,000

25 Copper, $1.50 per pound

30,800-92,400 Nickel, $4.00 (1975 data converted to January

6,800-20,300 1983 dollars

37,600-112,700

aYear of estimate.

SOURCE: Stillwater—Stillwater Mining, June 1984.

Goodnews Bay–Hanson Properties, July 1984.

Duluth G*bro—Calculated by OTA using preliminary results of Bureau of Mines research on Duiuth ores, State of Minnesota, Regional Copper-Nickel Study,

1979; Silverman, et al., OTA background study, 1983.
Ch. 5—Strategic Material Supply

of Mines as 0.130 troy ounces of platinum and

0.509 troy ounces of palladium per ton of ore

(5 ppm platinum, 17 ppm palladium). In comparison, grades of representative ore from the

Merensky Reef are 0.154 troy ounces of platinum and 0.066, palladium per ton (5 ppm platinum, 2 ppm palladium).111 The estimated PGM

reserves of the entire complex have been reported at 7 million troy ounces.112

The most important PGM zone was discovered during exploration by the Johns Manville

Sales Corp. in 1967 and sparked renewed commercial interest in this area once mined for its

chromite content. The Johns Manville zone has

an estimated 0.47 troy ounces of platinum and

palladium per ton of ore with a palladium-toplatinum ratio of 3.5:1113 (0.11 troy ounces of

platinum and 0.36 troy ounces of palladium per

ton of ore, or 4 ppm platinum and 12 ppm palladium).

Two sets of properties in the Stillwater Complex have been the object of extensive commercial exploration since 1979. The properties,

since June 1983, have been held by a joint venture of Stillwater PGM Resources & Anaconda

Minerals Co. under the name of Stillwater Mining Co. Stillwater PGM Resources is a partnership of Johns-Manville and Chevron Resources

Co. (Chevron USA); Anaconda Minerals is a

wholly owned subsidiary of Atlantic Richfield.

Stillwater Mining Co. has selected a particular mineralized zone (the Minneapolis Adit) in

one of the original Anaconda properties as the

site for an 18-month exploration and evaluation effort. Core drillings, both from the surface and within the Adit, constitute a major

portion of the evaluation project’s data. This

joint project may—or may not—result in eventual combined mine development and production activity.

The development phase would reportedly

take 2 years to place into operation an underground, hard-rock mine producing 1,000 tons

of ore per day. A milling plant, constructed at

the mining site, would produce a concentrate

—..—

1lllbid., p, 4.

I IZAnstett, et a]., op. Cit., P. 7.

lls~~e ,$tj]]tt,afer cjfjze~-s’url, Apr. 26, 1984, sec. 2, p. 5.

• 197

from the mined ores by grinding and flotation

processes. This product would be transported

by surface to an existing smelter (e.g., Inco’s

in Canada) for refining. Estimated mine life for

the project is 20 years.114

In mid-1984, the possibility of proceeding

with mining development was considered

“very price sensitive.’’115 A weighted average

price of $220 per troy ounce of PGMs is being

used in Stillwater Mining’s feasibility study calculations. (As a comparison, the June 1984 producer prices for PGMs were: platinum, $475

per troy ounce and palladium, $130 to $140.116

At these prices and given the Stillwater palladium-to-platinum ratio of 3.5:1, a weighted

average price of $206 to $214 is realized. Thus,

the market prices did not quite meet the target price,] The drilling program and feasibility study is scheduled for a mining development “go/no go” decision by mid-1985.

Anaconda’s Stillwater Project had originally

proposed, for a 1982 draft EIS, a mining operation producing 350,000 tons of ore per year

(1,000 tons daily for 350 days per year) over 25

years. Contained PGMs (at about 0.5 troy

ounces per ton of ore) would be 500 troy

ounces per day (or 175,000 troy ounces per

year). 117 The Anaconda site (now the Stillwater

Mining investigation) is smaller than the

original Stillwater PGM Resources properties,

whose reserves might be able to support a mining rate of 2,500 tons of ore per day,118 or approximately 437,500 troy ounces per year of

contained PGM values.

The Stillwater Complex is located in a rural,

agricultural community, partly within the

borders of two national forests. While development of mining at Stillwater would provide

job opportunities and broaden the local tax

base, local citizen groups have voiced concerns

—.—llqThe sfi]~water Citizen-Sun, p. 12.

llsLeS Dar]ing, Environment] Coordinator and principal

spokesperson, Stillwater Mining Co., personal communication,

May 1984.

1l”’’Closing Prices,” American Metal Market, June 15, 1984,

p, 31,

117s1]verman, et a]., op. cit., p. 104 (text of E] S).

Ilnsl]verman, et al., op. cit., p. 190. A Sept. 10, 1980, statement

from the Manvilfk group estimated a production rate of 1,000

to 3,OOO tons of ore per day
198 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

over population influx, overburdening of the

public service system and environmental issues

such as location of the mill and tailings pond,

the wastewater’s effect on the region’s groundwater, and protection of air, water and wildlife. During any permitting process, Montana’s

Department of State Lands will coordinate the

preparation of the necessary EIS; and the local

government and the Montana Hard Rock Mining Impact Board will evaluate socioeconomic

issues.

Goodnews Bay and Other Alaska Occurrences

The Goodnews Bay Placer Mine is a dredging operation located on the Salmon River near

the Bering Sea coastline of Alaska. Production

from Goodnews Bay totaled 641,000 troy

ounces of PGMs (over 80 percent platinum)

from 1934 until 1975, when production was

halted.119 Although new owners, Hanson Properties, announced intentions to resume operations in 1981, operational difficulties with

dredging machinery, environmental issues,

and overall, the costs of production have prevented them from doing so.120

While the major component of this placer deposit is platinum (reserves are estimated at

500,000 troy ounces of platinum),121 other

PGMs and precious metals are present. The approximate proportions of metals in the concentrate produced in the past were 82.31 percent

platinum; 11.28, iridium; 2.5, osmium; 0.17,

ruthenium; 1.29, rhodium; 0.38, palladium; and

2.24 percent gold.122 The mine could possibly

produce up to 10,000 troy ounces of platinum

per year.123 The high grade concentrate gener-

—— .— Ilelames c. J3arker, d d,, U.S. Department of the Interior, Bureau of Mines; Critical and Strategic Minerals in Alaska: Cobalt, the Platinum-Group Metals and Chrom’te, Information Circu]ar No. 8869, 1981, p. 2.

IZORaymond Hanson, Hanson Properties, persona] communication, July 1984.

YZ1 u.S. Department of the Interior, Bureau of Mines, Minerals

Yearbook 1981, p, 668.

IZZThese are the weighted mean percentages of the metals

mined from Goodnews Bay from 1936 to 1970 as presented in

the National Research Council, National Materials Advisory

Board, Supply and Use Patterns for the Platinum-Group Metals,

Nh4AB-359, 1980, p, 17.

U3U. S. Department of the Interior, Bureau of Mines, Minerals

Yearbook, 1981, vol. I, p, 668. Mr. Hanson inferred that this figure was high and commented that it was “what the oldtimers

in Alaska claim, ”

ated could be shipped directly to a U.S. refinery, such as Engelhard in Newark, NJ, for processing.

The Salt Chuck lode mine has been intermittently exploited for various PGMs since 1918

with the latest period of operation having been

1935 to 1941. Overall, 14,271 troy ounces of

PGMs have been produced from this mine.

PGMs are known to exist in deposits in Glacier Bay National Park in the Crillion-La

Perouse Complex. An unpublished U.S. Geological Survey report in 1980 indicated that

platinum may be recovered as a byproduct

from the Brady Glacier nickel-cooper ore body.

The ore body, which extends under moving

glacier ice, has not been extensively evaluated

and could prove expensive to mine.124 In addition, given its location, environmental concerns would weigh heavily on any mining

prospects.

In general, there is potential for more lode

and placer deposits in Alaska. The Alaska Field

Operations Center of the Bureau of Mines has

an ongoing program specifically directed

toward improving the available information

about occurrences of PGMs, as well as chromite and cobalt, in Alaska.

Duluth Gabbro, Minnesota

Copper and nickel sulfide deposits along the

Duluth Gabbro in the Lake Superior region of

northeastern Minnesota contain cobalt, PGMs

and other precious metals that could be recovered as byproducts. Production of significant amounts of PGMs depends on copper and

nickel mining on a large enough scale to make

these low-grade resources competitive in global

markets. Commercial production will not even

be considered until the recovery of both primary metals markets occurs and existing

worldwide nickel and copper mines have

returned to full production. (For information

on the economics of Duluth Gabbro and a Regional Cooper-Nickel study released in 1979 by

the State of Minnesota, see the domestic cobalt section.)

IZdcritjca] and Strategic Minerals in Alaska, op. cit., p. 3
Ch. 5–Strategic Material Supply ● 1 9 9
200 . Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Industry interest in the area peaked between

the late 1960s and 1970s. During that time,

Amax Nickel acquired an option from Kennecott Copper and investigated the possibility

of a combined surface and underground operation (Minnamax) and Inco considered opening an open pit mine (Ely Spruce). Inco’s

project was suspended in 1975, and Amax indefinitely postponed its project in 1981 owing

to depressed metal prices. This property has

now reverted back to Kennecott control. There

has been no revival of commercial interest in

the area.

These two holdings in the Duluth Gabbro

contain demonstrated resources of less than

800,000 troy ounces of platinum.125 PGM values

of 0.00107 troy ounces of platinum and 0.00304

troy ounces of palladium per ton (0.036 ppm

platinum, 1.03 ppm palladium) were estimated

from an Inco sample by the Bureau of Mines.126

The Minnesota Department of Natural Resources extrapolated this data to the rest of the

area and estimated that about 18 million troy

ounces of platinum resources existed in 4.4 billion tons of ore.127

The Bureau of Mines has recently conducted

research on the processing of raw materials

typical of Duluth Gabbro ores, and a report on

the results is in preparation. Data from these

studies indicate that, under optimum conditions, the recovery of platinum and palladium

per ton of ore would be approximately 0.0005

troy ounce and 0.0022 troy ounce, respectively.

This is equivalent to approximately 0.088 troy

ounces of platinum and 0.40 troy ounces of palladium per ton of copper produced.128 In the

1979 study by the State of Minnesota, the maximum possible annual output from Duluth was

calculated at 231,000 tons of copper metal and,

with one mine complex (rather than three) in

operation, 77,000 tons of copper would be

produced per year. This implies that between

125Anstett, et a]., op. cit., p. 7.

IZoNationa]ReSea~h Council, National Materials Advisory

Board, Supplj’ and Use Patterns for the PlatinumGroup Metals,

NMAB-359, Washington, DC, 1980, p. 16.

1

271 bid., p. 16.

IZU ,S. Department of the Interior, Bureau of Mines, ]etter to

OTA, july 31, 1984.

30,800 and 92,400 troy ounces of palladium and

between 6,800 and 20,300 troy ounces of platinum might be generated as byproducts from

Duluth given the proper economic incentives

for copper and nickel production.

Although the Duluth Gabbro lacked any commercial activity recently, this large resource of

low-grade material will continue to be viewed

as a potential source of metals. The proximity

of potential mining areas to the Boundary

Waters Canoe Area and Voyageurs National

Park, as well as possible damage from sulfur

emissions from a smelter operation processing

Duluth Gabbro sulfide ores, will ensure an important role for environmental considerations

in mine planning in the area.129

Domestic Mining and Processing

Technology Prospects

PGM deposits which occur in hard-rock environments (Stillwater, for instance) are amenable to underground methods such as sublevel

stoping and the newer vertical crater retreat

system. Placer deposits are generally dredged

unless, as maybe the case in some areas of the

Goodnews Bay deposit in Alaska, the thickness

of the overburden makes the technique uneconomic.

Domestic PGM deposits are not unique and,

therefore, metallurgical processing technology

is available. The high-grade platinum concentrates from Goodnews Bay can be sold directly

to existing U.S. precious metal refineries for

purification. Technology for the required

smelting and refining of Stillwater’s nickelcopper-PGM ores is well established. The most

qualified North American smelter for the initial refining of its concentrates is the Inco plant

at Copper Cliff, Ontario.

Included in current Bureau of Mines research is the evaluation of a method for processing of Stillwater ores. It involves flotation

of the ores and subsequent smelting and leaching to recover the various metal values in the

ores. The flotation concentrate results in 88

percent recovery of the PGM values and smeltlzgsl]verman, et al., 0p. cit., p. 112.
Ch. 5—Strategic Material Supply . 201

ing to a sulfide matte retains 95 percent, for

an overall recovery of 84 percent. This matte

then requires a refining step to separate out

PGMs and gold.130 Duluth ores are also under

investigation and are discussed in the preceding domestic cobalt section.

Processing of Platinum Group Metals

The major end uses of PGMs are as catalysts

in the automotive, petrochemical, and chemical industries and as contacts in the electronics

industry. These products are fabricated from

chemical forms of PGMs, which are produced

from metals, mainly platinum and palladium

and, increasingly, rhodium.

PGMs follow the same processing path as cobalt because they originate in the same ores.

PGMs are the last step in the long extraction

process of these ores (fig. 5-7), and it can take

up to 6 months to complete the cycle from mining of the ores to production of PGMs. The

final residual from the sequential processing

is a PGM concentrate, or “sludge,” Separation

of the precious metals from this concentrate

130 Re5~arch 85’, op. cit., P. 89.

is accomplished by various chemical methods,

many of which are proprietary, A new extraction process developed by the South African

National Institute of Metallurgy in 1975 can reduce the overall PGM processing time dramatically (to 20 days). Two South African

refineries and one in England now use the institute’s process.

PGMs are imported by the United States in

forms such as unwrought and semimanufactured metal. Recycled catalysts from the petroleum and chemical industries are another

source. The processing industry in the United

States consists of refiners and fabricators.

Large firms, such as Engelhard and Johnson

Matthey, can handle the final PGM processing

steps, while smaller firms only fabricate the

end products. Engelhard’s New Jersey refinery reportedly processes some of Falconbridge’s (Canada) PGM sludge. The National

Materials Advisory Board reported in 1980131

that, as a whole, the U.S. PGM processing industry was healthy and aggressive and could

readily meet the challenges of any increased

demand.

131N MA13.359, op. cit.

m

Exploration

The development of the major known domestic resources of chromium, cobalt, manganese,

and PGMs is technically feasible if political necessity dictates, However, with the exception

of a PGM deposit, these domestic resources

could be produced only at several times current world price.

Exploration for additional domestic deposits by private concerns will proceed only insofar as there are geologically favorable areas,

perceived economic benefits to the explorer,

and procedures that permit mining if a discovery is made. No group is actively exploring for

first-tier strategic materials in the United States

today, The benefits are not consistent with the

costs and risks involved, especially when foreign countries can produce vast quantities of

high-grade materials at costs well below that

of any domestic producer.

Land-Based Resources132

In North America, Precambrian rocks are

considered the most geologically favorable

areas for possible significant deposits of chromite and nickel-copper-cobalt sulfides with

associated PGMs. Figure 5-8 shows the formation period (1 to 2.6 billion years ago) of certain world deposits of chromium, cobalt and

PGMs. The formation of manganese deposits

is not as exclusively timebound as the other

lszThis section is based prlrnari]}~ on Ben F. Dickerson I I I i and

Carole A. O’Brien, Exploration for Strategic Materials, contractor studj’ prepared for the Office of Technology Assessment, September 1983,
202 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Figure 5-7.--PGM Processing, Simplified Flowcharta

aTyplcal South African prwess.

SOURCE: Department of the Interior, Bureau of Mines, Platinum Avaihrblllfy–kfarket.Ecorron’rY Countdes, Information Circular U8B97, 1982.
.

Ch. 5—Strategic Material Supply ● 203

Figure 5-8.—Time Chart of Some First-Tier Strategic Material Deposits

I Paleocene I

Early I

02

2

11

25

40

55

65

135

180

225

270

305

350

395

440

500

570

1000

1800

2600

3300

4500

Deposit

Katanga

Duluth Gabbro

Sudbury

Bushveld

Outokumpu

Kemi

Stillwater

Great Dyke

Location

Zambia-Zaire

Minnesota

Ontario

S. Africa

Finland

Finland

Montana

Zimbabwe

Approx. Age

(million yrs.)

1000-18OO

1000-1500

2OOO-21OO

2OOO-21OO

1800-2300

2400-2500

2600-2700

2400-2500

Commodity

Cobalt

Nickel-Cobalt

Nickel-Copper. Platinum

Chromite-Platinum

Copper-Nickel-Cobalt

Chromite

Chromite-Platinum

Chromite-Platinum

SOURCE. Ben F Dickerson Ill and Carol@ A O’Brien, ~xploratlon (or Strategic Materials, contractor study prepared for the Office of Technology Assessment, September

1983
204 Ž Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

strategic metals. In the United States the major exposure of Precambrian rocks (fig. 5-9) is

in the Great Lakes region of Michigan, Minnesota, and Wisconsin, with smaller, scattered

areas in many States, including Montana,

Idaho, Colorado, Arizona, South Dakota, Wyoming, Texas, and Missouri.

The constraints on exploration imposed by

the absence of extensive geological exposure

cannot be ignored in assessing the Nation’s

strategic materials outlook. Currently unidentified geologic environments in the United

States could possibly contain these metals, but

the uncertainties involved in identifying such

environments compound the already high risk

of exploration of regions of known potential.

Metals experts interviewed by OTA generally agree that there is a very low probability

that the United States contains significant, undiscovered economic deposits of chromite, cobalt, or PGMs. (Prospects for manganese are

deemed somewhat better.) Undoubtedly, some

geologists disagree with this majority opinion,

asserting that increased geologic knowledge,

better technology, and fresh exploration concepts can find new, economical deposits. Even

if such deposits do exist, the apparent risk/

reward ratio and the magnitude of identified

foreign reserves preclude meaningful action

under current conditions.

Experts were unanimous on one point: all believed their companies’ management would reject any strategic metals exploration program,

no matter how geologically well-conceived,

now and in the near future. 133

Until reliable long-term economic incentives

[perception of profits commensurate with risks)

are available, there will be no significant exploration for strategic materials in the United

States. A recent estimate gave $290 million as

the cost to find an ore deposit that would significantly affect the profits of a medium-sized

corporation. 134 Any find would have to result

in ores of higher than average grades and/or

lower than average costs to mine, substantial

1jjIbid., p. 11,

lsgIbid., p. 18.

and dependable markets, and an assumption

of long-term stability in the domestic economy.

Exploration Technology Today and in the Future

The following briefly reviews present and potential near-term technological developments

in land-based exploration for strategic materials. It is felt that the technology level that

mineral geologists employ today is about 20

years behind the level used in oil and gas exploration. This may be a reflection of the value

of national energy versus mineral needs. For

instance, in 1977 fuel production in the United

States was valued at $56.2 billion and metals

production, a tenth of the fuels value at $5.2

billion. 135

Most specialists think that a breakthrough in

mineral exploration technology is unlikely in

the next 10 years and that the exploration scene

of the early 1990s will probably not be greatly

different from that of today, except it will be

more expensive. Current tools and techniques

will be more precise and refined, owing largely

to the application of mineral exploration advances, general scientific knowledge, and electronic technology. Lacking incentives to explore for strategic materials, there will be little

attention to the development of specialized

technology for that purpose; but any general

improvements in exploration methodology or

technology could be of use.

Chromite deposits, for instance, have generally been found by surface prospecting and

drilling in and around identified outcrops (surface appearances). There are no unique problems in exploring for most types of cobalt deposits. Current geophysical methods can be

used to detect the presence of copper, nickel

and iron sulfide minerals, with which it is associated. Cobalt can be easily identified by relatively simple chemical analysis methods.

GENETIC THEORY

Increased interaction between industry and

academia could lead to better application of

new and developing concepts in genetic theIOSs~~tl~~iC~] A~~tr~Ct of the (_Jnit~ states, 1982.83 edition, ta.

ble No. 1276, p. 715.
—

Ch. 5—Strategic Material Supply ● 205

Figure 5-9.— Exposure of Precambrian Rock in North America

o

SOURCE Duncan R Derry A Cor?c/se World At/as of Geo/ogy and Mlrreral Depostts, 1980
206 Ž Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

ory. Most currently employed theories of ore

genesis are derived from developments in the

understanding of plate tectonics and continental drift.136 These concepts are definitely

useful in predicting areas favorable for certain

types of mineral deposits and will probably

continue to provide practical information.

Advances in this field are expected to call attention to some hitherto ignored, or currently

unknown, geologic environments for some

metals, particularly gold, silver, and perhaps

some base and strategic metals. Explorationists

do not feel, however, that any lo-year development of genetic theory will allow them to accurately fix the location and approximate quality of any type of mineral deposit. In fact, there

is strong doubt that this could ever be done.

DATA INTERPRETATION

Data interpretation is the single, biggest problem facing exploration. A substantial improvement in this art might far outweigh potential

technological improvements.

Both geophysics and geochemistry now can

deliver vast amounts of data that no one completely understands. Fully integrating this information with data from other exploration

techniques is very difficult. While a very few

“seat-of-the-pants” ore finders may be able to

do this intuitively, most explorationists are not

so gifted. One geologist said, “Better instrumentation is like giving an encyclopedia to an

illiterate—the pictures are neat, but it doesn’t

help him to read. ”

GEOPHYSICS

Geophysical techniques for locating particular geological structures and compositions are

one of the primary screening tools of mineral

exploration. The process involves measurement of various physical fields in which vari-

—.——-

Ise]n 1912 a German, A. Wegener, suggested that about 200

million years ago the continents were packed together in one

universal land mass called “Pangaea.” Wegener called attention

to the “jig-saw” piece matching effect of the South American

and African continents; similarities in geology, plant and animal life; and in paleoclimates of various continents. This basic

concept received little support until the mid 1950s.

ances in mineral content or physical condition

will cause anomalies in the data produced.

Current techniques, however, particularly

electromagnetic methods, are unable to distinguish between anomalies caused by various

minerals such as pyrite, chalcopyrite, or graphite. This prevents the explorer from correctly

identifying, or narrowing down sufficiently,

the sought-after mineral environment.

Research programs of a few large exploring

firms are aimed at developing instrumentation

to discriminate between various minerals, particularly sulfides. Because the work is proprietary, very little information is publicly available, Geophysicists interviewed for this report

said that such instrumentation would probably

not be developed before the end of the century

and, even then, may only compound current

problems of interpreting findings.

Other than the major problem of data interpretation mentioned above, instrumentation:

● must be better able to screen out natural

or human “background noise, ” this improvement might increase the effective

depth penetration, a current limitation of

the geophysical techniques; and

● needs additional miniaturization and improvement for borehole use, also increasing depth penetration.

Geophysical techniques are expected to improve only slightly, as many methods are approaching absolute barriers imposed by physical laws. (In particular, the decline of signal

strengths by the “inverse of the square of the

distance” effect.) Miniaturization of geophysical instrumentation will be much more highly

developed. The subsequent increased employment of down-the-hole geophysics will give, in

effect, greater depth penetration in areas being explored and could cope with the physical law limits, However, this improvement will

be of little use in the initial or reconnaissance

stages of exploration.

Geosatellite imagery and other associated

data will probably be employed cautiously, but

more frequently, particularly if some of the uncertainties of spectral interpretation can be
Ch. 5—Strategic Material Supply Ž 207

eliminated and higher spectral resolution obtained, Unfortunately, many large, geologically

favorable areas of the earth’s crust are hidden

beneath an alternate environment, preventing

satellite identification despite improved technology.

There are no special geophysical problems

related to strategic materials that preclude application of general improvements in exploration technology. For example, an effective borehole induced polarization (1P) transmitter and

receiver would perhaps be effective in exploration for podiform chromite bodies, in areas

where they are known to occur. Cobalt is associated with copper, nickel, and iron sulfides

which have detectable electromagnetic signatures. Chromite and manganese oxide can be

detected by using certain geophysical techniques as well. However, geophysical techniques have not been developed to identify economic concentrations of metals present in the

earth’s crust as carbonates and/or silicates (e. g.,

manganese carbonate deposits and nickelcobalt silicate minerals in laterites). Limited

success has been achieved in distinguishing

carbonate and silicate minerals using satellite

imagery but only when they appear on the surface. Manganese oxides, as well as sulfides, respond to 1P techniques but carbonates offer little, or no geophysical signature. Uncertainties

abound, however. 1P effects are produced by

graphite, magnetite, certain clays, and other

minerals. In fact, many 1P anomalies have no

ascertainable cause.

GEOCHEMISTRY

Geochemistry involves the analysis of soils,

surface water, and organisms for abnormal

concentrations of minerals. It is one of the

basic tools of modern mineral exploration and

is relatively rapid, cheap, and direct. But,

faster, more accurate, more sensitive, and more

specific analytical techniques are needed.

Current practice in sample preparation consists of crushing, grinding, pulverizing, and selecting a sample of appropriate size; each stage

of this process offers opportunity for error. The

ideal methodology would include automated

sample preparation and on-the-spot wholerock, accurate, multi-element analyses. An instrument for onsite analysis of drill-hole

derived samples, at least semiquantitatively, is

also needed. A technique that would not alter

the physical characteristic of the sample is

preferable.

Since strategic materials are not actively explored domestically, accurate multi-element

analysis would be highly desirable, no matter

what type of sample is being analyzed.137 Potentially valuable deposits of one element have

certainly been overlooked because analytical

work was at the time concentrated on locating other elements. Even if no potentially economic element is present, there would be great

geologic value in identifying and quantifying

all of the trace elements associated with particular types of mineralized bodies. In time, the

resulting patterns might offer definite clues to

the presence or absence of economic mineralization.

Borehole and handheld instruments, employing X-ray fluorescence analysis methodology,

have recently been developed. These are specific for such elements as silver, gold, molybdenum, and tin, But substantial improvements in

6 Compilation procedures for this “unwantedat-the-time” information would need to be instituted, however, sensitivity and analysis

reproducibility are needed. ICP (Inductively

Coupled Plasma atomic emission spectrometry) is the latest technique and is claimed to

be a multi-element analytical tool. There are,

however, substantial problems with interelement interference and element detection

levels.

High-precision and sensitive analytical methods—including ICP, neutron activation, laser

bombardment, irradiation by radioactive isotopes—have only limited use in geochemical

work because of their high unit costs (more

than $50 per sample) and certain physical

limitations of the equipment.

The main advances in geochemical exploration are expected to occur in instrumentation

I ~7[jom1)i]ation ~)ro[; ed ~1 res for this ‘‘unwanted-at-the-time iJl -

formation would need to be instituted, how’e~’er.
208 Ž Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

and in analytical techniques. Handheld and

drill hole-adaptive, direct in situ analytical devices will be available in exploration for some

elements, but probably only for PGMs among

the strategic metals, since there is little economic interest in the others. Although semiautomated wet chemical analytical methods

will be standard, and will increase reproducibility and sensitivity, more highly trained and

more costly technicians and analysts will be

required to perform the analyses,

Helicopter-borne spectral reflectance instrumentation, perhaps a spinoff of satellite research, may be used to screen vegetation geochemically in large forested areas. Practical

instrumentation should be available that will

directly measure gases emitted in decomposition of some economical minerals.

Chromite is a common accessory mineral in

mafic/ultramafic rocks, but geochemical surveys have not been successful at identifying

economic concentrations of chromite. Widespread high, but very variable, background concentrations of manganese in water, soils, and

rocks make geochemical techniques very difficult to employ.

DRILLING TECHNOLOGY

Drilling is the ultimate test phase of all exploration, and its costs, direct and indirect, are

one of the most significant limiting factors in

minerals exploration today.138 Improved technology which reduces these costs would allow

testing of more targets, however they are identified and defined, and would help improve

current ore discovery rates.

Techniques for mineral exploration include

core and rotary drilling. Core drilling physically removes a cylindrical sample of rock

while a rotary crushes and chips the rock so

that only cuttings are removed by air or water,

Core drilling today is not greatly different

from that of the 1860s, when it was first employed for coal exploration in Pennsylvania.

Although overall technology has steadily improved, only two significant improvements in

136Dickerson, et a]., Op. Cit., p. 66.

core drilling have been introduced in the past

30 years. The first was the introduction of wireline drilling (allowing the recovery of a sample core inside a drill stem); the second, the advent of long-wearing, impregnated diamond

drill bits.

Rotary drilling techniques for metals have

also generally stabilized. Sampling-related

problems prevent rotary drilling from being

employed to a much greater extent in minerals

exploration.

There has been comparatively little direct research directed at improving mineral exploration drilling. The U.S. Bureau of Mines and a

drill machine manufacturer and contract drilling company, E.J. Longyear, have jointly designed a method for replacing worn diamond

bits without removing drill rods from bore

holes, eliminating a costly and time-consuming

operation. With the use of impregnated diamond bits, however, it has proven more cost

effective to stay in the hole with these longer

wearing bits than to purchase the relatively expensive equipment required to change the now

partly obsolete surface set bits.

Most incremental improvements in drilling

have been developed in oil exploration, Although helpful in strategic materials exploration, various factors—e.g., the size of target,

rock types, dimensions of drill holes, and market size differences–prevent large-scale adaptation in mineral exploration. Substantial technical and cost benefits in mineral exploration

drilling techniques may be possible only if a

long-term, well-conceived, and adequately

funded research program is undertaken.

Drilling techniques are not expected to be

much different from those employed now.

Most explorers foresee increased drilling costs

and little change in drilling efficiency. If the

rate of growth in average drilling depth is

maintained, with its attendant increased costs

per hole, it is probable that fewer holes will be

drilled on any one target.

Research and Development

Mineral exploration technology and methodology have not been the subject of significant
Ch. 5—Strategic Material Supply ● 209

research and development (R&D) attention for

some time. Current metal market prices and

other problems have led to reductions of previous, modest funding levels in the private

sector.

A precise picture of mineral exploration related R&D, however, is difficult to develop.

Most work is spread throughout academia

(geology), the U.S. Geological Survey (geology,

geophysics, and geochemistry), the Bureau of

Mines (drilling, geophysics, and miscellaneous

pursuits), and mining and oil companies (geology, geophysics, and geochemistry). Equipment manufacturers, with a few exceptions

(mainly geophysical contractors), do very little R&D because their markets are so limited.

There appears to be no reliable figure available for the amount of direct explorationrelated R&D expenditures for any specific

period. (Guesses range from $10 million to $50

million per year by the private sector in North

America.) The quantification problem is complicated by no agreed-upon definition of work

that should be classified as mineral exploration

R&D, especially within the Federal Government. Is a U.S. Geological Survey geologist

studying the magnesium content of chromite

engaged in mineral exploration research? Most

practicing explorationists would say no, but an

argument could be made otherwise. One thing

is clear to explorationists: R&D in their field,

no matter how defined, is, by comparison to

most other technical fields, very poorly funded

and directed.

Ocean-Based Resources

The floor of the ocean provides a favorable

environment for the formation of expansive deposits of minerals containing manganese, iron,

and other metals. Some of these deposits contain significant amounts of nickel, copper, or

cobalt. As a result, they have gained some attention as possible alternative sources of metals

to supplement or replace land-based sources

of questioned reliability. The mineral resources

of the deep seabed gained visibility during the

1970s when their status was added to many

other subjects under consideration at the Third

United Nations Conference on the Law of the

Sea.

Three forms of the seabed manganese deposits are of interest from a strategic materials perspective: the manganese nodules and crusts located on the Blake Plateau off the coast of

Florida, the manganese nodules of the east central Pacific Basin, and the cobalt-rich crusts located on the slopes of seamounts and islands

in the Pacific. The status and outlook for exploitation of each of these types of deposits is

summarized in table 5-38.

The Blake Plateau deposits contain approximately 15 percent manganese and 15 percent

iron, but their content of more valuable metals

is low. The water depth ranges between 300

and 1,000 meters, and they are located on the

continental slope where they fall under the

jurisdiction of the coastal state (in this case,

jurisdiction is principally that of the United

States, although some of the region is under

Bahamian jurisdiction). In 1976, the National

Materials Advisory Board evaluated these

nodules as a potential domestic source of manganese. The nodules fared well against other

domestic sources, but were still judged to be

out of the realm of commercial exploitation

since their production costs were high in comparison with the large land-based deposits now

in production,

The Pacific manganese nodules differ from

those of the Blake Plateau in several respects.

They have attracted commercial interest because of their content of nickel, copper, and

cobalt, which exceed that of many land-based

deposits; they are located in water depths as

much as 10 times that of the Blake Plateau; and

they are located beyond the jurisdiction of any

country, with their legal status clouded by the

lack of widespread acceptance of any legal

regime for exploitation.

Interest in the Pacific nodules began to increase before the technology for exploitation

was developed and before the legal regime was

developed. The value of the metals contained

in the nodules was high in comparison to landbased ores, and the high value of contained

metals grabbed attention before estimates of
210 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table 5-38.—Outlook for Development of Ocean-Based Resources of Strategic Metals

Clarion-Clipperton

Blake Plateau Nodule Province Cobalt bearing crusts

Depth . . . . . . . . . . . . . .

Location . . . . . . . . . . . .

Metal content:

Manganese. . . . . . . .

Iron . . . . . . . . . . . . . .

Nickel . . . . . . . . . . . .

Copper . . . . . . . . . . .

Cobalt . . . . . . . . . . . .

Form . . . . . . . . . . . . . . .

Status of technology .

Economic outlook. . . .

Legal regime . . . . . . . .

300-1,000 meters

East coast of Florida, Georgia,

South Carolina Bordered to

east by Bahamian jurisdiction

Extremely low-grade manganese deposit is not competitive with land-based

producers

Under U.S. jurisdiction on the

Outer Continental Shelf

SOURCE: Office of Technology Assessment

Beyond U.S. jurisdiction: right

to license development activities by U.S. citizens

claimed by U.S. but challenged by supporters of the

U.N. Convention on the Law

of the Sea

the costs of the mining and processing equipment were well developed. It is now apparent

that capital and operating costs of deep ocean

mining would be much higher that current

costs of mining on land, and these high costs

more than offset the higher value of the metals

that the nodules contain.

There is little detailed information available

about cobalt-bearing manganese crusts. These

deposits are similar to the Pacific nodules, except that they are in the form of thin crusts

bonded to the underlying rock on the slopes

of seamounts such as the Hawaiian Islands. In

some cases, the crusts have been found to be

enriched with cobalt. In some samples, peak

cobalt contents of more than 1 percent have

been measured, but average cobalt levels have

been less than 0.8 percent,

While interest in nodules has declined, the

cobalt-bearing manganese crusts of the Pacific

seamounts have gained increased attention.

The high cobalt content of some of the crusts

presents the same attraction that was once presented by Pacific nodules. The high value of

the metal contained in the crusts, whether

measured in price or strategic interest, overshadows the high cost of recovering the metals

from their challenging environment and difficult mineral structure. Even though land-based

deposits may have lower content of cobalt,

nickel, or copper, they are more attractive to

investors because the cost of recovering the

metals is significantly lower. For manganese,

the case for land-based production is even

stronger since land ores are generally higher

in manganese content, easier to mine, and

more familiar to consumers in the metallurgical industries.

If so desired, the U.S. Government could assist private industry in overcoming the substantial barriers to exploitation of ocean-based resources of strategic materials and thereby

encourage industry to commit the major sums
Ch. 5–Strategic Material Supply • 2 1 1

needed to build and operate an ocean mine. able to physical interference at sea, and, withUnless there is a major increase in prices for out a widely accepted legal regime for exploinickel, copper, and cobalt, the cost to the gov- tation of the minerals of the seabed, it could

ernment of such assistance would be substan- be the subject of international legal and polititial. Furthermore, an ocean mine would not be cal disputes.

secure against interruption; it would be vulner-
CHAPTER 6

Conservation of Strategic Materials
Contents

Page

Introduction *e. **s* .*. o**. e#*s***, .+** *soO*** *0** **** *,o. e*. .0. *@*o 215

Recycling *s** **** .*e***s, *,**   ** ** *.** ***. **e* **. .*** *.*. .* #. * 215

Advanced Processing and Fabrication Technologies . ..................216

Conservation Through Part Life Extension and Design. . ...............216

Interrelationships of Conservation Approaches . . . e . . . . . . . . . . . . . . .. ...217

Case Studies of Strategic Materials Conservation Opportunities. . .........218

Superalloy ..** *,, *.. ,**, **, ..** ..*. e.. o.o*. *e. ,., ., o*,*.,***,*. , 219

Conservation of Manganese in the Steel Industry . . . . . . . . . . . . . . . . . . . . .227

Automotive Catalysts 6., *.** .**, ,.*o, o*oe. .,o, .,. .,o*, **o*, *o*,,,,, 238

Other Conservation Opportunities **** 9**m. **********0**.*****.**.*** 245

Prospects for Conservation of Strategic Materials . . . . . . . . . . . . . . . . . . . . . . . 254

Recycling Technology ● , *.,*.*******,.******..*.**..***.*.*.,*,**** 257

Nontechnical Impediments , ****..*.***.***..*****..*..***.*,**.*,*. 257

Recycling and Conservation Data Base ● ***************.**.,.,,***,** 258

List of Tables

Table No. Page

6-1.

6-2.

6-3.

6-4.

6-5.

6-6.

Cobalt Consumption in Superalloy, 1980 . . . . . . . . . . . . . . . . . . . . . . . . . 219

Manganese Content for Major Grade of Steel.. . . . . . . . . . . . . . . . . . . . . 232

Parameters Affecting Manganese Retention in the

Steelmaking Process ● **0* *e** **0* **** +8 *****************e****** 238

Current and projected Manganese Consumption in

U.S. Steel Production ● .,** *,**, ..** *.. @, ********m.*.,***,***,** 238

Cobalt Consumption and Recycling in Catalysts, 1982 . . . . . . . . . . . . . . 246

Selected opportunities for Increased Recycling of Chromium, Cobalt,

and Platinum Group Metals ● * * . . . ., . * ., * * * * *, * * * * * * * * * * ******.*. 255

List of Figures

Figure No. Page

6-i.

6-2.

6-3.

6-4.

6-5.

Service Life Time of Turbine Blades . *, * * *, . * * * ., . . . . * *, ****,*.*, 226

Historical Market Shares for Major Classes of Steel . . . . . . . . . . . . . . . . 231

Flow Diagram Showing the Principal Process Steps Involved in

Converting Raw Materials Into the Major Steel Product Forms,

Excluding Coated Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 234

Current Pattern of Manganese Use in Steelmaking . . . . . . . . . . . . . . . . . 235

PGM Demand by Vehicle Category ● .*. **e w*****..***.************ 239
CHAPTER 6

Conservation of Strategic Materials

Introduction

Past experience has shown conservation to

be an important response to shortages of materials, and strategic materials are no exception. In all of the post-World War II supply disturbances discussed in this report, industry

responded with increased recycling and, in

some instances, adopted new practices which

used materials more efficiently, Conservation

also can be an ongoing strategy to reduce industry dependency on insecure sources of supply, In this chapter, several different conservation techniques that can conserve strategic

materials are discussed, Included are recycling,

product life extension, trimming of alloy additions to the low side of acceptable ranges,

and improved processing techniques, Substitute materials and use of surface modification

technologies can also conserve strategic

materials; these are addressed in chapter 7.

Recycling

Recycling differs from other conservation

techniques in that it directly adds to material

supplies. Sources of recycled metals include

scrap material generated by the primary producer, which is called “home” or “revert”

scrap, and secondary (or purchased) scrap, Secondary scrap generated by manufacturers and

fabricators is called “prompt industrial scrap,”

while scrap that comes from products that have

been used and discarded is called “obsolete

scrap. ” Another secondary source is process

waste that can be reclaimed from metal processing plants.

Purchased scrap (comprised mostly of prompt

and obsolete scrap) accounted for 8 percent of

domestic cobalt consumption, 15 percent of

platinum consumption, and 12 percent of chromium demand in 1982.1 Actual levels of recy1 U, S. Department of Interior, Bureau of Mines, Mineral Com -

modit~ Summaries 1983 (Washington, DC: U.S. Go\’ernment

Printing Office, 1982), pp. 32, 36, and 116.

cling are significantly higher owing to internal

recycling by industry, toll refining arrangements, and incomplete reporting to the Bureau

of Mines. In addition, a substantial amount of

manganese is recycled from ferrous scrap, and

this may grow in the future.

Home scrap, which includes trimmings and

ends from castings and overflows from ingots,

is generally recycled with great efficiency.

Since it is clean and its composition is known,

it can simply be returned to the melt for reprocessing.

Recycling of prompt scrap is less uniform

than home scrap. In large manufacturing operations, where substantial amounts of scrap are

generated, efforts to separate scrap by type, to

keep it free from contaminants, and to maintain collection and marketing operations are

often justified by the market value of the scrap.

In smaller operations, or in processes where

oils or cutting fluids contaminate the scrap,

materials may be discarded as waste. Even

when recycling offers economic advantages,

firms may not want to divert their resources

to the establishment of a new set of internal

procedures for segregation and collection of

scrap.

Collection of obsolete scrap presents even

greater problems. This scrap may be disseminated across wide areas and mixed with a variety of other materials, Impurities from metallurgical contaminants must be eliminated to

make the scrap reusable. Owing to the expense

of collecting, identifying, and separating this

scrap, a substantial amount of metal is lost.

Even when quantities of known materials are

collected, limitations set by the processing

technology may result in the scrap being downgraded to a less demanding application. For example, superalloy scrap may be downgraded

to make stainless steel in which the cobalt content serves no purpose, and is essentially lost.

215
216 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Significant quantities of strategic materials

are lost in process wastes, because the costs

of treatment or handling for recovery exceeds

the value of the contained metals, Technological development, combined with imposition of

high costs on the disposal of wastes containing hazardous materials, have given impetus

to research on processing of such waste to ease

disposal problems and, where possible, to obtain saleable products from the processing.

Advanced Processing and Fabrication

Technologies

Industry constantly searches for new processing and manufacturing technologies that

can increase production, decrease costs, save

energy and materials, or improve performance.

Adoption of new technologies sometimes conserves strategic materials. The rapid phase-in

of the argon-oxygen-decarburization (AOD)

process for making stainless steel during the

1970s is a dramatic case in point. The AOD

process led to major improvements in chromium utilization in making stainless steel, including the ability to use more high-carbon ferrochromium (which is cheaper, and requires

less energy to make than low-carbon ferrochrome) as a raw material, and enhanced chromium recovery from scrap ferrochromium

charges. Nearly all stainless steel producers

now use the AOD process, so that further improvements in chromium utilization arising

from the process are likely to be modest.

Although it is rare for a new technology to

be adopted as pervasively and quickly as the

AOD process, ongoing industrial trends in metals processing and fabrication may lead to appreciable savings in some strategic materials

on a per-part or per-unit basis in the years to

come. For the most part, industry investment

in advanced processing and fabrication technologies is driven by concerns about product

performance, reducing costs, and minimizing

reject parts. Material conservation is not often

a primary reason why industry adopts advanced processing technologies, but it is often

an important side benefit.

The need for U.S. steelmaker to remain

competitive with foreign producers, for example, is leading to the replacement of older, less

efficient facilities with new processes which

are more cost effective and produce higher

quality steel.2 Furthermore, major savings in

manganese can be achieved as steelmaker upgrade basic steelmaking processes. As newer

technologies and processes are introduced, important reductions in the amount of manganese

needed to process each ton of steel can be expected. The pace of this phase-in will depend

on industry resources committed to upgrading

of domestic steelmaking capabilities.

Materials conservation is also a side benefit

of advanced processing technologies that are

increasingly used in producing and fabricating aerospace parts made from superalloys.

Often referred to as “near-net-shape” processes, these casting and powder metallurgy

techniques are used primarily to reduce costs

of machining and to improve control over manufacturing reliability. Because less metal is removed during processing, product yields are

improved significantly.

Conservation Through Part Life Extension

and Design

Life extension approaches to material conservation are of primary relevance to very highvalue parts. The overall value of a turbine blade

installed in a jet engine, for example, may be

500 times the raw material value. Technologies

and maintenance strategies that extend the usable life of a part, therefore, can result in substantial savings in replacement part costs and

materials over time.

Some life extension strategies are integrally

related to advances in nondestructive evaluation or testing (NDE or NDT) of products. On

the inspection line of manufacturing facilities,

NDE can be used to identify flawed products

‘The need for technological adjustments by the U.S. steel industry is discussed in the OTA assessment, Technology and Steel

Industry Competitiveness, OTA-M-122, June 1980.
Ch. 6—Conservation of Strategic Materials ● 217

which can be immediately set aside for reworking or recycling.

NDE has also been used on the production

line to monitor machine tool conditions in order to avoid breakage or other damage. For example, tungsten carbide drill bits have often

been retired prematurely because of concern

about breakage. A process developed by the

National Bureau of Standards for continuous

monitoring of the drill bit allows selective

retirement of a bit when failure is detected to

be imminent, rather than relying on a statistical average or waiting until the bit actually

breaks, In addition, since cobalt is used to bind

the tungsten carbide, strategic material use

may be reduced.

NDE’s potential role in monitoring of inservice parts is expected to grow in the years

to come as confidence in the reliability of inspection devices increases. Formal retirement

for cause maintenance programs are being

evaluated by the Department of Defense and

may be implemented in the late 1980s.

It is also possible to conserve strategic materials in the design of products, This sometimes happens inadvertently. For example, U.S.

automakers, in their effort to downsize cars,

have substantially reduced chromium use in

cars even though strategic materials conservation was not a primary objective. Design strategies specifically intended to minimize strategic materials use (e.g., industry’s effort to

conserve cobalt in the late 1970s) are probably

rare. However, in many noncritical applications, designers have a wide range of materials

that could be used. Actual choice of a material may be governed not only by cost and performance factors, but also by the designers’ experience and esthetic considerations. In theory,

as computer-aided design technologies and

computer-aided selection of materials advance,

designers may become more aware of alternative materials that use less strategic materials.

Design of products so that they can be easily recycled is another frequently proposed

conservation technique. However, the trend in

some industries is toward use of more complex

materials and products that pose greater

difficulties for recycling.

Interrelationships of Conservation Approaches

As discussed in subsequent sections of this

chapter, the prospects for conserving strategic

materials in many applications are quite good.

However, the extent to which any given approach will be adopted by industry will depend

on how well it fits into the overall corporate

strategies of many different firms. Generally

speaking, strategic materials conservation per

se is seldom a primary motive in industry

decisions—although it is sometimes an ancillary benefit.

In the future, industry concerns about competitiveness, improving product performance,

and cutting production costs will lead to adoption of new technologies, some of which may

lead to conservation of strategic materials. It

is difficult, however, to predict overall impacts

of conservation on U.S. import reliance: these

new technologies will interact in complex

ways—sometimes simultaneously in a given application, For example, increased use of materials-efficient fabrication processes in the

aerospace industry will reduce the amount of

home and prompt superalloy scrap that would

otherwise be available for recycling, The overall effect of this on strategic materials use, however, is likely to be positive, since some fabrication scrap is difficult to recycle. Life extension

techniques would reduce demand for replacement parts containing strategic materials, but

would also reduce the quantity of obsolete

scrap available for recycling.

38-844 0 - 85 - 8 : QL 3
218 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Case Studies of Strategic Materials Conservation Opportunities

Conservation of some strategic materials increased during the late 1970s and early 1980s,

encouraged in part by higher costs for raw

materials and energy, Government waste disposal requirements, and industry investment

in new materials-efficient technology. However, major opportunities to conserve strategic

materials are still evident. These vary by material and application:

1. Despite advances in manufacturing technologies, total cobalt losses in 1980 in unrecovered or downgraded scrap, or in processing wastes, amounted to 7.7 million pounds—

nearly half of the estimated 16.5 million pounds

of cobalt actually consumed domestically that

years By far, the largest opportunity for increased cobalt recycling lies in the increased

recovery of obsolete scrap. Of the 6.3 million

pounds of cobalt in products estimated to have

become obsolete in 1980, nearly three-fourths

(about 4.6 million pounds) was unrecovered or

downgraded. Potential sources for improved

recovery include superalloy from obsolete jet

engine parts and cobalt-bearing catalysts. Other

cobalt recycling opportunities include reduction of downgrading of obsolete scrap and improved recovery of processing waste, which together entail cobalt losses of 3.1 million pounds.

2. The steel industry is the country’s dominant user of manganese, consuming nearly 90

percent of total U.S. requirements. Manganese

consumption is dependent not only on the

amount of steel produced, but also on how efficiently manganese is used in steel production.

Significant future reductions in the amount of

manganese needed per ton of steel are expected: greater attention to trimming is expected to reduce the average amount of manganese in steel by 12 percent, from 13.8 to 12.2

pounds per ton by 2000. This, together with

adoption of improved steelmaking technologies, such as external desulfurization, continuous casting, and ladle and secondary refining techniques are likely to decrease the

amount of manganese required to produce a

ton of steel from 35.6 to 24.8 pounds by the year

2000. The consumption of imported manganese ore and ferromanganese is estimated to

decline from 17.8 pound per ton of steel to 9.5

pound per ton, a reduction of over 45 percent.

Most of these technologies will be implemented

for product quality and cost competitiveness

reasons.

3. Widespread adoption of the AOD process

by stainless steelmaker led to industrywide

improvements in chromium use that are not

likely to be repeated soon. However, chromium

conservation opportunities, including increased

recycling, and reduced overspecification of

materials, could lead to major savings. In the

1977-81 period, an average of 64,000 tons of

chromium contained in purchased stainless

steel scrap was recycled each year.4 By contrast, an estimated 62,000 tons of chromium

contained in obsolete stainless steel scrap went

unrecovered or was downgraded in 1977 (the

last year for which detailed estimates have been

made). The largest single opportunity for enhanced recovery of obsolete scrap is in automotive recycling, where most chromium-bearing scrap is downgraded. Chromium recovery

from industrial processing wastes is increasing, owing to adoption of collection procedures

and commercial reprocessing systems,

4. The high price of platinum group metals

(PGMs) encourages highly efficient use of these

materials. Recycling probably accounts for

over 40 percent of U.S. PGM consumption

when internal (toll refining) recycling by industry is taken into account. The key opportunity

for increased recycling over the next 10 to 15

years will be recovery of PGMs from automotive catalytic converters which could add up

to 500,000 troy ounces annually to U.S. PGM

aNational Materials Advisory Board, Cobalt Conservatbn

Through Techno]ogkal Alternatives, publication NMAB-406

(Washington, DC: National Academy Press, 1983), fig. 3 (p. 23)

and table 11 (p. 24).

4U. S. Department of Commerce, Critical Materials Requirements of the U.S. Steel Industry (Washington, DC: U.S. Government Printing Office, 1983), p. 62,
Ch. 6—Conservation of Strategic Materials . 219

supplies by 1995. Obsolete electronic scrap is

also a promising source for secondary recovery of PGMs, even though such scrap is disseminated widely throughout electronic equipment which, in turn, is spread all across the

country, making collection and separation of

metals expensive. The Department of Defense,

which is a large generator of electronic scrap,

and the Bureau of Mines, have cooperated in

developing improved means for processing this

scrap.

In the pages that follow, prospects for strategic materials conservation in certain specific

applications are discussed.

Superalloy

Superalloy constitute the largest single category of cobalt use. They are also the principal

users of high-purity chromium metal and major users of low-carbon ferrochrome. Typical

cobalt-base superalloy contain up to 65 percent cobalt- and nickel-base, alloys may contain up to 20 percent cobalt. Chromium content ranges between 10 and 25 percent.

Since 1978, when disturbances in Zaire led

to widespread concern about cobalt supplies,

manufacturers of aircraft jet engines and engine components and several Federal agencies

have placed increased emphasis on reducing

the need for cobalt in jet engines. One approach, covered in detail in chapter 7, is the

development and use of substitute alloys that

contain less cobalt. Other approaches emphasize conservation, through recycling of superalloy scrap, use of near-net-shape manufacturing processes to reduce fabrication scrap, and

extension of the useful life of components. As

industry adopts these techniques, the need for

cobalt, and for other strategic metals, such as

chromium, nickel, and tantalum, will be reduced on a per part basis.

Substantial amounts of cobalt, chromium,

and other strategic metals used in the production and fabrication of superalloys do not end

up in the final part. Table 6-1, adapted from

a 1983 National Materials Advisory Board

(NMAB) report on cobalt conservation opporTable 6-1 .–Cobalt Consumption in Superalloys, 1980

Wrought Cast Total

Input:

Primary cobalt . . . . , 3.47 1.73 5.20

Prompt scrap. . . . . . . 0.26 1.50 1.76

Obsolete scrap ., . . . 0,87 0.32 1.19

Total production . . 4.60 3.55 8.15

output:

Final parts ., . . . . . . . 2.34 1.24 3.58

Total lost ., . . . . . . . . 2.00 0.82 2.82

(Waste) . . . . . . . . . . 0.21 0.28 0.49)

(Downgraded) . . . . 1.79 0.54 2.33)

Prompt scrap. . . . . . . 0.26 1.50 1.76

SOURCE Adapted from National Materials Advisory Board, Coba/t Conservation

Through Technological Alternatives, Nat!onal Academy of Sciences,

1983, pp. 147, 148

tunities,5 estimates sources and end results of

the cobalt used in the production of superalloy

in 1980, the most recent year for which detailed

information is available. Several important

points can be drawn from the table:

●

●

●

●

Of nearly 8.2 million pounds of cobalt used

in superalloys in 1980, only 3.6 million

pounds, less than 45 percent, were contained in final parts.

Almost 55 percent of the consumption of

primary metal was lost through downgrading or waste in the production of superalloy parts in 1980.

Almost 44 percent of the initial amount of

wrought alloys were lost or downgraded;

for cast alloys the fraction is lower, about

23 percent.

The use of obsolete superalloy scrap was

quite low, accounting for less than 15 percent of the total cobalt used in processing

superalloys. NMAB also estimated that

only half of the cobalt in superalloy scrap

that became obsolete in 1980 was recovered for recycling by the superalloy industry (1.19 million out of 2.4 million pounds),

hCobait Conservation Through Technological Alternut i~~es, op.

cit. Some uncertainty surrounds the estimates sho~vn in table

6-1, owing to the inadequacy of the available data on scrap use

and new cobalt requirements of the superallo} industr}. As a

result, various assumptions had to be employed b}’ Nhl AB to

approximate conditions in 1980. While NMAB believed its cobalt material flow model to be “reasonable approximation of reality, ’ it noted that further work would be needed to confirm

or reject its assumptions (pp. 25-26).
220 Ž Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

These statistics suggest the tremendous potential of conservation techniques to reduce

requirements for primary cobalt. In 1980, 2,8

million pounds of cobalt were lost through

downgrading and to waste in fabrication of

superalloy parts. In the future, much more of

this material may be recoverable as superalloy

recycling technologies advance. Alternatively,

the amount of material lost could also be reduced through the increased use of near-netshape manufacturing processes, particularly

with respect to the wrought alloys.

Obsolete scrap is a large potential source of

cobalt. Most of the 3.58 million pounds of cobalt used in finished superalloy parts in 1980

will eventually be available for recycling, but

much of this material may be downgraded unless jet engine manufacturers are confident that

scrap can be safely recycled for jet engines, The

raw materials for superalloys, whether it is cobalt, nickel, chromium, or ferrochromium,

must be of the highest purity in order to avoid

faults in the final part that could cause it to fail,

Thus, manufacturers of aircraft engines often

prohibit use of obsolete scrap unless certified

processes for collecting and processing the

scrap have been approved, Rates of obsolete

scrap generation in the future may be affected

by techniques that extend the service life of

parts.

Near-Net-Shape Processes

The use of high-temperature alloys in a jet

engine is very inefficient in terms of the amount

of material consumed to produce a finished

part. Ratios of 8 to 1 for input material to final

part (also referred to as the “buy-to-fry” ratio)

are common, and ratios of 20 to 1 are not unheard of. This ratio can be significantly reduced by near-net-shape processes.6 Three general types of near-net-shape processes are in

use at this time: precision casting, advanced

forging, and powder processing.

8These processes are discussed in detail in New Metals Processing Technologies, a report prepared for OTA by Charles River

Associates, Inc.

PRECISION CASTING

Casting, the solidification of molten metal in

molds, is a near-net-shape process that has

been used for jet engine components since the

birth of the industry. Casting is very efficient

in its use of material. Although it is necessary

to use gates and risers to control the flow of

metal into the mold, resulting in as little as 40

percent of the metal actually ending in the final casting, large castings are very near to their

final shape (only 5 to 10 percent of the material needs to be removed during the final machining and finishing operations). Further,

most of the scrap generated in casting is “immediate revert’’—that is, it can be recycled

without further processing. Since it is recycled

in the same shop in which it is generated,

segregation and identification are simple matters. Therefore, most material poured from the

melting furnace is eventually used.

Recent trends in casting technology have resulted in precision castings of up to 500 pounds

(typically 10-pound units were produced in the

past). This results in two advantages. First, a

larger portion of the engine can be produced

by the material-efficient casting method, and

second, the elimination of numerous steps of

component assembly reduce the cost of assembling the engine.

New casting technologies have also resulted

in improved material properties. Through the

use of directional solidification, components,

principally blades and vanes, can be cast so

that grain boundaries are very long and are

aligned with the axis of the component. It is

also possible to cast components as a single

crystal, eliminating grain boundaries altogether,

This allows the elimination of elements that are

often added to strengthen grain boundaries,

such as zirconium and hafnium.

ADVANCED FORGING METHODS

Closed die forging is used extensively to fabricate gas turbine components ranging from

small turbine buckets to large fan blades and

very large disks. In this process, the starting

stock is heated to various temperatures depending on the alloy being forged and is placed be-
Ch. 6—Conservation of Strategic Materials ● 221

tween two dies that are forced together, enclosing the stock and deforming it to the shape of

the die. Usually the starting stock is wrought—

i.e., it consists of a bar or billet that has been

hot-worked from an ingot. The hot working ensures that the original casting achieves full density and chemical homogeneity.

The major disadvantage of this process, as

conventionally practiced, is that a large amount

of the material must be removed to reach final shape. It is common for the final part to

contain only one-tenth of the original materials.

This large material loss due to forging maybe

considerably reduced through the use of two

advanced technologies.

Isothermal Forging.—Isothermal forging is distinguished from conventional forging operations in that the temperature of the forging die

is the same as the piece being worked, approximately 1,7500 to 1,9500 F. Through reduction

of heat loss from stock to die, the plastic deformation of metal is significantly improved. The

operation is conducted in an inert gas atmosphere. Parts can be processed to close to the

final specifications, although the shape must

be configured to allow nondestructive inspection, usually by acoustic methods (hence the

term “sonic shape” for the form as it leaves the

die). Further machining is required to reduce

the shape to its final dimensions. Pratt & Whitney Aircraft has patented and licensed a variation of the isothermal forging process which

it claims can reduce the input material by 50

percent, thereby making a large reduction in

the “buy-to-fly” ratio. Isothermal forging is now

routinely used for the forging of turbine disks.

.

Near-Isothermal Forging.—Also referred to as

“hot-die forging, ” near-isothermal forging

differs from isothermal forging in that the die

is not heated to the temperature of the stock,

but to 1500 to 3000 F below the stock temperature. The operation is conducted in air and

can be adapted to conventional presses, making it more widely available at a lower cost than

isothermal forging. Although the improvements are not as great as those for isothermal

forging, this process does reduce the amount

of input material required by conventional

closed die forging,

POWDER PROCESSING

A third process for the manufacture of superalloy components is based on the processing

of ultrafine powder into billets or parts. The

powder may be of a single composition or a

mixture of materials. By the latter method, oxide dispersion-strengthened alloys, such as

MA-754, are produced.

Powder metallurgy is attractive, not just because it can produce new materials, but because it can produce substantial reductions in

the amount of scrap generated during forming

operations. Powder “pre-forms” are produced

by techniques similar to casting processes. The

pre-forms are then compressed at high temperatures and pressures to eliminate voids and

inclusions. The components are then ready for

inspection and final machining.

The combination of powder pre-forms and

hot isothermal forging has allowed the development and use of some of the most advanced

nickel-based alloys in turbine disks, including

IN-100, MERL-76, and Rene-95, none of which

could be reliably formed into components by

conventional means.

The advantages of powder metallurgy are not

limited to conservation of strategic metals in

the more exotic applications such as jet engine

components. Gears and camshafts, parts which

normally require considerable machining, can

be manufactured to near-net shape by powder

pre-forms, thereby reducing scrap production

and machining, The need for resulfurized steel

in these applications, normally used for its improved machining characteristics, can be eliminated as well, reducing the requirements for

manganese in this type of steel.

Recycling

Until cobalt supplies were seen as threatened

by the 1978 Katangese rebellion in Zaire, recycling in the superalloy industry was largely

limited to home scrap. Prompt industrial scrap

and obsolete scrap were either downgraded for
222 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

stainless steel production or exported out of the

country. As prices rose and supplies became

uncertain, the importance of recycling of superalloy scrap became apparent. Alloy producers,

parts fabricators, and turbine manufacturers

began to segregate fabrication (prompt industrial] scrap by alloy type so that it could be

remelted and reused. Some turbine manufacturers modified earlier specifications to allow

greater use of prompt industrial scrap and even

some obsolete scrap, provided that the source

and type of the scrap was known. The exact

amount of the savings provided by recycling

during the period of high cobalt prices ($25 per

pound at their producer price high point in

1979-80) is not known, but domestic consumption of primary cobalt in superalloy was probably 10 to 25 percent less than might otherwise

have been the case.7

Identification and separation of scrap is time

consuming and expensive. With 1983-84 cobalt

prices ranging from $6 to $12 per pound, it is

not clear whether the gains made in the late

1970s will continue. Some firms have continued their recycling programs, particularly for

prompt scrap, by encouraging suppliers and

customers to separate scrap by alloy type. Specialized scrap processing firms now have greater experience with this kind of recycling, which

may encourage jet engine manufacturers to update specifications to allow greater use of scrap

in the production of superalloys. Once such

specifications are established, recycling of

superalloy scrap can be increased quickly in

response to increased metal prices or supply

uncertainties.

PROCESSING OF SUPERALLOY SCRAP

Commercially used technologies for recycling superalloy scrap are based on the same

processes used in the original production and

refining of the alloy, including vacuum induction melting and vacuum arc remelting, but

strict attention is paid to segregation of scrap

by type.

For production of superalloys, uncontaminated home scrap of known composition can

be and is reverted directly to the charge. Additional processing sometimes involving several steps may be needed if prompt industrial

scrap or obsolete scrap is to be recycled.

Vacuum and air furnace technologies needed

to remelt high-quality superalloy scrap into

usable master alloys are already in place in the

United States. In-house scrap is now carefully

separated and routinely added to the alloy melt

by many producers of superalloys, and a specialized industry has developed to produce

master alloys from fabrication scrap. Some

firms report that they now recover virtually all

in-house scrap. Obsolete scrap is also recycled

to some extent, although generally not for the

most demanding application—rotating parts of

jet engines. As is discussed in box 6-A, instruments able to identify complex alloys and contaminants are now being marketed and may

alleviate some technical problems associated

with scrap sorting. According to recycling industry sources, several million pounds of hightemperature alloy scrap have been shipped

from scrap processors to melters in the last 10

years.8

Air-melting processes, involving electric furnace melting of the scrap charge and subsequent refining in an argon-oxygen-decarburization vessel, can produce alloys from scrap

that are suitable for many noncritical superalloy and super stainless steel applications, but

are not appropriate in critical applications such

as gas turbines used in aviation. Nickel and cobalt recovery is high, but readily oxidizable alloys are lost in the slag. Air melting of scrap

can also be used to produce master melt alloys

suitable for further processing through vacuum

melting into superalloys.9

Vacuum melting processes are used to produce superalloy suitable for the most demanding applications or superalloys containing

highly reactive elements. Only the highest qual7As discussed in Charles River Associates, Inc., E~fects of the

1978 Katangese Rebellion on the World Cobah Market, contract

report prepared for OTA, December 1982, pp. 1-6.

‘Information provided by the National Association of Recycling Industries.

‘J. J. deBarbadillo, “Nickel-Base Superalloy: Physical Metallurgy of Recycling, ” Metallurgical Transactions A., vol. 14A,

March 1983, p. 332.
Ch. 6—Conservation of Strategic Materials • 223

Box 8-A.-Scrap Sorting and Identification Instruments

Recycling of complex materials requires detailed knowledge of scrap constituents. Nickel- or cobalt-based superalloy scrap may contain 8 or even 10 separate alloying elements,

as well as potentially troublesome tramp elements and contaminants that need to be removed during processing. Concerns about

scrap quality are not limited to superalloys:

in stainless steel production, for example,

presence of phosphorus in scrap needs close

monitoring, due to its adverse effect on working, forming, and ductility of stainless steel.

Very small amounts of titanium in scrap charges

are believed to be harmful in tool steels and

high strength steels. Failure to correctly identify and sort scrap is a major reason for the

extensive downgrading of superalloy and

stainless steel scrap that is still prevalent.

Certification requirements placed on scrap

processors by their customers have become

increasingly stringent. In some premium uses,

scrap processors may have to identify scrap

constituents to an accuracy of a few parts per

million. Under these circumstances, conventional scrap sorting techniques—entailing visual inspection, magnetic separation, or spark

testing—are not sufficient in themselves.

Growth in recycling of superalloy and specialty materials during the last decade has led

to increased use of mobile and inexpensive

($4,000 to $50,000) sorting instruments. These

devices were not developed primarily for use

in scrap processing, but most can be used by

unskilled operators (or in some cases trained

technicians) to identify complex scrap components more accurately.16 Some of these (e.g.,

chemical spot testing) are used to confirm the

presence of alloys after preliminary hand sorting is carried out. These techniques are qualitative or semiquantitative in nature. More

complex readings can be obtained through Xray spectrometers, thermoelectric instruments and eddy current devices—all of which

I@Xavier Spiege] and E. Horowitz, Instruments for the sorting

and Identification oj Scrap Metal, Sponsored by the Institute of

Scrap Iron and Steel (Baltimore, MD: The Johns Hopkins University Center for Materials Research, Oct. 15, 1981), p. 1.

are now available as portable units which can

be used in scrap yards.17

A recent recycling advance has been linkage

of scrap identification devices to user friendly

computers, which provide workers with stepby-step procedures for classifying scraps.

Commercially available programs specifically

geared to the needs of small firms in the recycling industry have been marketed for several years. One such program, used in conjunction with a portable X-ray spectrometer

device, reportedly allows rapid identification

of up to 16 elements in a sample.18 Initial analysis can be completed in 10 to 50 seconds; a

more complete quantitative analysis requires

several minutes, if needed. If properly programmed, the computer will identify the trade

name of the alloy or materials which the scrap

most closely approximates. This is especially

useful in obsolete scrap identification, where

the origin of the materials may not be known.

Identification devices are increasingly used

by the scrap industry–with the encouragement of the National Association of Recycling

Industries, the Institute of Scrap Iron and

Steel, and the Bureau of Mines. Most of these

instruments were designed for laboratory or

scientific use, not the difficult operating environment of the scrap yard. Portable devices

have the ability to test a large number of samples rapidly on site, but are not capable of

such detailed analysis as laboratory or stationary instruments. As instrument manufacturers become more aware of the scrap industry,

instruments specifically designed for scrap industry use may be developed.

Likely trends in materials processing suggest that scrap classification techniques will

need continuing refinement. Use of more

complex alloys, and parts made from multiple alloys will increase recycling difficulties.

~zNeWell, R. E. Brown, I). M. Soboroff, and H. V. Makar, A Review of Methods for ldentijjing Scmp Metals, Bureau of Mines

Information Circular 8902 (Washington, DC: U.S. Government

Printing Office, 1982).

I$AS discuss~ in: “Phi]ips PB9500 X-Ray Spectrometer Speeds

Recycling of Critical Materials,” Norelco Reporter, vol. 28, No.1,

May 1981, pp. 40-42.
224 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

The Bureau of Mines is identifying alloys for

which current identification and sorting

methods are not adequate, as a preliminary

step towards development of new methods.19

Another area of government R&D (undertaken

by both the Bureau of Mines and the National

Bureau of Standards) is instrumented spark

testing techniques, which could reduce subjectivity in spark analysis by workers,

Ultimately, effective recycling requires welldeveloped linkages among processors, melt

shops, fabricators, and manufacturers. DurIOU.S. ~wtient of tie htarior, Bureau of Mktm AVOn~OJe

Research Center Research Program Fiscal Year IW3, (n.p., n.d.)

ing the last decade, many firms in the superalloy industry established recycling programs,

entailing close coordination of requirements

along the entire chain of the industry. A properly controlled program to ensure scrap integrity entails accurate separation and identification of scrap, and adequate measures to reduce risk of contamination.20

~A detailed discussion of superalloy scrap processing requirements can be found in R. S. Cremisio and L. M. Wasserman,

“Superalloy Scrap Processing and Traae Elemeht Consideration,”

Vacuum Metallurgy: Pmced@a of the 1977 Vacuum Metallurgy

Conferenm, R. S. Krutenat (ad.) (Princeton, Nl: Science Presa,

1977), pp. 353-3S8.

of known composition and history can be vacuum melted without extensive preprocessing,

In the long term, the potential for recycling

will depend more heavily on obsolete scrap as

the use of near-net-shape technologies increases.

Where traditional machining of superalloy

parts can typically require up to 10 times as

much material as contained in the final part,

new processes can reduce this figure to as low

as 2 or 3 to 1. This reduces the amount of

prompt scrap generated and thus increases the

importance of obsolete scrap.

The technical feasibility of using obsolete superalloy scrap to produce investment cast jet

engine turbine blades has been demonstrated

by Certified Alloy Products. The company

reportedly has produced a master alloy from

used superalloy turbine blades.10 The process

entails oxygen lancing in an electric arc furnace, followed by refining in a vacuum induction furnace. Testing of blades made from the

recycled alloy showed comparable quality to

turbine blades manufactured from virgin materials. The firm developed the process in the

aftermath of the 1978 cobalt price spike and

has subsequently discontinued its use.11 Ality of scrap is suitable for vacuum melting.

Such scraps are certified by alloy content and

must be free of contaminants and tramp elements. With careful separation and identification, some in-house scrap and fabrication scrap

———

IOThis process is described in Michael J. Woulds, “Recycling

of Engine Serviced Superalloy s,” Supera]]oys 1980: Proceedings

of the Fourth International Symposium on Superafloys, John K.

Tien, et al. (eds.) [Metals Park, OH: American Society for Metals,

1980), pp. 31-41.

~lprivate communication between personnel of Certified AIIoY

Products and OTA staff in May 1983.
— -—

Ch. 6—Conservation of Strategic Materials ● 225

though such techniques may enhance the potential for reuse of obsolete superalloy scrap,

further work to establish process reproducibility and results may be needed.

Both vacuum and air melting furnace technologies continue to evolve. New processes,

such as Electron-Beam Refining, Vacuum Arc

Double Electrode Remelting (VADER), and

Plasma Arc processes may have considerable

relevance to superalloy recycling. Some of

these technologies are in the early stages of use

in the United States.

Several laboratory-scale processes have been

developed which separate superalloy scrap into

its constituent metals, but none have been commercialized. Such techniques overcome most

concerns about contaminants. In a laboratory

project sponsored by the U.S. Bureau of Mines,

Inco developed a process that utilized a combination of hydro- and pyre-metallurgical processes to recover 93 percent of the chromium,

99 percent of the nickel, 96 percent of the cobalt, and 92 percent of the molybdenum from

clean, solid superalloy scrap.12 Other Bureau

of Mines research projects on superalloy scrap

are underway. In one experiment, the superalloy scrap is melted with aluminum or zinc

to form an intermetallic compound which can

be crushed into small particles. The particles

are then dissolved by acid; the resulting solution would then be treated hydrometallurgically to recover the metals. The process is

thought to be especially promising as a means

for recycling mixed combinations of bulk

superalloy scrap which have not been sorted.13

GTE Sylvania Corp. has a commercial facility for recovering high-purity cobalt from secondary sources that include some types of superalloy scrap, including grindings. GTE’s

—

’21. 1. cie Elarbi~illO, J. K. Pargetter, and H. V. Makar, Process

for Recoloring Chromium and Other Metals From SuperalloJr

Scrap, U.S. Department of the Interior, Bureau of Mines Report

of Investigation 8570 (Washington, DC: U.S. Government Printing Office, 1981),

lsJera]d R, Pederson, compiler, Bureau (~~ Mines Research ~ ~~.~

(Washington, DC: U.S. Government Printing Office, n.rl.), p. 103:

and (;. B. Atkinson, Increasing the l,eaching Rote a.f HuJk

Superallo~r Scrap b}’ Nfelting \lrith Aluminum, U.S. Department

of the 1 nterior, Bureau of Mines Report of Investigations 8833

(Washington, DC: LJ.S. Government Printing Office, 1983).

proprietary manufacturing process uses chemical means to recover highly purified cobalt

powder that is now used in cemented carbide

products. The firm is considering a larger scale

recovery process which would produce compacted briquettes of cobalt that maybe suitable

for superalloy production.14

Commercialization of advanced superalloy

reclamation processes by industry is impeded

by the currently low price of cobalt. Plans to

undertake a pilot plant to test the Inco/Bureau

of Mines laboratory process discussed above

were discontinued when cobalt prices fell in

the early 1980s. Feasibility studies showed that

the pilot plant process, and a small-scale commercial facility would have been profitable at

1980 metal prices, but would operate at a deficit at cobalt prices in the 1981-84 period. Estimated costs of a pilot plant project able to handle 100 pounds of scrap feed per hour were

estimated to be about $5 million in 1980 dollars,

assuming no donation of equipment by industry. Operating costs for such a facility would

be in the neighborhood of $2 million for an 18-

month period.15

RETIREMENT FOR CAUSE AND PRODUCT

LIFE EXTENSION PROGRAMS

currently, critical components of jet engines,

such as turbine disks, are retired from service

on a predetermined schedule, based on the

number of hours a part has been in operation—

not on the basis of actual detection of flaws or

defects in the part, This has been necessary because of difficulties in detecting the early stages

of flaws that could lead to a disastrous failure

of a part. While the current retirement procedures minimize risk of failure, most parts are

removed from service long before actual flaws

occur.

Turbine disks used in the F-100 jet engine,

for example, are only kept in service for the

number of hours in which there is a statistical

probability of a fatigue crack developing in one

out of a thousand disks. As a result, 999 parts

can be expected to be removed from service

141 nformation pro~.ided by GTE Products Corp.

1s1 nformation provi(]e(~ by the U.S. Bureau Of Mines.
226 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

prematurely for every single part that is defective. Subsequent testing has shown that the useful life of many of these retired parts could be

10 times longer than the disk in which the initial crack occurs.21

With the substantial technical advances that

have been made in NDE in recent years, it may

soon be possible to evaluate individual parts

from operating jet engines at prescribed intervals in order to determine whether the initial

stages of a flaw have appeared. Parts which

have such flaws could then be retired for cause

(RFC); those without flaws could be kept in

service.

Such a strategy underlies the Air Force’s

Wright-Patterson Aeronautical Laboratory evaluation of methodologies for a maintenance program based on retirement for cause. If implemented, the program will permit parts from

some jet engines to be used until there is actual evidence of an incipient flaw. An actual

decision about implementing the program will

probably not be made until after 1985. However, early indications are that the program has

the potential to reduce spare-part requirements,

and therefore to conserve strategic materials.

The initial Air Force evaluation centers on

the F-100 jet engine. If initiated in 1985, the

program’s savings in spare parts over the 15-

year average engine service life left in the F100 fleet could be $249 million. By 2000, a 70

percent material savings from requirements for

reduced spare parts would also be achieved,

according to the Air Force.

A related Air Force initiative is aimed at

“stockpiling” retired jet engine parts until they

can be returned to service rather than simply

disposing of them as scrap, as is ordinarily

done.22 Many of these parts have been retired

simply because they have reached the end of

the predetermined service life discussed above,

and could be returned to service if retirementfor-cause (RFC) methodologies are implemented.

“J. A, Harris, et al,, Concept Definition: Retirement for Cause

of FIOO Rotor Components. Technical Report AFWALTR804118

prepared for U.S. Air Force Materials Laboratory at Wright-Patterson Air Force Base by Pratt & Whitney Aircraft Group (Washington, DC: U.S. Government Printng Office, 1981).

ZZInformation provided by the U.S. Air Force.

These parts are also being used as test specimens for the evaluation of RFC methodologies.

Other parts in these “holding accounts” may

be capable of rejuvenation through current and

prospective technologies discussed in the previous section.

It is possible to extend the lifetime of components of the jet engine if flaws and defects

can be caught at an early time. Researchers in

West Germany, for example, have reported that

if an engine is dismantled at three-quarters of

its normal life and the turbine blades are subjected to hot isostatic pressing to eliminate incipient cracks, the overall life of the blades will

extend to 50 percent beyond their normal life

in service, as illustrated in figure 6-1.

Hot isostatic pressing (HIP) has also been

shown to extend the service life of vanes and

blades if it is used as a post-casting treatment

to eliminate all porosity remaining in the material after casting. The post-casting HIP treatment has been shown to increase the average

stress-rupture life by 100 percent and the fatigue life by 800 percent in two nickel-base alloys, B-1900 and IN-792, both modified by the

addition of hafnium.

Figure 6-1 .—Service Life Time of Turbine Blades

Dismantle

For For

SOURCE” H. Huff, R. Grater, and R Frohling, “Measures for Materials Conserva.

tion in Aero.Engine Construct ion,” paper delivered to the NATO Advisory Group for Aerospace Research and Development Conference,

Vimelro, Portugal, October 1983
Ch. 6—Conservation of Strategic Materials ● 227

A quite different approach toward material

conservation is to design parts for the life of

the aircraft. Such approaches may require

more strategic materials to be used in the initial part, but because these parts have a longer

life expectancy, the end result may be to conserve materials. Such strategies are being

evaluated through the engine structural integrity program of the Air Force.

OUTLOOK FOR CONSERVATION OF STRATEGIC MATERIALS

IN SUPERALLOYS

All of the factors discussed above—materialsefficient processing, recycling, and life extension—will play a role in determining conservation levels achievable in superalloy production

and parts manufacturing. More efficient processing and fabrication could reduce input raw

materials needed for each jet engine by 10 percent by 1990 and 25 percent in the early years

of the next century, compared to current levels.

This is a judgmental estimate, which assumes

that many currently used technologies (which

are less efficient in conserving materials) will

continue to be used throughout much of the

period. Advanced technologies are likely to be

introduced primarily when new alloys and successive generations of jet engines are brought

into production, typically at 5- to 10-year intervals.

As fabrication becomes more efficient, home

and prompt scrap—now preferred for recycling—will comprise a less important portion

of the materials available for recycling. If processing problems are overcome, obsolete scrap

will probably ascend in importance, although

to what extent is difficult to foresee. Part life

extension technologies and RFC maintenance

philosophies could extend the material life cycle, thus temporarily reducing obsolete scrap

production levels, even if advanced recycling

technologies are implemented.

Development of new alloys and manufacturing techniques by superalloy producers and jet

engine makers can have unpredictable effects

on recycling. Increased use of powder metallurgy, coatings, multiple alloy components, and

phase-in of advanced ceramics and composites

may make the job of recycling more difficult.

For example, coated or clad superalloys may

reduce the value of some superalloy scrap

owing to added costs of identifying and recovering the surface layer. continuing evolution

in scrap processing technologies to keep pace

with rapid changes by producers and component manufacturers will be required if the

promise of recycling is to be realized.

Conservation of Manganese

in the Steel lndustry23

Nearly 90 percent of the manganese consumed in the United States is used in the

production of steel, either as an alloying element or as a processing agent.24 Consumption

of manganese in this industry is dependent not

only on the level of steel production, but also

on the mix of steel grades produced and processing technologies used. This section discusses the function of manganese in both steel

and steelmaking, and assesses the effects of

product and processing trends on the pattern

of manganese use in the steel industry.

Manganese as an Alloying Element in Steel

Manganese is second only to carbon in importance as an alloying element in steel. Through

its influence on steel chemistry and microstructure, manganese influences an assortment of

physical and mechanical properties. As discussed in box 6-B, manganese provides sulfur

control, enhances hardenability, wear resistance, and solid solution strengthening, and

retards recrystallization. The amount of manganese used as an alloying element depends on

the specific property requirements of the particular steel product. Some grades make greater

use of it than do others.

ZaMuch of the analysis in this section was based on G. R. St.

Pierre, et al., Use of Manganese in Steelmaking and Steel Products and Trends in the Use of Manganese as an AJloying Element

in Steels, OTA contractor report, February 1983.

zqBased on data from Minera]s Yearbook Voiume 1 (Washington, DC: U.S. Bureau of Mines, Department of the Interior, 1980,

1981, 1982). Includes manganese consumed in ores with greater

than 5 percent Mn, ferroalloys, and metal, but not the manganese

contained in most iron ores
228 ● Strategic Materials: Technologies to F/educe U.S. Import Vulnerability

Box 6-B.—The Role of Manganese as an Alloying Element25

Sulfur Control.--In nearly all grades of steel, sulfur is an unwelcome impurity. It is a tramp element

that is picked up from the coking coal, fuel oils, and ferrous scrap used in the production of iron

and steel. Iron and sulfur form compounds (FeS) at the grain boundaries within steel, causing a

detrimental condition known as “hot shortness.” Problems arise because FeS has very little structural integrity, being either liquid or extremely plastic at the temperatures encountered during many

finishing (hot working) operations. The presence of this strengthless phase as a film along the network of grain boundaries severely weakens steel at high temperatures and causes cracking during

fabricating operations, Furthermore, in ferritic grades, FeS causes problems with low-temperature

mechanical properties. To minimize these effects, the sulfur content is typically held below 0.05 percent by weight. Manganese is added to react with the remaining sulfur, which would otherwise combine with iron. The globular MnS precipitates formed upon the addition of manganese are solid at

typical hot working temperatures and are structurally amenable to hot forming operations. Although

it is not a remedy for all sulfur-related problems, manganese generally improves both the high- and

low-temperature properties of steel.

Hardenability.--Heat treatment is the most potent method for optimizing the strength and ductility

of steel. The cooling rate required to form a given martensite profile during the heat treatment quench

is a very important parameter, known as “hardenability,” of steel. Additions of the common alloying

elements, namely molybdenum, manganese, chromium, silicon, and nickel, facilitate the formation

of martensite, thereby reducing the cooling rate requirement and increasing the hardenability of steel.

Manganese is a very cost-effective hardenability agent and consequently is one of the most vital alloying

elements for influencing the response of steel to heat treatment.

An allied effect of some alloying elements concerns their influence on the shape and distribution

of iron carbides in steel. Weld embrittlement can occur if the iron carbides form a continuous film

at the grain boundaries during the thermal excursion. Manganese tends to enhance weldability of

steel by inhibiting the development of such film.

Wear Resistance.--Manganese, like nickel, lowers the austenite-to-ferrite transformation temperature

of steel and is termed an austenite stabilizer. High-carbon steels that remain austenitic at room temperature can be produced by adding manganese to levels greater than 10 percent by weight. Austenitic

steels as a class are attractive because their strength increases markedly as they are deformed and

they have excellent resistance to fracturing under impact conditions, two properties important for

wear resistance. The austenitic manganese grades, called Hadfield steels, display good abrasion and

impact resistance and serve in construction, mining, quarrying, oil-well drilling, steelmaking, cement

and clay manufacturing, railroading, dredging, and lumbering applications. Other austenitic grades

(containing 15 to 25 percent manganese) have been developed for their nonmagnetic properties and

high toughness. These high-manganese austenitic steels are suitable for structural uses in strong magnetic fields and at cryogenic temperatures and may replace the stainless steels commonly used in

these applications.

Solid Solution Strengthening.--Steel generally becomes stronger when an alloying element is dissolved

in the iron phases. This effect is known as “solid solution strengthening.” It is a very important means

of strengthening ferritic steels, which cannot be strengthened by heat treatment. Alloying elements

vary markedly in their potency as solid solution strengtheners. In ferritic steels the order of decreasing effectiveness appears to be: silicon, manganese, nickel, molybdenum, vanadium, tungsten, and

chromium. While silicon is highest on this list, it is not used extensively because of an accompanying

loss of ductility. Thus, manganese has great utility as a solid solution strengthener.

Recrystallization.–When steel is deformed or heavily worked, its microstructure is altered in a way

that is detrimental to the properties of steel. To alleviate problems, steel in this condition is usually

annealed, whereupon the microstructure is recrystallized. Manganese slows the rate of recrystallization considerably. This is not a desirable effect and can have negative impacts on the productivity

of various steel-treating processes, such as continuous annealing operations.

~~he terms ferrite, austenite, and martensite that appear throughout this discussion refer to the various microstructural phases of steel.
Ch. 6—Conservation of Strategic Materials ● 229

MAJOR CLASSES OF STEEL

Steel is produced in a myriad of compositions, and the relative popularity of each grade

changes as consumer demands shift. Trends

in manganese use vary among the four broad

categories of steel: carbon, full alloy, highstrength low-alloy (HSLA), and stainless. All

four classes contain manganese, but in differing proportions.

The most widely used systems for designating steels in terms of their chemical compositions are those of the American Iron and Steel

Institute (AISI) and the Society of Automotive

Engineers (SAE). These cataloging systems are

very similar and are carefully coordinated by

the two groups. In addition to the common

grades listed by these organizations, steelmaker produce proprietary grades, but the

manganese contents of these are comparable.

The chemical specifications for a particular

grade of steel vary slightly according to the

product nature. Specifically, the ranges in

plates are a little wider than those for bars, simply because compositional variations due to

segregation are greater in the large rectangular ingots used in plate production than in the

smaller ingots used for bars.

Carbon steel.—The main constituents of carbon

steels are iron, carbon, and manganese, with

manganese present up to a maximum of 1,65

percent. The majority of carbon steels have

manganese specifications whose midpoints fall

in the range 0.40 to 0.85 percent. The average

manganese content of the entire carbon steel

category is estimated to be about 0.65 percent,

or 13. o pounds per ton of steel.

Manganese is used in carbon steels primarily for its sulfur control and solid solutionstrengthening characteristics. It also improves

the heat treating characteristics (hardenability)

of these grades, though this is not a major consideration for many uses of carbon steel.

Two types of carbon steel have especially

high manganese and sulfur contents in order

to improve machinability, These resulfurized

and resulfurized-rephosphorized grades typically contain 0.7 to 1.65 percent manganese

and find service in applications, such as gears

and cams, where considerable machining is

needed. The large number of manganese sulfide particles in these steels improve surface

finish, enhance metal removal rates, and increase the tool life by facilitating the chip formation process.

Full Alloy Steel.—Alloy steels usually contain

more manganese and silicon than do carbon

steels and, in addition, may contain other elements such as chromium and molybdenum.

The extra alloying additions enhance mechanical properties, fabrication characteristics, or

other attributes of the steel. In the more common alloy steel grades, manganese is added primarily for hardenability and less importantly

for sulfur control. The average manganese content of alloy steels is estimated to be 0.75 percent, or 15. o pounds per ton of steel.

There are experimental alloy steels which

have not yet been assigned regular AISI-SAE

designations. In general, these experimental

grades have higher manganese specifications

than the standard grades. This suggests that

manganese is becoming more popular as an alloying element and that the average manganese

content of alloy steels should be expected to

increase.

Although most alloy steels contain under 2

percent manganese, several grades containing

10 to 14 percent manganese are used. These

are the Hadfield grades, which have excellent

abrasion and impact resistance and are used

in construction, mining, and other high-wear

applications. There are also alloy steels with

manganese contents as high as 25 percent that

have been developed for use in strong magnetic

fields and at cryogenic temperatures.

HSLA Steel.—HSLA steels have been developed as a compromise, having the convenient

fabrication characteristics and low cost of carbon steels and the high strengths of heat-treated

alloy steels. HSLA steels are generally used in

applications such as energy production and automobiles, where savings in weight can be

made as a result of their greater strength and

atmospheric corrosion resistance and where

better durability is desired.
230 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

HSLA’s derive their superior properties from

a variety of alloying elements in relatively low

concentrations of 0.2 to 1.6 percent, coupled

with controlled rolling and heat treatments.

Common alloy additions include manganese,

nickel, chromium, columbium, molybdenum,

titanium, and vanadium. In comparison with

the majority of carbon and alloy steels, the

HSLA steels contain greater manganese contents. The limits in the 14 alloys designated by

the SAE range from 1 to 1.65 percent manganese, with an average of about 1.1 percent, or

an average of 22.0 pounds per ton of steel.

Stainless Steal .—Stainless steels are ferrous alloys that are rich in chromium and sometimes

nickel. They are used in a variety of applications requiring good corrosion and oxidation

resistance, as well as good strength. Compositional specifications for stainless steels usually

do not prescribe minimum manganese levels,

only maximum concentrations. Stainless alloy

304, which constitutes roughly 42 percent of

the stainless steel produced in the United States,

has a manganese specification of 2.0 percent

maximum. On the average, stainless steels contain 1.7 percent manganese, or 34.0 pounds per

ton of steel.

Several stainless steels, however, contain far

more manganese than the average. In part,

these alloys reflect the fact that an increase in

manganese levels permits a reduction in nickel

content. Tenelon steel, containing 14.6 to 16.5

percent manganese, was developed by U.S.

Steel Corp. following concern over nickel

shortages that occurred during World War II

and the Korean conflict.

TRENDS IN THE STEEL PRODUCT MIX AND MANGANESE USE

The average amount of manganese consumed

strictly for alloying purposes is being influenced by two major trends. The first is a changing product mix. Steel consumers are using increasingly greater proportions of full alloy,

stainless, and HSLA steels, which usually contain more manganese than do carbon steels.

Figure 6-2 shows the historical product shares

for each of the major steel classes. The classes

containing the most manganese, namely, full

alloy, HSLA, and stainless steels, are expected

to increase their portions of the market. By

2000, the product shares for the various products are expected to be approximately: carbon

80 percent; full alloy 9 percent; HSLA 9 percent; and stainless 2 percent.

The second contrasting trend is the decreasing manganese composition of carbon steels.

This is a result of improvements in the steelmaking process, namely, better sulfur removal

techniques and more reliable composition control, This effort is driven by economic pressures to conserve raw materials and increase

product fabricability. New technologies allow

steelmaker to retain the same quality product

with less manganese. They can now afford to

reduce manganese content to save on raw

materials costs and to avoid some of the more

unpleasant attributes of manganese, such as the

recrystallization problem alluded to in box 6-

B. Two manganese reduction techniques are

likely to be administered: trimming to the lower

end of the specified manganese range for each

of the grades and reduction of minimum manganese compositions because less is needed for

sulfur control.

Trimming.—Most manganese specifications for

steels are listed as ranges. To be on the safe

side, steelmaker generally aim for the midpoints of these ranges. Trimming involves aiming for the lower end of the specified range.

Improved ladle practice is the key to effective

trimming. Better manganese composition control is attainable with improved melt protection, alloy additions packaging, and sensing,

analytical, and control instrumentation. Trimming practices could be implemented very

quickly in an emergency, especially if operators become better aware of the statistical nature of quality control. The manganese content

of steel could be reduced by as much as 0,05

to 0.10 percent with the use of trimming.26

Reduction in Specified Manganese Range.—Sulfur

specifications of most steels, except for the

resulfurized grades, are usually about 0.05 percent maximum. In practice, steels are produced with average sulfur contents of about

ZeJohn R. stubbles, “Conservation Could Cut Steelmaking Requirements,” American Metal Market, Oct. 20, 1983.
Ch. 6—Conservation of Strategic Materials Ž 231

Figure 6-2. —Historical Market Shares for Major Classes of Steel

stainless

SOURCE Office of Technology Assessment, based on shipments data from the American Iron and Steel Inst!tute, Washington DC
232 Ž Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

0.025 percent. Manganese specifications could

be reduced to reflect this lower sulfur level.

Technologies such as external desulfurization of blast furnace iron and ladle metallurgy

techniques allow steelmaker to reduce the sulfur content of the finished product further still.

External desulfurization involves injecting calcium carbide or magnesium metal into the hot

metal prior to its introduction to the basic oxygen steelmaking units. Lime is sometimes injected as an auxiliary agent with these desulfurization materials. Implementation of this

technique will become almost universal in the

domestic industry by 1990. This will reduce the

need for desulfurizing during the steelmaking

stage and lead to much lower residual sulfur

levels in new steel and, eventually, in recycled

scrap. Furthermore, ladle injections of desulfurizing agents such as lime, calcium, or rare

earths just prior to primary casting reduces the

sulfur content below 0.01 percent, and often

below 0.005 percent. Ladle metallurgy technologies may not be installed primarily for sulfur

reasons, but once they are in place they will

no doubt be used to reduce sulfur levels in addition to providing the other benefits.

By 2000, the average sulfur content of steel

may be as low as 0.01 or 0,02 percent. This

means that less manganese is required in the

finished product solely for sulfur control purposes. Even though proportionally higher manganese-to-sulfur ratios are required at lower

levels of sulfur, a net reduction in the actual

amount of manganese needed is realized by reducing the sulfur content. The manganese content of each grade of steel could probably be

reduced by 0.2 percent with the widespread implementation of external desulfurization and

ladle technologies. For carbon steels, this represents a 30-percent reduction in the manganese content.

SUMMARY OF TRENDS IN THE MANGANESE

COMPOSITION OF STEELS

The effects of the product mix and manganese composition trends on the average manganese content of steel is illustrated by table

6-2. Note that even though the high-manganese

alloy products become more pervasive, the

average manganese composition is likely to

drop from 0.69 to 0.61 percent. That is a reduction of 1,6 pounds (from 13,8 to 12.2 pounds)

of manganese for each ton of steel.

Manganese in the Steelmaking Process

On an industry average, almost three times

more manganese is added to steel during its

processing than ends up in the finished product. When the 11 percent of the manganese additions that comes from in-house recycling is

discounted, the overall manganese recovery

rate comes to about 39 percent. This section

outlines the major trends in steelmaking practice that affect the efficiency of manganese use

in the production process.

Table 6-2.—Manganese Content for Major Grade of Steel

Current (1982) Forecasted 2000a –

Market Manganese Market Manganese –

share content share content

Carbon b 

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87.6 0.65 80 0.5 -

Full alloy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.1 0.75 9 0.8

HSLA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.8 1.1 9 1.2

Stainless . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.5 1.7 2 1.7

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100.0 0.69

—

100 0.61

aDra~tiC ~h~”~~~ in the bala”c~ of economic activl!y Could shift the market shares in 2000 to: 90 percent carbon, 9 PerCent combined full alloY and HSLA, and 1 Percen~

stainless In the low case; or 70 percent carbon, 27 percent combined full alloy and HSLA, and 3 percent stainless in the high case An average manganese content

of O 67 percent (high case) might arise from a shift In favor of alloy steels caused by a severe reduction in new construction and manufacture of machinery, vehicles,

and containers with a relative gain in the construction of new chemical, petrochemical, coal conversion, and powerplants. Similarly, a substantial shift (n favor of

carbon steels caused by extremely high demand for new buildings, highways, vehicles, and primary machinery might result In a manganese content of 0,56 percent

(low case)

bTrimming, together with reductions in the specified manganese range, could cut the manganese content of carbon steels by 0.25 to O.so p3rCent. A COrl SerVatiVe reductton of O 15 percent is shown here to account for less than full implementation of these practices.

SOURCE: Office of Technology Assessment based on data from the American Iron and Steel Institute, Washington, DC, and G R St Pierre, et al , Use of Manganese

in Stee/nraking and Stee/ Products and Trends in fhe Use of Manganese as an A//eying E/ernent In Stee/s, OTA contractor report, February 1983
Ch. 6—Conservation of Strategic Materials ● 233

PATTERNS OF MANGANESE USE IN STEELMAKING

Figure 6-3 shows the conventional steelmaking sequence, from raw materials preparation

to casting and finishing. Manganese enters the

process flowstream from five distinct sources:

iron ore, fines and waste materials, manganese

ore, iron and steel scrap, and ferromanganese.

On an industry average, iron ore and fines

and waste materials contribute approximately

36 percent of the manganese (disregarding that

present in ferrous home scrap] ultimately added

to the process stream. Iron ores contain approximately 0.16 percent manganese.27 Although this is a small concentration (and has

been declining in recent years), large quantities

of iron ore are added to the blast furnace. Fines

and waste materials generated by the steel production process contain large amounts of manganese. Though currently there are no satisfactory methods for extracting manganese from

the iron and steelmaking slags, dusts, sludges,

scales, and other wastes, some plants operate

sinter strands to recycle some of these materials, The ore sinter (consisting of partially

fused limestone, fine iron ore particles, and

steelmaking dust and other waste products)

produced in sinter strands can be charged

(added) to blast furnaces for hot metal production. Steelmaking slags and dusts consume a

large proportion (approximately 42 percent) of

the manganese added to the process stream.

Slags from both electric and basic oxygen steelmaking furnaces can be charged into blast furnaces, however, basic oxygen furnace (BOF)

slags are more commonly recycled in this manner. This is because of the proximity of BOFs

to blast furnaces—BOFs are always part of integrated steelmaking facilities, while electric

arc furnaces (EAF) are not, According to a 1976

NMAB study, about 40 percent of the BOF slag

(containing on average 4.5 percent manganese)

produced is recycled to the blast furnace: the

rest is discarded. 28 No blast furnace slag is

ZpA~~~rding t. the American Iron Ore Association (Cleveland,

OH), in 1982, 7(I percent of U.S. iron ore consumption was from

U.S. sources, while 20 percent was from Canadian sources, On

average, the U.S. ores contained 0.12 percent manganese and

the Canadian ores contained 0.31 percent manganese.

Z8LN ~tiona] Materials Advisory Board, I?langanesc ~e[:otr[?r}’

Tcchnolog}, publication NMAB-323 (Washington, DC: National

Academy Press, 1976].

recycled in this manner, but it does find other

commercial uses in the brick, aggregate, glass,

and bedding industries. There are no reliable

data on the overall extent to which manganese

is recovered from steelmaking waste materials,

but most likely less than 20 percent of the

manganese contained in iron and steel industry waste materials is currently recovered for

reuse.

Manganese ore charged to the blast furnace

accounts for 5 percent (industry average) of the

total input of manganese to the processing

stream. Charging this ore is a relatively inexpensive way of increasing manganese concentrations to levels beneficial for the processing

characteristics of ironmaking and steelmaking.

Iron and steel scrap is charged to the steelmaking furnaces and, to a lesser extent; the

blast furnace. The manganese content of home

scrap depends on the stage in the steelmaking

process at which it is generated. That created

at the steelmaking stage contains roughly 0.2

percent manganese, while that coming from

casting and finishing reflects the manganese

specifications of the product mix of the particular mill in question. Manganese contributions in purchased scrap depend on the trends

in the manganese content of steel products, discussed in the preceding section.

Ferromanganese is added to the process

stream during the ladle refining stage. Approximately 45 percent (industry average) of the total manganese input is added as ferromanganese. This manganese is not intended to be

sacrificed for the sake of processing improvements. Coming late in the steelmaking process,

it is intended to bring the level of manganese

in the steel up to final product specifications.

Much of the manganese contributed by these

five sources does not make it into the finished

product, but ends up instead in steel scrap and

processing waste products. The percentage

that does end up in the finished product is a

function of the manganese recovery factors for

the various process stages. These recovery factors are dependent on process yield rates and

manganese migration characteristics. Poor

yield rates result in both large quantities of
234 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Figure 6-3.— Flow Diagram Showing the Principal Process Steps Involved in Converting Raw Materials Into the

Major Steel Product Forms, Excluding Coated Products

1

coal Coal

r mines

+

1 1 L J

v ~

Manganese

ore

●

Alloying

elements

and

addition

agents

‘ea.. FeMn

r

-, m

e.g. Ferromanganese

I billet frills)

~ —Shows manganese

SOURCE The Making, Shaping, and

manganese flows.

Sheets Coils

additions.

Treating of Stee/, the United States Steel Corp., Pittsburgh, PA, 1971, adapted by the Office of Technology Assessment to show
-. . - . -. . . . . --- Ch. 6—Conservation of Strategic Materials • 235

wastes that cannot be recycled, and sizable

amounts of home scrap from which additional

wastes are produced during recycling. Manganese losses are exacerbated because waste

materials such as slags and dusts commonly

contain manganese in concentrations greater

than those in the steel, Manganese, as well as

many other alloying elements, often migrates

to the process wastes. Sometimes this segregation of elements between the steel and the

wastes is intentional, as during the steelmaking stage when manganese is used to react with

dissolved oxygen and carry it into the slag.29

In a sense, these are “sacrificial losses. ” In

other instances the segregation is an unwanted

consequence of the process chemistry, Regardless of the intent, this manganese migration

2Q~xygen disso]tred in mo]ten steel reacts with carbon to Produce gaseous carbon monoxide, which, when trapped during

ingot solidification, causes defects known as blowholes. This

problem can be avoided by reducing the oxygen content of the

steel with the addition of elements that react with the oxygen

and carry it off to the slag. Manganese, aluminum, and silicon

are the most important of the deoxidizing agents. Though a weak

deoxidizer by itself, manganese enhances the deoxidizing capacity of silicon. Moreover, the presence of manganese oxide

in the slag helps to develop proper slag characteristics, in part

through more rapid dissolution of lime, If the manganese content of the steelmaking charge is too low, additional slag fluxes

containing fluorspar, which is considerably more expensive than

ferromanganese, must be used.

causes the recovery factors to be lower than

the yield rates.

TRENDS IN STEELMAKING TECHNOLOGY

Figure 6-4 shows the current pattern of manganese use in the production of one ton of steel

product. Of the total manganese consumed in

the steelmaking process, 39 percent is embodied in the finished steel product, and 61 percent is lost in slags, dusts, and wastes. Note that

13 percent of the manganese inputs are recycled as home scrap, generated principally during the casting and finishing steps, The flows

in the figure are industry averages and do not

reflect operations in any particular steel plant,

They are aggregates based on the current mix

of equipment and operating characteristics for

the industry. Shifts in this mix of steelmaking

technologies are expected to change the manganese flow pattern.

Ironmaking.—From 50 to 80 percent of the

manganese charged to blast furnaces is retained in the molten pig iron, Typically, the

average recovery rate is 75 percent. The remainder is lost to blast furnace slag, which is

not recycled or processed for its manganese

content. Although construction and operation

of direct reduction ironmaking plants will conFigure 6-4.—Current Pattern of Manganese Use in Steelmaking (pounds of manganese of finished steel)

Home scrap

Purchased

4.97 I I

0.47

Wast e

2.86 I

1 Finishe d

‘Recovery with respect to ferromanganese additions IS assumed to be 82 percent, while complete recovery of Mn IS assumed for raw steel

SOURCE Office of Technology Assessment; and G R, St Pierre, et al , Use of Manganese in Sfeelmak(ng and Sfee/ Products and Trends in fhe Use of Manganese

as an A//eying E/ernent in Sfee/s, OTA contractor report, Februa~ 1983.
236 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

tinue, particularly in certain parts of the world,

e.g., the Middle East, Mexico, South America,

and Soviet Union, where natural gas is abundant, the principal source of domestic crude

iron will continue to be the blast furnace,

Over the next few years, the trend to shut

down the oldest and least efficient blast furnaces and to upgrade the better furnaces will

continue. Furnaces are upgraded in a number

of ways; including modifications of the charging systems and relining configurations, adoption of improved hot blast, additive, pressurization, and tapping procedures, and installation

of better instrumentation and control equipment. All of these developments taken together

will increase the operating performance of

blast furnaces but are unlikely to have a major

effect on manganese use.

Manganese retention in the blast furnace can

be expected to decrease somewhat from its current value of 75 percent because of the use of

more acidic slags allowed by external desulfurization, However, this should be offset by

the opportunity to include more manganesebearing steelmaking slag (primarily for its iron,

lime, and flux content, but also for manganese)

in the blast furnace charge.

Steelmaking.—Currently, manganese recovery

in BOF steelmaking ranges from 20 to 50 percent, depending on the final carbon content

and temperature of the melt (manganese recovery improves with increases in both), Recovery in electric steelmaking is substantially

greater, The proportion of steel produced in

EAFs is increasing relative to BOFs. The current ratio of EAF steel to BOF steel, roughly

30:70, is expected to increase to 40:60 by 2000.

This not only improves the average manganese

recovery rate, but also increases the average

ferrous scrap charge rate. Scrap is typically 100

percent of the charge to EAFs while only 30

percent to BOFs. Thus, greater use of EAFs increases the recycling of manganese,

Operating practices for both EAFs and BOFs

are changing. The basic oxygen processes are

undergoing dramatic changes with the incorporation of bottom blowing and inert gas mixing techniques, Manganese recovery will probably increase to the range of 40 to 60 percent

over the next few years as a result of these and

other changes, such as separate desiliconization and better control of the charge and slag.

Manganese recovery in EAFs is expected to improve somewhat over the next few years from

better charge materials, reduced oxidation during high-speed meltdown, improved end-point

control, and greater use of secondary and ladle refining.

Based on current operating practices and

mix of BOF and EAF steelmaking, the average

manganese recovery of the steelmaking stage

is estimated to be 26 percent. The increasing

use of EAF steelmaking and improvements in

operating characteristics are expected to improve this average recovery rate to 42 percent

by 2000.

Ladle and Secondary Refining.—The role of ladle

and secondary refining has grown rapidly during the past few years, In stainless steel production, adoption of AOD processing, which is a

secondary refining process, is almost universal.

For low-alloy and carbon grades, deoxidation

and desulfurization procedures have been

greatly improved with the increased use of argon shrouding of steel surfaces and pouring

streams. In addition to the trimming benefits

mentioned in the previous section, these processes capture the manganese content of ferroalloy additions to a much higher degree and

reduce reoxidation loss during subsequent

pouring. These improvements are expected to

raise the recovery of manganese from the ferroalloys from 82 to 90 percent which raises the

overall manganese recovery rate of the process from 87 to 95 percent.

Casting and Finishing .—The benefits of continuous casting have been fully established. Continuous casting leads to overall cost savings as

well as improved product quality (cleanliness,

homogeneity), reduction of energy requirements and decreased metal loss (scaling) during ingot reheating. In addition, it gives greater

yields of steel products from raw molten steel.30

30 The ingo t. to-s]ab Yie]d of conventional ingot casting opera -

tions varies greatly according to the nature of the products.

Owing to large shrinkage cavities, the yields for killed grades
Ch. 6—Conservation of Strategic Materials

Direct rolling of hot slabs and billets

Photo credtt Amertcan Iron and Steel lnstttute

Continuous casting of steel is one of a variety of

improved steelmaking technologies

that conserve manganese

From the manganese standpoint, increased

yield means that less home scrap must be recycled through processes where there are irrecoverable losses. In 1982, about 29 percent

of domestic steel was continuously cast. This

rose to about 36 percent in the first half of 1984,

and is likely to increase to 70 percent by 2000.

Manganese losses are not a major problem at

the casting stage because there is very little

migration of manganese to the waste products.

— —

can be quite poor, even as low as 70 percent. The yields for

rimmed products are substantially better. On an industrywide

basis, the average yield of ingot casting operations is estimated

to be approximately 87 percent. Continuous casting, the more

modern and more desirable process, has a yield of approximately

96 percent.

. 237

from

continuous casters has been demonstrated in

several plants throughout the world. By eliminating the cooling and reheating steps, this

technology offers potential for further improvements in metal recovery as well as energy

savings.

Based on the trends toward greater use of

continuous casting and direct rolling, the yield

rate during casting and finishing operations is

expected to increase from its 1982 value of 75

to 85 percent by 2000.

Summary of the Effects of Processing Trends

The current and expected yield rates and

manganese recovery factors for each stage of

the steelmaking process are shown in table 6-

3. These embody the shifts in technology discussed above. The overall manganese recovery rate increases from 39 to 49 percent.

Outlook for Manganese Use in the Steel Industry

The expected impacts of steel product and

processing trends on the manganese use pattern in 2000 are outlined in table 6-4. High and

low cases are included in the table to illustrate

the effects of different product mixes and various schedules of investment in new equipment.

A 12-percent net reduction in the average

manganese content of steel (from 13.8 to 12.2

pounds per ton) is expected to accompany the

contrasting shifts towards the greater use of

high-manganese products and the increased attention to trimming. Trends in steelmaking

technology are expected to cut average manganese consumption losses from 21.8 to 12,6

pounds per ton of steel, a reduction of 42 percent. In addition, these technology changes increase the role of purchased ferrous scrap

(available domestically) as a source of manganese.

Most importantly, these product and process trends decrease the per-ton-of-steel requirement for manganese in the form of ferroalloys

and manganese ore by 47 percent, from 17.8

to about 9.5 pounds. Depending on the product mix and the rate of adoption of the process improvements, the requirement could be
238 Ž Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table 6-3.—Parameters Affecting Manganese Retention in the Steelmaking Process

Current (1982) Expected 2000

Manganese Manganese

Yield rate recovery factor Yield rate recovery factor

(percent) a

(percent) b(percent) a

(percent) b

Ironmaking (blast furnace) . . . . . . . . . . . . . . 100 75 100 75

Steelmaking (BOF and EAF). . . . . . . . . . . . . 85 26 90 42

Ladle and secondary refiningc . . . . . . . . . . . 100 87 100 95

Casting and finishing . . . . . . . . . . . . . . . . . . 75 75 85 85

ayleld ~at~ = tlbs of iron in primary Output product) + (Ibs Of iron in inPut materials),

bRecoveW factor = (Ibs of manganese in primary output product) + (Ibs of man9anese in inPut materials).

CRecoveV factors for ladle and seconda~ refining are based on Ir)() percent recovey of manganese in molten steel combined with 82 percent (current) and W pOrCent

(2000) recovery of the manganese in ferroalloy additions.

SOURCE: Office of Technology Assessment; and G R. St Pierre, et al , Use of Manganese in Sfee/making and Sfee/ Products and Trends in the Use of A4arrganese

as an A//eying E/emerrt in Stee/s, OTA contractor report, February 1983

Table 6-4.—Current and Projected Manganese Consumption in U.S. Steel Production

(all figures in pounds of manganese per ton of steel product, except where noted)

Current Projected, Year-2000

(1982) Expected Low High

Total manganese use (excluding home scrap) . . . . . . . .

outputs:

Retained in steel products . . . . . . . . . . . . . . . . . . . . . . .

Losses (slag, dust, waste) . . . . . . . . . . . . . . . . . . . . . . .

Inputs:

Manganese ore. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Manganese ferroalloys . . . . . . . . . . . . . . . . . . . . . . . . . .

Iron ore and sinter. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Purchased ferrous scrap. . . . . . . . . . . . . . . . . . . . . . . . .

Overall manganese recovery rate

(ignoring home scrap) (percent). . . . . . . . . . . . . . . . . . .

Assumptions:

Manganese content of steel (percent) . . . . . . . . . . . . .

Percentage of molten steel produced in

EAF processes (percent) . . . . . . . . . . . . . . . . . . . . . .

Manganese recovery rates and yield rates:

Ironmaking:

Recovery (percent) . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Yield (percent) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Steelmaking:

Recovery (percent) . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Yield (percent) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Ladle and secondary refining:

Recovery (percent) . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Yield (percent) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Casting and finishing:

Recovery (percent) . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Yield (percent) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

35.6 24.8 20.6 30.4

13.4

17,0

13.8

21.8

12.2

12,6

11.2

9.4

1.9

15.9

12.9

5.0

1.2

8.3

8.5

6.8

1.0

5.5

7.1

6.9

1.5

12.2

10.1

6.6

39 49 54 44

0.69 0.61 0.56 0.67

28 43 48 38

75

100

75

100

75

100

75

100

26

85

42

90

50

93

34

87

87

100

95

100

98

100

90

100

75

75

85

85

90

90

80

80

SOURCE Office of Technoloav Assessment: and G R. St. Pierre, et al., Use of Manganese in Steelmaking and Steel Products and Trends in fhe Use of Manganese

asan A//eying E/efient in Stee/s, OTA contractor report, February 1983 -

as low as 6.5 pounds per ton or as high as 13.7 United States, accounting for over 30 percent

pounds per ton. of all PGM consumption. Platinum, palladium,

and, since 1981, rhodium are the active ingreAutomotive Catalysts clients used in converters to control hydrocarbon (HC), carbon monoxide (CO), and oxides

Since 1975, the catalytic converter (now used of nitrogen (NOX

) emission levels. In addition,

on most cars to control air pollution) has be- about 10,000 tons of chromium are used annucome the single largest use for PGM in the ally in the stainless steel shell of the catalytic
Ch. 6—Conservation of Strategic Materials . 239

converter—about 1.5 percent of U.S. chromium

consumption, and 3 percent of chromium consumption in stainless and alloy steels.

As a result of nearly a decade of using catalytic converters, a very large “above-the-ground

mine” of PGM has accumulated in the Nation’s

automotive fleet-some portion of which can

be retrieved each year through collection and

recycling of converters from scrapped cars. As

the fleet of converter-equipped cars ages, the

inventory of PGM available from scrapped cars

will grow very rapidly through the 1980s and

into the 1990s. If effective retrieval and recycling of catalytic converters from these scrapped

cars occurs, U.S. PGM imports can be reduced

appreciably below what they would be otherwise,

The current level of PGM recovery from catalytic converters is low, in part because converter-equipped cars are only now appearing

at scrapyards in large numbers. This may

change in the near future: the average life of

a car is about 9 to 10 years, so post-1975 model

cars (the first year in which production model

cars were equipped with a converter on a nationwide basis) will comprise an increasing

proportion of scrapped vehicles.

Figure 6-5, based on projections prepared for

OTA by Sierra Research and Energy and Environmental Analysis, Inc., compares the maximum theoretical potential for catalyst recycling

from scrapped cars with projected PGM demand for new vehicles through 1995. 31 As

shown, the theoretical potential for recycling

will grow from about 115,000 troy ounces in

1983 to over 800,000 troy ounces in 1995. Assuming a 50 to 60 percent recovery rate, catalytic converter recycling could add 400,000 to

500,000 troy ounces annually to domestic PGM

supplies by the mid-1990s. This compares with

new vehicle demand of 770,000 troy ounces in

1983, which is projected to grow to 1.4 million

troy ounces in 1995. Less economic incentive

exists to recycle chromium values from the

stainless steel shell of catalytic converters.

Slsierra Research and Energy and Environment Analysis, Inc.,

Critical Metal Consumption in Automotive Catalysts, Trends and

Alternatives, report prepared for OTA, December 1983, Much

of the analysis and data in this section are derived from this

report.

Figure 6-5.— PGM Demand by Vehicle Category

Heavy trucks and buses

75 76 77

SOURCE: Sierra Research

90 91

—

~

\ ,,1

I

I

I

I I

I I

J

92

——

,,

I II II I

I

I

‘ 1 ’ ;

I

‘1~’l I ~~• ,

II I

I

93 94

Model year
240 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

However, if the above recovery rates are assumed, 5,000 to 6,000 tons of chromium could

be provided annually.

It should be noted that considerable uncertainty surrounds the projections in figure 6-5—

especially those related to PGM requirements

for new vehicles. The projections for new vehicle PGM requirements are for the total U.S.

market for vehicles, without assumption about

prospective import levels. The projected demand is based on medium growth assumptions

about vehicle sales. The projections also reflect

anticipated new emission control standards expected to be applied to vehicles in the 1985-90

period. Changes in the timing and nature of

these standards would change the projections.

Readers are referred to chapter 3 for further

discussion of the projected growth in PGM use

for vehicle emission control.

Somewhat less uncertainty surrounds the

projections of PGM potentially available for

recycling through 1995. Cars already on the

road will constitute the great majority of vehicles scrapped during the projection period.

Actual recycling levels will be considerably

lower than the theoretical potential, due to

losses of PGM while cars are in service, and

at each of the several steps entailed in recycling. Estimates of PGM losses from catalytic

converters while cars are in service range from

under to well over 10 percent, and this is not

reflected in figure 6-5. According to the Automotive Dismantles and Recyclers Association (ADRA), only 70 to 80 percent of the 10

million cars that are “detitled” in a normal

scrappage year (1979 was the last such year)

actually reach dismantling yards where the

converter can be removed for recycling. Moreover, not all dismantles remove the converter

from the car before it is compacted into a bale

or shredded. Some PGM shipped to a refiner

(perhaps 10 percent) is lost in refining. Hence

potential addition of PGM to U.S. supplies

from catalytic converter recycling probably

will only be 50 to 60 percent of the levels shown

in figure 6-5, Actual levels or recycling will depend on economic incentives and the effectiveness of the collection networks that are established.

Structure of the Recycling Industry

Among the types of firms that have an interest in the growing market in PGM recycling

are primary and secondary PGM producers,

manufacturers of emission control devices,

scrap processors and dealers, automotive dismantles, muffler shops, collectors and distributors of used automotive parts, and decanners—a new specialized business that has arisen around the catalytic converter. There are no

major technological barriers to recycling of either PGM or chromium values from catalytic

converters, and the number of firms involved

in catalyst collection networks is expected to

increase gradually as the market continues to

grow. In addition, the industry appears capable of responding quickly to price increases,

so that recycling could be greatly expanded if

there were a supply disruption.

The industrial refining capacity needed to

recycle PGM from automotive catalysts taken

from scrapped cars is already in place. Major

domestic PGM refining facilities operated by

Gemini Industries and Johnson Matthey are

available for converter recycling. These facilities are able to recover PGM values both from

new catalysts rejected by automakers and from

scrapped converters. Domestic scrap processors are also able to recycle the stainless steel

shell of the catalytic converter as a scrap feed.

Steps entailed in recycling spent catalysts are

described in box 6-C.

Institutional factors could impede recycling

levels, however. Three categories of catalytic

converters are potential sources of PGM for

recycling: unused catalysts that fail to meet

product specifications, rejected and damaged

catalysts from operational vehicles, and spent

catalysts from scrapped vehicles. Of these, the

last category represents the largest future supply of PGM, but also presents the greatest collection difficulties. Reasons for this include

fluctuating PGM prices, the fragmentation of

the automotive dismantling industry, and a

lack of effective linkages between refiners and

dismantles.

The availability of automobile catalysts for

recycling is affected by several factors. Some
Ch. 6—Conservation of Strategic Materials ● 241

Box 6-C.—How Catalytic Converters Are Recycled

With the advent of the catalytic converter, a new industry has evolved to recover PGM values

from scrapped automobile catalysts. From a technical standpoint, there are few barriers to refining PGM from spent catalysts. In the mid- and late 1970s, facilities were set up to recycle unused

catalysts that failed to meet product specifications. This gave refiners the experience needed to

take advantage of the far greater amount of PGM that can be recovered from scrapped cars. However, the business of organizing effective collection systems has proven surprisingly complex.

Part of the reason for this is that catalytic converters are not uniform products whose value

can be easily identified. In 1982 model cars, for example, there is a 10-to-l range in PGM content

among different converter models—().33 troy ounces on heavily loaded converters down to 0.03

troy ounces on lightly loaded converters. (This wide range in catalyst loadings is probably not a

measure of the efficiency of the converter in reducing emissions; instead the heavily loaded catalysts

are probably installed in car models with engines that produce higher than average emission levels

prior to catalytic treatment.) Many of the converters, especially on older model cars, have catalyst

pellets (some of which maybe lost in the course of vehicle operation), while others are monolithic,

with the catalyst deposited on a secure substrate. Chromium content in the stainless steel shell

of converters also varies from 1.5 to 3 pounds. Finally, early model converters contained just platinum and palladium, but more recent “three-way converters” contain rhodium as well.

Before lots of spent catalysts actually arrive at a refiner for reprocessing, several separate firms—

including automotive dismantles, collectors, decanners, and scrap processors—can be involved.

Some of these firms specialize in collection of certain types of converters and do not purchase

other types. Some work under an arrangement with refiners. Others are independent.

Preliminary sorting is done by the automotive dismantle after the converter is removed from

the car by torching or cutting or, in the case of larger shredding operations, popped off with a

forklift. Some converter containers contain little or no catalyst. Spent catalysts commonly contain

at least some lead, which is particularly undesirable to refiners, and moisture, which can also affect chemical analyses and reprocess smelting. If the scrapped converter is sold to a collector, it

may be visually inspected by the collector for catalyst content. However, the dismantle may choose

not to sell the converter to a collector and may instead stockpile it, waiting for a price increase,

or keep it for sale to retail customers.

The decanner (who maybe the collector or the the auto dismantle) removes the catalyst substrate from the stainless steel container. After it has been removed, the catalyst is placed in drums

to prevent further moisture accumulation, and is sold to a refiner. The stainless steel shell of the

converter may be sold to a scrap processor, some of whom also may serve as collectors or decanners.

Both the quality and quantity of the catalyst play major roles in determining the price paid

to decanners by refiners. Some require a minimum shipment of 3,000 pounds of catalyst substrate.

Bonuses may be paid for shipments that exceed average PGM content, while penalties may be

charged for below-average shipments. A partial payment for the catalyst maybe paid upon receipt,

with the balance reserved until actual assay, often 6 to 10 weeks later.

Once the spent catalysts are accepted by the refinery, several commercialized processes can

be used to recover the PGM. Two major domestic refiners—Gemini and Johnson Matthey--use

proprietary hydrometallurgical processes to separate the substrate from the PGM through an acid

or alkaline leach. Final removal of the PGM from the resulting leach liquor or sludge is complex,

involving as many as 18 separate steps, but can recover more than 90 percent or more of the PGM.

Scrapped catalysts can also be run through copper or nickel pyrometallurgical refining circuits

to recover about 90 percent of the PGM. This approach was taken by Inco, a large Canadian nickel

and copper producer, in 1980 and 1981, when PGM prices were high, but has been subsequently

discontinued.

In addition to recycling PGM, interest is growing in the possibility of “regenerating” spent

catalysts. This would involve leaching out lead and other impurities and washing additional PGMs

as required, while keeping the substrate and shell intact.
242 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

cars are simply abandoned; some are taken

directly to a scrap processor for baling or

shredding, where the value of the PGM (and

chromium in the converter shell) is lost; others

are exported. As a result, about 20 to 30 percent of all cars are never taken to a dismantle.

Even those cars that reach dismantling yards

will not necessarily have their converter removed. According to the ADRA, the majority

of automotive dismantling firms have less than

10 employees. With a 1983-84 scrap price of

only about $5 to $7 per converter, not all dismantles feel it is worth their employees’ time

to remove the converters, while others maybe

stockpiling the catalysts until prices rise. A

1982 survey of some ADRA members and some

unaffiliated dismantles by Arthur D. Little,

Inc., found that 12 percent of those firms responding to the survey leave the majority of

converters on the car.32 However, ADRA members and other respondents may not be representative of the industry as a whole. Small

firms that lack the resources to participate in

the trade association may be more likely to

leave converters on cars.

Providing refineries with a steady supply of

scrapped converters has also been a problem.

The auto dismantling industry is highly decentralized, having 11,000 separate firms, according to ADRA, while only a few large firms are

involved in refining the catalyst. As more actors have become involved, intermediary firms

specializing in collection and decanning have

arisen either independently or in affiliation

with refiners. Because refiners are trying to

assemble economic volumes for recovery, a

premium is paid for larger volumes of material. When a sufficient number of converters

has been collected by a dismantle they are sold

to collectors and/or decanners. Usually a minimum of 50 to 100 converters is required to deal

with a large collector.

Collectors accumulate small lots of whole

converters within a particular region and sell

larger lots at higher prices to decanners. Some

collectors are also decanners. Often, collectors

have regular truck routes to purchase converters from dismantles and, in some cases,

from shredding yards.

Decanners purchase large lots of whole converters, and separate the catalyst’s substrate

from the housing or shell, usually by shearing

the canister in half. The pellets and honeycombs are packed separately in 55 gallon

drums. Owing to the low nickel content and

accumulated impurities, the 409 stainless steel

used in the converter shell has a low market

value ($1 10 per ton in late 1983). Nevertheless,

the shell represents an additional source of

value to the decanner.

The quality of catalyst material sold to refiners, as well as the volume, plays a major role

in determining the price paid to decanners.

Decanners are cautioned not to include contaminated units. Pure white catalyst substrates

indicate burnout and loss of the PGM coating,

Catalysts coated with lead and oil are also undesirable in the refining process.

Auto dismantles would prefer to have more

than one purchaser (collector or core buyer) for

used converters to ensure the best price and

most reliable pickup, while refiners prefer to

purchase large quantities of catalysts from one

collector. During periods of low platinum

prices, both dismantles and collectors may

stockpile catalysts, waiting for prices to rise.

In the long term, many of the problems apparent in the early stages of the industry’s evolution may be overcome, due to the increased

numbers of scrapped cars equipped with converters available for recycling and possible increases in PGM prices.

USED AND RECONDITIONED CATALYTIC CONVERTERS

A recent development in the automotive dismantling industry has been the emergence of

a market for secondhand catalytic converters

bought as replacement parts. The exact magnitude of this market is not known, but a recent survey in California found that about

80,000 secondhand converters were used annually in the State.33 Most of these secondhand

sZAutomotive Dismant]ers and Recyclers Association, profile:

Automotive Dismantling Industry, published in cooperation with

Arthur D. Little, Inc. (Washington, DC: Automotive Dismantles

and Recyclers Association, 1983), p. 12,

ttMobile Source Control Division, Used Catalytic Converter Survey (El Monte, CA: State of California Air Resources Board, July

1983), memo.
Ch. 6—Conservation of Strategic Materials ● 2 4 3

—

converters were obtained from parts distributors who purchased them from auto salvage

dealers at a somewhat higher price (averaging

$7 per unit) than is typically paid by refiners.

Auto dismantles also sell converters directly

to retail customers as used parts, often at a

price of $45 to $700

The apparently growing market for secondhand converters concerns some refiners since

it adds an additional layer of competition in

their efforts to secure a supply of catalysts for

recycling. The competition is great because this

market is an important source of income to dismantles, who typically obtain three-fourths of

their income from sales of used parts, while

scrap sales form only a small part of their

business.

An emerging issue associated with the apparently growing market for secondhand catalytic

converters concerns possible reuse of defective

catalysts in cars. While secondhand converters

are substantially cheaper to the motorist than

new replacement converters, which range in

price from $170 to $320, many secondhand

converters are defective, and will therefore adversely affect air quality if they are installed

in cars.

It is not possible to determine whether a used

converter is operating properly without emissions inspection and testing. A gradual deterioration in catalyst efficiency occurs over time,

and most automakers guarantee the converter

for only 50,000 miles. In addition, leaded gas,

which destroys the emissions control capability and the platinum metal values in the catalysts, is often used in converter-equipped cars

and trucks. Occasionally this happens inadvertently, if fuel supplies in a filling station become contaminated or are switched. More

often, motorists deliberately and illegally misfuel because of lower price and perceived improved performance of leaded gasoline.

Currently, overall procedures for testing and

certifying secondhand catalytic converters are

not in place. Although the U.S. Environmental

Protection Agency has issued voluntary aftermarket part self-certification regulations, these

relate primarily to new replacement converters. However, methods to test used catalytic

converters are under development by a major

muffler firm, using the voluntary self-certification regulations. The entire issue associated

with use of secondhand converters is highly

complex, and is likely to be an increasingly important concern in both emission control programs and recycling efforts in the years to

comer

ALTERNATIVES TO PGM USE IN THE CATALYTIC CONVERTER

At present, PGM use in the catalytic converter is the most effective means for meeting

emissions control standards under the Federal

Clean Air Act. Near-term (before 1995) alternatives to PGM use in the catalytic converter

are not promising, Most currently developed

alternatives would entail major loss of fuel

economy and/or a need to relax automotive

emissions standards. These problems could be

overcome, given several years lead time, but

there is no persuasive reason at this time for

auto makers to pursue these alternatives.

Increased use of diesel engines could also reduce the need for PGM catalysts. However,

while diesels do not currently require converters to reduce carbon monoxide and hydrocarbons, they do produce substantial amounts

of particulate. A more stringent particulate national emission standard for diesel-fired lightduty vehicles (cars and light trucks) is expected

to take effect in 1987. Some manufacturers are

expected to employ a platinum-catalyzed trap

oxidizer to meet the standard. The other most

likely alternative–a trapping system which

uses onboard dispersing of fuel additives—

would not entail PGM use. A particulate emissions standard for heavy duty vehicles, if

adopted as expected in 1990, most likely will

require PGM catalyzed trap oxidizers, because

additives are unlikely to prove practical over

the long lifetime of these engines. (In the projections shown in figure 6-5, it was assumed

that half of the light duty diesel vehicles will

use a PGM particulate trap when the standards

take effect—1986 in California and 1987 nationwide—but that all California light trucks and

diesels would use particulate traps to meet the

more stringent State standard expected in 1989.
244 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

It was also assumed that all heavy duty diesel

engines will require PGM particulate traps to

meet the anticipated 1990 national standard.)

Even in the longer term (beyond 1995), PGM

use for emission control is likely to continue,

although use of substitute materials, more efficient loading of PGM, and basic changes in

the overall design of automobiles, might reduce

per vehicle requirements. At present, the major auto makers foresee no major change in

total loadings of PGMs used in converters, although ratios of platinum, palladium, and

rhodium may change, Alternative base metal

catalysts are not likely to substitute for PGM

catalysts, unless breakthroughs overcome major technical problems that make them less effective in emissions control.

Downsizing of engines to meet federally

mandated fuel efficiency standards, coupled

with improved catalyst formulations, may reduce the amount of PGM needed to treat emissions effectively. With long-term increases in

gasoline prices, downsizing may occur regardless of whether Federal standards are extended

beyond 1987. Alternative trends in downsizing

to the year 2000 are discussed in detail in the

1982 OTA assessment, Increased Automobile

Fuel Efficiency and Synthetic Fuels.34

Considerable speculation exists about possible future use of alternative automotive engines

that are radically different from those used

today, such as the automotive gas turbine

(AGT) and stirling engines. These engines

would have very low emissions levels, thus reducing emission treatment needs. As is discussed in chapter 7, technical problems (including development of reliable ceramic parts)

make it unlikely that the AGT will be widely

used until after the year 2000, if then. Alternative fuels, such as methanol, are also under

consideration as a principal fuel for some automobiles, Emissions from cars retrofitted to

burn methanol do not meet current standards

without catalytic treatment. Moreover, emission tests on methanol-burning cars show relaaq~ncreased Automobile Fuel Efficiency and Synthetic Fuels

(Washington, DC: U.S. Congress, Office of Technology Assessment, September 1982), p, 17.

tively higher levels of aldehyde emissions than

for gasoline-powered cars. Aldehyde emissions

can be reduced by catalytic after treatment. Aldehydes are not covered in current emission

standards, so new standards could be required

if methanol is widely used.

STRATEGIES FOR EMISSION CONTROL IN A SUPPLY DISRUPTION

PGM recovered from catalytic converters

can be reprocessed into virtually any form

needed by industry. In a major supply disruption, automotive catalyst production could be

temporarily curtailed, thus permitting PGM

that is recovered from scrapped catalytic converters to be diverted to more critical economic

and military uses. PGM use in catalytic converters is critical to controlling air pollution,

but is not otherwise a critical component of the

U.S. economy. In a national emergency, a temporary discontinuance of PGM use in the manufacture of new catalytic converters, together

with intensified recycling of PGM from scrapped

cars, would insulate the most critical economic

uses from the effects of a supply disruption.

As a result, U.S. ability to contend with a supply cut-off has theoretically improved, owing

to reliance on PGMs for emission control, even

though PGM imports have increased because

of it. Use of such an emergency strategy, however, would have major impacts on the emissions control program established under the

Federal Clean Air Act.

Alternative strategies for auto makers and

Government officials for dealing with a nearterm curtailment of PGM supplies were addressed in the report prepared for OTA by

Sierra Research and Energy and Environmental

Analysis, Inc. This analysis demonstrates that

practical alternatives to the catalytic converter

are not currently available that could meet both

current emissions and fuel economy standards.

In a near-term supply disruption in which no

PGM was available for emissions control, auto

makers would probably have little alternative

except to build cars without catalytic converters—although this could be accompanied with

a requirement for retrofit when the shortage

ended.
.—

Ch. 6—Conservation of Strategic Materials ● 2 4 5

In a supply disruption lasting 1 to 3 years,

recalibration of new vehicles for lower emissions without catalyst use would be feasible.

This could entail programming of fuel metering systems for leaner operation to reduce

hydrocarbon and carbon monoxide emissions.

In addition, retarding spark advance to further

reduce HC and NOX emissions could be undertaken. These changes would not entail substantial design changes or development costs. Although some fuel economy penalties would be

incurred, average new car emission levels approximately equal to 1977-79 standards could

be achieved in this way. Since computer controlled systems are now used in many new vehicles, retrofitting after the disruption would

be comparatively simple, entailing replacement

of a computer chip or (more likely) the entire

electronic control unit of the vehicle.

With an intensive program of research and

development (R&D), according to the analysis,

alternative emission control systems that do

not use PGM but would approach current emissions and fuel economy standards could probably be developed. However, this would require at least 5 years and is unlikely to be

undertaken by auto makers simply out of concern about future supply disruptions.

Development of such technology could be

necessary in the event of a “worst case” supply

disruption of several years’ duration in which

national emergency requirements could not be

satisfied from recycled PGM alone. Under such

dire circumstances, pressures would mount to

recover PGM from operating vehicles.

The total current in-service vehicle fleet contains roughly twice as much PGM as was consumed for all uses domestically in 1982, This

will more than double by 1995—to a total of 9

million troy ounces of PGM, some portion of

which could be recovered in a dire emergency

through Government programs aimed at removing some catalytic converters from the inservice automotive fleet.

Ultimately, both the objectives of national

preparedness in the event of a supply emergency and national air quality objectives could

best be served if contingency planning were

undertaken to determine under what circumstances, and in what way, allocation of PGM

would occur in a supply emergency. Such planning could also be used to identify emission

control strategies available to auto makers in

the event that supplies of PGM are not available for manufacture of catalytic converters,

Other Conservation Opportunities

Petroleum and Chemical Catalysts

Both PGMs and cobalt are extensively used

in the petroleum and chemical industries as

catalysts. PGM use in these catalysts is already

highly efficient so that only limited improvements in current patterns of use can be made

in the foreseeable future. The PGM contained

in industrial catalysts is generally retained in

ownership by the user firm and is refined or

regenerated on a toll basis by a specialized

recycling firm. This system is highly efficient:

Of the 235,000 troy ounces of new PGMs that

were purchased for petroleum and chemical

industry catalyst applications in 1982, only

about 10 percent was to make up metal losses

during processing and toll refining; the rest

was to meet new production needs. The only

catalysts that are not now recycled contain less

than 0.05 percent PGMs. Recovery of PGM

values from these catalysts is technically feasible, but the refining costs (including transportation costs to and from the refinery) exceed

the contained metal value.

In the case of cobalt-containing catalysts,

however, major opportunities exist to increase

recycling levels, particularly in the case of the

cobalt contained in spent petroleum refining

catalysts. Although some other metals are now

reclaimed from these spent catalysts, cobalt

values are not.

Overall national trends in cobalt catalyst use

(exclusive of paint dryers) were extensively

analyzed for OTA by the Inco Research & Development Center, Inc.,35 and are summarized

35F. j. Hennion, 1. J. deBarbadiIlo, j. H. Weber, and G. Alex

Mills, Use of Critica] Materials in Catalysts for the Petroleum and

Chemical Industries, Cobcdt and Platinum Group MetaLs (prepared

for OTA by Inco Research & Development Center, Inc.]. Much

of the information in this section is derived from this report.
246 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

in table 6-5. This information, obtained from

estimates provided by industrial sources in late

1983, is believed to be the most up-to-date and

detailed information about these trends that is

publicly available.

As shown in table 6-5, three major processes

dominate cobalt catalyst consumption: petroleum hydroprocessing, used to remove contaminants from sour and heavy crude oil; alcohol production through hydroformulation;

and production of terepthalic acids and derivatives, used to produce polyester fibers and

films. Cobalt is also used in catalysts to produce synthetic fibers, solvents, pharmaceuticals, and industrial chemicals.

Significant recycling of the cobalt used in

chemical catalysts is occurring. According to

Inco, about 1.5 million pounds of cobalt were

consumed in both chemical and petroleum catalysts in 1982. Of this, 1.1 million pounds—about

72 percent—was contributed through recycling. Fresh cobalt needed to makeup the difference was only about 426,000 pounds. This

is less than some other estimates which may

underestimate the extent of recycling by the

chemical industry.

However, cobalt from spent petroleum hydroprocessing catalysts is not now recycled.

Since none is recovered, all of the cobalt consumed in hydroprocessing was fresh cobalt.

Inco estimated that about 270,000 pounds of

cobalt was consumed in hydroprocessing in

1982. This is less than some estimates for prior

years, due to lower refinery utilization. The

Table 6-5.—Cobalt Consumption and

Recycling in Catalysts, 1982

Cobalt New cobalt

consumption for makeup

(thousand Percent (thousand

Process pounds) recycled pounds)

270

Hydroformulation . . 700 90 70

Terephthalic acid 500 90 50

Organic acid . . . . . . 35 0 35

Alkyl amines . . . . . . 30 95 1.5

Total . . . . . . . . . . . 1,535 72 426.5

SOURCE” F. J Hennion, J. J. de Barbadillo, J. H. Weber, and G. Alex Mills, Use

of Critical Metals in Catalysts for the Petroleum and Chernica/ /ndustries (Cobalt and Platinum Group Metals), 1983. Report prepared

for OTA by the Inco Research & Development Center, Inc., December

1983.

Inco estimate is consistent with a National

Materials Advisory Board finding that between

200,000 to 300,000 pounds of cobalt were consumed in this use in 1982.

Expanded use of hydroprocessing catalysts

in the petroleum industry is likely in the years

to come. However, growth in demand will

probably be less than was anticipated in the

mid and late 1970s, when refineries were rapidly installing hydroprocessing capacity to

process heavy source crude oils obtained from

non-OPEC sources. The combined effects of

energy conservation and the 1981-82 recession

have resulted in scaling back projected requirements. While hydroprocessing capacity can be

expected to grow appreciably from the depressed 1982 levels, “fresh” cobalt requirements will not necessarily increase proportionately. According to the National Materials

Advisory Board, future cobalt make up requirements could be in the range of 200,000 to

400,000 pounds a year, assuming that effective

recycling takes place. Substitution of nickelmolybdenum catalysts could reduce future requirements by another 100,000 pounds a year,

according to NMAB.36

In current practice, hydroprocessing catalysts may be regenerated one or more times in

the course of their life cycle (2 to 3 years). At

some point, however, the catalyst becomes so

contaminated that subsequent regeneration is

impossible. These spent (unregenerated) catalysts may be stored temporarily on site by

refiners, landfilled, or sent to a processor for

recovery of non-cobalt metal values or for export, The typical spent catalyst will contain

about 8 percent molybdenum, 1.5 percent cobalt, 0.5 to 1.5 percent nickel, 1 to 6 percent

vanadium, 10 to 15 percent carbon, 10 percent

sulfur, 0,2 percent phosphorus, and the balance, alumina.

During the late 1970s, when molybdenum

and cobalt prices were very high, considerable

effort was made to recover metal values from

these spent catalysts. However, most of these

efforts were discontinued as prices fell. By

Wobalt Conservation Through Technological Alternatives, op.

cit., p. 119.
Ch. 6—Conservation of Strategic Materials . 247

1982, Gulf Chemical & Metallurgical Co., of

Freeport, TX, was believed to be the only domestic firm recovering metal values from spent

hydroprocessing catalysts. Gulf C&M, which

has been in the catalyst recycling business for

over two decades, uses a combination of pyroand hydro-metallurgical techniques to recover

molybdenum and vanadium values from the

spent catalysts but does not currently recover

cobalt, nickel, or other metals.

From years of reprocessing, some 100,000

tons of processing residues are reported to have

accumulated at the Gulf C&M facility, As much

as 7 million to 8 million pounds of cobalt and

nickel may be present in this residue, some portion of which could be recovered with adoption of adequate reprocessing technology. The

company has reportedly developed a pilot-scale

process to recover nickel, cobalt, and alumina

values from this residue, but economic recovery of these metal values at current prices

is not feasible. Because Gulf C&M reprocesses

spent catalysts from both foreign and domestic sources, more cobalt residues are accumulated at the facility each year than are generated from domestic hydroprocessing activities

alone.

At least two other domestic firms–Hall

Chemical of Wickliffe, OH, and CRI Metals of

Baltimore, MD—have announced plans to construct facilities to reclaim cobalt and other metals from spent hydroprocessing catalysts. Hall

Chemical, which currently produces 1 million

pounds of cobalt salts annually, is constructing a facility (at Arab, AL) said to be able to

reclaim individual components of spent cataMolybdenum and vanadium are recovered from petroleum refinery catalysts at this plant in Texas. Several million

pounds of potentially recoverable nickel and cobalt are left in the waste and slag that is stored in

containment ponds surrounding the plant
248 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

lysts, including cobalt, nickel, molybdenum,

vanadium, sulfur, and alumina. Hall intends

to purchase spent catalysts from generators

around the world.

CRI Metals, a unit of Catalyst Recovery Inc.,

has announced plans to establish a hydroprocessing catalyst reclamation facility in the

South. The CRI process has been evaluated

through pilot plant trials, but CRI has yet to

commence construction, owing to depressed

metal prices. Like the Hall process, the CRI

plan is to recover several contained metals—

cobalt, nickel, vanadium and alumina—from

the spent catalysts for reuse by the catalyst industry. CRI apparently plans the recycling venture to complement its current catalyst regeneration activities.

Although the industrial capability to reclaim

cobalt from spent catalysts may soon be in

place, prospects for improved recovery will depend on an increase in cobalt prices. Sizable

quantities of spent catalysts may continue to

be landfilled, with cobalt values effectively lost

in the interim. From the refinery’s point of

view the fastest method of disposal of spent

catalysts is preferred. At current prices, this

often means paying the freight to ship spent

catalysts to reprocessors, storing the catalyst

at a temporary site off the premises, or landfilling. While the technology exists to reclaim

landfills, the high cost of such activities means

that recovery of cobalt values from landfills is

unlikely.

An important issue associated with both

recycling or landfilling of spent hydroprocessing catalysts concerns hazardous waste disposal requirements. Although spent hydroprocessing catalysts are not a listed hazardous

waste, some spent catalysts may contain trace

amounts of lead, arsenic, and other compounds

that are toxic. For hazardous wastes, refiners

must decide within 90 days about whether the

waste is to be landfilled in an approved site or

recycled. With current depressed metal prices,

there is little economic incentive to recycle

these spent catalysts, so that many refiners may

choose to landfill them.

Stainless Steel and Steel Process Wastes

Chromium used in stainless steelmaking is

obtained from ferrochromium and from scrap.

The scrap charge includes home scrap gathered

within the plant during various stages of the

steelmaking process, prompt scrap obtained

from mills and fabricators, and obsolete scrap

from postconsumer products and salvage. With

the exception of steelmaking wastes, home

scrap is generally recycled with a high degree

of efficiency. Stainless steel producers routinely recycle most of the solid scrap generated

in making stainless steel and in forming primary products, such as sheets, bars, and wires.

An estimated 35 to 45 percent of stainless steel

production is derived from such home scrap,

but since the home scrap cycle is within the

mill, it is not considered to be a secondary supply source.

Owing to adoption of the AOD process,

which cut losses of chromium to slag by more

than half, purchased scrap is an increasingly

important source of chromium in stainless steel

products. Prompt industrial scrap and obsolete

scrap together form the purchased component

of scrap supplies. An estimated one-fourth of

the chromium needed to make stainless steel

and heat-resisting steels in the 1977-81 period

came from purchased scrap.37 Chromium is

present in other alloy steels and in cast iron

scrap, but in low concentrations that do not

favor recycling for chromium content. These

materials are usually recycled for their iron

content, and the value of the alloying metals

is lost (this practice is referred to as “downgrading”).

More chromium may be lost each year to

downgrading or to failure to recover obsolete

products than is recovered from purchased

scrap. According to estimates prepared for the

Bureau of Mines,38 about 135,000 tons of stainSTU,S, Department of Commerce, Critical Materials Requirement of the U.S. Steel Industry (Washington, DC: U.S. Government Printing Office, 1983), p. 32.

Snchar]es L. Kusik, et a]., Availability of Critica] Scrap Metak

Containing Chromium in the United States: Wrought Stainless

Steel and Heat Resisting Alloys, U.S. Department of the Interior,

Bureau of Mines Information Circular 8822 (Washington, DC:

U.S. Government Printing Office, 1980).
Ch. 6—Conservation of Strategic Materials • 249

less steel scrap containing about 24,000 tons

of chromium were included in the carbon steel

scrap used in nonstainless steelmaking in 1977.

Another 38,000 tons of chromium was lost in

obsolete scrap that was not recovered. (The

range of uncertainty of these estimates is high

owing to a variety of factors, including imprecise export and import data and long lifetimes

of stainless steel products,) Of course, not all

of the stainless steel that was downgraded

could have been recovered, since it may have

been present only in small amounts or have

been inseparable from other materials, but the

volume of downgraded scrap makes it clear

that there are major opportunities to increase

the recovery of chromium from scrap.

Large quantities of scrap are generated when

stainless steel is made into fabricated products,

but most firms collect and separate the better

quality scrap for sale either to scrap collectors

or to primary producers for recycling. The

comparatively low value of chromium in prompt

industrial scrap may slow the return of some

scrap for recycling and lead to some downgrading. The nickel-chromium stainless steels

(AISI 300 series) are usually recycled because

of the high value of nickel and other alloying

agents, Recycling of the 400 series scrap, which

has 12 to 30 percent chromium but little nickel

or other alloying agents, is affected by the relatively low value of chromium.

Recovery of obsolete stainless steel scrap is

impeded by dispersed location, the uncertain

quality of materials in the scrap, and the long

lifetime (5 to 25 years or more) of stainless

products. Only a small proportion of stainless

steel used in appliances, cutlery, and other consumer items is ever likely to be recovered from

scrap, although some may end up in municipal solid waste collection systems from which

metals recovery is possible. Fuller recovery of

stainless steel scrap from used automobiles,

machinery, and other industrial applications

takes place, but seldom in excess of 60 percent.

Automobiles provide the single greatest opportunity for reduced downgrading of obsolete

chromium scrap. About one-third of the obsolete stainless steel recycled in 1977 came from

scrapped automobiles, but this amounted to

only about 30 to 40 percent of the potential

quantities of chromium that could have been

recovered from scrapped cars, Baling, which

is used for 10 to 20 percent of scrapped cars,

prevents recovery of most stainless steel except

easy-to-remove items, such as hubcaps, Shredding of vehicles permits better recovery since

nonmagnetic stainless steel can be separated

from the carbon steel scrap and sold separately,

However, magnetic stainless steel, including

the steel used for converter shells, is not easily separated. This downgrading of stainless

steel is not likely to be overcome because of

the low value of the chromium and the high

cost of identifying and separating it from other

steels.

Prospects for improved recovery of chromium from scrapped automobiles will be closely

tied to efforts to recycle PGMs in catalytic converters, since the converter shells are made of

stainless steel, The average 1976 U.S.-built car

(now approaching obsolescence) contained about

4.8 pounds of chromium, of which 2.6 pounds

was contained in the shell of the catalytic converter. Since 1975, chromium used in catalytic

converters has averaged about 10,000 tons per

year. Assuming that 70 percent of the cars that

annually become obsolete reach dismantling

yards, 7,000 tons of chromium could theoretically be recovered from converter shells alone.

Since additional losses are likely, recovery of

5,000 to 6,000 tons per year is probably the

maximum practical level of recycling. Most

cars now manufactured have monolithic-type

converters (containing about 1.5 pounds of

chromium), so that per vehicle chromium recovery rates in the mid-1990s will decline compared to today. At the same time, the number

of cars scrapped each year may grow, hence,

the overall amount of chromium that is potentially available for recycling will increase.

The value of chromium in the converter is

low, however, and the recovery of the shell for

recycling will depend largely on the value of

the PGMs contained in the catalyst itself. Most

dismantlers–even those who remove the converter to collect PGM catalysts—do not segre38-844 0 - 85 - 9 : QL 3
250 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

gate the shell for recycling as stainless steel

scrap. Instead, the shell is shredded or baled

with the rest of the car.

While small in relation to overall chromium

demand, appreciable quantities of chromium

as well as other critical metals are also lost in

flue dusts, slags, sludges, and other steelmaking and chemical wastes each year. These

wastes are not suitable for direct recycling because of contaminants such as lead or zinc, but

the chromium and other metals from some of

these wastes are increasingly recovered through

special processing,

According to Bureau of Mines researchers,

about 17,400 tons of chromium were contained

in metallurgical wastes generated in 1974 (the

most recent year which comprehensive data

were collected).39 Until recently, these lowgrade wastes were almost entirely unrecovered. However, some firms are now commercially recovering chromium containing wastes,

and several steel producers have established

their own in-house waste recovery programs.

A partial impetus for this has been environmental regulations restricting the disposal of

solid wastes.

Since 1978, Inmetco, a subsidiary of Inco,

has been recovering chromium and nickel from

low-grade steelmaking wastes. This facility has

the capacity to process 47,000 tons of waste per

year to produce 25,000 tons of pig metal containing 4,500 tons of chromium and 2,000 tons

of nickel. The pig metal, which is 18 percent

chromium and 8 percent nickel, is suitable for

use in AISI-type 304 stainless steel or, if it contains molybdenum, AISI 316. Inmetco currently processes about 75 to 80 percent of the flue

dust, mill scale, and grinding swarf of U.S.

stainless steelmaker. The company estimates

that 3,100 tons of chromium was contained in

wastes entering their plant in 1982, of which

2,800 tons were recovered. The Inmetco facility also has the capacity to recover chromium

WW. M, Dressel, L. C. George, and M. M. Fine, “Chromium

and Nickel Wastes: A Survey and Approval of Recycling Technologies, ” Proceedings of the Fijlh Mineral Waste Symposium,

Eugene Aleskin (cd.), cosponsored by the U.S. Bureau of Mines

and the I IT Research Institute (Chicago, IL: I IT Research Institute, 1976), p. 269.

and other materials from catalysts, superalloys,

and other products. An Inmetco subsidiary,

Pittsburgh Pacific Processing Corp., reprocesses oil-contaminated scrap.

Economic processes for recovery of chromium and other metals from specialty steelmaking slags have yet to be developed, Estimates made in the 1970s of nationwide losses

of chromium to slag in stainless steelmaking

vary widely—from 3,000 to 30,000 tons per

year. The lower figure is from the previously

cited 1974 estimate of total chromium losses

in metallurgical wastes, and appears to be quite

low. The latter figure, based on 1965-75 data,

is from a study by the National Materials Advisory Board, which also projected that losses

would be reduced to about 10,000 to 15,000
——

Ch. 6—Conservation of Strategic Materials . 251

tons per year as stainless steelmaker switch

entirely to the AOD process,

Revised estimates do not appear to have been

made since the NMAB study, which was published in 1978, but the AOD process is now

used almost universally. Nonetheless, the losses

remain appreciable. Chromium content in

steelmaking slags analyzed by the Bureau of

Mines Rolla (MO) Research Center range between 1 and 12 percent, with most samples in

the range of 6 to 7 percent. Experiments being conducted at the Center are aimed at upgrading chromium and nickel from crushed

and ground slag. Concentrations of more than

20 percent chromium have been achieved. Future research will assess ways to recycle the

concentrates in steelmaking furnaces.40

Over 3,000 tons of chromium were also lost

annually in processing wastes from the chemical industry, metal plating and etching shops,

and leather tanning firms, according to the

1974 data mentioned previously. Recovery of

the chromium in such wastes is expensive, and

until recently wastes were generally disposed

of in municipal wastewater systems or landfilled without significant preprocessing. Environmental requirements under Subtitle C of the

Resource Conservation and Recovery Act

(RCRA) and the Federal Clean Water Act have

resulted in the need to process such wastes

prior to disposal. As a result, the opportunity

to recover chromium from the waste has arisen.

Many metal finishing wastes are classified

as hazardous wastes by the Environmental Protection Agency and are subject to the disposal

requirements of RCRA. Pollutants, including

chromium, must be reduced to acceptable

levels before disposal in Subtitle C landfills.

Disposal fees at landfills may run on the order

of $25 to $50 per drum, which does not include

costs of transportation and preprocessing.41 Recovery of metal values may be incorporated

‘As discussed in Bureau of Mines Research 83, op. cit., p, 104.

41 ~’ ,s. ~nvironmenta] protection Agency, Environ mcmtal Po~-

Iution Control Alternatives: Sludge Handling, Dewatering and Disposa~ Alternatives for the Metal Finishing Industry (Washington,

DC: U.S. Government Printing Office, 1982), p, 1, EPA 62515-

82-018.

into waste processing, and the value of the metals can then help reduce the cost of disposal.

Several processes have been developed or are

under development by public agencies and industry to recover or recycle metals from processing wastes. Corning Glass reportedly has developed a closed-loop process which permits

reuse of chromic acid etching solutions, thus

reducing the amount of waste and reducing the

need for new chromium-bearing chemicals.

Another process to recover chromic acid etching solutions, developed by the Bureau of

Mines, has been demonstrated to be economically competitive with the purchase of new

acid, when savings of disposal costs are included in the analysis. This process, which extends the useful life of the acid a hundred fold,

results in major materials savings and also permits the recovery of other metals, such as copper, which can be sold.42

Electronic Scrap

The key constraint in recycling of PGMs

from electronic scrap is the very small amount

of metal used in each unit. The two largest consumers of PGMs in the electrical and electronic

sector are the telecommunications industry,

which uses them in electromechanical contacts, and the ceramic capacitor industry. In

telephone relays, palladium and platinum are

found in the contact points, which are brazed

to base-metal alloy arms. In a single handdismantled relay module taken from a large

unit, the Bureau of Mines found 18 large and

36 small PGM contacts, weighing a little more

than 0.06 of 1 percent of the weight of the

whole module.43 The National Association of

Recycling Industries estimates that 1,000 tons

of telephone relay scrap are generated each

year. However, this scrap contains only a minute proportion of PGMs.

aZDeborah A. spotts, Economic Evaluation af a i$fethod to Regenerate \$’aste Chromic Acid-Sulfuric Acid Etchants, U.S, Department of Interior, Bureau of Mines Information Circu]ar 8931

(Washington, DC: US, Government Printing Office, 1983].

atFre~ Ambrose and B. Wr. Dumay, Jr,, ‘‘Mechanical processing of Electronic Scrap to Recover Precious Metal Bearing Concentrations, ” paper presented at the International Precious Metals Institute Conference, Vicksburg, VA, May 1983.
252 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Another potential barrier to recycling of

PGMs from electronic scrap is the fact that palladium (which, with an average 1982 dealer

price of $100 per troy ounce is much lower in

price than platinum or gold) predominates in

this sector. Palladium is used in ceramic capacitors and is increasingly substituted for gold

in low-voltage, low-current electrical contacts,

such as telephone relay contacts. Higher reliability electronics, including those for military

use, require greater amounts of platinum and

gold in contacts, capacitors, and other electronic components.

Despite these potential barriers, there is a

growing electronic scrap recycling industry in

the United States. An industry observer44 estimates that 102,000 troy ounces of platinum, or

more than the total yearly platinum purchases

by the industry, were recovered from electronic scrap in 1982. The growth in recycling

of this type of scrap is reflected in the location

of the secondary precious metals industry.

Twenty years ago, most precious metals refiners and semi-refiners were clustered around

the jewelry industry on the east coast. Today,

many semi-refiners and refiners are located in

California’s “Silicon Valley,” Texas, and other

areas where the electronics industry has developed.

As in other sectors, PGM recovery is greatest from manufacturing scrap. Large refiners

such as Johnson Matthey deal in both primary

metals and scrap, supplying the electronic

component industry with palladium metal,

powders, and pastes, and recycling the metal

from their reject components. In addition,

some large electronics companies have set up

their own in-house recycling processes to

recapture the precious metals from both their

manufacturing scrap and obsolete scrap. However, the percentage of PGMs recycled from

obsolete electronic scrap is generally lower. Because of the high labor costs involved in manually processing electronic scrap prior to final

refining, some electronics firms and scrap

dealers find that foreign dealers offer the best

44Mark Stringfel]ow, “Platinum: Its Present and Future, ” paper presented to the National Association of Recycling Industries, Dec. 15, 1982.

price for their scrap. Material is shipped both

to Europe, where such firms as SGM in Belgium have a long history of expertise and sophisticated technology for precious metal refining, and to Taiwan and other Asian countries,

where lack of raw materials and low labor costs

make low-grade scrap more attractive.

Industry assessments of the quantity of electronic scrap exported by the United States vary.

Total sales of PGMs to the electrical and electronic sector were 438,000 troy ounces in 1982.

By comparison, exports of all types of PGMbearing scrap that year were 388,437 troy

ounces. 45

Future trends in domestic recovery of PGMs

from electronics are difficult to predict. Over

the next decade, the scrap market is expected

to increase as technological advances make

equipment obsolete. Computer manufacturers,

concerned about possible resale of their obsolete components, may crush the parts and sell

them for recycling. However, whether the platinum group metals found in this scrap are recovered for U.S. consumption depends on a variety of factors. While some of the materials

may be exported for overseas refining, this may

be done on a toll-refined basis. For example,

A5u.s. Department of Interior, Bureau of Mines, Mineral industry Surveys, Platinum Quarterly, June 7, 1983, table 5,

Photo credit’ GTE Corp

Precious metal scrap produced during the manufacture

of electronic components is segregated to enhance

recycling of gold, silver, and platinum group metals
Ch. 6—Conservation of Strategic Materials ● 253

a recently opened Engelhard plant in Cinderford, England, will refine metal from scrapped

components and circuitry from U.S. sources

on a toll basis, providing an equivalent amount

of PGMs to those sources from Engelhard’s

U.S. refineries.46 In addition, a number of European firms, such as De Gussa, a German firm,

have begun to operate PGM recycling plants

in the United States. It is too early to tell whether these trends will have a major impact on the

amount of scrap that is exported.

As in other platinum-consuming industries,

the long-term potential for recycling of strategic materials from electronics will depend on

the quantities of materials used in production,

The rapid evolution of the electronics industry has led to continual improvements in efficiency of use of the precious metals. For example, palladium-silver alloys are increasingly

replacing pure palladium in electrical contacts,

dampening both palladium use and potential

future levels of palladium recycling. In addition, composites show promise for replacing

contacts made entirely of PGMs.47 A fiber composite made of a copper matrix with embedded palladium fibers and an overall palladium

content of 30 percent has the same electrical

and thermal conductivity as a palladiumcopper alloy having a composition of 60 to 85

percent palladium. One of the greatest impacts

on PGM use will come from the Bell System’s

present conversion to solid-state switching,

thus reducing electromechanical switching

and platinum and palladium demand.

Despite these trends in increased efficiency

of use, opposing trends are causing overall demand for PGMs in electrical and electronic

equipment to increase. Because of its low cost,

palladium is increasingly being substituted for

gold in electrical contacts and printed circuits,

and new types of components, such as ceramic

capacitors, are making use of PGMs. In addition, ruthenium, which is already used in the

large quantities of reed switches used in electronics, is finding new applications in the in-

—— — —.

4eJudith Crown, “Engelhard Revamping Precious Scrap Setups, ” American Metals Market, July 8, 1983, p. 1.

4TStockel, “composites for Electrical Contact Applications, ”

Zeitschrift fuer Werkstofj’echnik, July 1979.

dustry. Overall, it appears that consumption of

palladium and ruthenium will increase, and

that there will be large quantities of these

materials available for recycling beyond 1990.

Technologies for recycling PGMs from electronic scrap require further development.

While several hydrometallurgical and pyrometallurgical processes are available for final

refining of PGMs, preprocessing technology is

not yet adequate. Currently, there are numerous steps in the refining process, often carried

out by different companies, with each step adding to recycling costs. The initial manual disassembly of the most valuable components

from the aluminum and copper frames (e.g.,

snipping off contacts with wire cutters) may

be done either by the electronics company or

by a specialized preprocessing firm. These

firms sell some components for reuse and

others for scrap to both domestic and foreign

businesses.

Semi-refiners of electronic scrap collect circuit board scrap after initial disassembly and

process it further. This may involve simply

stripping off the plastics with chemicals, followed by shredding and chopping the components, or more complex steps such as ball mill

crushing and pulverizing of capacitors, which

leave a “sweep” or pulp containing precious

metals. Other firms combine these processing

steps with smelting out the PGMs as crude bullion, which may be either sold to electronic

component manufacturers or shipped to refiners. Final refining to high specifications is

generally done by one of a handful of specialized refiners using pyrometallurgical techniques.

Using obsolete electronic scrap provided by

the Defense Property Disposal Service, the Bureau of Mines has developed a process for mechanically upgrading electronic scrap, The

process is made up of a series of unit operations using technology already widely available

in the recycling industry. These operations include shredding, eddy current separation, and

high-tension separation. The process can break

down mixed scrap into an iron-base fraction,

an aluminum base fraction, a wire fraction,

and a high and a low precious metal concen-
254 . Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

trate, greatly reducing the amount of material

that must be processed for precious metal recovery and also reducing shipping and toll

refining costs.

The Bureau of Mines process could reduce

costs of refining electronic scrap by replacing

costly, slow, and unpredictable hand stripping

with reliable automated techniques. While it

can be used on mixed scrap, it is most effective when incoming scrap is first separated into

lots. For example, connector assembly plating,

printed circuit cards, wiring, and other components high in precious metals should still be

manually separated from their outer box covers. While all segments of the precious metals

recycling industry have expressed interest in

the process, economic factors may prevent

widespread adoption of fully automated processing. Some in the recycling industry view the

high capital costs of the equipment and the

high energy costs of operating it as formidable barriers to profitable domestic processing

of low-grade mixed scrap.

Cemented Carbides

About 8 percent of the cobalt consumed domestically each year is used as a binder in

cemented carbides, which are used in cutting

tools or other high-wear applications. Most

scrap produced during fabrication of cemented

carbides is now recovered, and in the last few

years, producers of cemented carbides have begun to recycle substantial quantities of obsolete cemented carbide scrap. This improved recovery became pronounced in the late 1970s

but the improvement was less a function of industry response to the cobalt price increase

than of the ongoing adoption of technological

advances by tungsten carbide producers.

According to the NMAB, up to 0.5 million

pounds of cobalt from obsolete products are

now recovered by tungsten carbide producers

each year. In early 1984, installed capacity to

reprocess such scrap is estimated to be 36 percent of domestic consumption. Obstacles to increased recycling of obsolete carbide scrap

include widespread geographic diffusion of

products and difficulties in recovering worn

or broken parts,

Tungsten carbide scraps constitute a major

proportion of current tungsten recycling. GTE

Corp., the largest domestic producer of tungsten, established a patented process in the early

1970s for recycling tungsten scraps and in

1978, a proprietary process for producing

extra-fine, highly purified cobalt powder from

recycled scrap on a toll and nontoll basis. With

sintering, the powder can be turned into a

metallurgical cobalt material suitable for use

in superalloy, GTE has also established a pilot plant project to reclaim cobalt from superalloy scrap. The recycled cobalt is equivalent

to highly refined cobalt produced from virgin

ores. Although the cobalt is produced as powder

for cemented carbide use, it may be suitable

for superalloy if compacted and pelletized.48

Other cemented carbide producers, such as

Teledyne, employ a zinc process to recover

both cobalt and tungsten carbide as powders

from tungsten carbide scrap. The process was

developed by a British firm in 1946 and furthered by the U.S. Bureau of Mines,

qBInformation provided to OTA by GTE, Aug. 10, 1983.

Prospects for Conservation of Strategic Materials

Table 6-6 summarizes key opportunities for quantities of materials are involved. Under

increased recycling of chromium, cobalt, and tight supply conditions, appreciable increases

PGMs. Data limitations prevent close estima- in recycling can be anticipated as scrap coltion of prospective recovery opportunities in lectors, processors, and consumers respond to

many applications, but it is clear that very large increased prices of primary metals.
Table 6-6.—Selected Opportunities for Increased Recycling of Chromium, Cobalt, and Platinum Group Metals

Current level

of recycling

Superalloy (Co, Cr):

An estimated 2.8 million Ibs of

cobalt-bearing superalloy processing scrap was lost or downgraded in 1980; 1.2 million Ibs

of cobalt in obsolete scrap was

not recovered. However, these

figures are based on 1976 scrap

use rates.

Key recovery

opportunities

Increased recovery of obsolete

scrap, reduced downgrading

of high-quality industrial scrap

and recovery of wastes, using

advanced recycling technologies.

Petroleum hydroprocessing catalysts (Co):

No cobalt recovery at this-time;

270,000 Ibs of cobalt was not

recovered from spent catalysts

in 1982.

Cemented carbides (Co):

10 to 30°/0 of cobalt used in domestic cemented carbide shipments came from recycling.

Cobalt consumption in catalysts

is expected to grow to 675,000

Ibs in 1990, 900/. of which

could be recovered.

Accumulated spent catalyst

residues may include 8 million

Ibs of cobalt and nickel.

Obsolete scrap (a high proportion of industrial scrap is already recovered.)

Barriers to increased recycling

Technical Economic

Concern about contaminants

limits recycling in superalloy

production to high-quality

scrap and processes that have

been certified.

Experimental processes to reclaim elements separately

have not been commercialized.

Not significant; various proprietary processes are purported

to recover Cr, Co, Ni, Mo, Va,

and other metals for catalytic

or chemical purposes.

Some technical problems; pilotscale recovery process is under investigation by a private

firm.

Not significant: several firms

use a Bureau of Mines process to recover cobalt binders.

One firm produces highly refined, pure cobalt powders

from scrap that could potentially be used in” other

premium uses.

Current prices encourage downgrading of superalloy scrap

for use in stainless steel or

nickel alloy production in

which the cobalt is not

needed.

Certifying recycled materials for

superalloy use is expensive

and time-consuming.

Current prices may discourage

recovery of cobalt in preference for molybdenum. However, at least two firms have

proprietary processes for recovery of all elements in

catalysts.

Reprocessing of residue is not

profitable

Recovery of

dispersed

economic

at current prices.

obsolete scrap from

uses may not be

at current prices.

Institutional

Not significant once manufacturing specifications for use of

recycled materials have been

established; however, this can

take several years.

Landfilling of spent catalysts by

refineries prevents possible

future recovery of some

catalysts.

Not significant; residues are

stored on site of major

processor.

Lack of effective scrap collection programs by industrial

users. Practical limits for

postconsumer recovery vary

by industry. However, some

users (such as the oil industry) return 80% of their scrap

for recycling; the coal mining

industry, by contrast, only

returns 150/0 (out of a practical limit of 500/0).
Table 6.6.–Selected Opportunities for Increased Recycling of Chromium, Cobalt, and Platinum Group Metals (Continued)

Current level Key recovery Barriers to increased recycling

of recycling opportunities Technical Economic Institutional

Stainless steal (Cr):

Home scrap is efficiently recovered; purchased scrap for stainless steel accounted for about

20°/0 of total demand for Cr in

1983.

Catalytic converters (PGM, Cr):

Up to 30°/0 of scrapped converters

may now be recovered for

recycling.

Electronic scrap (PGM):

High for industrial scrap, low for

obsolete scrap.

Improved recovery, reduced

downgrading of obsolete

scrap, especially automotive

catalytic converters.

Increased recycling of industrial

processing wastes (slags, flue

dust, low-quality fabrication

scrap, etc.)

Retrieval of PGM from scrapped

automobiles, muffler shops,

etc. Maximum theoretical

PGM recovery will grow to

800,000 troy oz by 1995. Maximum practical recovery rate

will probably be about 500,000

troy oz.

Obsolete scrap.

Not significant, but current in- Comparatively low price of chrodustrial practices encourage mium and labor costs assodowngrading. ciated with removal of stainless steel components from

automotive and other obsolete

scrap encourages downgrading.

Recovery of chromium from Resource recovery from indussome wastes (e.g., slags) is

technically difficult.

trial wastes may not be economic: however. commercial

recovery of low-grade flue

dusts, grindings, turnings, borings is now being undertaken

commercially.

Several companies have proprie- Dependent on PGM prices, but

tary processes to recycle appears favorable.

catalysts.

Lack of technology for Depends on PGM prices; hand

preprocessing of scrap to a labor disassembly encourages

form usable by a refinery. export of scrap.

Recovery of obsolete consumer

products containing stainless

steel catalytic converter shells

is a primary candidate for recovery, but will depend on

effective linkage of PGM and

Cr recovery efforts.

Environment and solid waste

disposal requirements are providing increased impetus to

recovery where economic.

Some dismantles do not remove catalytic converter from

cars prior to scrapping.

Collection networks have not

been established in many

areas.

Dismantles want more for the

catalysts than reclaimers are

(i.e., households) is unlikely

without incentives.

Value of scrap is not widely recognized; monitoring of trends

is inadequate.

willing to pay.

Collection of obsolete scrap

from consumer electronics

SOURCE: Office of Technology Assessment.
Ch. 6—Conservation of Strategic Materials . 257

Evidence from past “crises’ ’-most notably

the Canadian nickel strike of 1969 and the cobalt price spike in 1978—suggests that U.S. industry can quickly increase recycling when

concerns about supplies are paramount or

when prices rise rapidly. In 1969, nickel scrap

purchases exceeded 1968 levels by over 60 percent despite the fact that the Canadian strike

did not occur until mid-1969. Nickel scrap as

a proportion of domestic consumption expanded rapidly over the following 3 years—

accounting for 22 percent of domestic supplies

in 1972 as compared to 8 percent in 1968, (The

current level is about 23 percent,) Cobalt scrap

purchases doubled in 1978 and remained at or

above 1 million pounds per year through 1981,

a growth from 4 percent of domestic consumption to 8 percent.

It is more difficult to quantify savings of strategic materials likely to arise from adoption of

new manufacturing and processing technologies by U.S. industry, but they are also large—

particularly in the cases of manganese used in

steelmaking and strategic materials used in

superalloy. Upgrading of basic steelmaking

processes could lead to important reductions

in the amount of manganese needed to produce

each ton of steel (see table 6-6). Use of advanced

manufacturing technologies by the aerospace

industry will reduce chromium, cobalt, and

other strategic material input requirements for

superalloys on a perpart basis. Part life extension programs could also conserve materials

over the long run. As discussed in chapter 7,

increased use of coatings and other surface

treatment technologies and use of advanced ceramic and composite materials also could reduce per part strategic material requirements,

especially in the long term.

Recycling Technology

With some notable exceptions, there appear

to be few significant technological barriers to

increased recycling of strategic materials.

High-quality scrap generated in the production

and manufacture of products is recognized to

be a valuable source of raw materials by industry and is usually effectively recovered and reused. Ongoing industrial trends, including

establishment of specialized scrap processing

firms and improved industrial waste treatment

processes, have expanded the range of waste

materials considered suitable for recycling, so

that continued incremental improvement in

recycling is likely in the coming decade.

Difficulties in identifying and sorting complex

scrap containing several materials have recently been eased by the commercial availability of portable and relatively inexpensive instruments suitable for use in scrapyards, as

discussed in box 6-A.

In the area of superalloy recycling, considerable technological advances have been made

over the last decade. However, additional innovations may be needed if full use of obsolete scrap and other less preferred scrap is to

occur. In the most demanding applications,

even small trace amounts of impurities may be

unacceptable. Because of concern that contaminants acquired from scrap material could

result in failure of superalloy parts, use of

superalloy scrap in jet engines has been limited

to scrap of the highest quality—generally, home

and prompt industrial scrap, although limited

use has been made of obsolete scrap obtained

from commercial aircraft, where parts can be

identified by alloy type. Much of the remaining scrap is downgraded to use in stainless

steel, where it is used for its nickel and chromium content. When this occurs, cobalt is lost,

and the previously high-quality chromium used

in superalloys becomes a replacement for chromium usually supplied from high-carbon ferrochrome or stainless steel scrap.

Nontechnical Impediments

In most applications, institutional and economic constraints on recycling are more formidable than the technical constraints. Fluctuating commodity prices, costs associated

with segregation and processing of scrap,

transportation costs, and industry structure all

affect the ability of recycled materials to compete with primary metals.

ECONOMICS OF RECYCLING AND CONSERVATION

The economic incentive for recycling highpriced materials, such as PGMs, is very high.
258 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

However, other strategic metals are less expensive and often account for only a very small

proportion of the scrap. For many applications,

raw materials comprise only a small fraction

of the total value of the product. A 6,000-pound

jet engine, for example, may cost $3.5 million,

while the value of the materials it contains is

only $60,000. Even though an alloy may contain metals that are relatively rare and high

priced, the cost of separation of the alloy into

its constituents may be so high that it discourages any attempt to recover the metals; so, the

alloy is downgraded to recover its nickel and

chromium content.

Recycling opportunities will change along

with changes in manufacturing processes and

product designs. More efficient manufacturing

processes will require less raw material, so

there will be less prompt industrial scrap available for recycling, New product designs that

use combinations of materials to achieve desirable properties will present difficult and expensive problems for the separation of materials

for recycling. Often, products can be designed

for ease of recycling, but since raw material

costs are generally a small component of overall cost, this is seldom done,

Materials conservation is an important side

benefit of the advanced manufacturing technologies widely used by the aerospace industry. These technologies may gradually filter

down to other industrial users. Diffusion of

computer-aided design and nondestructive

evaluation techniques may be impeded to some

extent by lack of experience of engineers, designers, and others with these new approaches.

This is not a major problem in the aerospace

industry or in other critical uses, however.

INFRASTRUCTURE

The complex structure of recycling industries, often entailing primary metals processors, collectors and dealers, scrap processors,

and parts manufacturers, can inhibit initiation

of recycling programs, even when the programs may be economically advantageous.

Generally, the secondary metals industry comprises a large number of small firms that respond to prices offered by the primary metals

industry, This system works well for materials

for which there is a relatively constant demand

for a standard product. Although recycling

firms can respond rapidly to changes in materials demand due to shortages of primary materials, exacting standards for superalloy and

other premium materials can only be met

through the use of sophisticated equipment and

experienced personnel who are familiar with

the needs of consumers. This can delay recycling response time in a shortage situation,

Recycling and Conservation Data Base

Accurate information is needed to have a

realistic picture of the potential for recycling

to reduce U.S. materials import vulnerability.

The existing data are weak, with many uncertainties about their accuracy. Key areas where

improvements can be made are: upgrading of

annual information about scrap purchases by

consuming industries, development and use of

materials flow models on a periodic basis, and

improved tracking of the ultimate disposition

of obsolete scrap and industrial wastes that

contain appreciable amounts of strategic materials,

The U.S. Bureau of Mines prepares annual

estimates of scrap purchases by domestic industry. In most instances, these estimates are

based on voluntary reporting by private firms.

Not all firms are canvassed, and of those that

are, not all respond. Consumers of more than

one strategic material may be surveyed about

only one material. Although adjustments can

be made to compensate for incomplete reporting, the resulting estimates are subject to considerable uncertainty. In the course of this

study, OTA found evidence that substantially

more recycling may be taking place than is currently reported in Bureau of Mines’ data.49

Scrap purchases alone provide only a limited

picture of recycling trends, Substantial recycling occurs internally and through toll refining arrangements that do not involve purchases,

goother reports have reached a similar conclusion. See, for example, the NMAB report, Cobalt Conservation Through Technological Alternatives, op. cit., p. 25.
Ch. 6—Conservation of Strategic Materials • 259

Also, scrap purchases provide no insight into

the ultimate fate of scrap that is not recovered.

Periodically, Federal agencies such as the Bureau of Mines and the NMAB have published

detailed and relatively comprehensive materials flow models for individual metals. These

models have appreciably increased understanding of overall recycling trends, but they

have been prepared infrequently and there has

been little or no consistency in procedures used

in developing the models.

A notable impediment—from the perspective

of identifying possible responses to disruptions

in materials supply—is the absence of information about accumulations of unrecovered obsolete scrap containing strategic materials.

Only a portion of the scrap that becomes obsolete each year is recycled domestically. Some

is exported, while the rest is unaccounted for

in national statistics. Much of this lost material may now be effectively unrecoverable

owing to disposal in landfills, dissipative corrosion, contamination, or abandonment in

unknown locations. Some, however, may be

retrievable from industrial disposal sites, commercial scrap yards, and military storage

depots for use during supply disruptions. Extensive efforts have been made over the years

to estimate the accumulated “inventory” of potentially recoverable ferrous scrap, but a similar effort to monitor the disposition of strategic materials in obsolete superalloy parts,

catalysts, and other applications has not been

made. As a result, plausible estimates of the

above-ground mine of strategic materials recoverable in an emergency are not available.
CHAPTER 7

Substitution Alternatives for

Strategic Materials
Contents

Page

Roles of Substitution in Materials Use. .. ...263

Substitution as an Emergency Response to

a Supply Problem. . ..................264

Substitution as a Continuing Strategy for

Reducing Import Vulnerability. . . . . . . ..264

Factors Affecting the Viability of

Substitution . . . . ...............,.....265

Technical Factors. . ................,...265

Economic Factors . . . . . . . . . ...,.........265

Institutional Factors. . ..................265

Designer and End-User Acceptance .. ....266

Summary of Substitution Prospects . .......266

Prospects for Direct Substitution in Key

Applications . .............,,...,....268

Chromium Substitution in Stainless Steel .268

Chromium Substitution in Alloy Steels.. ..276

Reducing Cobalt and Chromium Used in

Superalloys for High-Temperature

Applications . ..............,.......,277

Advanced Materials . ..................,.285

Ceramics . ............................28 6

Composites . ..........................30 1

Long-Range Order Intermetallic Materials .313

Rapid Solidification . ...................314

Institutional Factors in Substitution . . . . ....318

Information Availability and Substitutes ..318

Qualification and Certification of Alloy

Substitutes ..., . ....................319

Institutional Barriers and Advanced

Materials . . . . . . . . . . . . . . . . . . . . . . .., ..323

List of Tables

Table No, Page

7-1.

7-2.

7-3.

7-4.

7-5.

7-6.

7-7.

Examples of Substitution Relevant to

Strategic Materials . . . . . . . . . . . . . . . . 263

Primary Motivations for Substitution

R&D . . . . . . . . . . . . . . . . . . . . . . . . . . . . 266

High-Volume Stainless Steels . . . . . . . 269

Development Status of Potential

Substitutes That Could Reduce

Chromium Requirements in Stainless

Steel . . . . . . . . . . . . . . . . . . . . . . . . . . . . 271

Ladle Analysis Ranges for the

Chrome-Free Replacement

Compositions for Standard 4118 and

8620 Steeds . . . . . . . . . . . . . . . . . . . . . . . 277

Typical Structural Alloys Used for

Hot-Section Components. . . . . . . . . . . 280

Nickel-Base Superalloys Selected for

Cobalt Substitution Research by

NASA . . . . . . . . . . . . . . . . . . . . . . . . . . . 283

Table No. Page

7-8. Use of Structural Materials Under -

7-9(

7-1o,

7-11,

7-12.

7-13,

7-14,

7-15,

7-16.

7-17.

7-18.

7-19.

Figure

7-1.

7-2

7-3,

7-4(

7-5.

7-6,

7-7,

7-8.

Development to Reduce Cobalt and

Chromium Usage in Hot-Section

Parts . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Current and Prospective Uses for

Advanced Ceramics . . . . . . . . . . . . . . .

Some Advanced Ceramics Material

Families . . . . . . . . . . . . . . . . . . . . . . . . .

Potential of Advanced Ceramics to

Substitute for First-Tier Strategic

Materials . . . . . . . . . . . . . . . . . . . . . . . .

Advanced Composite Materials

Options . . . . . . . . . . . . . . . . . . . . . . . . .

Price Range of Selected Composite

Raw Materials . . . . . . . . . . . . . . . . . . . .

Current Aircraft Applications for

Advanced Composite Materials . . . . .

Potential Commercial Applications of

Metal Matrix Composites . . . . . . . . . .

Potential Automotive Applications

for Composites of Kevlar 49 Aramid.

Current Status obtesting of

Modified 8Cr-1Mo Steel Tubes in

U.S. and Foreign Steam Powerplants

Status of Specifications for Modified

9Cr-1Mo Alloy . . . . . . . . . . . . . . . . . . .

Structural Ceramic Technology

Federal Government Funded R&D...

List of Figures

No.

Temperature Capability of

Superalloy . . . . . . . . . . . . . . . . . . . . . .

Temperature Capabilities of Turbine

Blade Materials . . . . . . . . . . . . . . . . . . .

Graphite Fiber Cost . . . . . . . . . . . . . . .

Fiberglass Composite Applications . .

Carbon/Carbon Composite Needs . . .

Development of Modified 9Cr-1Mo

Steel for Fossil Fuel and Nuclear

Power Applications . . . . . . . . . . . . . . .

Technology Transfer Ladder for ODS

MA 6000. .. . . . . . . . . . . . .

Technology Transfer Ladder for

COSAM Strategic Material

Substitution . . . . . . . . . . . . . . . . . . . . . .

284

287

288

291

303

304

307

309

312

321

321

326

Page

279

281

304

306

308

320

323

324
CHAPTER 7

Substitution Alternatives for Strategic Materials

Roles of Substitution in Materials Use

Designers choose materials that they think

offer the most attractive combination of service performance and reliability, ease in processing and manufacturing, cost, and availability. However, these factors constantly change

as new materials with better properties are developed, better information about existing materials becomes available, new processing techniques are developed, and relative costs and

availability of materials fluctuate. Substitution,

the process of revising the match between materials and applications, is the material users’

technical response to this shifting environment. In some cases, substitution involves finding or developing the best material for the application (replacement); in others, it involves

designing or redesigning the application to

make the best use of available materials.

Substitutions can be very costly and therefore are undertaken only when there is a high

degree of certainty that the benefits will be substantial. To be adopted, a substitute material

or design must demonstrate both technical and

economic feasibility and must overcome a variety of institutional hurdles. More important,

it must gain the acceptance of the designers

and end users who will ultimately use it.

Even though substitution includes both replacement and redesign, current strategic

materials-motivated substitution research is,

for the most part, oriented toward development

of alternative materials that have less strategic

material content.l At present, considerable reI Th(] ugh product design and redesign can be used to reduce

strategic materials requ i rernents, this strategy is less amenablo

to a centralized research effort because of the vast number of

products [and the case-by-case nature of this technique). New

manufacturing process designs can also rfxluce strategic

m a ter ia ]s needs i n some applications, However, these sa \’i ngs

are rare] y the prima r}’ m oti \’a t ion for process d e~. elopm en t or

implcrnf?ntation dnd are not realized if greater cost or performan(:e advantages lie with other processes. As a national strat -

search—most of it government sponsored—is

focused on development of replacement materials that could reduce strategic material requirements in several critical applications.

These include, among others, several lower

chromium alternatives for existing stainless

steels now used in powerplants, chemical processing facilities, and other applications where

corrosion resistance in a range of environments is needed; low- or no-chromium alloy

steels for bearings, gears, shafts and other highstress, long-service life applications; and lowor no-cobalt superalloy for gas turbine applications. Some examples of substitutions that

have been or could be important to strategic

materials use are shown in table 7-1.

Table 7-1 .—Examples of Substitution Relevant

to Strategic Materials

Direct material substitution:

Ceramic magnets for aluminum-nickel-cobalt magnets

Dolomite for magnesia-chromite refractories

Interchangeability of platinum-group metals and gold in

electronic components

Modified 9% chromium-1% molybdenum steel for 18%

chromium-8% nickel stainless steel in reactor vessels,

heat exchangers, and tubing in powerplants

Polymeric materials for decorative chrome in automobiles

Cobalt-free superalloy for 56% cobalt superalloy in JT-9

jet engine

Process design substitution:

AOD vessel for double-slag in stainless steel making

Precision casting and forging for machining in parts

manufacture

Continuous casting for ingot casting in steelmaking

Product design substitution:

Ceramics in experimental automotive gas turbine engines

Downsizing of turbine engines made possible through the

use of lighter materials in aircraft components ——

S–OURCE” Off Ice of Tech~ology Assessment

—.

egy to reduce U.S. dependency on imported materials, produ(:t

or process design modification can on]}’ be succf?ssful i f df~sign

engineers can be convinced to include strategi(, materials sa\-

ings as an i rnportant objective in design decisions.

263
264 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Substitution as an Emergency Response

to a Supply Problem

To a certain extent, already developed, onthe-shelf substitute materials and technologies

can be relied upon in an emergency to conserve materials that are in short supply. As discussed in chapter 3, substitutes for strategic

materials in many applications are often available, though not necessarily readily recognizable as such. Alternative materials could be used

in these applications with low (or at least tolerable) penalties in performance and cost. The

material saved through these measures would

then be available for use in critical applications

where higher or unacceptable penalties are

associated with substitution.

The existence of technically and economically viable substitutes is not the only requirement for a timely response to a supply emergency. For many critical applications, a new

material must be tested and its use in a particular component must be qualified (accepted

by the consumer) and certified (shown by the

producer to meet the consumer’s requirements). Thus, immediate response is limited to

those materials that are already in (or very close

to) commercial use, and to applications that do

not have stringent materials requirements or

for which the material has been certified and

qualified. The substitution response by U.S. industry to prior supply problems involving strategic materials is discussed in chapter 4.

The current ability of U.S. industry to respond to a supply problem with substitution

is not known with any degree of certainty. Although a large backlog of alternative materials

and technologies is generally conceded to exist, information about many of these potential

substitutes has not been assembled in a systematic way which would be accessible to designers, material users, and decisionmakers in an

emergency. Development of a substitution data

bank or a materials information system that

would bring available substitutes to the attention of engineers and designers is one frequently proposed means for reducing U.S. vulnerability to an import curtailment. This concept

is discussed further in chapter 8.

Substitution as a Continuing Strategy for

Reducing Import Vulnerability

Besides being an emergency response, substitution can also play a key role in long-term

strategies to reduce dependency on imported

materials. During the last decade, there has

been much research focused on development

of substitute materials that could reduce strategic material requirements for many alloys

currently used in key applications. Other research has been aimed at development and

commercialization of advanced materials (e.g.,

ceramics and composites) which may displace

use of strategic materials in some applications.

Although many technically promising substitutes are under development, the extent to

which they will be adopted by U.S. industry

is difficult to foresee, In the absence of an

immediate availability problem, industry’s

adoption of new materials, designs, and manufacturing technologies is usually not motivated by concerns about strategic materials

availability. Generally, the new technologies

will be used only if they offer some more immediate benefit such as reduced costs, increased outputs, improved product performance, or potential new products.

A successful long-term strategy for reducing

U.S. vulnerability to imported materials

through substitution depends not only on the

technical feasibility of alternative materials but

on acceptance of them as practical alternatives

by industry. Acceptance comes only when the

technical and/or economic benefits have been

clearly demonstrated, various institutional barriers have been surmounted, and a high degree

of designer and end-user confidence has been

established.
Ch. 7—Substitution Alternatives for Strategic Materials ● 265

Factors Affecting the Viability of Substitution

Technical Factors

Over time, a backlog of proven, on-the-shelf

materials and technologies have been developed that for one reason or another have not

been adopted by industry, Research and development (R&D) efforts by public and private

agencies throughout the world are adding to

this store of potential substitutes almost daily.

Only a few of these are likely to be adopted by

industry at any given time.

Technological barriers to strategic materials

substitution can be time-consuming and formidable, especially for applications in which

little or no compromise in performance is

acceptable, Even when a promising substitute

is developed in the laboratory, new and significant technical problems may be encountered

when large-scale tests are undertaken to verify laboratory findings, Often, a return to basic

research is required to overcome these scaleup problems. Additional technical problems

may be encountered when full-scale industrial

production is begun.

Economic Factors

The technical potential of substitution to reduce strategic materials requirements is far

greater than what is economically feasible. Industry will not adopt technically promising

alternative materials unless they are costeffective compared with current materials.

Often, the cost effectiveness of using the current material is not greatly affected by price

increases in strategic raw materials. In fact, the

prices of raw materials can be such a small part

of the cost picture that they are relatively unimportant in a substitution decision. For example, raw materials account for only about 1 percent of the cost of a jet engine, Even platinum

group metals (PGMs), which cost between $100

and $400 per troy ounce, account for less than

5 percent of the cost of products manufactured

with PGM catalysts. Therefore, all else being

equal, a change in the cost of raw materials

often has to be dramatic to warrant the expense

of shifting to a substitute material. Adoption

of a new material may require costly new

equipment or changes in operations. There are

also costs associated with change itself—for

training workers in the use of a new material

or process, for changing the design of products,

and for adjusting manufacturing practices.

Institutional Factors

An alternative material may take a decade

or more to bring to commercial fruition, even

after the technical and economic feasibility of

the substitute has been demonstrated. Government, industry, academia, professional societies, and standard-setting organizations may

all play roles in this process, depending on the

material and its application.

Substitution R&D relevant to strategic materials is conducted in government, industrial,

and academic laboratories. Since most of the

support for this work has come from the government, funding of the projects is subject to

shifting governmental budgetary priorities and

may not be sustained for the protracted period

needed to adequately demonstrate the technical potential of a material or its application.

Also, government conducted or sponsored

R&D can suffer from insufficient industrial interest in commercializing a material,

Industry, the group which ultimately decides

whether or not substitutes are adopted, usually

does not commit the funds, time, and effort

necessary to develop and qualify substitutes for

strategic materials unless such activities also

provide cost or performance advantages. Private firms often do not perceive national materials availability and vulnerability as problems that they have a major role in remedying,

Availability concerns are usually not immediate enough to cause much corporate concern.

Table 7-2 illustrates the representative R&D priorities by government and industry.

Standard-setting and professional organizations play key institutional roles in the development process by testing new materials and

developing standards for their use. Often, test-
266 . Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table 7-2.—Primary Motivations for Substitution R&D

Industry Government

Reduced import dependency . . . . . x

Cost advantage . . . . . . . . . . . . . . . . . x

Better performance . . . . . . . . . . . . . x

New market penetration . . . . . . . . . x

Materials conservation. ., . . . . . . . . x

Maintenance of national

industrial competitiveness . . . . . x

SOURCE: Office of Technology Assessment,

ing and standard-setting are done by volunteers

from professional societies, with limited resources and time to dedicate to the effort. In

other instances, such as the qualification of a

new superalloy for jet engine use, testing and

qualification is undertaken by an individual

firm on a proprietary basis. The effort may

have to be duplicated by others if the material

is to be used broadly. In many cases, several

years of effort—and millions of dollars—may

be entailed in testing and qualifying a new material for use in a critical application.

Designer and End-User Acceptance

Acceptance by designers and end users can

be the highest hurdle in the adoption of a substitute. These groups sometimes have been indifferent to the need to save strategic materials. A heightened awareness of the importance

of design to strategic materials vulnerability

may be able to reverse this indifference,

Substitutes are adopted only when component designers and end users have acquired a

high degree of confidence in the technical capabilities and economic potential of the new

technologies. These materials users will not use

any substitute technology with which they are

uncomfortable; they are reluctant to make

changes, especially if the new designs or

replacement materials are relatively untried,

Substitution in critical applications often requires a degree of confidence or comfort with

the new material or design that can only come

from a proven track record. Consequently,

promising substitutes are often introduced first

into noncritical applications where confidence

can be gained without fear of catastrophic

failures.

These acceptance hurdles can be especially

high for advanced materials. Since many advanced materials are relatively recent developments, they are still fighting to establish a track

record, This situation is exacerbated by the fact

that most designers receive little formal training in the use of advanced materials,

Summary of Substitution Prospects

On-the-shelf substitutes, which could be

adopted by industry relatively quickly, enhance

U.S. preparedness to deal with import problems. It has been estimated, for example, that

immediately available substitutes could replace

one-third of the chromium now used. There are

also fully developed substitutes for cobalt and

PGM in some applications. Substitution prospects for manganese are less promising, although substantial reductions in the amount

of manganese needed per ton of steel produced

are likely in the coming years because of the

upgrading of steelmaking processes, as discussed in chapter 6.

Industry response time depends in part on

the ready availability of information about substitute materials. Technologically sophisticated

firms are generally aware of available substitutes, and some are reported to have undertaken contingency planning to address future

supply availability problems. Less sophisticated

firms may have greater difficulties in obtaining such information in the event of an actual

supply disruption, and, as a general rule, would

have the greatest difficulty in competing for

scarce materials.

Substitution prospects in many critical economic and defense applications depends partly

on overcoming significant technical barriers.

In these applications, substitutes must equal

the performance of the materials already used,

which is often technically difficult, Substitutes
— —.. .—.. —

with low strategic material content have not

yet been developed for some of these important applications. The degree of commitment

needed to develop direct substitutes is substantial in both money and time. For applications

which require that alternative materials be

qualified, the development effort may take 10

or more years and several million dollars, even

after their technical promise has been identified in the laboratory.

Industry has little incentive to develop substitutes on its own unless clear benefits in cost

or performance are anticipated. As a result, the

Federal Government has undertaken or sponsored most of the research where strategic

materials savings, not cost or performance benefits, are given top priority. Several Federal

agencies, including the Department of Energy

(DOE), the Interior Department’s Bureau of

Mines, and NASA have sponsored research

programs aimed at developing substitutes for

strategic materials. However, the sustained

support needed to develop particular materials

to the point of commercialization generally has

been lacking,

Substitution research programs undertaken

by NASA, the Bureau of Mines, and DOE national laboratories have resulted in lower chromium research alloys that are potential substitutes for stainless steel in some applications.

(Selected examples of these alloys are discussed

in a subsequent section, and summarized in table 7-4,) Even if fully developed, most of these

materials would not duplicate the great versatility of the high-volume stainless steels and

would be capable of replacing stainless steels

in only a limited range of applications.

With some exceptions, these substitutes are

only in the initial stages of development. In

most instances, a continuing government commitment will be required if these materials are

to be fully developed, since private industry is

unlikely to undertake this research itself. Issues

surrounding possible additional Federal support for such development activities are discussed in chapter 8.

The Federal Government–especially NASA,

through its Conservation of Strategic AeroCh. 7—Substitution Alternatives for Strategic Materials ● 2 6 7

space Materials Program (COSAM)—has also

sponsored initial laboratory work on replacement superalloys that have reduced levels of

cobalt, These research materials could potentially reduce the cobalt now used in some

nickel-based superalloys by one-half or more.

However, full development of these replacement materials would require several more

years and millions of dollars in additional

funds. As with lower chromium stainless steel,

subsequent development steps needed to bring

these substitute superalloy to the point of commercial use probably will need to be federally

supported if this development is to occur at all.

The changing material requirements of the

aerospace industry may make it impractical to

develop these direct substitutes for superalloys

to the point of commercial use. The development steps required could entail 5 to 10 years

of additional effort. Beginning in the mid1990s, advanced superalloy materials may begin to be commercially used in the next generation of military aircraft. The direct substitutes now under development for currently

used materials will not be suitable replacements for new materials used in the next generation of jet engines. (Less near- and mediumterm change in materials is expected in the

case of stainless steel.) Superalloy substitution

research is discussed in greater detail in a subsequent section.

In addition to direct substitutes, advanced

materials (including ceramics and composites)

are also under development because their properties offer new possibilities in product design

and performance. These materials, which contain little or no strategic metals, may have longterm implications for reducing import dependency, although to what extent is not clear. Because the emphasis is on cost and performance

benefits, much of the development of advanced

materials is carried out by private concerns.

Advanced ceramic materials have the potential to displace metals where exceptional wearresistance or heat-resistance is required. Current and prospective advanced ceramic applications in which strategic materials are now

used are discussed in a subsequent section, and
268 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

summarized in table 7-II. Aerospace and

automotive applications command most of the

funds for ceramic R&D efforts.

Composites (including polymer matrix, metal

matrix, and carbon/carbon materials) are primarily under development because of their

lightness compared to conventional materials.

In critical applications, their potential role in

reducing strategic material requirements is

likely to be indirect and will depend upon design factors. At present, commercial applications for advanced composites are dominated

by aerospace applications and high-value sporting goods. Increased use of composites in automotive applications is predicted.

Strategic materials conservation is not a primary motivation in the development of advanced materials, and the potential of these

materials for displacing current requirements

for strategic materials should not be overemphasized. Nonetheless, in the long term, they

may well bring fundamental changes in the

overall mix of materials in the domestic and

international economy. Major industrial countries including the United States, Japan, Great

Britain, and several Western European countries are all vying for prospective markets for

these materials. Moreover, because of their key

importance in defense applications, the question of the adequacy of domestic processing capabilities with respect to these materials is

likely to be an increasingly important issue.

Processing capacity is often located in several

different countries. The United States, for example, currently imports from Japan most of

its high-quality polyacrylonitrile (PAN) used as

a precursor in carbon-carbon composites. The

international nature of these markets could create a new type of materials import dependency.

Prospects for Direct Substitution in Key Applications

Adequate substitutes exist for many applications in which strategic materials are now

used. For example, aluminum alloys, plastics,

and plated carbon steels already compete with

stainless steels for many construction and consumer markets. In the event of a chromium

supply disruption, these alternative materials

would be readily available as substitutes for

stainless steel in many nonessential applications where exceptional corrosion resistance

is not needed. Similarly, if the supplies of PGM

were to tighten, electronic components manufacturers could quickly substitute gold for

much of the platinum and palladium now used

for contacts. This is a case where raw materials

prices are a significant part of the total product cost and can be counted on to drive substitution. Fifteen years ago, gold was the preferred material for contacts, but current prices

favor platinum and palladium.

Materials substitution in many essential economic and defense uses is more difficult, however. Performance compromises are very costly

in these cases, so the replacement must match

or better the properties of the current material,

There are very few, if any, immediately available replacement materials capable of meeting

the demanding performance standards required

for these applications. In some cases, adequate

substitutes for the current materials have yet

to be developed. In other cases, technically

acceptable substitutes may be known, but are

too expensive to be used. In still other cases,

potential substitutes have been developed in

the laboratory but have yet to be taken through

the time-consuming and expensive testing

processes necessary to make them acceptable

for commercial use. Depending on the extent

of the laboratory research and the promise

shown by the results, some of these substitutes

could be brought to the point of commercialization in the next 5 to 10 years, while others

are unlikely to be developed fully.

Chromium Substitution in Stainless Steel

Stainless steel accounts for almost half of the

total U.S. chromium demand, and about 70 per-
Ch. 7—Substitution Alternatives for Strategic Materials ● 269

cent of the chromium consumption in metallurgical uses. Table 7-3 shows the contribution

of the highest volume stainless steel grades to

chromium use. The most common grade, AISI

304, alone accounts for over 40 percent of domestic stainless steel production and over 20

percent of total domestic chromium consumption. Although the chromium content of stainless steels varies from 10 to over 30 percent,

on the average stainless steels contain about

17 percent chromium.

The primary function of chromium in stainless steel is to provide corrosion and oxidation

resistance. z Chromium makes stainless steel

highly resistant to damage in a large variety of

environments. This characteristic, along with

good fabricability and mechanical properties,

is what makes stainless steel so attractive for

a wide variety of applications, ranging from

decorative trim, kitchen utensils, and other

consumer products to industrial applications

ZThe protection from corrosion and oxidation damage comes

from the chromium oxide skin that forms at the surfaces of stainless steels. Chromium concentrations of 12 percent or higher

are required for the formation of the protective skin, but since

corrosion and oxidation resistance increases with chromium

content, much greater concentrations are often used. AISI 304

stainless steel contains 18 to 20 percent chromium, and some

superstainless grades have chromium contents of 30 percent or

more.

In addition to conferring corrosion and oxidation resistance,

chromium improves the hardenability and stabilizes the austenite, the highly workable, ductile, and weldable microstructure found in the majority of stainless steel grades.

such as tubing and reaction vessels in powerplants and chemical processing facilities.

There is little chance that a universal substitute for stainless steel can be found for use in

all of these applications. However, some opportunities exist for piecemeal substitution. The

potential for reduced use of stainless steel (and

thus chromium) in an emergency is very great

in the decorative and consumer uses and lowtemperature (room temperature to 9000 F) industrial applications. Materials such as aluminum, titanium, plastics, and low-chromium

stainless steels (9 to 12 percent chromium) can

often substitute without serious performance

compromises for stainless steels in these relatively undemanding uses. The possibilities for

replacement in the industrial applications operating at higher than 900° F (5OO° C) is somewhat smaller. In some of the moderately severe

(referring to both temperature and corrosiveness) industrial environments, steels with 12

to 15 percent chromium would suffice where

high-chromium stainless grades (18 percent or

more) are now used. This substitution opportunity exists because engineers often specify

the common grades, which have better properties (and more chromium) than needed, in order to expedite the design process. In addition,

there are low-chromium (e.g., 9 percent) or

chromium-free steels now under development

for use in these moderately harsh environments. Even considering these new alloys, reTable 7-3.—High-Volume Stainless Steels

Percent of domestic Percent of chromium Percent of total

stainless steel Typical chromium consumed in domestic chromium

AISI stainless steel grade product ion compositions stainless steel consumption

301 . . . . . . . . . . . . . . . . . . . . 9.60/o 17.0% 9.4% 4.60/o

304. . . . . . . . . . . . . . . ! . . . . 42.3 19.0 46.5 22.6

304N & 304L . . . . . . . . . . . 4.0 19.0 4.4 2.1

316. . . . . . . . . . . . . . . . . . . . 3.6 17.0 3.5 1.7

316L . . . . . . . . . . . . . . . . . . 3.1 17.0 3.1 1.5

409. ......., ., . . . . . . . . 10.1 11.1 6.5 3.2

430. ., . . . . . . . . . . . . . . . . . 3.5 17.0 3.4 1.6

Other grades . . . . . . . . . . . 23.9 NA 23.1 11.2

Total stainless ... . . . . . . 100.0 ”/0 17,3”/0 100.0 ”/0 48.50/o

alncludes chromium in metal, ferroalloys, and chromite

Columns may not add to totals because of rounding

NA = Not applicable, chromium composftlons vary greatly among these stainless steels

SOURCE American Iron and Steel Institute, Cwarfer/y Product/on of Stainless and Heat Res(stirrg Raw Steel, publication AlS-l04(1983) and U S Bureau of Mines, Minerals Yearbook, Chromium Preprint (1982)
270 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

placement of the high-chromium stainless

steels in extremely severe industrial applications, especially those at temperatures above

1,300° or 1,400° F (700° to 800° C) appears infeasible. Much of this currently irreplaceable

demand for stainless steel is in critical defense

applications, the chemical processing industry,

and energy facilities such as powerplants and

petroleum and natural gas refineries. These applications make full use of stainless steel’s impressive high-temperature corrosion and oxidation resistance and strength.

According to a 1978 report by the National

Materials Advisory Board (NMAB), in a supply emergency 60 percent of the chromium

used in stainless steel could be saved through

the use of low-or no-chromium substitutes that

are either already available or could be developed within 10 years.3 The other 40 percent of

the chromium consumed in stainless steel was

found to be irreplaceable unless compensated

for by design or process improvements. This

amount represents approximately 20 percent

of the current total domestic chromium use.

Most research on reducing the use of chromium in stainless steels is sponsored by Federal agencies. The focus is on developing alternative alloys with lower chromium contents

than those stainless steels in greatest demand

(e.g., AISI 304,409, and 301) for use in moderately harsh industrial environments. In addition, R&D related to advanced surface treatment processes and ceramic and composite

materials, though not motivated by chromium

conservation, may uncover ways to reduce the

use of stainless steel in some applications,

Low-Chromium or Chromium-Free Substitutes

for Stainless Steels

Current commercial low-chromium steels are

unsuitable as substitutes for stainless steel in

critical applications. However, several low- or

no-chromium alternatives for some grades of

3National Materials Advisory Board, Contingency Plans for

Chromium Utilization, National Research Council, Commission

on Sociotechnical Systems, Publication NMAB-335 [Washington D. C.: National Academy Press, 1978).

stainless steel are under development (table 7-

4.) These new steels show promise for various

moderately harsh environments but do not perform as well as high-chromium grades in extremely severe applications. Most are still at

the laboratory stage of development, although

some are now undergoing certification, The

bulk of the research is being sponsored by Federal agencies, since private firms have little incentive at current chromium prices to develop

low-chromium substitutes. (See ch. 3 for chromium price information.)

Low-chromium or chromium-free substitute

alloys for the AISI 300 (austenitic) series stainless steels have received the greatest attention

from researchers. Austenitic grades, most of

which contain between 16 and 26 percent chromium, account for nearly 70 percent of domestic stainless steel production and for about 36

percent of all domestic chromium demand.

Among this group is the very popular and versatile type 304. Excellent fabricability and mechanical properties, combined with corrosion

and oxidation resistance in a wide range of

environments, makes the 300 series stainless

steels attractive for many applications, Unfortunately, the remarkable combination of properties that enables this great versatility is currently impossible to replicate, Consequently,

a universal substitute for the entire 300 series

(or even one of the particularly popular grades)

is not a likely development, The promise of

each of the substitutes tends to be very application- or environment-specific.

Examples of promising research on substitutes for 300 series stainless steels in moderately severe applications include:

● DOE’s Oak Ridge National Laboratory development and promotion of a modified 9

percent chromium (Cr), 1 percent molybdenum (Me) steel [modified 9Cr-lMo alloy).4

The initial objective of the laboratory was

to develop a single reference material for

intermediate sections of liquid metal fast

breeder reactors, Currently, these reactors

contain 18 percent chromium-8 percent

4Basically a standard 9Cr-1Mo alloy with additions of columbium and vanadium.
—— . —.

Ch. 7—Substitution Alternatives for Strategic Materials • 271

Table 7“4.—Oevelopment Status of Potential Substitutes That Could Reduce Chromium

Requirements in Stainless Steel

Substitute

material Key objective

1. Modified 9 % Develop single material

c hromium-1 % system to replace

molybdenum ferritic (2.25°/0 Cr)

steel. and austenitic (18°/0

Cr) steels used in

pressure vessels and

connecting tubing in

liquid metal fast

breeder reactors.

2. 12°/0 chromium

alternative to

18°/0 chromium

304 stainless

steel.

3. Iron aluminum

molybdenum

(Fe-8 °/O Al- 6°/o Mo)

alloy strengthened

by zirconium

carbide (ZrC).

4. 9°/0 chromium

austenitic alloys.

5. Theoretical

method to develop lowchromium austenitic stainless

steel compositions.

6. Manganese-aluminum steel

(Fe-M n-Al).

Determine feasibility of

reducing Cr use in

type 304 stainless.

Develop chromium-free

material for midtemperature oxidationresistant application.

Technical

status Institutional sponsors

Fully developed; may Oak Ridge National

also find use in Laboratory.

fossil, solar thermal,

and fusion energy

systems,

Determine if other alloying elements could

replace part of the

chromium in stainless steels.

Develop a technical tool

for devising lowchromium alloys

with mechanical properties equivalent to

those of type 304

stainless steel.

Develop general use

alternative to

chromium-nickel

stainless steel.

Mechanical properties

and corrosion and

oxidation resistance

compare favorably

with type 304

stainless.

Early tests show excellent workability and

oxidation resistance,

ZrC strengthening

mechanism could

not be controlled

reliably and needs

additional work.

Tests show corrosion

resistance (in less

severe environments), fabricability,

weldability, and mechanical properties

comparable to conventional stainless

grades.

Modeling of alternative

compositions has

been undertaken. No

test heats have been

made.

Laboratory work shows

that these alloys

may be useful at

cryogenic and moderate temperatures

and various corrosive

environments.

NASA-Lewis Research

Center.

U.S. Bureau of Mines

Albany Research

Center.

INCO under U.S.

Bureau of Mines

sponsorship.

Allegheny Ludlum

Steel Corp.

Studies are being conducted in many different laboratories.

7. 6-12°/0 chromium Develop low-chromium Oxidation and creep ARMCO (producer

ferritic steels. oxidation-resistant resistance are super- company).

ferritic stainless ior to type 409

steels. stainless.

Economic factors

and commercial status

In process of certification by ASME boiler and pressure

code committee.

Cheaper than

18%Cr-8% Ni stainless for indicated

uses; lack of industry sponsorship

may slow commercialization.

Laboratory stage;

initial work

completed in 1979.

Laboratory stage.

Laboratory stage.

Could add to the

stockpile of information about substitutes, but work

has yet to progress

to the experimental

stage.

Most work is still at

the laboratory

stage. Limited prototype testing is

being done in other

countries. May be

cheaper than current stainless

steels.

Laboratory stage.

SOURCE Off Ice of Technology Assessment
272 Ž Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

●

nickel (Ni) (18 Cr-8Ni) alloys (e.g., AISI 304,

321, 347) in the reactor vessels and heat

exchangers and a 21⁄4Cr-1Mo alloy in the

steam generators. Use of a single material

in these applications eliminates, among

other problems, an undesirable dissimilar

metal weld at the transition joints. The

modified 9Cr-1Mo alloy was found to be

a promising replacement for both types of

materials. The encouraging results of the

research suggest that this alloy may find

use in conventional power applications, as

well. Although it will replace both low- and

high-chromium materials, modified 9Cr1Mo will probably yield a net chromium

savings. However, chromium conservation is a byproduct of this development effort, not a primary motivation. If this new

material sees widespread use in the power

industry, the resultant availability and

designer acceptance may encourage its use

in other low or moderately hostile applications now dominated by high-chromium

materials.

Nearing commercialization, this modified 9Cr-1Mo alloy is being considered by

the American Society for Testing of Materials (ASTM) and by the American Society of Mechanical Engineers (ASME)

boiler and pressure vessel code committee for final certification. Since use of the

material entails fabrication and inspection

cost savings, as well as a materials cost reduction, prospects for successful substitution are good if it is approved5 6 (table 7-4,

item 1).

NASA’s comparison of the mechanical

properties and oxidation and corrosion resistance of reduced chromium alloys with

those of type 304. One steel, containing 12

percent chromium, 10 percent nickel, 1.5

percent silicon, 1 percent aluminum (Al),

2 percent molybdenum, and 2 percent

manganese (Mn), demonstrated properties

that compare favorably with 304 stainless

‘Robert R. Irving, “What’s This Steel They’re Raving About

Down in Tennessee?” Iron Age, June 25, 1982,

‘V. K. Sikka and P. Patriarca, Data Package for Modi~ied 9CrIMO Alloy [Oak Ridge, TN: Oak Ridge National Laboratory, December 1983).

●

●

●

steel and could be used for most applications (except nitric acid environments)

where type 304 is currently used. This alloy conserves one-third of the chromium

normally used in type 304 stainless steel7

(table 7-4, item 2).

The U.S. Bureau of Mines’ investigation of

a chromium-free iron-aluminum-molybdenum (Fe-Al-Mo) alloy as a potential substitute for high-chromium, heat-resistant alloys. An optimal composition for the alloy

has yet to be developed, but early findings

suggest that the chromium-free alloy may

resist oxidation at moderate temperatures

to an extent comparable to 300 series stainless 8

9 (table 7-4, item 3).

The Bureau of Mines’ work on reducedchromium substitutes for high-performance

stainless steels (e.g., type 310 with 25 percent chromium) used in elevated-temperature, severely corrosive environments,

Steels containing chromium (12 to 17 percent), nickel, and aluminum are being

studied in this program. The Albany Research Center of the Bureau of Mines has

been successful in reducing the chromium

content to 12 percent. One 12 percent

chromium substitute has about three times

the sulfidation-resistance of, and approximately equivalent mechanical properties

to type 310 stainless steel.10

The Bureau of Mines’ study of low-chromium stainless steels for high-temperature,

oxidation-resistant applications. Research

has shown that steels having 8 to 12 percent chromium with additions of aluminum and silicon can have excellent oxidation-resistance and mechanical properties

(to 800° C), These alloys are potential substitutes for 18Cr-8Ni stainless steels in

————

7Joseph R. Stephens, Charles A, Barrett, and Charles A.

Gyorgak, “Mechanical Properties and Oxidation and Corrosion

Resistance of Reduced-Chromium 304 Stainless Steel Alloy s,”

NASA Technical Paper 1557, November 1979.

‘J. S. Dunning, An iron-Aluminum-Molybdenum Alloy as a

Chromium-Free Stainless Steel Substitute, U.S. Department of the

Interior, Bureau of Mines Report of Investigations 8654 (Washington, DC: U.S. Government Printing Office, 1982).

‘J. S. Dunning, M. L. Glenn, and H. W. Leavenworth, “Substitutes for Chromium in Stainless Steel s,” Metal Progress,

October 1984, p. 23.

l’JIbid., p. 23.
Ch. 7—Substitution Alternatives for Strategic Materials ● 273

some applications. Further long-range research to qualify other important properties such as high-temperature stability,

weldability, and age-hardening characteristics is underway .11

● Research sponsored by the Bureau of Mine s

at the Inco Alloy Products Research Center

aimed at replacing some of the chromium

now needed for stainless steels used in corrosive environments. The findings suggest

that it may be feasible, with additions of

nickel, molybdenum, copper, and vanadium, to produce 9 percent chromium

austenitic stainless steels with corrosion

resistance, hot working behavior, weldability, and mechanical properties comparable to those of conventional grades. These

low-chromium alloys, while not adequate

for more severe environments, could be

used in decorative, aqueous, and some industrial applications” (table 7-4 item 3).

● Allegheny Ludlum Steel Corp. Research

Center’s development of a theoretical model for devising new reduced chromium alloys that would duplicate the excellent mechanical properties of type 304 stainless

steel, although not its corrosion resistance.

Actual alloys have not been developed

from these theoretical compositions,

which range from 6 to 16 percent chromium, but some of them could be suitable as

substitutes in noncritical applications13 (table 7-4 item 5).

• Various researchers’ work with iron-manganese-aluminum (Fe-Mn-Al) steels. The FeMn-Al steels contain no chromium, but

may consist of up to one-third manganese,

another strategic material. The high aluminum content of the Fe-Mn-Al steels provides oxidation resistance, Though most

of the work is still preliminary, these alloys

show promise as replacements for 300 series (chromium-nickel) stainless steels in

some moderately corrosive environments.

‘l Ibid., p. 23.

‘2S. Floreen, “An Examination of Chromium Substitution in

Stainless Steels, ” Metallurgical Transactions A, November 1982.

13R. A. Lula, ‘‘Potential Areas for Chromium Conservation in

Stainless Steels, ” in Technical Aspects of Critical Materials Use

by the Steel Industry, vol. 11A, NBSIR 83-2679-2 (Washington,

DC: U.S. Government Printing Office, June 1983).

Photo credit US. Department of the Interior, Bureau of Mines

An 80-pound heat of an experimental low-chromium

stainless steel is poured into a split steel mold at the

Bureau of Mines, Albany Research Center

With heat treatment, the Fe-Mn-Al steels

demonstrate excellent mechanical properties, in some cases as good as or better than

type 304. In addition, they are 10 percent

lighter (and have greater strength-to-weight

ratios) than nickel-chromium stainless

steels, Though the economics depend on

the relative costs of manganese, aluminum, chromium, and nickel and the size

of the production runs, Fe-Mn-Al alloys

are likely to be less costly than 300 series

grades 14 15 (table 7-4, item 6).

14 Samir K. Banerji, “The 1982 Status Report on Fe-Mn-Al

Steels, ” as cited in Technical Aspects of Critical Materials Use

by the SteeI Industry, ” vol. IIB, NBSIR 83-2679-2, June 1983.

1’Rosie Wang, “New Stainless Alloy is Less Costly, ” American Metal Market, Sept. 19, 1983,
274 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Information requirements for stainless steel

substitutes are under evaluation by the Metal

Properties Council, Inc. (MPC), an organization set up by industry and technical societies

in 1966 to provide engineering data on materials, MPC established a Task Group on Critical Materials Substitution in 1981. An initial

MPC task group report,16 issued in 1983, noted

a gap on the technical information about alternative low-chromium compositions for stainless steel. Most of the available data was from

laboratory investigations, with little information developed about processing and fabrication of these compositions, or about how they

held up in service environments—essential

information if industry were to use these substitutes during a protracted supply shortage.

Subsequently, MPC has decided to focus on

chromium substitution options for 18 percent

chromium-8 percent nickel stainless steels used

in room-temperature to moderately high-temperature (up to 1,2000 F) applications.17 These

applications comprise the highest volume uses

for stainless steels, including many for which

a decrease in corrosion resistance may be acceptable to some consumers in times of a supply shortage. MPC is now evaluating future

steps, such as developing alternative compositions that duplicate all metallurgical and mechanical properties of the popular grades of

steel, except corrosion resistance. MPC is preparing a survey to gain input from industry.

The AISI 400 series, accounting for about 20

percent of domestic stainless steel production,

is the second largest class of stainless steels.

Type 409, which contains approximately 11

percent chromium, is the second most popular stainless steel. It accounts for about half the

production of 400 series grades and is used

principally in the catalytic converter housings

in automotive exhaust systems.

ARMCO is exploring several lower chromium

alternatives to ferritic (400 series) stainless steels

containing 12 percent chromium, These new

alloys, still at the laboratory stage, may be prom-

—. .- ——-.—— leThe Meta] Properties Council, Inc., “Task Group on Critica]

Materials” (New York: The Metal Properties Council, Inc., 1983).

ITprivate communication with R. A. Lula and officials of the

MPC.

ising substitutes for stainless steel used in the

catalytic converter shell of automobiles, ARMCO

reports that its 6.6 percent chromium alloy 6SR

(scale resistant) is more oxidation- and creepresistant than 409 stainless steel. Unlike, the other

substitutes described above, the SR alloys (which

also include 12SR, a potential 12 percent chromium substitute for some 18 percent chromium

grades) are being researched in the producer industry. As a result, the institutional barriers to

the acceptance of these SR alloys are relatively

low18 (table 7-4, item 7),

These substitutes are all in various stages of development. Other than the modified 9Cr-1Mo alloy, which is undergoing certification, the

replacement alloys have not yet advanced beyond

the laboratory level of investigation in the United

States. The development of the chromium-free

substitutes, such as the ferritic Fe-Al-Mo and the

austenitic Fe-Mn-Al alloys, designed for elevated-temperature oxidation/corrosion-resistant

service, probably involve the longest range, highest risk research. The low-chromium alloys also

require additional study, but technical success

is in general less speculative, Extensive additional testing of mechanical properties, phase stability, and other physical properties of any of the

newly designed alloys, as well as ease of processing, could take several years. Even if these alloys overcome the initial hurdles, economic feasibility will remain in question. Without large

markets in place, these alloys cannot be produced

cheaply enough (due to poor economies of scale)

to compete effectively with the current highvolume stainless steel products.

Advanced Surface Treatment

Technologies and Processes

Most of the chromium in stainless steel is

present solely for corrosion and oxidation resistance. Chromium’s secondary roles can be

met with the use of other alloying elements or

processing techniques. Since corrosion and oxidation resistance is only needed at the surface,

the chromium on the interior of the stainless

—.—

leJoSeph A. Douthett, “Substitute Stainless Steels With Less

Chromium, ” in Conservation and Substitution Technology for

Critical Materials, vol. I, NBSIR 82-2495 (Springfield, VA: National Technical Information Service, April 1982).
Ch. 7—Substitution Alternatives for Strategic Materials . 275

.— .

steel is nonessential, Surface modification techniques can endow low- or no-chromium materials with corrosion and oxidation resistance

sufficient to substitute for stainless steels in

some applications, Advanced surface treatment techniques may also improve wear resistance, thus extending product life.

Existing fully developed surface treatment

technologies—e.g., plating steels with chromium, nickel, cadmium, or zinc or welding a

stainless steel overlay to nonchromium alloys—

have been used for decades in a large number

of applications, but there are constraints in

their use. Fabricated parts and brittle metals

cannot be clad, for example, and clad materials

are difficult to weld. Claddings sometimes separate from the base metal, with potentially disastrous results.

A number of advanced processes now under

development or in the early stages of commercialization may broaden applications for surface treatment. One advanced coating technique that can compete directly with stainless

steels in some applications is the DILEX process, This technique involves the diffusion of

chromium (or other elements) into the surface

of a ferrous part that is placed in a lead bath.

The surface alloy typically contains 25 percent

or more chromium (and possesses excellent

corrosion and oxidation resistance), while the

underlying substrate contains little chromium.

The cost of continuously processed DILEX

strips is currently competitive with stainless

steel products. In addition, parts and components that are difficult to fabricate from stainless steel can sometimes be produced more

easily with the DILEX process.19

Surface alloying with lasers (by processes

commonly referred to by their United Technologies trade names, LASERGLAZING and

LAYERGLAZING) can provide corrosion and

oxidation protection and wear resistance to

materials. LASERGLAZING can improve erosion and corrosion properties through elimi-

~eRa}l J, L’a n Th~’n e, “Conservation of Critical Metals Utilizing Su~face Alloy ing, ’ ‘as cited in Conser~ration and Substitution

TmhnoIogj for CriticaJ ,MateriaJs, v~l. II, NBSIR 82-2495 April

1982.

nation of surface porosity, and can produce a

wear-resistant surface that could extend the life

of steels used in metal cutting and grinding.

LAYERGLAZING can be used to build entire

parts (e. g., turbine discs) through continuous

melting of very thin layers of alloy at the surface. Such processes permit tight control over

the composition of the alloy and can also reduce part rejections, since flaws detected in

processing can be reglazed immediately. While

laser techniques have impressive capabilities,

these processes are not presently as cost effective as some of the more established surface

modification practices, such as roll bonding.

A recent technological advance, ion implantation, holds long-term promise as a way of improving the wear- and corrosion-resistance of

parts, thus helping conserve strategic materials

through extending product life or reducing the

need for chromium in corrosion-resistant applications. In ion implantation, high-energy

ions of alloying elements are embedded into

the surface of the workpiece to produce a surface layer of 100 to 1,000 angstroms that is an

integral part of the substrate. Advantages of

this technique include excellent coating-substrate adhesion (owing to the lack of a sharp

boundary between the two), no dimensional alteration of the substrate, and low processing

temperatures. Elements such as carbon, nitrogen, chromium, and nickel can be implanted,

but the resulting properties are not as dependent on the type of ion as on the mechanical

deformation it causes to the matrix surface.

Therefore, the choice of an ion is based on its

mechanical effect in the host material, not

on its own inherent corrosion- or oxidationresistant properties. 20

Ion implantation has been shown to extend

the life of cobalt-based cemented carbides and

tool steels when carbon and/or nitrogen are applied. Implantation of yttrium in diesel fuel injection pumps reportedly dramatically improves wear resistance in comparison with

chrome plating. Bureau of Mines-supported research has shown that ion implantation can

Zochar]es River Associates, INeIIF Metals Processing Technologies, OTA contract report, December 1983, p. 46.
276 . Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

protect plain carbon steels against mild aqueous corrosion.

Ion implantation techniques, first developed

in Great Britain, are fully commercialized in

the semiconductor industry. For metallurgical

applications, ion implantation is at the operational prototype stage—commercial machines

are being developed, but there has been little

market penetration.21 Substantial technical and

economic constraints impede its use for largevolume metallurgical uses. To be effective in

providing corrosion resistance, ionic density

must be much greater than in semiconductor

applications. Commercial equipment capable

of handling this higher beam density has yet

to be developed and appears to be prohibitively

expensive at this time. High capital costs and

limited product size and production rates are

key constraints acting against this technique’s

widespread use.

All surface treatment techniques have drawbacks, If the surface layer fails, the exposed

substrate would be vulnerable to corrosion.

Fabrication and construction with surfacetreated materials is more difficult and costly

than with monolithic materials. Special welding and joining techniques must be used to assure that the base material does not become exposed, Edges of the material must be treated

to maintain protection. These welding and joining techniques are subject to separate research

and development efforts. In addition, surface

treatment can be very expensive, so there are

major efforts aimed at improving the process

economics of these techniques.

Surface treatments also face nontechnical

and noneconomic hurdles, Designers and consumers often resist use of surface modification

processes in new applications where solid

monolithic alloys perform satisfactorily.

ZICarnegie-Mellon university, Department of Engineering and

Public Policy, Department of Social Sciences, and School of

Urban and Public Affairs, The Potential of Surface Treatment

Technologies in Reducing U.S. Vulnerability to Strategic Materials,

Pittsburgh, PA, April 1984.

Chromium Substitution in Alloy Steels

About 15 percent of U.S. metallurgical chromium (10 percent of total domestic chromium)

is consumed in alloy steels, Chromium is used

in these steels primarily as a hardening agent.

Although other elements, such as molybdenum, silicon, and nickel, can be used for this

purpose, chromium and manganese are currently the most cost-effective hardenability enhancers, Because chromium’s hardenability

characteristics are more easily replicated than

its corrosion and oxidation attributes, fewer

technical problems exist in developing adequate substitutes for alloy steels than for stainless steels. In its 1978 Chromium Utilization

study, the NMAB concluded that 80 percent

of the chromium used in alloy steels could be

replaced either now or after a short-term R&D

effort.

The chromium contents of alloy steels typically range from less than 1 to 4 percent, although some grades have as much as 9 percent.

Compared to carbon steels, these steels have

improved strength, wear resistance, and hardenability. They are chosen when parts (e.g.,

bearings, gears, shafts) will be highly stressed

over a long service life.

Several alternative chromium-free alloy compositions are under investigation as substitutes

for large-volume alloy steels. These alloys have

been designed to duplicate the most important

properties of the steels they would replace, so

that processing changes and design changes

could be minimized if they were to be used as

replacement steels.

Work at the International Harvester Co.,

sponsored by the Bureau of Mines, was aimed

at the design of chromium-free substitutes for

two alloy steels that together account for about

60 percent of the chromium used in constructional alloys, or about 6 percent of total U.S.

chromium demand. These Cr-Mo grades (AISI

4100 series) and the Ni-Cr-Mo grades (8600 series) have been used for decades, and as a result, current designs for parts and manufacturing processes are adapted to these steels. The

chromium in these grades was substituted with
Ch. 7—Substitution Alternatives for Strategic Materials ● 277

manganese, molybdenum, and nickel. Silicon,

another common hardening agent, was not

used because alloy steel producers have little

experience with the high silicon levels (0,6 percent Si) required to achieve the desired

hardenability. The compositions of the Mn-NiMo and Mn-Mo replacement steels are shown

in table 7-5.

To minimize the disruption entailed in shifting to new steels, the new chromium-free steels

were designed to be produced using prevalent

U.S. production practices. Moreover, the experimental substitutes have the same microstructure, heat treatment response, and mechanical properties as the steels they would

replace, and therefore would provide equivalent engineering performance. So far, actual

production of these steels has been limited to

100-pound” experimental test heats, thus the

steels’ characteristics in large-scale commercial production have not been demonstrated.

The second phase of this program—to produce larger heats for testing–was delayed,

owing to the financial status of the contractor.

However, in 1984 the Bureau released a request

for proposal which calls for about a 3,000-

pound test heat. When completed, this phase

of the program will provide better information

for the possible transfer of this technology to

industry.

In the original economic analysis (based on

1981 raw materials costs), these steels were not

found to be cost effective. However, the MnMo replacement for the 8600 series steels may

become economical with the moderate chromium price increases that would be expected

under steady economic and political conditions. The other replacements (Mn-Ni-Mo for

8600 and both Mn-Ni-Mo and Mn-Mo for 4100)

would become economical only with the drastic price increases (on the order of tenfold for

chromium ore and fourfold for ferrochromium)

that would accompany severe chromium supply disruptions, such as a complete cutoff from

South African supplies. To facilitate their use

in such an emergency, the researchers recommended additional testing of these steels to determine equivalency of these steels under typical production practices by U.S. producers .22

Development of these alternative steels was

facilitated through International Harvester’s

CHAT (Computer Harmonizing Applications

Tailored) system, which first identifies metallurgical properties needed for particular parts

and then selects the least-cost alternatives from

AISI and SAE steels that are available. Use of

computerized information systems of this sort

could facilitate the development of a strategic

materials substitution information system that

could be used in an emergency.

Reducing Cobalt and Chromium Used in

Superalloy for High-Temperature Applications

Superalloys, used in jet engines, industrial

gas turbines, and a widening spectrum of other

industrial applications, account for 30 to 40

Zzcar] J. Keith and V. K. Sharma, Development of Chromiu m-Free

Grades of Constructional Alloy SteeJs, U.S. Department of the Interior, Bureau of Mines’ contract No. JO1 13104, May 1983.

Table 7-5.—Ladle Analysis Ranges for the Chrome-Free Replacement Compositions for

Standard 4118 and 8620 Steels (in percent)

4100 type steel 8600 type steel

AISI-4118 Mn-Ni-Mo Mn-Mo AISI-8620 Mn-Ni-Mo Mn-Mo

Chemistry ladle range steel replacement replacement steel replacement replacement

Carbon. . . . . . . . . . . . . . . . . . 0.18-0.23 0.16-0.21 0.16-0.21 0.18-0.23 0.16-0.21 0.16-0.21

Manganese . . . . . . . . . . . . . . 0.70 0.90 1.00-1.30 0.70-0.90 1.00-1.30 1.00-1.30

Chromium . . . . . . . . . . . . . . . 0.40-0.60 r

Nickel . . . . . . . . . . . . . . . . .

0.08-0.15 0.15-0.25 0.25-0.35 0.15-0.25 0.25-0.35 0.35-0.45

r— residual

silicon range = 0, 15-().35°/0, sulfur = O 05°/0 maximum, phosphorus = 0.04°/0 max!mum

SOURCE Carl J. Keith and V K Sharma, Deve/oprnerrt of Chromium-Free Grades of Constructfona/ A//oy Stee/s, U S. Bureau of Mines contract No JO1 13104, May 1983
278 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

percent of U.S. cobalt consumption. Only a

small portion of U.S. chromium consumption

goes into superalloys—about 3 percent in 1982.

This amount is in the form of highly purified

ferrochromium and chromium metal. Other

materials used in superalloys include nickel,

aluminum, titanium, and a number of minor

alloying elements, including columbium (niobium) and tantalum—two second-tier strategic

materials for which the United States is importdependent.

While many superalloys do not contain cobalt, the use of cobalt has increased over time

because it improves the weldability of some superalloys, contributes to their strength, and also

enhances oxidation and corrosion resistance.

Chromium is currently essential in all superalloy.

Importance of Superalloy to the Aerospace Industry

Improved jet engine performance has been

highly dependent on development of new

superalloys 23 that extend the maximum operating temperature of the engine yet are still able

to withstand the high mechanical and thermal

stress, oxidation, and hot corrosion that occurs

in the hot section parts of a jet engine. Through

complex adjustments in composition and processing, the temperature capability of superalloy has been extended from about 1,4000 F

in 1940 to about 1,9500 F today (some superalloys now in use have operating temperatures

of about 2,100° F), as shown in figure 7-1. In

addition, the required life of various components (the minimum predictable time before

overhaul or replacement) has also increased

significant y.

ZsThe ana]ysis of superalloy substitution potential in this section is drawn in large part from Richard C. H. Parkinson, Substitution for Cobalt and Chromium in the Aircra-ft Gas Turbine

Engine, OTA staff background paper, September 1983. It should

be noted that superalloy use is spreading to many nonaerospace

applications, such as oil country tubulars, heavy duty tooling,

pulp and paper production, medical and dental uses, and glass

manufacture. In these applications, superalloy were substituted

for other materials that could again be used in an emergency,

although possibly with some performance costs. In the case of

gas turbine engines used in jet aircraft, however, alternatives

to superalloy are not currently available, and moreover are not

likely to be developed in this century. Thus, aerospace uses remain the most demanding and critical superalloy applications.

Each individual component in the hot section of a jet engine, such as turbine blades,

vanes, and discs, requires a superalloy with a

different range of properties—so that development of an adequate substitute for one part

does not mean that it can also substitute for

other parts, In addition, each of the U.S. jet engine manufacturers maintain separate specifications for superalloy that can be used in

each part. Today, there are well over 100 superalloys used domestically, but some of these

may be certified for use only by one engine

manufacturer, Table 7-6 shows representative

superalloys used in the different parts of the

hot sections of current jet engines,

As superalloy have become more specialized, their costs have escalated, so that it often

takes a decade or more and several million dollars to bring a promising new alloy even to the

engine testing stage. Initial development of a

new superalloy in the laboratory for disc or

blade applications constitutes only part of the

total effort. Prior to engine qualification and

use, a complete design data base, specifications

and standards, component and machine testing, and commercial-scale heats must be demonstrated, Without a pressing need for substitutes, industry alone is unlikely to make this

kind of commitment.

Substitution Prospects

From the standpoint of reducing U.S. vulnerability, backing out or reducing cobalt and

chromium use in superalloy would be highly

desirable–but only if they could be achieved

without impairing the push toward higher performance in military applications. Continued

increase in performance is the primary objective behind most government and industrial research aimed at developing new hot-section

materials, although many of these materials

could have the side benefit of reducing strategic materials requirements. Figure 7-2 shows

NASA estimates of the approximate date for

introduction of some of these higher temperature materials in aircraft. These materials are

discussed later in this chapter.

Superalloys will almost certainly remain the

primary structural material in turbine blades
Ch. 7—Substitution Alternatives for Strategic Materials . 279

for at least

Figure 7-1 .—Temperature Capability of Superalloy

2,000

1,500

1.400

1940 1950 1960 1970 1980

Approximate year available

SOURCE Garrett Turbine Engrne Co

the next 20 to 30 years. During this

period, complete elimination of cobalt and

chromium in jet engines is highly unlikely, although use of alternate alloys, wider use of

coatings, and adoption of more efficient processing technologies could reduce use of these

materials in individual applications.

In the long term, probably not before the second decade of the next century, a variety of

nonmetallic materials (e. g., advanced ceramics and carbon-carbon composites) may be developed sufficiently to be widely used in some

hot-section parts of human-rated jet engines.

If so, chromium, cobalt, and other metals then

may begin to be phased out of jet engines. Actual production dates for the first engines containing significant amounts of nonmetallic materials is likely to be well beyond the year 2000.

In the sections that follow, near-term (to

1990), medium-term (1990 to 2000), and longterm prospects for reduced chromium and cobalt usage in jet engines are selectively discussed, under the assumption that R&D efforts

continue at approximately their present levels.

Institutional factors that could affect the extent

to which various substitution potentials are

adopted are discussed in the concluding section of this chapter.

Near-Term Prospects for Cobalt Substitution (to 1990)

Cobalt supply insecurities in the late 1970s

led U.S. jet engine makers to substitute already

developed nickel-base superalloy for cobaltbase alloys wherever possible. A conspicuous

example of this was the substitution of the already developed and qualified cobalt-free superalloy Inconel 718 for Waspaloy (13 percent

cobalt) in turbine disk applications below 7000

C. Inconel 718, which contains a large amount

of niobium, a strategic material imported

largely from Brazil, continues to be used in

these applications owing to its comparative

cheapness and ease of fabrication. Other superalloy substitutions included replacement of

cobalt-base vanes with cobalt-free nickel-base

superalloy.

Cobalt prices are unlikely to stimulate further substitution in the near term. Easy to accomplish substitutions have already taken

place, As a practical matter, adoption of lower

chromium or cobalt substitutes by engine

makers is not likely unless substantial improvements in properties, higher temperature capabilities, or ease in fabrication accrue, as well.

Processing Advances. —As a result, the greatest

opportunities for cobalt and chromium conser-
280 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table 7-6.—Typical Structural Alloys Used for Hot-Section Components

Nominal operating conditions

Composition (percent weight)

Surface

temperature

Component Alloy Ni co Cr Fe Form Stress (oF)

Combuster liner . . . . Hastelloy X

HA-188

Turbine valve MA-754

MAR-M 200

MAR-M 247

MAR-M509

X-40

IN-713

Rene-77

Turbine blad e Alloy 454

MAR-M200

MAR-M247

B-1900

Rene-80

IN-713LC

Rene-77

Turbine disc. IN-100

MERL-76

Astroloy

Waspaloy

Rene-95

IN-718

IN-901

A-286

Cas e Waspaloy

IN-718

IN-901

A-286

48

22

78

60

60

10

1 0 5

72.5

55

62.5

60

60

65

60.5

72.3

55

56

54.1

55.5

58

61.3

53

45

25.5

58

53

45

25.5

1 5

41

—

10

10

55

56—

15

5

10

10

10

9 5

—

15

18,5

18,5

17

13,5

9

—

—

—

13.5

—

—

—

22

22

20

9

8

23.5

25.5

13.5

15

10

9

8

8

14

12

15

12.5

12.4

15

19.5

14

19

12.5

15

19,5

19

12.5

15

18.5

—

1 —

—

—

—

—

—

,.

cc

cc

cc

cc

–Large grains–

— se —

—

—

—

—

—

—

—

—

—

—

18

34

55

—

18

34

55

DS

CC, DS

DS

cc

cc

cc

–Small grains–

PM +HIP, PM +forged

PM +HIP, PM +forged

PM +HIP, PM +forged,

forged

Forged

PM +forged

Forged

Forged

Forged

–Small grains–

Sheet, forged

Sheet, CC, forged

Forged

Forged

Low

Low

Moderate

10 low

High

1600

1600

1600

1900+ ‘

1900

1800-1850

1800 +

1800 +

1600

1600

1900

1850

1800-1850

1800

1750

1600

–Rim temperature–

1300

1300

1300

1250

High 1200

1200

1100

1000

1300

High 1200

1100

1000

vation in superalloys in the near term lie in

continued commercialization of advanced

processing technologies, which have the incidental effect of improving cobalt or chromium yields in parts or of extending the life

of components.

Several of these new metals processing technologies are currently being adopted by industry, as is discussed in chapter 6. Powder metallurgy, with its potential to produce parts that

are close to their final shape, can dramatically

reduce reject rates and scrap generation in

fabrication of engine components. Two powder

metallurgy processes used in conjunction with

each other—hot isostatic pressing (HIP) and

isothermal forging—are now used commercially, although equipment costs are high.

Improved material utilization would be

achieved if HIP parts did not have to be hot

worked. This is now essential in order to over-
——.

Ch. 7—Substitution Alternatives for Strategic Materials ● 281

Figure 7-2.—Temperature Capabilities of Turbine Blade Materials

800

SOURCE’ National Aeronautics and Space Administration

come fatigue problems, but reduces product

yields. The U.S. Air Force Office of Scientific

Research is supporting research in this area to

improve the final quality of superalloy components.

Hot isostatic pressing can also be used to rejuvenate turbine vanes and blades, potentially

doubling the operating life of parts. So far, HIP

rejuvenation has been used primarily in industrial gas turbines but is not yet widely used for

worn aircraft parts. As discussed in chapter 6,

life cycle extension techniques are under intensive investigation by the Air Force, and

some jet engine parts are now being saved

(rather than sold as scrap), pending possible improvements in rejuvenation technologies. Most

obsolete jet engine parts, however, continue to

be sold as scrap, and most of the scrap is downgraded to less demanding uses.

By the end of the 1980s, additional jet engine

applications for cobalt-free oxide dispersion

strengthened (ODS) superalloy are probable.

These nickel- and iron-based superalloys are

produced through a mechanical alloying process, first developed in 1968. Although still considered an emerging technology, rapid growth

in ODS production is expected as new applications are accepted.

All currently available ODS superalloys are

cobalt free and are marketed by the Inco Alloy Products Co. One ODS alloy, MA-754, has

been used for years in high-pressure turbine

vanes of military aircraft produced by General

Electric. New applications for ODS alloys in

combustor linings and turbine blades are being

investigated as part of NASA’s Materials for

Advanced Turbine Engine [MATE) Program.

NASA and Pratt & Whitney Aircraft are currently evaluating another cobalt-free ODS alloy

(MA-956) for use in combustor linings. Early

results suggest that MA 956, coupled with design changes, could extend the operational life

of these linings by up to four times compared

to existing linings. It can also be used at a

higher temperature than a commonly used

liner material, Hastelloy X (which contains 1.5

percent cobalt).

38-844 0 - 85 - 10 , QL 3
282 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Although ODS alloys are superior at high

temperatures (i.e., 2,100° F), their poorer performance in intermediate temperature ranges

(i.e., 1,4000 to 1,600° F) has so far prevented

their use in turbine blades. However, NASA,

in conjunction with the Garrett Turbine Engine

Co., is evaluating the recently developed cobaltfree ODS alloy MA-6000, for turbine blade applications. Research suggests that an increase

in surface metal temperature of 1500 F over the

best current superalloy blade material may be

feasible.

ODS alloys are more expensive than conventional superalloy. With expanded markets,

however, finished part costs have declined. Additional price reductions could arise if the market expands into turbine blade and industrial

applications. Current production of these alloys is about 120,000 pounds per year, but is

growing rapidly.

Coatings.—Continuing near-term progress in

enhancing the surface properties of hot-section

components through use of coatings is also expected. Coatings of one sort or another have

been used since the 1960s and have extended

the life of parts significantly. Thermal barrier

coatings (TBCs), now used on combustor linings and vane platforms, provide oxidation and

hot corrosion resistance through a metallic

bond coat (often containing chromium), which,

in turn, is covered with a thin ceramic coat to

provide thermal insulation. TBCs have yet to

be applied to turbine airfoil surfaces because

peeling problems have not been completely

overcome. However, they may may be used on

airfoil surfaces by the end of the decade.

Coatings (or other surface treatments) may

some day permit reduced use of chromium in

superalloys—although near-term prospects are

very limited. Chromium’s primary function in

superalloy is to provide oxidation and hotcorrosion resistance at the surface of components. Most superalloy contain several times

as much chromium as strictly needed to provide this surface protection. As an insurance

measure, chromium is added throughout the

alloy, even though it is only needed at the

surface.

Aside from its absolutely essential role in corrosion resistance, the high levels of chromium

throughout monolithic superalloy may not be

needed. In theory, conservation of chromium

and improved mechanical properties could be

achieved if a safe way could be found to put

chromium only at the surface of components,

leaving the rest of the part chromium free. Presently, coating or cladding of a chromium-free

base alloy is not acceptable, owing to the possibility of a disastrous crack forming in the

coating. Other advanced surface treatment

processes have yet to be applied for the specific purpose of reducing chromium content.

From the above discussion it would appear

that prospects for cobalt substitution in superalloy are quite limited in the near term, and

that few available alternatives are ready for use

by engine manufacturers, Chromium substitution prospects are even more limited.

Medium-Term Prospects for Further Cobalt and

Chromium Substitution (1990-2000)

Over the next 10 to 15 years, only substitute

materials that are now approaching qualification and approval for jet engine use are likely

to be useful in reducing U.S. dependency on

imported strategic materials, The long lead

time entailed in testing and certification of new

materials and the time it takes for designers to

become familiar with them make it unlikely

that new materials or processes not now being actively developed will be in commercial

use before the last half of the 1990s.

Several cobalt-free or low-cobalt alternative

materials have been investigated under NASA

sponsorship (Conservation of Strategic Aerospace Materials Program, established in 1981,

and pre-COSAM research activities.) These

substitutes could provide alternative compositions for six widely used superalloy. Table 7-

7 shows currently used superalloys selected for

substitution research. Preliminary laboratory

experiments suggest that cobalt may not be

needed in the high-volume Udimet 700 type superalloy (18 percent cobalt) which is used in

turbine discs and blades. One evaluation of the

initial COSAM research hypothesized that
Ch. 7—Substitution Alternatives for Strategic Materials ● 283

Table 7-7.–Nickel-Base Superalloy Selected for Cobalt Substitution Research by NASA

Typical engine Cobalt content

Alloy application Form Remarks (% weight)

WASPALOY . . . Turbine disc Forged Highest use wrought alloy in current 13.5

engines

UDIMET-700 . . . Turbine disc Forge d Similar alloys used in various forms and 18.5

(LC) ASTROLOY Turbine disc as-hip-powder applications

(RENE 77) . . . . . Turbine blades Cast

MAR-M247 . . . . Turbine blades and wheels Cast Conventially cast, DS and single crystal 10,0

RENE 150 . . . . . Turbine blades DS-Cast Highly complex directionally cast alloy 12.0

SOURCE Adapted from Joseph R Stephens, A Status Review of NASA COSAM (Conservation of Strafegfc Aerospace Mafer)als) Program, NASA Techn{cal Memoran

dum 82852 (Springfield, VA National Techn!cal Information Service, May 1982)

while definite conclusions are premature, it

may be possible to cut by one-half or even eliminate cobalt now used in some nickel-based superalloys with little or no effects on mechanical properties or environmental resistance. (An

estimated 2.15 million pounds of cobalt was

contained in nickel-based superalloy primary

products in 1980, according to the NMAB. This

comprised about one-eighth of total apparent

cobalt consumption in that year. )24

The COSAM substitutes are still in the laboratory stage of development and are many

years away from actual use in a jet engine. In

theory, the COSAM alternatives could be

brought on line more quickly than an entirely

new material, since only slight adjustments in

manufacturing processes may be needed to

produce the low-cobalt substitutes. However,

to commercialize these alloys fully could still

require 6 to 7 years and $6 million to $9 million per application—a commitment that engine makers will find difficult to justify, given

current low-cobalt prices. Hence, their postCOSAM development may be delayed until a

perceived need arises.

Over the next 10 to 15 years, strategic materials conservation could also be a side benefit

from several advanced superalloy production

techniques that are approaching commercialization—simply because some of the experimental prototypes and research materials happen

to contain little or no cobalt. These processes

may not necessarily conserve strategic materiZ4Nationa] Materials Advisory Board, Cobalt Conservation

Through Technological Alternatives, National Research Council, Publication NMAB-406 [Washington, DC: National Academy

Press, 1983), pp. 24 and 47.

als over the long run, however, if it turns out

that cobalt provides a performance benefit over

the experimental prototypes.

One group of these new processing methods

is “rapid solidification, ” in which metals are

solidified so quickly that the resulting distribution of elements is nearly homogeneous, having few inclusions that could initiate fatigue

cracks. Moreover, previously unattainable alloy compositions with superior properties can

be obtained in some cases, Experimental

cobalt-free superalloy powders produced

through various rapid solidification processes

have been shown in early experiments to have

some advantages over conventionally processed alloys. Detailed information on rapid

solidification processes and their prospects as

substitutes for strategic materials is provided

in the Advanced Materials section of this chapter.

The capability to produce directionally solidified eutectic superalloy is another of the recent processing advances. Over the past two

decades considerable effort has been devoted

to developing this technique. When superalloy

are produced in this manner, they are strengthened by the formation of microscopic carbide

or intermetallic fiber reinforcements. Most of

the experimental alloys have comparatively

low levels of chromium and cobalt—4 percent

and 3 to 10 percent respectively. As with other

advanced processes and materials, the key objective of eutectics development is not to conserve strategic materials, but to increase temperature capabilities of turbine blades and

vanes. Eutectic superalloy could increase the

allowable operating temperature of these components by about 100° F compared to currently

available single-crystal alloys.
284 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Although work on eutectic alloys is progressing, they have yet to receive qualification for

engine use. Technical problems include inferior transverse properties and poor oxidation

and corrosion resistance. Cost of these alloys

is high because the processing times are high;

a eutectic blade can be withdrawn from the furnace at only about one-fourth inch per hour,

However, eutectic R&D has had active support

by engine producers (General Electric and

United Technologies) as well as scientific support at government laboratories and universities.

The medium-term (1990-2000) prospects for

reducing cobalt and chromium in jet engines

are difficult to assess because new materials

will be used as new jet engines are introduced

into military and civilian aircraft. The selection of these materials will be performance

driven, and while some materials may contain

little or no cobalt, others almost certainly will.

Development of the COSAM alternatives to the

point of commercial use is possible over this

period, but these materials will serve as substitutes for currently used superalloys which

will comprise a declining portion of superalloy use. It is also possible that, over this period,

a breakthrough in basic science will occur

which will lead to a better understanding of the

precise role of cobalt in superalloy, with possible reductions of cobalt in the design of new

alloys. Improved understanding of the role of

cobalt and other strategic materials in superalloy is a key purpose of the COSAM program.

Long-Term Prospects

Over the long term, several classes of new

materials that are completely free of cobalt or

chromium may come into use. These alternatives are being actively pursued because of

their potential to extend the maximum operating temperatures (and thus performance) of

turbine blades beyond the current limits of

around 1,150° C or 2,100° F. These materials

include ceramics, composites, and monolithic

intermetallic compounds (or long-range order

materials) and are discussed in detail in the

next section. Table 7-8 summarizes potential

applications for these advanced materials in

the hot section of jet engines,

Table 7-8.—Use of Structural Materials Under Development to Reduce Cobalt and

Chromium Usage in Hot-Section Parts

Composition (percent weight)

Material c o Cr Suitable components

Rapid solidification processed superalloy . . Varies Varies Combustor liners; cases; turbine blades,

vanes, discs, seals.

Long-range order (intermetallics):

Ni . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — HP turbine discs (combustor liners; HP

turbine vanes, blades)

Ti — LP turbine discs, blades, vanes; cases,

Fe j I 111 I 1 ; I j ~ 1 : 111 j 11 I ; 1 I I 11 I 111 I I ~ 111 ~ — Combustor liners; LP turbine discs, blades,

vanes; cases

Directionally solidified eutectics . . . . . . . . . . . 3-1o 4 Turbine blades, vanes

Oxide dispersion strengthened superalloys . . — 15-20 Turbine vanes; (combustor liners, turbine

blades).

Fiber-reinforced (metal matrix composite)

superalloy . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 15 (matrix) Turbine blades, vanes; combustor liners;

cases

Monolithic ceramics . . . . . . . . . . . . . . . . . . . . . . — — Turbine discs, vanes, blades, seals; cases;

combustor liners

Ceramic-ceramic composites . . . . . . . . . . . . . . — — Turbine vanes, blades, cases

Carbon-carbon composites . . . . . . . . . . . . . . . . — — Combustor liners; cases; afterburners;

nozzles; turbine discs, vanes, blades

KEY” HP = High pressure

LP = Low pressure.

( ) = Less likely application — = Minimal or none

SOURCE: Office of Technology Assessment.
——

Ch. 7—Substitution Alternatives for Strategic Materials ● 285

Advanced

There is currently a great deal of interest in

the development of advanced materials such

as rapid solidification processed materials,

long-range order intermetallics, ceramics, and

composites. This interest is driven by the impressive array of properties these new materials offer. They not only offer enhanced properties, but often entirely new combinations of

properties, as well, A side benefit of advanced

materials is their use of little or reduced

amounts of strategic materials.

Many advanced materials are still undergoing R&D and have thus far seen limited commercialization, In selected component applications, some advanced materials are now

being used. The number of applications for advanced materials should increase appreciably

during the next 5 to 20 years—especially where

major design modifications are not needed. In

most critical applications where performance

standards tend to be exacting, however, they

will require much more R&D before they see

widespread use,

Although growth in the use of advanced materials is expected, the overall effect of their

use on future strategic material needs is unclear. Some major technical problems (e.g., the

brittleness of ceramics, difficulties in repairing composites, etc.) must be solved before they

can be used in many critical applications.

Moreover, advanced materials will not necessarily be used as direct replacements for existing materials. In many applications, these

new materials are so different from the alloy

substitutes described previously that redesign

of entire systems is often necessary to benefit

fully from their properties. In addition, use of

strategic materials may just as easily increase

as decrease as these new materials are adopted.

For example, using advanced materials in the

hot section of a gas turbine engine to raise its

operating temperature may increase the temperature in a cooler section of the engine to a

point where it requires the use of strategic

materials. Yet, using advanced materials (e. g.,

composites) to make an aircraft lighter may alMaterials

low the use of smaller engines containing less

amounts of strategic materials. In an economic

sense, advanced materials and materials containing strategic elements may be both substitutes and complements.

The various industries involved in developing and producing advanced materials are doing so because of a belief in the promise of future economic benefit from the introduction of

these materials in existing and entirely new applications, not because they foresee a role for

them as materials substitutes. The advanced

materials industry has the potential to make a

large contribution to future U.S. gross national

product (GNP), The U.S. market for advanced

ceramic materials, for instance, has been projected at $5.9 billion by the year 2000, an

amount 10 times the 1980 market. 25

This emerging U.S. advanced materials industry faces global competition, especially

from Japan and Western Europe, in materials

development, processing, and commercialization. Today, some processed ceramic materials

and components of composites are only available from foreign sources. In some instances,

the United States is credited with the basic research on some material components for which

Japan now holds most of the processing capacity. In others, process licensing has been made

available to U.S. firms for foreign patented

materials.

Compared to their metallic counterparts, advanced materials have relatively brief histories

of use, and this absence of a proven track record often makes designers and their industries

reluctant to use them. Different societies approach institutional barriers to commercialization in different ways. In the United States,

the standard engineering education still provides little, if any, formal training in the use

of advanced materials, Industry must bear the

cost of continuing education. In Japan, indusZ5U .S. Department of Commerce, A Competiti\re Assessment

of the U.S. Advanced Ceramics Industry [Washington, DC: U.S.

Government Printing Office, March 1984), p. xiii.
286 Ž Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

tries are willing to introduce advanced materials to the marketplace at a lower level of confidence in their eventual success than in the

United States. The risk of failure is reduced by

testing new materials in everyday items such

as scissors or high-value glamour products,

such as sporting goods.

The following sections present the current

state of the art of these advanced materials,

and, where known, potential areas for strategic material savings. It must be kept in mind,

however, that many unknowns exist, and the

rapid advance of the science of these materials

could change their prospects in only a short

time.

Ceramics

Advanced ceramic materials are an emerging technology with a very broad base of current and potential applications and an evergrowing list of material compositions (see table

7-9). While this dynamic situation makes it difficult to quantify their future impact, it does

not appear that advanced ceramics will replace

any substantial portion of the U.S. demand for

first-tier strategic materials within the next decade. Beyond 2010, a larger potential for substitution exists if ceramic rotating parts are successfully applied in gas turbine engines. In

order for this major materials substitution to

be technically feasible, however, the brittleness

tendency of ceramic materials must be overcome by improvements in material properties

and processing technologies and the use of ceramics must be integrated with system designs

that reduce the ways in which stresses are

loaded on ceramic parts.

Most ceramic raw materials (see table 7-10)

are not considered potential strategic materials

because they are available in large quantities

from domestic sources. However, the United

States is competing with other countries in advanced ceramics R&D, and loss of a leadership

role in the development and use of ceramic

materials could ultimately result in a dependence on international sources (primarily Japan) for processed ceramic materials and

products.

While a potential decrease in U.S. consumption of strategic materials is an important benefit of ceramic use, the promise of performance

improvements is the main force driving the development of advanced ceramic materials. The

sought-after properties of advanced ceramics

include wear resistance, hardness, stiffness,

corrosion resistance, and relatively low density

(providing a weight savings that can translate

into energy savings), A major attraction, however, is a high melting point and accompanying mechanical strength at high temperatures.

Ceramics offer one of the best possibilities for

raising the operating temperature of heat engines and power generating equipment; and as

the operating temperature in these systems is

increased, system efficiency in energy conversion can increase, resulting in cost savings. The

metallic superalloy currently used in jet en

gines limit operating temperatures to about

2,000° F, whereas ceramic materials can withstand temperatures up to about 2,500° F. Complicated and energy-consuming cooling systems now must be used—even in relatively

low-temperature engines such as automobiles—

to maintain the integrity of metals at operating temperatures. Ceramic materials can also

be used to increase the energy efficiency of

many high-temperature processing systems.

The excellent wear-resistance properties of ceramics could increase productivity in the

machining, chemical, and metal processing industries, where wear and corrosion resistance

are critical. Box 7-A provides detailed information on the properties of ceramics and on the

processes for making them.

Although research into some areas of advanced ceramics is still in the development

stages, new roles in electronics and wear-resistance applications are being filled by ceramics. Neither the economic viability nor the technical capability of using ceramics in many of

the structural applications (e.g., heat engines)

has yet been demonstrated. Although the basic

ceramic raw materials (e. g., silicon, alumina,

magnesium) are plentiful and inexpensive, the

procedures necessary for converting the raw

material into a usable form (usually an ultrafine powder) and then a final product can be

expensive. It has been estimated that from 25
Ch. 7—Substitution Alternatives for Strategic Materials . 287

Table 7-9.—Current and Prospective Uses for Advanced Ceramics

First-tier strategic

materials substitution

Ceramic material Current and potential applications opportunities

-. . . Electric:

Insulating (AI2O3

, BeO,

MgO)

Low-firing and/or glass ceramics, ferroelectrics

(BaTiO3

, SrTiO3)

Piezoelectric (PZT)

Semiconductor (BaTiO3

SiC, AnO-Bi2O3, V2O5,

and other transition

metal oxides)

Magnetic:

Soft ferrite

Hard ferrite

Optical:

Translucent alumina

Translucent magnesium

oxides, muIIite, etc,

Translucent Y2O3

-ThO2

ceramics

PLZT ceramics

Chemical:

Gas sensor (ZnO, Fe2O3

,

SnO2

)

Humidity sensor

(MgCr 2O4

-TiO2)

Catalyst carrier (cordierite)

Organic catalyst

Electrodes (titanates, sulfides, borides)

Thermal:

ZrO2-based

Al2O3

-based

Si-based

IC circuit substrate, package, wiring substrate, resistor substrate, electronics interconnection substrate,

Ceramic capacitor.

Vibrator, oscillator, filter, transducer, ultrasonic humidifier,

piezoelectric spark generator.

NTC thermistor:

temperature sensor, temperature compensation,

PTC termistor:

heater element, switch, temperature compensation.

CTR thermistor:

heat sensor element.

Thick film thermistor:

infrared sensor.

Varistor:

noise elimination, surge current absorber, lighting arrestor.

Sintered CdS material:

solar cell.

SiC heater:

electric furnace heater, miniature heater.

Solid electrolyte for sodium battery.

ZrO2 ceramics:

oxygen sensor, pH meter fuel cells.

Magnetic recording head, temperature sensor.

Ferrite magnet, fractional horsepower motor, powders

tapes and discs (u-FezOS, CrO2

).

High-pressure sodium vapor lamp.

—

Low-temperature firing permits use of copper instead of tungsten, moly

or PGM wires, nickel instead of PGM electrodes.

—

—

Pt, Pt-Rh heaters, Nichrome heaters

Ceramics for Co-Sin

magnets

for

Ceramics for AINiCo

magnets

For a Iighting tube, special-purpose lamp, infrared transmission window materials,

Laser material.

Light memory element, video display and storage system,

light modulation element light shutter, light value.

Gas leakage alarm, automatic ventilation fan; hydrocarbon,

fluorocarbon detectors.

Cooking control element in microwave oven.

Catalyst carrier for emission control.

Enzyme carrier, zeolites, other ceramics.

Electrowinning aluminum, photochemical processes, chlorine production.

Infrared radiator, thermal barrier coatings.

—

—

—

Reduced use of Pt-group

catalyst

—

—

Catalytic processes may

replace Co, Pt

—

Reduced use of W, Cr, Co,

Ni
288 . Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table 7-9.—Current and Prospective Uses for Advanced Ceramics—Continued

First-tier strategic

materials substitution

Ceramic material Current and potential applications opportunities

Mechanical:

Cutting tools Ceramic tool, sintered SBN. WC-Co cemented cutting

(AI2O3

, TiC, TiN, others) Cermet tool, artificial diamond. tools and high-speed

Nitride tool. steels (Cr)

Wear resistant (AI2O3

, ZrO2) Mechanical seal, ceramic liner, bearings, thread guide, pres- Hard facing alloys

sure sensors. (Cr, Co, Mn)

Heat resistant (SiC, AI2O3

, Ceramic engine, turbine blade, heat exchangers, welding Superalloy (Co, Cr)

Si3N4

, ZrO2, others) burner nozzle, high-frequency combustion crucibles.

Biological:

Alumina ceramics implan- Artificial tooth root, bone, and joint. Bone and tooth implants

tation (Pt, Co, Cr-based

Hydroxyapatite bioglass

SOURCE’ Elaine P. Rothman,George B KenneY, and H. Kent Bowen, MIT Materials Processing Center, Poterrtlal of Cefarrric Materla/s to Replace Gobal(, Chromium,

Manganese, and Platinum in Critical Applications, OTA contract study, January 1984.

Table 7.10.—Some Advanced Ceramics Material Families

Families Chemical formula Elements

Alumina . . . . . . . . . . . . . . . . . . . AI2O3 Aluminum, oxygen

Aluminum silicate. . . . . . . . . . . AISi Aluminum, silicon

Barium titanate . . . . . . . . . . . . . BaTiO3 Barium, titanium, oxygen

LAS . . . . . . . . . . . . . . . . . . . . . . . Lithium, aluminum, silicon

Magnesium silicate . . . . . . . . . MgSi Magnesium, silicon

MAS (cordierite) . . . . . . . . . . . . 2MgO~5Si0,02Alz0, Magnesium, silicon, oxygen,

aluminum

Magnesia . . . . . . . . . . . . . . . . . . MgO Magnesium, oxygen

Silicon carbide . . . . . . . . . . . . . SiC Silicon, carbon

Silicon nitride . . . . . . . . . . . . . . Si3N4 Silicon, nitrogen

SiAION . . . . . . . . . . . . . . . . . . . .(various alloys of silicon nitride and alumina)

Zirconia . . . . . . . . . . . . . . . . . . . ZrO2 Zirconium, oxygen

PZT (partially stabilized zirconia) Zirconia with particles of calcia,

magnesia or yttria

SOURCE: Office of Technology Assessment.

to 75 percent of the production cost of ceramic

components is due to a high rejection rate

caused by the poor reproducibility of current

processing steps.26 As new manufacturing technologies mature and the ability to design with

brittle materials increases, prices are projected

to become competitive with existing metallic

technologies. As yet, however, mass production of many advanced ceramics does not yet

occur. Scaling up an experimental process to

a commercial manufacturing level of production, while retaining the desired properties of

ZaE]aine p, Rothman, George B. Kenney, and H. Kent Bowen,

Materials Processing Center, Massachusetts Institute of Technology, Potential of Ceramic Materials to Replace Cobalt, Chromium, Manganese, and Platinum in Critical Applications, OTA

contract report, January 1984, p. 240.

the materials and obtaining production reliability, has not often been achieved.

Ceramics as a Strategic Material Substitute

A growing market for advanced ceramics exists in a number of applications, with limited

implications for the use of strategic materials,

Strategic material substitution, however, may

have a higher potential in the long term (2010

and beyond), particularly in the eventual use

of advanced ceramics in aircraft gas turbine

engines and, to a lesser extent, as components

in automotive gas turbine and heavy vehicle

diesel engines.

As shown in table 7-11, ceramic materials are

displacing some first-tier strategic materials in
.— ——

Ch. 7—Substitution Alternatives for Strategic Materials • 289

Box 7-A.—Ceramics Primer

Ceramics, derived from the Greek word

“keramos,” meaning “burnt stuff,” is a general term for inorganic,27 nonmetallic materials processed or consolidated at high temperatures. Traditionally, ceramics has referred to

the family of earthenware, brick, glass, porcelain, and enamels in common use. The field

now encompasses a wide range of materials

and applications.

Traditional types of ceramics are made from

natural raw materials such as clay, silica, and

feldspar and produced using relatively simple

chemical processing, forming, and firing steps.

Advanced ceramic products, on the other

hand, are produced from ultrafine powder

forms of synthetic materials derived from the

natural raw minerals. The powder production

phase of advanced ceramics processing has

become increasingly critical. Purity, particle

size, shape, and distribution of particles and

how they agglomerate must be rigidly controlled in order to produce reliable, reproducible components, To attain such high-quality,

new techniques such as sol-gel, coprecipitation, and laser synthesis have been added to

conventional powder production and agglomeration methods.

Because a great number of materials are

classified as ceramics, a wide range of properties are available; and ceramic materials

have many characteristics that distinguish

them from metals. They are generally more

stable chemically and thermally and are better insulators than metals. On the other hand,

they are much stronger in compression than

in tension and do not have the same ductility, or “forgiving” nature, of metal. Ceramics

are harder and more rigid than either metals

or plastics and are more stable (retain their

low-temperature properties) at high temperatures.

Owing to their lack of ductility, ceramic

products cannot be formed by the stamping

or forging processes used for metals. Instead,

they are generally processed directly from

highly refined raw material by the consolidation of powder. (Melt formation is used to

form glass and single crystal ceramics.) The

powder is first formed to the desired shape.

Forming methods include isostatic pressing,

injection molding, and slip casting. This

“green body” preform is then further densified by the application of heat (sintering) or

the simultaneous application of heat and pressure (two such processes are hot-pressing and

hot-isostatic pressing). Reaction bonding and

reaction sintering are special sintering processes during which the final composition of

the ceramic material is obtained along with

densification. The combination of processes

selected to produce a ceramic material will affect its ultimate properties.

Ceramics are brittle and fracture with little

or no warning. This characteristic has been

the material’s major barrier to expansion into

a wide range of applications, both technically

and institutionally. Ceramics must be considered and used in ways different from those

taught traditionally to designers and engineers schooled in the use of metals. Because

metals bend and deform prior to reaching a

point of fracture, ceramics cannot usually be

directly substituted for metal alloys on a onefor-one basis. Instead, redesign of components

and systems to eliminate or minimize loadbearing (stresses) are often necessary in order

to substitute a ceramic material.

A considerable amount of the research in

ceramics centers around how to reduce, cope

with, or design around this brittleness. Research takes three approaches: 1) basic research to increase the knowledge base and understanding of the behavior of the materials,

2) improvement of processing technologies to

reduce the probability of brittle failure, and

3) investigation of how varying material compositions can affect ceramic properties.

Brittle failure results from microscopic

flaws (cracks), solid inclusions, and voids in

the microstructure28 of finished products inevitably introduced to a ceramic material during processing. The likelihood of brittle failure increases with the size of such flaws, and

tension loading on a part will lead to the

ITSubstances that do not contain carbon except as a minor constituent.

ZaThe detailed arrangement (size, nature, and distribution) of

phases (combinations of elements) that constitute the overall material.
290 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

growth of existing flaws (crack propagation).

New processing techniques aim at reducing

flaw size and population by the use of homogeneous powders and forming procedures.

Greater processing reproducibility is another

goal.

Another, complementary method of decreasing the probability of fracture of ceramics is to increase the energy required to extend a crack in the material. Such a barrier

to crack propagation is provided by introducing toughening mechanisms into the powders

before processing. Examples include zirconium oxide particles embedded in aluminum

oxide and calcia, magnesia, or yttria added to

zirconia to create partially stabilized zirconia

(PSZ).

wear-resistant applications such as cutting tool

tips, pump seals, bearings and nozzles, and in

heat-resistant applications such as heat exchangers. Turbochargers with ceramic rotors

may be offered by one Japanese automobile

manufacturer within the next few years.

Wear-resistant parts today are often made

from cemented tungsten carbide materials in

which cobalt is used as a binder. This material accounts for 9 percent of the annual U.S.

consumption of cobalt, more than half of which

is estimated to be used in these wear-resistant

applications. (Another major end use is machine dies.) In heat-resistant applications, ceramic materials such as silicon carbide, silicon

nitride, and aluminum silicates can replace

stainless steels and other heat-resistant alloys

containing chromium, cobalt, and some manganese. While it is difficult to quantify the individual quantities of these metals used in

wear- and heat-resistant applications, the overall amounts are thought to be small. The substitution of ceramic materials will, therefore,

result in minor strategic material savings. Additional indirect savings may be generated by

higher temperature operations, energy savings,

and weight reductions made possible by the

use of ceramics.

The ability to identify the flaws cm increase

the reliability of ceramic products. Nondestructive evaluation (NDE) techniques are being developed (by both industry and the Federal Government) to determine flaw size,

shape, concentration, and type with an aim

toward predicting when component failure

will occur. As yet, there is no “perfect”

method for detecting all types of flaws in ceramics. Many methods are not applicable to

the production line or are simply too costly

and time-consuming, NDE techniques include

ultrasonic, radiography, optical, and thermographic methods.

If successfully introduced in the rotor section of turbochargers, advanced ceramics will

find their first commercial rotating, structural

use and will replace nickel superalloys and

nickel-iron alloys containing cobalt and chromium, respectively. With 100 percent penetration in the automotive market, ceramic materials would replace less than 1 percent of

current U.S. cobalt and chromium annual consumption, but may inhibit a growing use of

strategic materials.

Current automotive engines consume a negligible amount of first-tier strategic materials,

but operating engine conditions require air pollution control devices that consume 1.5 percent

of the chromium and 34 percent of the PGMs

consumed annually in the United States. It has

been suggested that the use of ceramic gas turbine and diesel automobile engine technologies

may alter these pollutants, thereby changing

the material requirements for catalytic converters. In aircraft gas turbine engines, on the

other hand, a direct material substitution could

occur with the replacement of superalloy

containing cobalt and chromium currently consumed in portions of such engines. (The aviation industry annually consumes approximately 40 percent of the U.S. cobalt demand
Table 7-11. —Potential of Advanced Ceramics to Substitute for First-Tier Strategic Materials

Current strategic Ceramic materials

material use currently used Extent occurrent

estimated percent of or under Advantage to use Primary factors affecting adoption commercialization — Application annual U.S. consumption consideration of ceramics Technical Economic lnstitutional U S and world —

Near term (before 1995):

Wear resistance.

Cutting tool tips Cobalt, as binder m

tungsten carbide

5 percent

Seals, bearings, Cobalt, as binder m

nozzles, etc tungsten carbide

3 percent

Alumina, silicon Increased productivity

nitride, sialon

Overcoming Inadequate

fracture toughness

Appears competitive with

tungsten carbide

Most U S machine tools cannot

accept ceramic bits Lack of

information within machine tool

industry

Need to standardize parts Consumer awareness and lack of

desire to change; pumps are a

replacement parts market,

longer seal life is not seen as

an advantage to producers

Change over to electrical induction heating which does not

use recuperators. Depressed

state of the domestic steel

industry and metal processing

industries has inhibited change

Ceramics will be used if they

demonstrate superior

performance

2% of U.S. market

Higher in Japan and

West Germany

Alumina- Improved wear and corzirconia, rosion resistance

silicon carbide

No significant barriers Competitive with

tungsten carbide except large (>8 inch

diameter seals)

20% of U.S. and world

market

Improved joining

technology (ceramic/

ceramic. ceramic/

metal) and

reproducibility of SIC

tubes in processing

Overcoming difficulties in

ceramic/metal joining;

improving reproducibility of the ceramic

rotors

Higher initial capital investment than metallic

heat exchangers High

cost of SiC tubing

< 5% of U.S. market

Possibly higher in Japan

Heat exchangers Small amounts of

Large Industrial chromium in highSmall single burner temperature stainless

recuperators steels

Silicon carbide Energy savings Longer

furnace life

Cordierite

Turbochargers Superalloy containing

(automotive) Chromium. (0.02 percent)

Cobalt: (0.4 percent)

Silicon carbide, Higher temperature

silicon nitride capability with lower

mass Potential for

tower costs

Current cost of producing the ceramic rotor

IS high, but economies

of scale are predicted

Expected limited introduction by

Japanese soon, possible market penetration

by 1990

Long term (after 1995):

Automotive diesel

engine (cylinder,

pistons, sensors)

Some chromium and

cobalt in heat resistant

and specialty steels;

in addition, chromium:

1 5 percent, PGMs 34

percent in automobile

catalytic converters

(Use of ceramic parts

will alter operating

temperatures of engines, causing possible change in

converter material requirements )

(same as above)

Silicon, silicon Higher engine efficiencarbide, silicon cies potential. Lightnitride, zirconia weight engine

components

Improved fracture toughness, reproducibility

and reliability of parts

Only prototype parts are

currently produced,

generally, hot pressed

prototype parts require

diamond machining

which IS an expensive

mass production technique. New processing

techniques could

generate significant

economies of scale

Almost revolutionary change in

engine style IS required to fully

realize ceramics potential

Only several demonstration engines so far

Automotive gas turbine

combustors, shrouds,

and rotors

Silicon carbide, Higher engine efflclensilicon nitride, cies, ability to burn

sialon, lithium, any fuel, lower mass

aluminum Potentially lower cost

silicate

improved fracture toughness, thermal shock

resistance, reproducibility and reliability

High cost of processing

due to current techniques and Iimited

production volumes

r ‘Proof of concept” engines

follow-on design will need

thorough, exhaustive road testing to overcame brittle image

of ceramics

Only prototypes and

demonstration testing

NOTE These apphcahons are not meant 10 be all Incluswe but represent key potential applications

SOURCE Elaine P Rothman, George B Kenney, and H Kent Bowen MIT Materials Processing Center Poferrt@ of Ceramic L4aterlak 10 Replace CobaH C/Irornwn Manganese and Plaflflum In Wlca/ App/IcatIorM OTA contract study, January 1984
292 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

and less than half a percent of its chromium

demand, and most of this material is used in

the manufacture of jet engines.)

Owing to their higher temperature capabilities, resistance to corrosive environments, low

inertial mass, potentially low cost, and the

ready availability of raw materials, ceramics

could become an integral part of future power

generating technologies. In contrast to current

and near-term applications, however, major

technical barriers must be overcome before ceramic components for diesel and gas turbine

engines can advance from demonstration projects to commercialization. Improvements are

needed in material properties (most significantly, fracture toughness), processing and

fabrication techniques, ceramic-ceramic and

ceramic-metal joining capabilities, testing procedures, and design methodologies. Ceramic

components must be reliably produced and

manufacturing processes must be capable of

a high degree of reproducibility, neither of

which is possible at the current state of the

technology.

The Ceramics Market and Industry

The worldwide market for advanced ceramics in 1980 was estimated to be $4.25 billion. 29

Electronic components represent the primary

market for ceramics, with cutting tools and

wear parts second and third, respectively.

Roughly half of the present overall demand is

being met by Japanese companies, whose sales

exceeded $2 billion in 1980.30 While the electronic segment now accounts for more than

two-thirds of the total market and offers significant growth potential, it may eventually be

dwarfed by the ultimate size of the high-temperature applications market.

Indicative of a high level of uncertainty, projections made to estimate the value of the advanced ceramics market by 2000 vary widely.

An American Ceramics Society study31 projected a $20 billion world market, half of which

would be domestic. The U.S. Department of

Commerce was more conservative in a study

released in 1984. It projected total domestic

shipments (as equivalent to future market potential) of advanced ceramics of $5.9 billion.

Included were electronics shipments of $3.5

billion; heat engines, $840 million; cutting

tools, $960 million; and wear parts, $540 million.32 In yet another estimate, advanced ceramic usage in automotive engines alone was

projected to reach $30 billion on a worldwide

basis by the year 2000.33

Except in electronics, advanced ceramic

materials have penetrated a very small share

of their recognized end use markets worldwide, primarily due to the state of the technology and relatively high costs of its products.

While low-volume production adds to these

high costs, demonstrated technical performance will not necessarily create markets for advanced ceramics. Roughly half of the cost of

a typical ceramic component is estimated to

be due to production rejects.34 An incremental

introduction into most markets is expected until ceramic component mass production techniques are developed which can reproducibly

fabricate reliable products and customer acceptance can be firmly established. In automobile markets, revolutionary ceramic engine

designs may have to await a lengthy proving

process prior to successful commercialization.

If it is successful, the ceramic turbocharger—

the first commercial structural heat engine use

of advanced ceramics—can provide invaluable

information for this process and the beginnings

of institutional acceptance of the structural capabilities of advanced ceramics.

The essence of the advanced ceramics business is that common starting materials are con-

~9ROthrnan, et al,, op. cit., p. 238.

~Ibid., Japanese firms were estimated to hold 52 percent of

the worldwide ceramic powders market; 61 percent of electronic

IC packages/substrates; 91 percent, piezoelectrics; 43 percent,

capacitors; 63 percent, thermistor/varistors; 79 percent, ferrites;

II percent, gasdlmmidity sensors; 44 percent, translucent ceramics; 12 percent, cutting tools (carbide, cermet); and 48 percent,

structural ceramics (heat and wear resistant).

Slrbido

32u.s. Department of Commerce,, op. cit., p. 13. The Department of Commerce cautioned in its study that it is too early in

the history of this new industry to predict its future with a high

level of confidence.

33AccOr&ng to Kent Bowen of MIT, as quoted in Rothman,

et al., op. cit.

s41bid.
Ch. 7—Substitution Alternatives for Strategic Materials ● 293

verted into high value-added commodities and

components by sophisticated, high-technology

processing and manufacturing systems. Exacting standards require extensive quality control.

Generally, material producers in the ceramics

industry have been and still remain vertically

integrated; thus, raw materials are processed

and fabricated into component parts within a

single company. Relatively few producers supply ceramic raw materials, and even fewer supply new advanced ceramic powders. The evolving advanced ceramics industry consists of

traditional ceramics firms expanding into new

applications, new end users taking on the task

of being materials suppliers, and conventional

materials firms expanding into the ceramics

arena. 35

The United States is not alone in its interest

in advanced ceramic materials. It already is

competing with and will continue to encounter stiff competition from Japan and Western

Europe in tapping future markets. The Japanese industry is currently the sole source for

some high-grade ceramic powders (e. g., silicon

carbide) and has eclipsed the rest of the world

in supplying the electronics market. se A British firm, which holds numerous patents for

sialons (a ceramic composed of oxides and nitrides of silicon and aluminum), now licenses

others to manufacture these materials.

Japan began its comprehensive advanced

ceramics R&D program only in 1977, but its

government-industry-university collaborative

effort is widely regarded as the best organized

and financed in the world, The Japanese are,

of course, more materials and energy importdependent than the United States; and a prime

goal of their research efforts is to ease that dependence. But they also view advanced ceramics as a technology which will be part of an

tsFOr a review of the status of the U.S. advanced ceramics industry and the firms involved, see the U.S. Department of

Commerce, A Competititre Assessment of the U.S. Advanced

Ceramics Industry, op. cit.

t@Not a]] such sales in the United States are imports, however.

Kyocera International, a subsidiary of Kyoto Ceramic Co. of Japan, established production facilities in San Diego in 1971 which

now supply 70 percent of the U.S. demand for ceramic packaging for integrated circuits. See “The Japanese Score on a U.S.

Fumble, ” Fortune magazine, June 1, 1981, pp. 68-72,

industrial base for the future. In an issue of The

Japan Industrial & Technological Bulletin37 in

1983, R&D in ceramics is recognized as involving “huge investment risks” and requiring “a

relatively long lead time before the commercialization of these materials. ” As such, the

study concluded that the Japanese government

“should take the main role in promoting advanced and fundamental research as well as

development. ” And, the primary objectives of

the Fine Ceramics Office set up in July 1982

under the auspices of the Ministry of International Trade and Industry (MITI) are to “get

a comprehensive picture of the domestic fine

ceramics industry, systematize the industry,

consolidate the industry’s foundation and

adopt comprehensive policies designed to promote the industry’s sound growth. ”

While the United States, Japan and Western

Europe have all followed interdisciplinary approaches in their independent research efforts,

the U.S. effort has leaned toward basic research and design methodologies while others

have emphasized materials supply and processing. As a consequence, some feel that the

United States may end up lagging behind in

the implementation and exploitation phases of

advanced ceramics technology. In advanced

ceramics (as in other new technologies), the

Japanese seem willing to take the risk to apply

state-of-the-art materials to consumer products.

This provides field testing for improvement of

the knowledge base of the technology

tion experience and cost reductions

come to finance further research efforts

while gaining customer acceptance

materials,

producand in-

, all the

for new

If one assumes that the Japanese rather than

the United States becomes the dominate factor in an all-important future automobile ceramic engine market, the United States could

be adversely affected by a decline in the GNP,

loss of employment opportunities, shift in the

——

37 Japan Externa] Trade Organization, The Japan Industrial ~

Technological Bulletin: The Development of Structural Fine Ceramics in Japan, Specia] Issue, No. 15. 1983, pp. 6-7. Note that

Japan uses the term “fine ceramics” for what is commonly referred to as “advanced ceramics” in the United States.
294 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

balance of trade, and loss of savings in energy

costs .38

One aspect of the expanding ceramics industry for which there is little data is the possible

environmental, health, and safety effects on the

communities and workers where the processing occurs. While some may assume that these

processes may be “cleaner” than those of existing metal production, the statistics as they

are now collected and aggregated by the Environmental Protection Agency and the Occupational Safety and Health Administration based

on the traditional ceramics industry do not correspond to the future industry,

Research in Ceramics Applications

Ceramics is an ancient art. Despite—or because of—the age old and common use of ceramics, it remained essentially an art until recently, when more exacting standards were

asked of the materials. One major engineering

textbook on ceramics states in its 1976 edition

that:

. . . until a decade or so ago, ceramics was in

large part an empirical art, Users of ceramics

procured their materials from one supplier and

one particular plant of a supplier in order to

maintain uniformity. Ceramics producers were

reluctant to change any detail of their processing and manufacturing (some still are), The reason was that the complex systems being used

were not sufficiently well known to allow the

effects of changes to be predicted or understood, and to a considerable extent this remains true.39

British scientists conducted much of the

original research in the 1950s and 1960s in ceramics theory, raw materials development, and

processing methods. Not until the 1970s were

ceramics developed to the point where they

could be considered engineering materials in

that their chemical and physical properties

could be altered to match intended functions

3LIL. R, Johnson, A, P. S. Teotia, and L. G. Hill, A Structura]

Ceramic Research Program: A Preliminary Economic Analysis.

ANL/CNSV-38. Argonne National Laboratory, March 1983.

wwr, D. Kingery, H. K, Bowen, and D. R. Uhlmann, ~ntroduction to Ceramics, Zd ed, (New York: John Wiley & Sons, 1976),

p. 1.

in various applications. This short period of development time probably contributes to the

relatively low rate of usage of advanced ceramic materials so far,

Following is a discussion of the current

status of the research and use of advanced ceramics in cutting tool, wear resistance, heat exchanger, and heat engine applications.

CUTTING TOOLS40 

Cutting tool applications represent a limited

but growing and potentially valuable market

for ceramic materials. At present the total U.S.

market for cutting tools has been estimated at

$2.2 billion per year. Advanced ceramic cutting tools hold 2 to 3 percent of this market

(compared to tungsten carbide at 45 percent).41

Nine percent of the annual U.S. consumption

of cobalt is used as a binder in tungsten carbide material.42

New cutting tools are continually being

sought to increase manufacturing productivity

by attaining higher cutting speeds and reducing the downtime of cutting machinery through

improved lifetime of tool inserts. Ceramic

materials have proven feasible in this application and may offer higher performance than

existing cutting tool materials; but they must

compete with new metal alloys, coatings, and

processing methods (e.g., powder metallurgy)

for market penetration. No one material meets

all cutting requirements in all applications, and

advanced ceramic cutting tools tend to be

higher in cost than conventional tools,43 owing

to their smaller volume production and more

complex processing. This higher initial cost,

however, can be mitigated by the higher cut-

— —.————

aCutting tools are insert pieces—the cutting edge—held and

guided by machine tools. The process of machine tooling shapes

and removes excess materials from manufactured products to

produce desired tolerances.

AIU.S. Department of Commerce, Op. Cit., P. 35.

AZRothman, et a]., op. Cit., p. 168.

‘sAccording to an interim draft report (January 1984) by

Charles River Associates for the National Bureau of Standards,

Technological and Economic Assessment of Advanced Ceramic

Materials: A Case Study of Ceramic Cutting Tools, a typical silicon nitride cutting tool is currently sold in the $18 to $20 range,

whereas typical tungsten carbide cutting tools are priced at $4

to $5.
Ch. 7 —Substitution Alternatives for Strategic Materials ● 295

ting speeds, if downtime due to lower reliability is not excessive,

An increase in the use of advanced ceramics

is dependent on improvements in ceramic materials and the machine tools in which they are

used. Advanced ceramic materials have greater

abrasion, wear, and creep resistance than their

carbide counterparts, but less strength, fracture

toughness, and thermal shock resistance. The

attributes of ceramic materials provide superior performance at high cutting speeds

(especially demanded by the automotive and

aerospace industries), which can translate into

productivity gains. But widespread conversion

to advanced ceramic cutting tools will require

investments in new machine tools as many of

those still in use have neither the speed, power,

nor rigidity needed to use ceramic cutting tools

effectively.

While approximately two-thirds of current

ceramic tool sales are alumina (Al2O3

), introduced in the 1960s, the newest cutting tools in

use today are based on the silicon family. (Silicon nitride exhibits twice the fracture toughness of alumina.) Rapid development of silicon

nitride ceramics has been the result of accelerated research activity over the past decade on

high-temperature structural ceramics for use

in advanced energy conversion systems. Ford

Motor Co., for instance, is now moving toward

commercialization of its “S-8” material, which

was developed during research on materials for

gas turbine rotors.

Most of the direct research in cutting tools

in the United States is conducted by private industry and has been estimated at $1 million per

year. 44 Indirect benefits may accrue, however,

from the much heavier investments by government, industry, and academia in structural ceramics R&D.

Japan and Western Europe are considered to

be ahead of the United States in the development and utilization of ceramic cutting tools.

(About half of the advanced ceramic tools sold

in the United States are imported from Japan.)

The difference in higher usage has been attrib-

~41bid., p. 45.

uted to the fact that in the United States’ older

machine tool industry equipment is outdated

and must be modernized or replaced before ceramic tools can be used to their full advantage .

4 5

WEAR APPLICATIONS

Wear applications are often in low-temperature environments in which resistance to abrasion and corrosion are the primary performance goals. Applications include ball and roller

bearings, valves and pipefitting, industrial

fasteners, and pumping equipment such as

seals, liners, and nozzles. The traditional

materials for those applications are cemented

tungsten carbide and wear-resistant steels (in

which chromium is used as an alloying agent

for its hardenability). Up to about 3 percent of

U.S. cobalt consumption may be used in all

wear-resistant applications and about 2 percent

of chromium. Thus, strategic materials savings

could result from more extensive substitution

of ceramic materials in wear applications.

While the technical feasibility of wear parts

made from ceramics (primarily aluminum oxides, and silicon carbides, silicon nitrides) has

been demonstrated, the Department of Commerce has estimated that ceramics currently

hold less than 1 percent of the annual $3.3 billion U.S. market.46 The extent to which they

will assume a greater share of these markets

will be strongly affected by performance versus

cost tradeoffs. The current state of processing

and fabrication techniques for ceramic wear

parts (rather than raw materials costs) leads to

the higher initial costs than those for metal

parts, Ceramics can, however, provide longer

service life than metals.

The potential to resist fatigue, corrosion, high

temperatures, and loss of lubrication better

than metals make ceramic materials attractive

for ball and roller bearing uses, Their high cost

of fabrication, however, makes them imprac4sE Dow Whitney, “Process in Ceramics Research for Cutting Tools in the U. S., West Germany, Japan and Sweden, ” paper given at the National Science Foundation conference on Substituting Non-Metallic Materials for Vulnerable Minerals, June

1983, p. 1.

SeDepartment of Commerce, Op. cit., p. 35.
296 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

tical in many applications. Ceramic bearings

tend to be consumed primarily by petroleum

and chemical industries, which have demanding performance standards (e. g., in corrosive

environments) and in specialized aerospace applications, all of which can absorb the high initial cost.47 Pump seals are the largest wear application market now held by ceramics. The

properties required are hardness, low friction,

high resistance to corrosion, and high-temperature capability. Ceramics (especially, silicon

carbide and silicon nitride) have been shown

to be superior to metals in performance in this

application and, with improved manufacturing techniques and reduced costs, are expected

to assume more of the market. Nozzle parts

must withstand high wear and abrasion resistance properties which the hardness of ceramics provides. 48

Research in wear applications for ceramics

is primarily conducted by the private sector,

much of which remains proprietary, resulting

in little transfer of technology. The research

is concentrated on improving the properties of

the materials, on manufacturing techniques to

reduce costs, and on nondestructive evaluation

methods to gain reliability.

HEAT EXCHANGERS

Competitive pressure in high-temperature industrial processes, as well as the rising cost of

energy and the reduced availability of highgrade fuels in the 1970s, have led to the development and expanded use of energy conservation devices such as heat exchangers.49 As

in other high-temperature applications, the use

of advanced ceramic materials in heat exchanger technology allows for improved performance over metals and often makes the

technology possible. In addition, ceramics can

provide better oxidation and corrosion resistance, which can result in longer component

—

qTceramic bearings Cost about $100 while simi]ar steel bearings cost from $1 to $3,50.

aaRothman, et al., op. Cit., p. 191.

@’Heat exchanger” is a generic term for any device that transfer heat from a fluid flowing on one side of a barrier to another

fluid flowing on the other side of the barrier. Here, the term refers

to the use of such devices in combination with industrial furnaces, stationary power generators, and engines.

lifetime. Constraints to the expanded use of

ceramics in this application are those specific

to individual types of heat exchangers, but include the need for improved materials properties such as thermal shock resistance and resistance to certain corrosive environments, the

development of joining and sealing technologies, and low confidence in the reliability of

the ceramic components. The use of ceramics

is still not cost effective vis-a-vis metal alloys

in some heat exchanger designs, especially for

large industrial furnace and power systems,

which are constructed from an array of thinwalled ceramic tubes, Processing technologies

are still being refined to provide high reproducibility for long (greater than about 8 feet)

tubes. In addition, sealing against leakage between the hot and cold streams has not been

fully successful.

Because of their high temperature and often

corrosive environments, heat exchangers have

been predominantly fabricated from stainless

steels and superalloy; therefore, substitution

of ceramic materials will result in some savings of chromium and cobalt, although the

amount is difficult to quantify due to lack of

specific end use reporting. On the other hand,

much recent heat exchanger technology has

been made possible by new ceramic materials,

and the resultant growth in the use of ceramic

materials are not as replacement materials. The

use of ceramic materials, such as high-temperature cordierite (a magnesium alumina silicate

commonly referred to as “MAS”), silicon carbide, silicon nitride, aluminum oxide, and lithium-alumino-silicate (LAS) in this application

will be driven by energy costs faced by users

and the unit cost of fabricating ceramic components.

The use of ceramics in recuperators, a type

of heat exchanger that allows a furnace to operate more efficiently by recycling its waste heat

to preheat incoming combustion air, has received a considerable amount of attention.

Both development and commercialization research in ceramic recuperators was contracted

by DOE’s Conservation Office through GTE

Sylvania and the Carborundum Co. As a result,

small ceramic recuperators are now commer-
Ch. 7—Substitution Alternatives for Strategic Materials . 297

cially available and are economically viable.

They can be retrofitted to existing furnaces

with the modification of furnace burners to

cope with the higher temperatures generated.

The performance advantage of ceramic recuperators is expected to encourage their use in

new furnaces and as add-ens to unrecuperated

furnaces; but a changeover in large industrial

systems will be slow owing to the high investment costs of such installations coupled with

the current stabilization of energy costs. The

GTE “Super Recuper” is reported to save some

industrial furnaces 30 to 60 percent in fuel by

enabling furnaces operating at 2,500° F to preheat incoming air to 1,600° F. Unlike the long

tubular array systems, GTE’s counterflow plate

design heat exchanger does not present any

major ceramics processing problems. But materials properties improvements are needed in

order for the device to be applicable in certain

highly corrosive environments such as those

in the glass industry,

A variety of other heat exchanger applications are being investigated by both the private

sector and DOE. They include ceramic regenerator cores for inclusion in gas turbine engine

designs and specific designs for use in cogeneration and combined-cycle power generation

equipment.

HEAT ENGINES

Ceramic materials are under active investigation by both the Federal Government and industry for use in the propulsion of automobiles,

trucks, military equipment (tanks and missiles),

and aircraft as well as stationary uses, such as

power-generating equipment. Research in these

applications is being conducted to achieve significant advantages over the use of metal alloys, including fuel economy, improved performance, reduced maintenance, and possible

reduction of pollution emissions, with savings

of strategic materials a secondary objective.

Private sector R&D is focused primarily on

advantages of ceramics that could translate

into direct cost savings or improved product

competitiveness. A review of the governmentsponsored research in ceramic heat engines in

table 7-11 shows that the main focus of that effort has concentrated on the gas turbine engine

for automotive applications.

The ceramic materials being applied today

to these technologies are generally termed

“structural ceramics.” They include monolithic

forms of the silicon carbide (SiC), silicon nitride (Si3N4

), zirconia (ZrO2), and aluminum silicate (AlSi) families of ceramic materials. Ceramic composites are also being considered for

engine applications because of their superior

strength and hardness, low thermal expansion,

and wear resistance, which may allow them to

overcome the fracture problems of the monolithic ceramics. However, ceramic composites

have been found to lose their strength at higher

temperatures, a problem that has not yet been

resolved,

Ceramics are likely to see service in the hot

sections of engines, progressively, as follows :50

●

●

●

●

●

●

●

Turbochargers: static parts and rotors,

Small stationary electric power generators,

similar to airplane auxiliary power units

(APUs).

Large stationary electric power generators,

then mobile (ground and marine) APUs.

Short-life turbojet and turbofan engines for

missiles.

Heavy-duty turboshaft vehicular propulsion engines; military truck, tank, off-road

vehicular, marine engine.

Automobile propulsion,

Human-rated aircraft propulsion and utility electric power generation.

Technical advances gained from continuing

research efforts are necessary before ceramic

materials can serve in these applications.

VEHICLES

Ceramic materials are being considered either as direct substitutes for selected components of existing gasoline and diesel engines

or for use in engines designed specifically to

benefit from the properties of ceramic materials.

Component substitution in gasoline engines

offers only minor improvements in fuel econSoparkinson, op. Cit.
298 • Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

omy or power production over conventional

all-metal engines. As such, while selected components (cylinder liners and heads, exhaust and

intake ports, valves, bearings) of such engines

may be fabricated from ceramics, a “ceramic

gasoline engine “ is not considered a possibility, Ceramic diesel engines, on the other hand,

can provide a 10- to 30-percent reduction in

fuel economy and improved reliability due to

the elimination of cooling systems. Since only

minor amounts of strategic materials are used

in conventional engines, ceramic components

substitution can only marginally affect the use

of strategic materials. One possibility, as yet

unproven, is that the pollutants emitted by such

hybrid metal-ceramic engines will be lower,

owing to higher operating temperatures, and

that strategic materials savings could occur

with a shift in the materials requirements (now,

PGMs and chromium) consumed by automotive catalytic converter systems.

Turbochargers. —Turbocharger rotors, now

made primarily of nickel-based superalloys and

nickel-iron alloys, could be a significant nearterm use of ceramics. This technology51 is one

of the few heat engine applications being investigated with mostly private rather than government funding and is driven by a desire to

combine the fuel economy of today’s small cars

with the performance of yesterday’s larger engines, As this competition for greater fuel economy/performance increases in the automotive

industry, the inclusion of ceramic rotors in turbochargers may retard an otherwise growing

market for superalloy. The main candidate

material for ceramic rotors is silicon nitride.

The primary attraction of the ceramic rotor

is the improved performance provided by its

low rotational inertia, which enables a quick

response by the turbocharger at low engine

rpms. The higher weight of metal alloys causes

a delayed response called turbo lag. Secondly,

there are expected material cost savings to be

gained from the use of ceramics, along with

sIA turbocharger, added to a standard internal combustion engine, pumps hot air (compressed by action of a turbine spun by

hot exhaust gases) into the engine. Other options for fuel economy are available through redesign of the standard engine to

improve its performance by reducing the amount of waste heat.

overall weight savings (providing additional

fuel economy). The high-temperature characteristics of ceramics are not a prime factor.

Two technical problems constrain mass

production of ceramic rotors for turbochargers:

the difficulties in joining ceramics and metals

and uncertain reliability and reproducibility in

materials processing. Nevertheless, ceramic

turbochargers may be offered—to a limited

extent—by the Japanese automobile industry

within the next few years. Two Japanese firms

reportedly began delivering sample turbochargers to Japanese car companies in mid-1983 for

testing purposes. One of these firms announced

plans to begin production in late 1984 and predicted that its ceramic turbines will be massproduced within 3 to 4 years. The major U.S.

turbocharger manufacturer, Automotive Products Division of AiResearch, competes in international markets and expects to have its ceramic rotor turbocharger ready by 1986 for the

1987 model year, If the ceramic turbocharger

is successfully marketed by the Japanese industry, the U.S. automobile industry is expected

to compete by offering similar turbochargers

on their specialty market automobiles, where

such gains in performance are desirable and

the consumer may be willing to absorb added

costs (both initial and maintenance).

The ceramic turbocharger is seen as a precurser to the use of ceramics in gas turbine engines where the rotor must withstand higher

stresses. Successful commercialization of the

ceramic turbocharger could provide valuable

information to accelerate the application of ceramics to gas turbine engines.

Gas Turbines and Diesel Engines.—Research in new

automotive engine designs to incorporate ceramic materials has been a major beneficiary

of government support. Technologies now being investigated under contract to industry are

the “adiabatic” (or, minimum heat loss) diesel

and gas turbine engines. Industry also supports

R&D in engine technologies through cost sharing on government contracts and its own private basic research. While various government

projects have been funded sporadically since

the 1940s, the heaviest support has occurred
Ch. 7—Substitution Alternatives for Strategic Materials ● 299

during the last decade.52 NASA was directly

involved in the early research with the Department of Defense and the Department of Energy

(DOE) now taking the lead. The current major

projects are DOE’s Automotive Gas Turbine

(AGT) program to develop a gas turbine engine

by fiscal year 1986 and the U.S. Army Tank Automotive Command (TACOM) program with

Cummins Engine Co. to develop the adiabatic

diesel engine for use in military vehicles. It is

believed that this diesel engine technology will

eventually be transferred to the private sector

for use in heavy-duty trucks. Automotive use

of both the diesel and the gas turbine engines,

if commercialized, is not expected until after

2000.

The benefits foreseen in use of the adiabatic

diesel engine are increased fuel economy (due

to the reduction of lost energy and the elimination of the need for a cooling system), reduction in weight and inertia, and greater engine

reliability and maintainability. Energy loss may

be reduced as much as 50 percent, and fuel

consumption, 25 percent over conventional

diesel engines with a significant increase in

power.

The TACOM/Cummins research project

started with development of ceramic components for conventional diesel engines. A second phase followed to design and test an

uncooled, nonadiabatic diesel engine with ceramic and metal parts. R&D is now proceeding on an adiabatic diesel engine, combining

both a ceramic combustion system and a turbocompound unit (to utilize waste heat). Remaining technical issues include the need for

further materials research and the development

sZAc~ording to a draft interim report (November 1983) by

Charles River Associates for the National Bureau of Standards,

Technological and Economic Assessment of Advanced Ceramic

Materials: A Case Stud~r of Ceramics in Heat Engine Applications:

Since 1976, total U.S. Government support for R&D in ceramic

heat engines has exceeded $10 million per year. In 1981, 74 percent

of tota! go~.ernment funding was provided by DOE, 23 percent b y

DOD, and about 3 percent by hTASA, In addition, Charles Ri\er Asso-

[.iates ha~re estimated that private funding of structural ceramics R&D

1s roughly’ equal to the amount of funding received by the prit’ate

~ector from the government in this area. However, little information is available about the focus of this private funding, i.e., what

arnou n ts are devoted to heat engine applications.

of component manufacturing methods that are

cost effective and provide reproducibility.

After Congress passed the Automotive Propulsion Research and Development Act (Title

III of Public Law 95-238) in 1978, DOE and

NASA initiated the AGT program. Two contracts were awarded: one to General Motors

(Allison and Pontiac divisions) for the AGT 100

and another to the Garrett Corp. and the Ford

Motor Co. for the AGT 101. Each of these contracts involve the design, development, and

testing of an advanced ceramic automotive gas

turbine engine. In the final versions the engines

will have been designed from scratch to exploit

fully the material properties of ceramics. Since

its inception in 1980, the AGT program has

been revised to take the development of the ceramic engine through to the proof-of-concept

stage. A probable decrease in funding in fiscal

year 1985 will require another shift in the overall program goals or organization.

Both the AGT 100 and 101 have successfully

passed an initial testing phase. The models

tested were designed using ceramics for static

components, retaining metal for rotary parts.

The phase now underway will test versions designed with ceramic rotary parts.

One of the largest technical problems foreseen with the application of ceramics as engine

components is that of gaining reliability and

reproducibility in the large-scale production

that commercial automotive application will require, The ultimate phase required for bridging a tough attitudinal barrier (“ceramics are

brittle”) and to ensure transfer of this new engine technology will be to convince engineers,

designers, the automobile industry management, and consumers that ceramics can indeed

serve in these capacities. This will require rigorous testing of ceramic engines in real environments—in automobiles subjected to daily

use over long periods of time.

Again, the benefits of strategic material savings from these new automobile engines will

be minor except for the possible changes in

materials now used for catalytic converters. Results from the use of advanced ceramic

materials in vehicle applications and the knowl-
300 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Photo credit A//isorJ Diw.won, Genera/ Mofors

Ceramic components are being evaluated in the advanced gas turbine being developed by Allison Division of General Motors

for the U.S. Department of Energy and NASA

edge gained in processing of those materials

will undoubtedly benefit the development of

aircraft gas turbine engines, where real strategic materials savings may be realized from

the substitution of ceramics for superalloy

(chromium and, especially, cobalt).

AIRCRAFT TURBINE ENGINES

The use of ceramics in gas turbine engines

for human-rated aircraft is believed to be one

of the most challenging and difficult applications for advanced materials, owing to high

performance demands and the extremely high

risk of use involved. It is, however, an area in

which the private sector is acutely interested

because of a continuing desire to increase the

performance of jet engines. This performance,

which translates into fuel economies, increases

as the inlet temperatures for a gas turbine engine increases. The current materials—superalloys—used in the hot sections of the engine

have operating limits over time of about 1,9500

F. Ceramics, on the other hand, can withstand

operating temperatures up to about 2,500° F.

This higher thermal efficiency allows for a reduction in airflow through the engine and a

corresponding smaller engine size. NASA has

estimated possible introduction of monolithic

ceramics as turbine blades in this application

around the year 2010.53 

Ssparkinson, op. cit.
Ch. 7—Substitution Alternatives for Strategic Materials

Both the Air Force and NASA54 have maintained a continuing interest in ceramic gas

turbine engine development, In the private

sector, both Pratt & Whitney and General Electric Co. have contributed to basic research on

structural ceramics for potential aircraft engine

applications. The Air Force Materials Laboratory has sponsored small research programs on

the evaluation of ceramics and ceramic composites with potential use in aircraft systems.

NASA’s Lewis Research Center, in addition to

managing DOE’s AGT programs, has sponsored

small research programs on structural ceramics. NASA has also developed an overall

program to augment its current research efforts

in ceramics. This program, with its focus on

the aircraft engine, is intended to broaden the

technological base of advanced ceramics by coordinating research in the various technical

needs (e. g., materials processing, nondestructive testing, design methodologies). The development of this plan was coordinated with other

government agencies and industry but was not

included in the final NASA fiscal year 1985

budget proposal.

Much work remains in developing monolithic ceramics and processing techniques and

gaining applications experience before these

materials will be acceptable for human-rated

aircraft. The advantages of ceramics with regard to engine performance and, to a lesser extent, the potential for reducing the overall use

of first-tier strategic materials are incentives

that will help promote the still-substantial research, development, and commercialization

tasks ahead.

STATIONARY ENGINES

Stationary engines being considered for ceramic materials applications are primarily gas

turbines for industrial and household use, including accessory power units for emergency

or peak load service. The possible development

of these small generators for near-term use

have benefited from research sponsored by

s~The budget for NTASA’s Ceramic Technology for Aerospace

Heat Engines was an estimated $3.3 million in fiscal year 1983

and $4.4 million in fisca] year 1984.

● 3 0 1

DOE and the private sector. In the longer term,

both General Electric Co. and Westinghouse

are investigating the application of advanced

ceramics in large gas turbines for electric powerplants. It is believed that the thermal efficiencies obtainable with the use of ceramics can

result in considerable energy savings. To be

economic, the ceramic materials will have to

withstand long component lifetimes. These

large units are not expected for use until 2000.

Strategic materials savings could be realized

through reduced use of wear- and corrosionresistant materials, such as chromium alloy

steels.

Composites

Two or more materials, when combined into

a composite, can yield a product with very impressive properties, including high strength

and stiffness, low weight, and good corrosion

and chemical resistance. In addition, composites offer engineers unparalleled opportunities

to tailor materials to particular applications.

Most composites contain little or no strategic

metals, As a result, the anticipated growing

market for composites has the potential to displace some strategic metal use.

Technically, a composite is any material

composed of two or more physically distinct

phases. This category includes, among other

materials, filled plastics, laminated materials,

dispersion-strengthened alloys, and fiber-reinforced materials. Of these, the latter two are

most likely to affect strategic materials usage.

Dispersion-strengthened alloys were covered

in the superalloy substitution section, so the

discussion here will be limited to fiber-reinforced materials (commonly called advanced

composites). The basic characteristics of fiberreinforced composites are outlined in box 7-B.

Advanced composites can be made from several different combinations of matrix and reinforcement materials, but are generally classified by matrix material. Table 7-12 shows the

most common matrix and filament combinations. Organic (polymeric) matrix composites

(including fiberglass reinforcements) are the

only composite materials in widespread com-
302 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Box 7-B.--Fiber-Reinforced Composites

Fiber-reinforced composites, which are continuous filaments or whiskers embedded in a binding

matrix, exhibit properties that exceed those of its constituents taken alone. Each constituent serves

a special function. The filaments provide the strength and stiffness, while the matrix provides the

body of the finished composite product and transfers the stresses and loads to the fibers.

The mechanical properties of a composite depend on the composition of both the matrix and

the fibers, the relative proportion of each, the orientation of the fibers, and the length of the fibers.

By varying these parameters, the strength of a composite can be optimized for the loads encountered

during its service.

The filaments, which account for 25 to 80 percent of the composite by weight, can be either

continuous or discontinuous (whiskers). Composites with continuous fibers have outstanding directional properties, while those with discontinuous fibers lend themselves more readily to such conventional metalworking operations as forging, extrusion, squeeze casting, and welding.55

In addition to strength and stiffness, the filaments enhance other properties of the composite.

Often, the filaments will increase the maximum service temperature by adding high-temperature

strength to the composite. Also, certain filaments can enhance thermal stability because they do

not expand greatly when heated (i.e., low coefficient of thermal expansion).

Since most of the load-bearing responsibility falls on the fibers, the importance of the strength

characteristics of the matrix material is diminished. In fact, composites with the weaker, but lighter

matrices such as plastics, carbon, and aluminum can have good strength. Therefore, composites

are known to have good strength and stiffness for their weight (i.e., high specific strength and

modulus).

The matrix provides more than the body of the composite. In unidirectional composites, which

have all the filaments aligned in a single direction, the matrix provides most of the transverse (perpendicular to the fiber direction) and shear properties. Additionally, the matrix is responsible for

much of the corrosion and oxidation resistance and for providing the visual and textural appearance of the finished composite product.

Although matrices and fibers serve different functions, they are not independent. The thermal

expansion mismatch between matrix and fiber must below to minimize thermal fatigue problems.

Also, both phases must be chemically compatible at both fabricating and operating temperatures

in order to prevent interdiffusion and the concomitant degradation of fiber strength. In some cases

where such compatibility is inconvenient, barrier coatings can be applied to the fibers to inhibit

interdiffusion.

SORobart R. Irving. “Metal Matrix Composite pose a Big Challenge to COnV9ntiOn~ mOYSt” 1- 4N, Jan. IZ, 19839 P. 35.

mercial use. Carbon/carbon composites are in

limited production for aerospace applications.

Metal and ceramic matrix composites have yet

to be commercialized, except in highly specialized applications.

prospects for composites to displace strategic materials varies by composite class, Organic or polymeric composites—the only composites now in widespread use—will seldom

directly replace the first-tier strategic materials

considered in this report, but the indirect effects of their use could be significant, as was

brought out at a recent National Science Foundation workshop:

It is unlikely that this country will witness

any wholesale and direct substitution of composites for critical and strategic materials unless some national emergency dictates such

steps. Rather, composite materials will make

inroads in those areas where weight and/or

cost are the primary drivers. Most of the critical materials, namely cobalt, chromium, platinum, tungsten and tantalum are used because

of their unique resistance to high temperature,
Ch. 7—Substitution Alternatives for Strategic Materials ● 3 0 3

Table 7-12.—Advanced Composite Materials Options

NOTE Circles ind!cate composites which have been or are now In production status

SOURCE Stanley L Channon, /ndustria/ Base and Qua/IfJca/Ion of Composfte Mater(a/s and .SWctwes (An Execut/ve Overview) (Alexandria. VA. Institute for Defense

Analyses, March 1984), working paper, p 3

corrosion or their catalytic phenomena. In no

way can the composite materials we ordinarily consider, graphite, glass, or Kevlar with epoxy, polyimide, or thermoplastic resins be considered for direct substitution. The impact of

composites will come indirectly in secondary

effects. An example is a gas turbine in which

the weight reduction by the use of composites

for stationary, low-temperature components

will cascade into downsizing of high-temperature components and result, not in elimination

of the critical metals, but in a significant reduction in the amount of strategic material

needed. se

Carbon/carbon composites, used primarily in

aerospace applications, may also have indirect

effects on strategic materials through redesign

of products. Metal and ceramic/glass matrix

S“William E. Winters, “Use of Composites in High Performance Structural Application s,” Materials and Society, vol. 8, No.

2, 1984, p. 313.

composites may eventually be used in very

high-temperature superalloy applications.

The high cost of advanced composite materials is an important deterrent to their widespread use. Table 7-13 shows the high relative

raw material costs of various advanced composites. Moreover design, fabrication, testing,

and inspection costs are often higher for composite materials than for monolithic materials.

These costs can be expected to decrease as the

materials come into more widespread use and

as processing and fabrication problems are

overcome. Figure 7-3 shows the decrease in

graphite fiber costs since 1970.

The advanced composites industry has rapidly become internationalized, with the United

States, Japan, Great Britain, France, and other

countries participating in individual segments

of the industry. Very often, separate fabrication steps needed in the manufacture of par-
304 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table 7-13.—Price Range of Selected Composite Raw Materials

1985

Reinforcement cost/pound

Graphite grades:

Rayon precursor fibers (woven cloth) . . . . . . . . . . . . . . . . . . . . ., . . $70 to $80

PAN precursor (commercial and large-volume

aerospace orders). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $17 to $40

Pitch grade (high-volume aerospace) . . . . . . . . . . . . . . . . . . . . . . . . $35 to $275

Graphite fiber prepreg (PAN grade, 60 percent fiber) . . . . . . . . $36 to $40;

up to $100/lb for

specialty products

Boron:

Tungsten core. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $365 to $375

Boron fiber prepreg (carbon core fiber):

250° cure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $270 to $300

350° cure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $310 to $340

Kevlar:

Type 29 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $5.40 to $39.25

Type 49 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $12.55 to $48.20

SOURCE Va~ous Industrial producers contacted ~ythe Offlceof ~chnology Assessment

;970 1975 1980 1985

Years

SOURCE1970.1980d ata: Commercia/ Opportunities for Advanced Composites,

A A Watts (ed)(Philadelphla, PA. American Society for Testing and

Materlals,1980), publication 704,p 90; 1985data provided bylndustry

producers.

ticular composites are undertaken in separate

countries. Although advanced composites are

not strategic materials in the ordinary sense of

the term, a growing concern in the defense

community concerns U.S. dependency on foreign processing capacity to fabricate key composite components. Until recently, for example, the United States depended on Japan and

Great Britain for virtually all carbon fiber reinforcements made from polyacrylonitrile (PAN),

one of three possible precursor materials for

carbon fiber. The United States now produces

some carbon fiber using foreign PAN precursor materials. Also, Union Carbide has opened

a domestic PAN production facility that reduces U.S. dependence on foreign PAN to 70

percent of domestic needs. However, this domestic precursor is not yet qualified for all defense programs, so in many critical applications dependence on foreign supplies is still

near 100 percent. France, similarly, is the

source of all quartz fibers and of an important

curing agent used in epoxy resin formulations.57 

It has been estimated that, in most segments

of the composites industry, U.S. production capability could be doubled within 2 years if the

need arose.58

Polymer (Organic) Matrix

Polymers, such as polyesters, epoxies, and

polyamides, are by far the most developed of

all composite matrix materials. They are most

frequently reinforced with (fiber) glass, graphite, or aramid (commonly referred to by its

Dupont tradename, Kevlar) filaments. Polymeric composites can have performance capabilities that are commonly thought unattainable by plastics. For example, polyimide

composites are capable of continuous operation at 7000 F in some applications. Organic

Szstan]ey L. Channon, Industrial Base and Qualification of

Composite Materials and Structures [An Executive Overview)

(Alexandria, VA: Institute for Defense Analysis, March 1984),

p. 10 (working paper).

‘

e

Ibid., p. 16.
Ch. 7—Substitution Alternatives for Strategic Materials ● 305

composites are attractive because they combine these good physical properties with lightweight and ease of fabrication. Consequently,

these materials may reduce the need for strategic materials—not via direct substitution, but

through the cascading effects of downsizing

and redesign allowed by the decreased weight

and innovative fabrication.

The total U.S. consumption of polymer composites in 1982 approached 1 million metric

tons (tonnes). Of this, 618,000 tonnes of polyester/glass (fiberglass) was the largest share,

Additionally, 106,000 tonnes of reinforced thermoplastics and 28,000 tonnes of epoxy resins

(equivalent to approximately 90,000 tonnes of

epoxy-based composites) were consumed.59 

U.S. consumption of composite reinforcing

filaments in 1982 was: glass, 280,000 tonnes;

aramid, 900 tonnes; carbon (graphite), 800

tonnes; and other, 10 tonnes,

Fiberglass-reinforced organics (which are not

generally considered advanced composites)

dominate current markets. High-volume applications include boat hulls, plumbing and bathroom fixtures, and automotive body and trim

panels, which are often made from polyester/glass composites. Low raw material costs

and automated, high-speed production processes have made possible the widespread use

of polyester/glass composites. Figure 7-4 shows

selected applications for different fiberglass

composites.

Because of their high price, use of other polymer composites has been largely limited to aerospace applications, sports equipment, and automotive applications. Low-volume aerospace

applications for polymer composites have increased since 1968, when an epoxy/ boron horizontal stabilizer for the F-14 jet was first used

on an experimental basis. In 1970, the Grumann

Corp. approved this application for limited

production.

Since then, air frames, air panels, satellite

structures, and sporting goods have been built

from advanced composites, Table 7-14 shows

5e]Oe] Clark, ~ofen~jaj of Composite Materia]s to Replacec~romium, Cobalt, and Manganese in Critical Applications, O T A

contract report, 1984.

recent aerospace applications for advanced

polymeric composites. In each of these applications, advanced composites were selected for

their high specific properties. Specific properties refer to common materials properties (e.g.,

strength), normalized to the weight of the material. Organic composites have very good

strength and stiffness for their weight and are

therefore said to have high specific strength

and stiffness.

Aside from polymer/glass composites, the

polymeric composites with the greatest potential for continued growth appear to be epoxy/

graphite and epoxy/aramid. Epoxy/boron (despite its early use) is no longer seen as promising, owing to difficulties in processing the extremely hard and brittle boron fibers, to high

costs associated with producing the fibers, and

to effective competition from the graphite and

aramid systems.

Carbon Matrix

A carbon matrix reinforced with carbon or

graphite fibers is commonly known as a carbon/carbon composite. They are high-cost

materials used in specialty applications and

are, for the most part, in early developmental

stages. To date, commercial applications include rocket nozzles and exit cones, re-entry

vehicle nosetips, and aircraft brakes. 60

These materials are very strong and tough,

and have the potential for maintaining these

properties at temperatures up to 4,500

0 F.

Moreover, carbon/carbon composites are very

light—somewhat less than 25 percent of superalloy density and about 50 percent of ceramic

(monolithic or ceramic/ceramic composite)

density—dimensionally stable, wear resistant,

and free of strategic metals,

There are, however, several disadvantages

which must be addressed. Controlled environments or impervious coatings must be used to

prevent oxidation problems in high-temperature applications, and special weaves of graphite fibers are needed to prevent surface fatigue

cracking caused by low interlaminar strength.

eochannon, op. cit., p. 36.
306 Ž Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Pressure

bottles

Silos

Tubing

Pipe

Missile

shells

Figure 7-4.— Fiberglass Composite Applications

I f Fabrics 1 I I I

I

Manufacturing methods and design

Nozzles I

Rods

Tubes

Shapes

Building

components

Electrical

appliances

Structural

Boats

Silos

Car bodies

Scooters

Motorcycles

Furniture

Trucks

Homes

Chemical tanks

Swimming pool

Bath tubs

Plumbing fixtures

SOURCE: Cornmerck?l Opportunities for Advanced Composites, A. A. Watts (cd.) (Philadelphia, PA: American Society for Testing and Materials, 1980), publication 704,

p. 112.

In addition, carbon/carbon composites are very

expensive as a result of the complex weaving

procedures, long processing times, and high

energy consumption involved in processing. As

with most developing materials, the cost is expected to decrease as the technology emerges

and production rates increase.

Development work at NASA and in industry is aimed at reducing the high fabrication

costs of carbon/carbon composites. Improving

composite strength and stiffness and increasing the reliability of coatings and oxidationinhibiting matrix additives are also goals of this

work.

U.S. carbon/carbon composite use is expected

to grow rapidly, primarily because of defense

and aerospace needs. In 1982, an estimated

200,000 pounds of carbon/carbon was consumed in the United States. One survey of government and industry experts found an expected need for 800,000 pounds of carbon/

carbon by 1990—-a quadrupling in demand in

an 8-year period.61 As already discussed, some

concern exists about U.S. reliance on Japan for

most of its carbon fibers made from PAN. Although rayon- and pitch-based carbon fibers exist, PAN-based fibers are used in most current

applications. Figure 7-5 projects defense and

civilian needs for carbon/carbon composites

through 1990; this may be an overestimate, due

to changed program priorities.

Ceramic/Glass Matrices

Monolithic ceramics and glasses are brittle

and exhibit low fracture toughness. The toughness of these materials can be improved by

61The 1982 estimate and the 1990 projection were made by

Channon, op. cit., p. 42.
——— ..——— - -—

Ch. 7—Substitution Alternatives for Strategic Materials ● 307

Table 7-14.—Current Aircraft Applications for Advanced Composite Materials

Component Source Remarks

Wing:

F-15 composite wing . . . . . . . .

C-5A leading edge slat . . . . . .

F-5 main landing gear door. . .

737 spoilers . . . . . . . . . . . . . . . .

A-4 landing flap. . . . . . . . . . . . .

F-5 leading edge flap . . . . . . . .

B-1 leading edge slat . . . . . . . .

Empennage:

A-4 horizontal stabilizer . . . . . .

F-5 horizontal stabilizer . . . . . .

F-4 rudder . . . . . . . . . . . . . . . . .

DC-10 upper aft rudder , . . . . .

L-101 1 vertical fin . . . . . . . . .

Fuselage:

A-7 speed brake . . . . . . . . . .

F-5 speed brake . . . . . . . . . . .

McDonnell Douglas

Lockheed-Georgia

Northrop

Boeing

McDonnell Douglas

Northrop

Lockheed-Georgia

McDonnell Douglas

Northrop

McDonnell Douglas

McDonnell Douglas

Lockheed

Vought Aeronautics

Northrop

Graphite/epoxy used to form wing ribs and spars over

much of the wing substructure; target weight savings

for entire wing, 25°/0

Basic design is graphite/epoxy skins over aluminum

honeycomb core: weight savings, 22%

Weight savings, 36°/0

Basic design is graphite/epoxy skins over aluminum

honeycomb core with aluminum and fiberglass fittings,

edgemembers and ribs: 108 units (27 ship sets) have

been fabricated and service tested: weight savings,

15%

Basic design is graphite/epoxy skins over aluminum

honeycomb with aluminum edgemembers except for a

molded graphite/epoxy actuator rib: weight savings,

47 %

Weight savings, 32%

Basic design is graphite/epoxy skins over aluminum

honeycomb core with aluminum and fiberglass ribs and

trailing edge close-out. Front beam is molded

graphite/epoxy along with the leading edge structure:

weight savings, 15%; cost savings, 35%

Basic design is multishear web/solid-laminate skin

concept; shear web constructions are both

graphite/epoxy laminates and fiberglass coregraphite/epoxy skin honeycomb structure: weight

savings, 28%

Basic design is graphite/epoxy skins over aluminum

honeycomb core with aluminum close-out ribs, integral

spar, and torque tube fitting: weight savings, 23°/0

Used graphite/polymide in leading edge spar; other hightemperature materials used were fiberglass olyimide

honeycomb core, boron/polyimide prepreg. titanium,

and high-temperature adhesive

Graphite/epoxy rudder is 32 ft2 rib-stiffened-skin design

manufactured in a co-cured assembly; composite

component weight is 57 lb: weight savings, 37%

Graphite and Kevlar composite box beam and skins to

replace 9 x 25 ft primary structure; composite

component weight is 640 lb (17°/0 metals): weight

savings, 25°/0

Built-up molded laminate design using graphite/epoxy

elements bonded with structural adhesive: weight

savings, 400/0

Weight savings, 23°/0

CONVERSION FACTORS 1 ft] – O 1 m’

Ilb = O 45 kg

If! = 03 m

SOURCE CornmercM Opporlunft~es focAdvarrced Cornpo.wfes, A. A Watts (cd.) (Ph!ladelphla, PA American Soc!ety for Testing and Mater!als, 1980), publication 704, p 104

reinforcing them with ceramic fibers to limit Most glass compositions (e.g., lead, quartz,

the growth of cracks. Currently, glass matrix borosilicate, and boron oxide) have been reincomposites are more developed than their forced on a laboratory scale. They have been

ceramic counterparts. Ceramic matrix compos- allied with a variety of filaments, including aluites are still confined to experimental applica- mina, silicon carbide, graphite, and tungsten,

tions–-they are not currently used commercially, in order to improve their toughness and high-
308 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

800 -

600 -

400 -

200 -

0

1 I I 1 I I I 1

1982 83 84 85 86 87 88 89 90 1991

Years

‘Th~~e e~tlrnates, reported ifl 1~, reflect anticipated ‘se ‘n ‘eaPons

systems, aircraft brakes, and engines at that time. Recent changes in program

planning indicate that these needs may be overestimated.

SOURCE: Stanley L Channon,/rrdustria/ Base and Qua/if/cation of Composite

Ma?eria/s and Structures (An Executive Overview) (Alexandria, VA: In.

stitute for Defense Analyses, March 1984), working paper, p 43

temperature strength. One promising example

is United Technologies’ lithium aluminum silicate glass, reinforced with silicon carbide

fibers, This material has roughly 10 times the

fracture toughness of the unreinforced glass up

to about 2,0000 F.

Ceramic matrices that have been examined

experimentally include alumina, boron nitride,

zirconia, silicon nitride, and silicon carbide,

Reinforced with either inorganic materials or

metal wires, these ceramics could possibly be

used in applications with temperatures exceeding 3,0000 F. As with glasses, ceramics are

reinforced to improve their toughness. They do

not, in general, benefit from any improvement

in high-temperature properties.

Reinforcement of higher temperature ceramics has been relatively unsuccessful to date

because of fiber strength losses due to fiber and

matrix interaction at high fabrication temperatures, fiber recrystallization, and fiber fracture

due to abrasion and stress during processing.

As a result of these problems, NASA research

has been redirected to ceramic composites employing weak bonding between the fiber and

the matrix and to developing processing technologies that employ lower temperatures and

no pressing, Clearly, ceramic/ceramic composites will need substantial additional research

and development. They may eventually be used

for turbine vanes, blades, and cases.

Metal Matrix

Metal matrix composites are relatively new

structural materials. Many metals, including

lead, titanium, stainless steel, magnesium, copper, nickel, and zinc, have been experimented

with, but the most highly developed are aluminum matrix composites. Virtually any metal

can be reinforced; benefits include increased

specific strength compared to conventional

metals, improved wear resistance, and higher

allowable operating temperatures. However,

the gains from reinforcement are often insignificant when compared with the costs.

Metal matrix composites are still primarily

laboratory materials. However, some successful commercial applications exist. Toyota Motor Co. has developed an aluminum/alumina

composite for reinforcing the piston ring

groove in production diesel engines and is developing composite pistons and cylinder heads.

In such applications, improved performance

is highly valued, and this has been the justification for developing metal matrix composites,

Table 7-15 shows some potential commercial

applications of metal matrix composites,

Copper composites are under consideration

for use in transmission lines. Lead is reinforced

for use in batteries because in certain applications lead lacks the strength to support its own

weight. Aluminum matrices, containing boron,

alumina, or silicon carbide fibers are designed

to compete with titanium. Reinforcing an aluminum alloy can raise its allowable service

temperature by 2000 F, permitting its utilization in many applications where it otherwise

could not be used. Aluminum/graphite and aluminum/boron composites have been developed

for use at 525° F.

Fiber-reinforced superalloy (FRS) technology

is under development in the NASA Metal Matrix Composite Program, The aim of this program is to develop the technology to fabricate

an FRS turbine blade capable of operating at

a surface temperature of 1,100° to 1,200° C
Ch. 7—Substitution Alternatives for Strategic Materials ● 309

Table 7-15.—Potential Commercial Applications of Metal Matrix Composites

-.. Application

Aerospace:

Space structures. . . . . . . . . . .

Antennae ., . . . . . . . . . . . . . . . .

Aircraft:

Airplanes:

Pylons . . . . . . . . . . . . . . . . . . .

Struts . . . . . . . . . . . . . . . . .

Fairings . . . . . . . . . . . . . . . .

Access doors . . . . . . . . . . . .

Wing box . . . . . . . . . . . . . . . .

Frames . . . . . . . . . . . . . . . . .

Stiffeners ., . . . . . . . . . . . . . .

Floor beams . . . . . . . . . . . . .

Fan and compressor

blades . . . . . . . . . . . . . . . . .

Turbine blades . . . . . . . . . . .

Turbine blades

Helicopters:

Transmission cases . . . . . . .

Truss structures . . . . . . . . . .

Swash plates . . . . . . . . . . . .

Push rods. . . . . . . . . . . . . . .

Trailing edge of tail

rotor blades

Automotive:

Engine blocks .

Push rods . . . . . .

Frames, springs

Piston rods . . . .

Battery plates . .

Electrical:

Motor brushes . .

. . . . . . . . . . .

. . . . . . . . . . .

. . . . . . . . . . . .

. . . . . . . . . . . .

. . . . . . . . . . . .

. . . . . . . . . . . .

. . . . . . . . . . . . Cable, electrical contacts . . . .

Utility battery plates. . . . . . . . .

Medical:

X-ray tables, prosthetics . . . .

Wheelchairs . . . . . . . . . . . . . . . .

Orthotics . . . . . . . . . . . . . . . . .

Sports Equipment:

Tennis racquets ... , . . . . . . .

Ski poles . . . . . . . . . . . . . . . . . .

Skis . . . . . . . . . . . . . . . . . . . . . . .

Fishing rods . . . . . . . . . . . . . . .

Golf clubs . . . . . . . . . . . . . . . .

Bicycle frames . . . . . . . . . . . .

Motorcycle frames . . . . . . . . . .

Textile industry

Shuttles . . . . . . . . . . . . . . . . . .

Other:

Bearings . . . . . . . . . . . . . . . . . . .

Chemical process

equipment . . . . . . . . . . . . .

Abrasive tools . . . . . . . . . . . . .

Desired properties

lightweight, stiffness

lightweight, stiffness

lightweight, stiffness, heat resistance

lightweight, stiffness, strength

lightweight, stiffness

lightweight, stiffness, strength

lightweight, stiffness, strength

lightweight, stiffness, strength

lightweight, stiffness, strength

lightweight, stiffness, strength

strength, stiffness, heat resistance,

impact resistance

strength, stiffness, heat resistance,

impact resistance

strength, stiffness, heat resistance,

erosion resistance

lightweight, stiffness, strength

lightweight, strength, stiffness

lightweight, strength, stiffness

lightweight, stiffness, strength

lightweight, stiffness, strength

lightweight, heat resistance, strength,

stiffness

lightweight, heat resistance, strength,

stiffness

lightweight, strength, stiffness

lightweight, strength, stiffness

stiffness

electrical conductivity, wear resistance

electrical conductivity, strength

stiffness, strength, corrosion resistance

lightweight,

lightweight,

lightweight,

lightweight,

lightweight,

lightweight,

lightweight,

lightweight,

lightweight,

lightweight,

lightweight,

—

—

—

stiffness, strength

stiffness, strength

stiffness, strength

stiffness, strength

stiffness, strength

stiffness, strength

strength, flexibility

strength, flexibility

strength, stiffness

strength, stiffness

wear resistance

aslc whisker andlor continuous SIC filament

bSIC whiskers only

Suggested composite systems

B/Al, B/Mg, Gr/Mg

B/Al, B/Mg, Gr/Mg

B/Al, SiC/Al

B/AI, SiCa

/Al

B/Al, SiCa

/Al, Gr/Al

B/Al, SiCa

/Al

B/Al, SiCa

/Al

B/Al, SiCa

/Al, Gr/Al

B/Al, SiCa

/Al, Gr/Al

B/Al, SiCa

/Al, Gr/Al

B/Al, SiCa

/Al, Gr/Al

tungsten or tantalum fiber-reinforced

superalloys

directionally solidified eutectics Ni3AlNi3Cb, Ni3Al-Ni 3Cb-N i, Ni-Mo wire

Gr/Al, SiCa

/Al

SiCb

/Al

SiCa

/Al, B/Al

Gr/Cu

GrlCu

Al2O3Pb, Gr/Pb, fiberglass/Pb

B/Al,, SiCa

/Al

B/Al, SiCa

/Al

B/Al, SiCa

/Al

B/Al, Gr/Al, SiCb

/Al

B/Al, Gr/Al, SiCb

/AL

B/Al, Gr/Al, SiCb

/AL

B/Al, Gr/Al, SiCb

/AL

B/Al, Gr/Al, SiCb

/AL

B/Al, Gr/Al, SiCb

/AL

B/Al, Gr/Al, SiCb

/AL

B/Al, Gr/Al, SiCa

/AL

Gr/Pb

Al2O3

/Pb

B/A l

2O 3

, SiC/Al 2O 3

SOURCE Commercial Oppotiun(fies for Advarrced Cornpos/fes, A A Watts (ed ) (Philadelphia, PA American Socfety for Testtng and Materials, 1980), publication 704, P 119.
310 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

(2,000° to 2,200° F). FRS development has been

carried out almost solely through NASA sponsorship. With no end user deeply committed

to the material, its development pace has been

slow.62

NASA’s development prototype is a cobaltfree (15 percent chromium) iron-based tungsten

fiber-reinforced superalloy (TFRS). This experimental material has been successfully fabricated into a turbine blade, but has not yet

been engine tested. Cobalt- and nickel-based superalloys can be used as a matrix material, but

only if a protective barrier is provided to prevent tungsten/matrix interdiffusion. Hence, the

first FRS material likely to be commercialized

will probably be cobalt free.

In addition to their high-temperature properties, TFRSs are good substrates for thermal

barrier coatings (TBC), which also raise engine

temperature capabilities. The thermal expansion coefficient of TFRSs is low compared to

superalloy and approaches that of current

TBC. Such coatings applied to TFRS components would, therefore, show less tendency to

span (i. e., crack and flake particles off the surface) than they do with present superalloy,

(Spalling problems prevent TBC from being applied to present superalloy blade and vane air

foils.) Further, regardless of the application of

a TBC, the high thermal conductivity of TFRSs

permits the use of simpler internal blade geometries for cooling air, thereby lowering manufacturing costs,

Several major technical problems currently

limit the prospects for widespread use of

TFRSs in turbines. The expansion coefficient

of the tungsten fibers is approximately onethird that of the matrix. This induces thermal

fatigue in a TFRS blade, considerably reducing its life. Also, tungsten fibers oxidize rapidly

at turbine operating temperatures if exposed

to the hot gas, Accidental exposure of the fibers

in service could lead to rapid failure of the

blade. At present, insufficient confidence exists that the probability of such exposure can

be kept acceptably low, even with the application of a coating,

Ceramic whiskers and fibers also have been

used to strengthen metal matrices. Such reinforcement is attractive because ceramic whiskers and fibers have high strength at ambient

and elevated temperatures, high elastic modulus, good oxidation resistance, and low density,

It has been found that ceramic reinforcement,

usually as chopped fibers, can significantly improve the wear resistance of certain metals.

However, results of research with both the

whiskers and the long single crystal fibers have

been disappointing so far.

One of the major advantages of metal composites over polymer composite systems is that

there is not as large a difference between transverse and longitudinal strength. Transverse

strength in metal composites is essentially

equal to the strength of the matrix metal. An

additional advantage, which can be important,

is that metal matrix composites are electrically

conductive.

Generally, the cost of metal composites is on

the order of 10 times the cost of the matrix

metal alone. Much of this differential is due

to the high raw material cost of the reinforcement. Also, processing complexities add significantly to the total cost. For this reason,

metal matrix composites are only considered

for applications where the value of their added

performance is great,

Prospects for the Future

Advanced composites are now entering a

period of rapid growth. Much of this increased

use will occur in the transportation industry,

where there are significant incentives to decrease the weight and increase the performance of materials. Over the next 10 years, the

aerospace industry could represent over 50 percent of the total high-performance composites

market, Significant growth in the automobile

and industrial sectors may occur in the late

1980s.63

ezparkinson, op. cit. esclark, op. cit., p. 1.
Ch. 7—Substitution Alternatives for Strategic Materials . 311

Aerospace Applications

Most aircraft applications of composite materials do not require high-temperature performance and can be satisfied by polymer or

aluminum matrix composites in such applications as airframe and structural parts. The use

of aluminum matrix composites in these applications represents the largest foreseeable market for metal matrix composites, The downsizing and redesign, made possible through the

reduction in weight, has the potential to reduce

strategic materials usage.

Weight reduction in aircraft translates into

fuel savings, lower operating costs, and increased profits for commercial aircraft; increased range, payload, and maneuverability

for military aircraft; and reductions in manufacturing due to parts consolidation in both

cases. The impetus for substitution of composite materials for conventional materials comes

from market forces alone rather than from any

desire to substitute strategic materials. Constant economic pressure can be expected to

stimulate materials innovation.

Metal matrix composites, like advanced

ceramics, ceramic composites, and carbon/carbon composites also have some potential for

use in the jet engine industry, where the use

of composite materials is expected to be performance- and market-driven. Cost considerations for jet engine materials will be of secondary importance relative to the overall cost of

the engine.

While substantial technical problems must

be overcome, these advanced materials could

boost operating temperature above 2,500° F,

far beyond even the most advanced superalloys

now under development, However, use of

these nonmetallic materials is not expected by

NASA for human-rated engines until after the

year 2010—roughly the same period as for advanced ceramics.

Tungsten fiber-reinforced superalloys will,

in all likelihood, be used in jet engines only in

the event of a prolonged crisis in the cobalt

market. They have not satisfied important reliability criteria necessary for serious long-term

consideration as substitutes for conventional

superalloys or directionally solidified eutectics.

They have not yet seen active operating service and would require a serious testing commitment before acquiring the confidence for

industrial implementation,

Today, carbon/carbon composites can be fabricated into forms that may be useful in the gas

turbine for combustor liners, cases, afterburners, and nozzles. A one-piece bladed turbine

disc has also been formed, Industrial-research

is at such an advanced stage for low- stress applications that jet engine afterburners made of

composites could be in use in 5 years. Highstress applications are 10 or more years away.

The complex qualification procedures used in

the composites industry could affect timing, as

well. These procedures are discussed in the

concluding section of the chapter.

Carbon/carbon composites, despite their advantages in low-stress applications, cannot be

expected to satisfy high-temperature, highstress requirements for jet engine applications

for another 10 to 20 years. Use of these materials will depend on developments in oxidation

inhibitors and nondestructive testing methods,

While materials prices are of negligible importance when compared to the overall cost of an

engine, efficient implementation of these materials in jet engines will require a major overall redesign effort that will be both costly and

risky, Industry seems to believe that government risk-sharing will be necessary to promote

a rapid development of these novel technologies.

It is not expected that engine blades will be

made of carbon/carbon composite materials,

if only because reliability criteria for rotating

high-stress parts are far from met, and testing

has been far from sufficient. 64

Automotive Applications

Currently, all the major automotive manufacturers have active development programs investigating the use of advanced composites in

~4c]ark, op, cit., p. 75.
312 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

automotive structures. A wide variety of prototypes have been fabricated of advanced composites, including hinges, brackets, leaf springs,

drive shafts, doors, and door guard beams.

Many of these components have been tested

in actual service over the last few years and

have been found to perform well. Composite

parts equivalent to steel parts in performance

have been built. Significant redesign of these

components has been accomplished to take

advantage of the design flexibility which composites offer. Table 7-16 shows the potential automotive applications for Kevlar-reinforced

composites.

Composites will also see increased use in automobile engines. Toyota has used aluminum

reinforced with polycrystalline aluminum oxide fibers for the connecting rods in an experimental engine. Advantages of composite use

in engines could include increased fuel efficiency, faster engine response, and reduced engine vibration.65

Large-scale use of composites by the automotive industry could occur as broader consumer acceptance, lower production costs, and

B6Meta] Progress, February 1984, p. 14.

Table 7-16.-Potential Automotive Applications for

Composites of Kevlar 49 Aramid

Potential application Reasons for use

Leaf springs . . . . . . . reduced weight, stiffness, fatigue

resistance

Transmission

supports . . . . . . . . . reduced weight, stiffness,

vibration damping

Drive shafts . . . . . . . .

Bumper beams . . . . .

Radiator supports. . .

Anti-intrusion

beams. . . . . . . . . . .

Wheels . . . . . . . . . . . .

Body parts . . . . . . . . .

reduced weight,

strength

reduced weight,

resistance

reduced weight,

reduced weight,

resistance

reduced weight,

resistance

reduced weight,

resistance

stiffness, fatigue

stiffness, damage

stiffness

damage

damage

stiffness, damage

Clutch faces, brake

linings . . . ~ . . . . . . . strength, wear resistance, high

temperature, frictional properties

SOURCE: Commercial Oppoflunfties for Advanced Composites, A. A. Watts (cd.)

(Philadelphia, PA” American Society for Testing and Materials, 1980),

publication 704, p. 119.

design concepts lead to a general expansion of

composite materials markets and lower prices.

Corporate Average Fuel Economy (CAFE) regulations have been instrumental in creating an

environment for novel new concepts of automotive designs and materials usage. However,

these pressures have been relieved by automotive downsizing to meet CAFE standards in the

short run. If CAFE requirements become more

stringent and make downsizing less profitable

in the U.S. market, polymeric and metal matrix composites could be a very important

means of achieving weight reduction. New

auto body parts production and assembly technologies, which are likely to affect the use of

composites in automotive structures, are expected to see implementation over the next 10

years. Use of composites in substantial quantities is not expected to increase before the

1990s. The impact of composites technology

on critical materials (mostly chromium) will be

largely indirect, through weight reduction and

performance enhancement.

Barriers to the Adoption of Composites

Composites have some major technical problems which counter the attractiveness of many

of the properties described above and inhibit

the introduction and effective use of these

materials. There is little doubt that many of

these problems will be overcome as the technology matures,

Use of composites in many potential applications has been discouraged by the lack of established design practices and insufficient design

data, Additionally, when composites are selected for use, they are often used as direct substitutes for conventional materials without redesign. The performance of composites in such

circumstances is often less than optimal. The

implementation of sophisticated computeraided design algorithms promises to reduce

greatly the complexity of designing for composite structures and allow more effective use

of composites,

Another problem of composites is the high

cost of raw materials, especially high-performance reinforcements such as boron, graph-
ite, and aramid. Prices for these reinforcements

range from $20 per pound to well over $100

per pound. For this reason, advanced composites (those with specific properties exceeding

steel) are selected only for applications where

their special properties are highly valued.

Contributing to the high cost is the poor

productivity of composite product fabrication.

Processing composites is generally labor-intensive and time-consuming. While innovative

techniques for automated, high-speed processing have been developed, their use is not widespread and is usually limited to forming specific

types of goods. Moreover, once a nonmetallic

composite is fabricated, the integrity of the

structure is difficult to assess without destroying the component. This drawback is being

overcome with the advent of nondestructive

tests based on ultrasound and laser holography

and with improved design procedures and increased experience in end uses.

Long-Range Order Intermetallic Materials

Materials in which two elements are arranged in an ordered pattern throughout the

entire crystal lattice are known as long-range

order intermetallics. Although there are many

types of intermetallics, three families are particularly interesting with respect to the use of

strategic materials:

Nickel aluminizes , , ., ... , . . . . . . NiAl and Ni3Al

Titanium aluminizes . . . . . . . . . . . . TiAl and Ti3Al

Iron aluminizes . . . . . . . . ., . . . . . . FeAl and Fe3Al

None of the above materials contains any cobalt or chromium, but other compounds could

contain strategic materials. Very little information concerning long-range order materials is

publicly available, making it difficult to assess

the state of the technology or determine when

it will be commercialized.

Each of these six materials has low density

as well as excellent high-temperature stability,

strength, and oxidation resistance. These properties have been known for many years, but the

materials have seen little service because of

brittleness problems. Their poor ductility, particularly at low temperatures, results in fabriCh. 7—Substitution Alternatives for Strategic Materials Ž 313

cation problems, low impact strength, and low

thermal shock resistance. Recent research,

however, has shown that the ductility can be

improved by microalloying and thermomechanical treatment, This raises the prospect of

using the intermetallics in high-temperature applications, such as gas turbines, where strategic materials are currently used.

Nickel Aluminizes

Single crystals of Ni3Al exhibit good ductility, but polycrystalline Ni3Al is very brittle. Because of the cost and inconvenience of single

crystal-technology, monolithic Ni3Al is unattractive for most applications.66 Research at

Oak Ridge National Laboratory has demonstrated that small additions of boron (around

0.05 percent) to the polycrystalline form removes the ductility problem.67 Microalloying

(doping) with boron makes it possible to extrude, forge, and cold roll these materials, In

addition to being fabricable, these boron-doped

aluminizes have tensile strengths that compare

favorably with those of Waspaloy, Hastelloy X,

and 316 stainless steel.

Possessing high-temperature strength and oxidation resistance, and adequate ductility and

fabricability, boron-doped Ni3Al alloys have potential as structural materials. The aircraft gas

turbine industry is beginning to evaluate the

material for various applications. Polycrystalline forms are being considered for discs—

operating temperatures up to 1,250° C, or

2,280° F, seem possible. Combustor liners and

turbine vanes are other possible uses. A single crystal Ni3Al turbine blade is also of interest.

The good oxidation resistance of Ni3Al results from the formation of aluminum oxide

scales, which protect the alloy, Recent work

has shown that alumina-forming materials

88 NiaA] is most commonly known as the dispersion phase

[gamma prime) that imparts high-temperature strength to nickelbased and iron-nickel-based superalloy.

5TC. T. Liu and C. C. Koch, “Development of Ductile PoIYcrystalline NiqAl for High-Temperature Application s,” Technical Aspects of Critical Materials Use by the Steel Industry, Volume 1113, NBSIR 83-2679-2, June 1983, op. cit.

38-844 0 - 85 - 11 , ~L 3
314 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

have excellent hot-corrosion resistance in coal

energy conversion systems. Such findings suggest that aluminizes may be useful as structural

materials in sulfiding environments.

Titanium Aluminizes

The ductility problems of Ti3Al are overcome

by microalloying with columbium (niobium),

a second-tier strategic material. Ti3Al is being

studied in the United States for use in aircraft

gas turbine engine compressor rotors and blades

and in low-pressure turbine discs, blades, and

vanes. These materials are potential (albeit expensive) substitutes for some superalloy (e.g.,

Waspaloy and Inco 713.)68

Iron Aluminizes

Pratt & Whitney Aircraft has studied these

materials in conjunction with rapid solidification rate processing.69 The inherent ductility

problem was removed and an increase in tensile strength achieved by microalloying with

titanium diboride (TiB2

). The particular interest in these materials is for use as sheet for

combustor liners—up to temperatures of 1,800°

to 2,0000 F. Iron aluminizes are also of interest for turbine discs, blades, and vanes at lower

temperatures, and for cases.

Nickel, titanium, and iron aluminizes are all

in relatively early stages of development. While

they have shown great promise to date, much

remains to be learned concerning the full range

of their material properties.

Rapid Solidification

Many new and potentially useful materials

are being developed using technologies that solidify molten alloys extremely quickly. These

rapid solidification (RS) technologies enable

materials engineers to improve current alloys

and to explore previously unattainable alloy

compositions and microstructure. The effects

~Parkinson, op. cit., p. 49. @@JoSeph Moore and Colin Adam, “Potential of Rapid Solidification for Reduction of Critical Element Content of Jet Engine

Components, ” Conservation and Substitution Technology for

Critical Materials, Vol. IZ, NBSIR 82-2495 (Springfield, VA: National Technical Information Service, April 1982).

of this new technology on the use of strategic

materials are as yet unknown. As emphasized

in a 1983 NMAB study:

Work is continuing in the field of rapid

solidification and its applicability to the reduction of strategic elements. Work to date indicates that this method of processing holds

much promise for attaining at least a degree

of independence from such elements as cobalt

and chromium in various systems of alloys.

However, it must again be emphasized that, for

critical alloy applications, the principal motivation in alloy and process development is the

achievement of improved mechanical, physical, or chemical properties, Whether the successful application of RS technologies will be

accompanied by a reduction of the use of strategic elements cannot be foreseen at this time.70

Rapid solidification refers to the chilling of

molten materials into solids at very high cooling rates. Materials are considered rapidly

solidified when they have been cooled fast

enough to assume microstructure that cannot

be generated by conventional solidification

techniques. Cooling rates obtained with RS

processes are often on the order of millions of

degrees Celsius per second.

Because of the heat transfer characteristics

needed to attain the requisite high cooling

rates, RS materials must have high surface

area-to-volume geometries. This requirement

limits the shapes of RS products to powders,

flakes, and ribbons. These are rarely used in

the as-cast form; usually, consolidation and

mill working operations are needed. The casting, consolidation, and mill working processes

are described in box 7-C.

RS in Strategic Materials Substitution

A vast number of alloy systems have been

rapidly solidified in the course of scientific inquiry, but commercial interest in RS has been

limited to only a few classes of alloys. Of these,

transition metal-based glasses and aluminum-,

nickel-, and iron-based crystalline alloys seem

to have the greatest commercial potential.71 In

PONMAB.406, op. cit., p. 68.

71J. V. Woods, “Rapid Solidification Processes and Perspective Part I I,” Materials and Design, vol. 4, April/May 1983, p. 712.
Ch. 7—Substitution Alternatives for Strategic Materials Ž 315

general, glassy materials are most interesting

for their magnetic or electrical properties,

while crystalline alloys are of interest for structural applications. Some of the potential applications of RS materials include:

Aluminum alloys for aerospace structures.

RS aluminum would compete with polymericand, possibly, aluminum-matrix composites

and titanium in these applications.72 73

— .

pZNatiOnal Ma@rialS Advisory Board, Rapidly Solidified (RS)

Aluminum Alloys—Status and Prospects, National Research

Council, Publication NMAB-368 (Washington, DC: National

Academy Press, 1981). This unclassified document contains inNickel alloys with abnormally high refractory metal concentrations for gas turbines.

Steels with submicron-sized phase dispersions for higher speed bearings.

formation which is subject to special export controls. It should

not be transferred to foreign nationals in the U.S. or abroad without a validated export license. Distribution is limited to U.S. Government organizations. Other requests for the document must

be referred to DARPA/TIO, 1400 Wilson Blvd., Arlington, VA

27709.

TSC$ Blankenship, panel/Workshop on Critical Questions in

Rapid Solidification Processing, Rapid Solidification Processing, Principles and Technologies, III, Proceedings of the Third

International Conference on Rapid Solidification, Reston, VA,

1983.
316 . Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Amorphous (glassy) eutectic iron alloys with

unusual electrical and magnetic properties for

power transformers and magnetic applications. Use of RS alloys with good magnetic permeability coupled with high resistivity can cut

transformer core losses by 60-70 percent. This

can greatly reduce energy wastage during

power distribution.74 75

Commercial use of RS is still limited primarily for cost reasons. Auto industry experts estimate it will be 10 to 15 years before the technology reaches their area. Entry should be

sooner in aerospace where a lo-percent improvement in strength-to-weight ratio warrants

a twofold to threefold increase in raw material

price. T’ Based on information gathered at the

first Workshop on Rapid Solidification Technology held at the National Bureau of Standards (NBS) in 1981, the NMAB concluded that:

The primary application of RS crystalline alloys at this time are superalloy disks for aircraft engines and high speed tool steels . , , and

near-term opportunities for commercial applications of RS aluminum alloys appear limited

to the aerospace industry. 77

Limited commercial acceptance notwithstanding, RS research enjoys substantial support from industry. Pratt & Whitney Aircraft,

with the considerable support of the Defense

Advanced Research Projects Agency (DARPA),

has played a major role in promoting RS alloy

development, Production of RS superalloy material has reached the level of a few thousand

pounds per year and some discs made from RS

material have been incorporated into jet en74’’ Glassy Metals Move Into Production, ” High Technology,

March/April 1982, p, 80,

75’4Glass-Like Metals Cut Cost and Energy Use, ” Machine Design, Apr. 26, 1984.

~Metal Progress, “Trends in Powder Metallurgy Technology,”

January 1984, p. 58.

TTNationa] Materials AdvisorV Board, Rapid so~idification

Processing, Status and Facilities;, National Research Council,

Publication NMAB-401 (Washington, DC: National Academy

Press, 1982), p. 3. This unclassified document contains information which is subject to special export controls. It should not

be transferred to foreign nationals in the U.S. or abroad without a validated export license. Distribution is limited to U.S. Government organizations. Other requests for the document must

be referred to DARPAITIO, 1400 Wilson Blvd., Arlington, VA

27709.

gines.78 79 If processing difficulties can be overcome, it is possible that the suitability of different RS alloys for other engine applications

could be determined in 5 years (with an expenditure of $5 million for each application).80

Cobalt-free superalloy powders produced

through various rapid solidification processes

have been shown in early experiments to have

some advantages over conventionally processed alloys. One promising example is an experimental, cobalt-free superalloy being developed by Pratt & Whitney Aircraft for turbine

airfoils. The alloy, which chiefly contains

nickel, molybdenum, and aluminum, offers superior creep resistance compared to some

other hot-section alloys. Moreover, with addition of 3 percent chromium as well as smaller

amounts of hafnium and yttrium, the RS alloy

has oxidation resistance exceeding that of alloy 454 (10 percent chromium), now used in

the turbine blades of the F-100 jet engine. The

RS alloy “offers approximately 1500 F advantage in temperature capability over our current

(directionally solidified polycrystalline) metals

in the stress range critical for blade design.”81

Depending on the design strategy, the increased

temperature capability can be used to improve

the performance, durability, or cost of the engine. R&D with this RS superalloy continues,

but neither the results nor an estimate of the

possible year of introduction are available.82

The development of rapidly solidified ironbased alloys has received support from DARPA

and the Army Materials and Mechanics Research Center (AMMRC). These two organizations have sponsored a program at Marko

Materials Inc. aimed at developing RS ironbased alloys for potential high-temperature

structural applications in the intermediate temperature range of 800° to 1,200° F. These new

TWMAFMO1, op. cit., p. 16.

Tgcharles River Associates, New Metal Processing Technologies, OTA contract report, 1983, p. 53.

aOJohn K. Tien and Robert N. Jarrett, Potential for the Development and Use of New Alloys to Reduce the Consumption of

Chromium, Cobalt, and Manganese for Critical Applications,

OTA contract report, 1983, p. 9.

alMoore and Adam, op. cit.

azparkinson, op. cit., p. 48.
Ch. 7—Substitution Alternatives for Strategic Materials . 317

RS alloys will be specifically developed to

evolve as potential replacements for conventional precipitation-hardenable (PH) stainless

steels, titanium alloys, and iron-based superalloys. 83

Rapid solidification particulate technology

offers great potential for the production of a

new family of aluminum alloys that have properties superior to those of ingot alloys. According to NMAB, realistic property improvements

likely between 1985 to 1990 include: 10-percent

reduction in density, lo-percent increase in

tensile strength, 15-percent increase in fatigue

strength, 10-percent increase in modulus of

elasticity (stiffness), and usable properties at

elevated temperatures (450° F). 84 Improvements in corrosion and stress corrosion cracking resistance are also likely. These alloys are

not expected to replace many strategic materials directly. Furthermore, the new aluminum

alloys may contain cobalt and manganese as

alloying elements. However, RS aluminum alloys will probably change the need for strategic materials because of design relationships

in the applications where they are likely to be

used.

Though actual in-service experience has not

been accumulated, use of these new alloys is

foreseen in a variety of aircraft, missile, armored vehicle, and space structure applications. Because of weight savings, significant reductions in fuel costs would be achieved, a’

Effective use of the expected improved properties will make these materials potentially

competitive with various composite materials

and titanium alloys for selected applications.

as~an jan Ra]~, vlsw~a nathan panchanathan, and Saul Isserow,

“Microcrystalline Iron-Base Alloys Made Using a Rapid Solidification Technology, ’ Metals Progress, June 1983, p. 30,

84N MAB-S6B, op. cit, The improved properties of RS alum iinure alloys derit’e from \’ery’ small grain sizes, extended solubilitj or supersaturation of solute alloying elements, and Ierjr

fine dispersions of dispersoid and insoluble particles,

WA, [,. Bement and E, C, van Reuth, “QUO Vadis—RSR, ” Rapid

Solidification Processing; Principles and Technologies 11, R, Mehabrian, B. H. Kear, and M, Cohen (eds.) Baton Rouge, LA:

Claitors [publishing [livision, 1980).

Near-term opportunities for commercial applications, other than aircraft, are limited. Significant commercial applications have not been

identified, or at least verified, with any degree

of confidence. 86

Two RS aluminum alloys have achieved

production status and are being offered as extrusions, die forgings, and hand forgings.

These are alloys 7090 and 7091, air-atomized

700()-series powder alloys that are modified

with cobalt additions and have been developed

by Alcoa.87 The mechanical properties of 7090

and 7091 have been evaluated in several industry and government programs. In addition to

good strength and fracture toughness, these alloys have excellent exfoliation and stress corrosion cracking resistance. This combination

of high strength and corrosion resistance is superior to that of any existing ingot alloy. Two

7090 die forgings will be used as a main landing gear support link (an 85-pound finished

forging) and an actuator component for the

main landing gear doors on the Boeing 757 air

transport. The components offer a 15-percent

weight savings over the same parts designed

with conventional alloys. 88

The Air Force Materials Laboratory is currently working on the development of advanced

second-generation alloys with improved strength

and ductility properties, improved fatigue and

fracture properties, increased modulus and decreased density, and improved elevated temperature properties for service at temperatures

ranging from 450° to 6500 F. Scale-up to production status will be initiated when adequate

properties are demonstrated and is expected

to be completed by 1990.89

WIN MA B-368, op. cit., p. 5.

IW090 A]uminum—8. (1 7,inc—2, 5 Magnesium- 1.0 (kpper- 1.4

Cobalt

7091 Aluminum—6,5 Zinc—2.5 Magnesium-1.6 Copper-O.4

Cobalt.

‘

8 Stephen Ashley, “RS Alloys Gaining A[;f:e[)tance, ’ .4n]erican Metal ~~arket, 9/12/83, p. 13.

aeNMAB-36u, op. cit., p. 2.
318 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Institutional Factors in Substitution

The potential role of direct substitutes and

advanced materials in reducing U.S. strategic

material needs depends not only on resolution

of technical problems, but also on overcoming

several institutional barriers that may impede

their development. Several institutional issues

are discussed below, including the general

need for improved material data management,

qualification and certification processes involved in substituting one metal alloy for

another in critical applications, and factors

affecting development of advanced ceramics

and composites.

Information Availability and Substitutes

Limited access to materials properties information inhibits the use of substitute and advanced materials in many applications. The

lack of a publicly accessible material property

data base not only discourages direct substitution, but also frustrates the design process.

In a recent study on material properties data

management, the NMAB found that:

Materials properties combined with structural analysis form the basis of modern industrial design. International competitive pressures are driving virtually all structural design

in the direction of greater complexity and increased economies of production and operation. If the U.S. industrial design process is to

remain competitive in this environment, engineers must have rapid access to a well organized materials properties data base.90

Handbooks, the traditional method of presenting material properties data, are increasingly unable to keep up with developments in

a timely manner. Moreover, their methods of

organizing the data are too limited. The computerized material information sources that exist are bibliographic services that search according to material properties. However, the

information they provide is often cumbersome

to use. According to NMAB:

,.. the citations for a given material are frequently so numerous as to render compilation

and evaluation for relevancy a very time-consuming and expensive task. Further, the interpretation of relevant data often is complicated

by the lack of a standard format for presentation and the absence of sufficient information

to properly characterize the material.91

To make the most of the wealth of materials

information being generated, an on-line material properties data base with concise, thorough, and validated data would be desirable.

This base would provide engineers with easy

access to important information regarding substitution and design. Benefits of such a system,

according to the NMAB study, would include

“stimulation of innovative design, decreased

design costs, and increased component reliability, and, as a result, the U.S. position in the

international markets would improve.”92

Such an on-line data base would greatly enhance the design process, especially that based

on computer-aided design (CAD) and computer-aided manufacturing (CAM) systems.

Also, it would disseminate a great deal of useful information to small businesses, which may

not be able to support a staff of materials

engineers.

There seem to be no technical barriers to the

development of such a data base. A recent

workshop sponsored by NBS, the Committee

on Data for Science and Technology of the

International Council of Scientific Unions

(CODATA), Fachinformationzentrum, and Oak

Ridge National Laboratory (ORNL) found that

the major problem is selecting the best organization to lead the effort, raise the necessary

funds, and coordinate the required technical

expertise. 93

Finally, it should be mentioned that the

dearth of easily accessible properties data is a

particularly acute problem for advanced materials, such as composites and ceramics. The

WNational Materials Advisory Board, Materials Properties Data

Management–Approaches to a Critical National Need, NMAB405 (Washington, DC: National Academy Press, 1983).

QIIbid., p. 3.

‘JZIbid., p. 33.

QaIbid., p. 3 and 102.
Ch. 7—Substitution Alternatives for Strategic Materials . 319

great potential of these new materials lies in

the innovative structural designs that they

make possible. However, in order to examine

a wide array of structural configurations and

to use most effectively the special capabilities

of the materials, the design process must be

computer assisted, An on-line material properties data base would be an integral part of

such a design system, However, not only are

machine-readable data not widely available,

but information in any form is difficult to come

by. Much of the development work on advanced materials is done by end users (as opposed to suppliers) who have no interest in

promoting the material outside their company

or industry. Therefore, properties data are often unavailable for use in other applications.

Qualification and Certification of

Alloy Substitutes

Currently, many promising alloy substitutes

are under development that have potential to

reduce strategic materials requirements. Actual

use of these materials by industry is problematic. Many of these substitute materials will not

be tested and developed to the point where they

can be considered on-the-shelf technologies

that will be immediately available in a supply

disruption.

A major reason for this is that industry is not

likely to commit resources to qualify and certify new materials that it does not have immediate plans to use. Qualification and certification is needed in many critical applications—

those in which substitution could be most important to reduced import vulnerability—yet

few substitutes will be taken through this process because of the time and cost involved. This

barrier appears greatest when there is no evident economic driving force to entice industry to engage in the process. Such is the case

for many strategic materials substitutions—

government, not industry, is the party with the

most concern for making sure that the new

alloy gains customer acceptance. In addition,

owing to their critical applications, the certification process for strategic materials substitutes is more demanding of time and data,

which translates into cost.

Two examples of alloy certification processes

—one for stainless steel, the other for superalloys—are discussed below.

Stainless Steel

As the earlier section on substitution prospects suggests, several promising low- or nochromium alloys could serve as alternatives to

currently used stainless steels and nonstainless

alloy steels. Actual use of technically promising, lower chromium substitutes will depend

on acceptance of these new materials by producers and end users. For many consumer and

decorative steel applications, substitution of a

new material is a comparatively simple matter—often entailing a decision to switch by a

manufacturer. For critical applications, however, extensive testing and certification is essential before widespread use.

In contrast to superalloys, in which company-oriented qualification of materials predominates, certification of new stainless steels

and alloy steels is usually undertaken through

committees of professional societies or trade

associations, often through voluntary donation

of time and facilities by producers and end

users, Such activities may take 10 years or

more if the immediate need is small, and can

slow the process of user acceptance of replacement materials,

An instructive example of the steps entailed

in qualifying a new material in a critical application is provided by the ongoing effort by

DOE to qualify a new alloy as a boiler and pressure vessel material. The initial steps toward

development of the alloy began in 1974, when

a task force set up by DOE (then called the

Energy Research and Development Administration) recommended a program to develop

reference structural alloys for use in the liquid

metal fast breeder reactor.94 The alloy development process was sponsored through two

offices in the DOE under an Oak Ridge Nag4The history of the 9- I alloy is discussed in P. Patria rca, E.

E. Hoffman, and G. W. Cunningham, “Historical Background”

in P. Patriarca, compiler, ORNL Technology Transfer for A4eeting A New Chromium-Molybdenum Steel for Commercial Applications (Oak Ridge, TN: Oak Ridge National Laboratory, Apr.

7, 1982].
320 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

tional Laboratory contract with Union Carbide

Corp., and in conjunction with Combustion

Engineering, Inc. After studying several alternative alloys, a modified 9Cr-1Mo alloy was

selected for further development, Data development for qualification began in 1979, but the

alloy has yet to be approved for widespread

commercial use. The purpose of the effort was

not to conserve chromium, but rather to provide a uniform construction material for boilers

and pressure vessels. Figure 7-6 shows the development “ladder” for this alloy.

Once initial laboratory work had been undertaken, the need to demonstrate reliable transfer of properties through scale-up and field testing arose. Under arrangements with several

alloy producers, commercial heats (ranging

from 0,5 to 15 tons) were made using several

commonly used processing practices (e. g.,

AOD and vacuum induction melting). The

commercial heats were then formed into plates,

bars, tubes, and pipes, using a variety of fabFigure 7-6.— Development of Modified 9Cr-1Mo Steel

for Fossil Fuel and Nuclear Power Applications

r

Foundation of knowledge of alloys A

SOURCE. John K, Tlen and Robert N. Jarrett, Potenfial for the Deve/oprnerrr

and Use of New Alloys to Reduce the Consumption of Chromium,

Cobalt, and Manganese for Crltlcal Applications, OTA contract

rication processes. To provide additional test

data, modified 9Cr-1Mo alloy replacements for

18-percent stainless steel tubes have been put

in service in six conventional powerplants located in the United States, Canada, and Great

Britain, as shown in table 7-17.

Widespread, nonexperimental use of this

substitute in powerplant applications is dependent first on approval of its specifications by

the American Society for Testing of Materials

(ASTM), followed by its inclusion in the American Society of Mechanical Engineers (ASME)

Boiler and Pressure Vessel Code,

In May 1981, an application was made to

ASTM to approve specification of the modified

9Cr-1Mo alloy for use in plate and tube products, followed a year later by a similar request

for forgings, pipings, and fittings. The specifications are currently working their way

through the ASTM approval process, as shown

in table 7-18. A data package for inclusion of

the material in the ASME Boiler and Pressure

Vessel Code pertaining to nonnuclear applications was provided in June 1982, Additional

data will have to be collected before the substitute material can be considered for possible

use in nuclear powerplants.

By early 1984, the alloy had been approved

for certain limited uses in conventional (nonnuclear) powerplants. Additional applications

for the alloy can be expected to be approved

sometime in 1985—9 years after initial design

of the alloy. Estimated costs for the post-laboratory alloy development through the end of 1983

are $5 million by the government (an estimated

$2 million has been donated in services by industry).95

Superalloy

As suggested previously, several current and

prospective materials and technologies could

be used to reduce cobalt and, to a lesser extent,

chromium use in the hot sections of gas turbine engines. Some, perhaps most, of these

may have the technical potential to reduce straosInformation provided by V. Sikka, Oak Ridge National Labreport, September 1983. oratory.
Ch. 7—Substitution Alternatives for Strategic Materials • 321

Table 7-17.—Current Status of Testing of Modified 8Cr-1Mo Steel Tubes in U.S. and Foreign Steam Powerplants

Operating

Tube temperature Tubes being Number Date

Utility Plant location (“c) replaced of tubes installed Status

Tennessee Valley Authority Kingston Steam Plant, Unit 3 Superheater 593 Type 321 8 May 1980 Operating

American Electric Power Tanners Creek Unit 3 Secondary 593 Type 304 10 April 1981 Operating

superheater

Detroit Edison St. Clair Unit 2 Reheater 538 Type 347 2 February 1981 Operating

Central Electric Generating Board (U K) Agecroft Power Station Superheater 590-620 21⁄4 Cr-1 Mo 6 April 1982 Operating

Ontario Hydro (Canada ) Lambton TGS Reheater 538 Type 304H 9 May 1983 Operating

Reheater 538 Standard 9 Cr-1 Mo 9

Ontario Hydro (Canada) Nanticoke TGS Secondary 538 21⁄4 Cr-1 Mo 11 April 1984 Planned

superheater

SOURCE V K Slkka and P Patrlarca, L7a/a Package for Modlfled 9Cr-lMo A//oy (Oak Ridge, TN Oak Ridge National Laboratory December 1983), p 28

Table 7-18.–Status of Specifications for Modified 9Cr-1 Mo Alloy

Specification

number Description

A-213 T91 . . . . Seamless ferritic and austenitic alloy-steel, boiler, superheater, and heat-exchanger tubes

A-387 GR91 . . . Pressure vessel, plates, alloy steel, chromium-molybdenum

A-182 F91 . . . . Forged or rolled alloy-steel pipe flanges, forged fittings, and

valves and parts for high-temperature service

A-234 WP91 . . . Piping fittings of wrought carbon steel and alloy for moderate and elevated temperatures

A-335 P91 . . . . Seamless ferritic alloy steel pipe for high-temperature

service

A-336 F91 . . . . Steel forgings, alloy, for pressure and high-temperature

parts

A-199 T91 . . . . Seamless cold-drawn intermediate alloy-steel heat-exchanger

and condenser tubes

A-369 FP91 . . . Carbon and ferritic alloy-steel forged and bored pipe for

high-temperature service

Status as of December 1983

Approved and available as separate

Approved by Main Committee and awaiting Society Ballot

Approved by Main Committee and awaiting Society Ballot

Approved by Main Committee and awaiting Society Ballot

Approved by Main Committee and awaiting Society Ballot

To be submitted for AI.06 Subcommittee

approval

To be submitted for AI.10 Subcommittee

approval

To be submitted for AI.10 Subcommittee

approval

SOURCE: V K. Sikka and P Patriarca, Data Package for Modified 9Cr-lMo Alloy (Oak Ridge, TN: Oak Ridge National Laboratory, December 1983), p. 5

tegic materials without impairing the advances

in performance so critical to the military. However, aside from those that are already fully developed, most of these potential substitutes still

face massive R&D costs, and, if they prove viable, large scale-up and qualification costs.

Given industry’s little incentive to assume these

costs itself, unless clear performance and cost

benefits would also accrue, most of the resources available for qualifying new superalloy are dedicated to prospective materials

to be used in the next generation of jet engines.

Successful commercialization of a new superalloy for the hot section of a gas turbine engine can take two decades, beginning with the

researcher’s idea, through laboratory proof-ofconcept, to engine testing and eventual commercial application. Many research ideas never

reach the laboratory stage, and of those that

do, only some show technical promise.

Even when technical problems can be overcome, institutional barriers can add appreciably to development time or can indefinitely

delay work on the project. Given the protracted

time period involved, what may have been initially seen as a clear need for a new material

may not be relevant a decade later. Many superalloy development efforts are cost-shared

between government and industry, which adds

to the risk that R&D priorities will change during the course of the project. Coordination of

research may also be difficult. By the time commercialization of a superalloy is successfully

reached, several different government agen-
322 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Photo credit: U.S. Oepatiment of the Interior, Bureau of Mines

Aluminum and silicon can reduce the need for chromium in stainless steels for high-temperature applications. A 5-percent

aluminum addition to a Bureau of Mines 17Cr-8Ni research alloy (center) enormously improves oxidation resistance after

380 hours at 1,000° C compared to type 304 (18Cr-8Ni) and type 316 (18Cr-12Ni) stainless steels. The research alloy is under

investigation as a possible high-performance alternative to the 25 percent Cr-20 percent Ni stainless steels

cies, universities, and companies may become

involved—each with its own specific objectives, personnel, and priorities.

Typically, laboratory findings must be verified in large-scale industrial heats. It is only at

this stage that the technical validity and manufacturing practicality of the process can be

known with assurance, and it is only at this

stage that the expensive and time-consuming

process of engine qualification can begin.

Designer and user acceptance of the new material will occur only when there is confidence

about its reliability and performance at acceptable costs.

Figure 7-7 shows key steps that must be overcome in the successful commercialization of

a new superalloy, using Inconel MA 6000 as

an example. Inconel MA 6000 contains no cobalt, but its initial development had nothing to

do with conservation of strategic materials.

Rather, the key objective was to develop a turbine blade material able to operate at a higher

temperature than other superalloy, while

avoiding the performance penalties associated

with the need for cooling air.

The origins of Inconel MA 6000 date back

to 1968, with the invention by a researcher at

the International Nickel Co. of a mechanical

alloying process for producing oxide dispersion strengthened superalloy. In 1974, NASA

entered the picture by providing Inco with support to design an alloy composition that became MA 6000. In time, university researchers and several manufacturers of jet engines

became participants in the project as it advanced through scale-up to its present status—

preparation for engine testing. If successful, it

will probably be another 5 years before MA

6000 is actually used for turbine blades and

vanes in human-rated jet engines. Using 1974

as a starting date, 15 or more years—and an

estimated $10 million to $12 million—will have

been consumed in the development of this one

cobalt-free superalloy.

Development costs associated with an entirely new superalloy may be greater than for
— —— .

Ch. 7—Substitution Alternatives for Strategic Materials . 323

Figure 7-7.—Technology Transfer Ladder for ODS MA 6000

I

SOURCE Joseph R. Stephens and John K. Tlen, Considerations Of Technology Transfer Barriers in the Modification of Strat.9QiC Supera//oys for Aircratf Turbine Er?glrres, NAsA Technical Mernorarldurn 83395 (Springfield, VA’ National

Technical Information Service, 1983)

a superalloy with a modified composition. For

example, the low- or no-cobalt COSAM alternatives are intended as substitutes for existing

superalloy. If the alternative materials were

commercially used, it is probable that only minor adjustments in manufacturing and fabrication processes would be needed, In this regard, NASA’s proposed fiscal year 1985 budget

earmarks $50,000 for preparing several test

heats of one of its four low-cobalt, alternative

superalloy. Figure 7-8 shows steps taken to

date and additional development required for

the COSAM superalloy.

Institutional barriers to continued development of the materials are formidable, even if

their technical promise is favorable. In the case

of the low-cobalt COSAM alternative superalloy, post COSAM augmentation efforts

could require 6 to 7 years and $6 million to $9

million, assuming real-time testing requirements and typical scale-up activities for each

modified alloy. Since the COSAM alternative

superalloy would substitute for already used,

widely accepted, higher cobalt superalloy, no

single company is likely to be committed to assuming such a development effort simply for

the purpose of contingency planning for a

hypothetical future cobalt shortage.

Institutional Barriers and Advanced Materials

Advanced materials face a number of institutional barriers before being adopted on a major scale. As comparatively new technologies

and new industries, they need the support of

more complete and reliable data than is currently available and of innovative design which

uses the materials to their best advantage. In

the end, final acceptance of advanced materials

by engineers, designers, and consumers will

come only from experience in use. The Federal Government’s efforts focused on these new

materials can assist in this adoption process

and promote the growth of new industries.
324 • Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Figure 7-8.—Technology Transfer Ladder for COSAM

Strategic Material Substitution

SOURCE Joseph R Stephens and John K Tien, Considerations of Techrro/ogy Transfer Barr/ers in the Modification of Strategm

SuperalJoys for Aircraft Turbfrre Engfnes, NASA Technical Memorandum 83395 (Springfield, VA Nattonal Technical

Information Servtce, 1983)

Ceramics Data Base Requirements, Standards,

and Qualification Processes

The properties of ceramic components and

the materials from which they are made—and

thus their usefulness for any particular application—can vary depending on their chemical formula and the methods by which they

are produced. One of today’s largest single institutional constraints to expanded structural

usage of ceramics is the poor quality and

limited availability of information on these

variable material properties. The technology

needs not only the application of standardized

test procedures (specific to materials and processing and the effect of different temperature

and chemical environments over time) and a

systematic collection of available information

but also research efforts devoted to producing

the information.96

geThe National ~ureau of Standards recently announced the

establishment of a Ceramic Powder Characterization LaboraDesigner Preference and Education

Product design engineers select materials on

the basis of past experience and available data.

Few structural design engineers have experience with ceramics (less so with composites).

As stated above, reliable data about material

properties are scarce, and in general, formal

codes and specifications do not yet exist, Such

data bases normally serve as guides for engineers working with unfamiliar materials,

In general, the formal education received by

engineering students is deficient both in knowledge obtained about advanced materials and

in how to incorporate that knowledge into design work. For instance, materials courses are

not generally required of mechanical engineering students, and if they are, the emphasis is

on metals. Educational institutions are reluc-

——

tory (IVZ?S Update, June 11, 1984). The laboratory will help manufacturers by providing them with information on powder characteristics.
Ch. 7—Substitution Alternatives for Strategic Materials Ž 325

tant to adjust long-established curricula to eliminate such deficiencies and may often be constrained by budgets from doing so. In a broader

context, the base of 10 to 15 universities in the

United States with programs in ceramics may

be insufficient to meet the future research

needs of a rapidly expanding industry,

Industry in Transition

The advanced ceramics industry is being created out of discrete parts of other industries.

The mature traditional ceramics industry, conservative because of a history of stable and

profitable years, is only now examining new

possibilities. This change in perspective may

be a result of recent depressed conventional

markets (linked to the steel industry) and talk

of future competition from abroad. Most of the

innovations in the industry, however, appear

to come from end users rather than from the

producers. Much of the research conducted by

end users naturally leads them into becoming

materials processors in order to maintain the

necessary tight control over this critical step.

Other segments of this emerging industry are

the expansion into advanced ceramics by conglomerates and conventional materials firms

that sense future market changes.

This merging process means that there is no

focal point, no industrial champion for advanced ceramics. As yet, no industrial association or organization is charged with research,

development, or product data specification.

The established professional association—the

American Ceramics Society—provides a forum

for the exchange of technical information. It

does not, however, have a technical section

dealing with advanced ceramics as a separate

issue. Recently, it has begun to collect data on

industry production of advanced ceramics and

form a standardized data bank. With little information yet available about the organization

of the industry and its participants, government data collection centers, such as those of

the Department of Commerce,97 EPA, and

971 n f.rrnatiO nis hegi n n i ng to emerge, however. See, for instance, U.S. Ilepa rtrnent of Commerce, A Cornpetititre Assessment of the [;. S. ,4d\anced Ceramics lndustr~-, March 1984.

OSHA, do not yet aggregate advanced ceramics data separate from that of the traditional

ceramics industry.

Government Research

Currently, several agencies are involved in

many aspects of advanced ceramics research:

primarily, DOE, Department of Defense, NASA,

and NSF. Those interested in the advancement

of the technology express concern over the uncertainty from year to year over adequacy of

funding, the direction of funding, and possible lack of coordination which may lead to

duplication of effort.

The bulk of the research effort is focused on

the high potential (in terms of market size,

energy efficiencies, and strategic materials substitution) heat engine applications. While this

may be appropriate from an applications point

of view, questions remain as to whether concentration on major development projects is

the best way to advance the science of advanced ceramics and whether this approach

will contribute to the building of a firm, broad

base of technical knowledge for the support of

a competitive domestic industry. Supporters of

the concept argue that the technological base

is broadened by focusing on the development

of a major application, since success requires

an iterative process in which researchers must

continually return to basic science in order to

solve problems encountered in the development phase. Others worry that, by pushing the

development phase at the expense of basic research, application failures which occur will

result in generating negative impressions of the

ultimate capabilities of the technology.

The current contractors on the ceramic heat

engine projects have plans to commercialize

the technology eventually, but a technology gap

will exist after the proof-of-concept stage is

reached by government R&D efforts. The skills

developed in designing the ceramic components of experimental engines will be transferable to engines designed with the consumer in

mind. But industry will have to be firmly convinced of the technology’s viability to be willing and able to take on expensive and lengthy
326 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

development costs before ceramic heat engines

are ready for the marketplace.

Until recently, there was no Federal office

with a specific mission to promote, coordinate,

and focus the government’s R&D efforts in advanced ceramics. (As is discussed in chapter

8, the National Critical Materials Act of 1984

establishes a council in the Executive Office

of the President that is to formulate a Federal

program plan for advanced materials.) It is currently difficult to obtain a comprehensive overview of the R&D efforts of the various agencies and to determine whether there is any

overlap of effort. Table 7-19 provides a breakdown by agency of estimated Federal Government R&D for structural ceramics technology.

This reflects internal shifts of program emphasis and is a result of a growing awareness in

many sectors of the important role that advanced ceramic technology could play in future U.S. economy.98

DOE has initiated some steps to cope with

the lack of available information. Its Oak Ridge

National Laboratory (ORNL), in its Ceramic

Technology for Advanced Heat Engines Program Plan,99 provides a breakdown of the funds

committed by various agencies for R&D in advanced ceramics considered applicable to heat

engine technology. The Advanced Materials

Development Program at DOE is developing

a computer-based data system which, when

completed, will provide continuing—and systematically collected—information on the R&D

efforts in structural ceramics of Federal Government agencies.

Even with these statistics available, overlap

of effort is difficult to assess. The difficulty lies,

in part, in the large and growing number of advanced ceramic materials, each designed with

specific properties for specific applications

(similar to metallic alloys). While the knowledge gained from success in one application,

if transferred, can advance the use of similar

ceramic materials in another application, a material designed for a specific application cannot necessarily serve “as is” elsewhere.

SeRobert B. Schulz, Program Manager, Advanced Materials

Development Program, Department of Energy, personal communication, Oct. 4, 1984,

W3ak Ridge National Laboratory, Ceramic Technology for Advanced Heat Engines Program Plan, ORNL/TM-8896, June 1984.

Table 7.19.—Structural Ceramic Technology Federal Government Funded R&D (in millions of dollars)

Fiscal year Fiscal year Fiscal year Fiscal year

1982 1983 1984 1985

Department of Energy:

● Conservation and renewable energy:

— Heat engine propulsion . . . . . . . . . . . . . . . . . . . . . . . . . . .

— Industrial programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

— Energy utilization research. . . . . . . . . . . . . . . . . . . . . . . . .

. Fossil energy:

— Advanced research and technology development . . . . .

— Advanced energy conversion systems . . . . . . . . . . . . . . .

“ Energy research:

— Basic energy science . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

NASA:

● Lewis Research Centerb. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

NSF . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Department of Defense:

● Defense ARPA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

● U.S. Air Force . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

s U.S. Army . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. U.S. Navy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$9. 3

1.5

0.3

1.2

1.9

2.0

1.8

2.7

2.0

1.7

1.3

1.0

$26.7

$14.6

1.0

0.5

1.0

3 . 0

a

3.0

2.9

7.7

3.0

4.7C

1.2

$42.6

$15.5

2.3

0.6

1.0

3.0

3.5

3.3

9.5

3.4

6.0C

1.3

$49.4

$13.6

2.7

2.0

1.0

3.0

4.6

3.6

7.7

4.7

2.5C

1.4

$46.8

aReflects increase in portion of budget applied to structural ceramics.

blnclutjes salaries for manpower.

CTACOM included.

SOURCE: U.S. Department of Energy, Advanced Materials Program, October 1984
Despite the lack of official oversight, coordination among agencies has apparently improved in recent years. The ORNL program

plan on ceramic heat engine technology was

developed to identify technology base needs;

develop a multi-year technical and resource

agenda; and coordinate activities with other industry, government, and university programs.

NASA holds regular and frequent meetings

with DOE that now include DARPA and the

Air Force. Each fall, an interagency meeting

is held for all the participants from government, industry, and academia working on ceramics in heat engines,

NASA’s Lewis Research Center has also developed a new comprehensive ceramics program proposal but funding was not included

in the fiscal year 1985 budget, The program’s

goal, while focused on the aircraft engine as

the application, was to broaden the ceramics

technology base in general.

The National Science Foundation, under its

industry and university cooperation program,

has funded the Center for Ceramic Research

at Rutgers University. This center has been

granted public funding for 5 years with the intent that it will be able to generate sustaining

private funding of its research efforts within

that period. Research areas in which the Center is involved include, among other things,

powder processing technologies and improvement of materials properties.

Qualification, Certification, and Standardization

of Composites100

Composites are engineered materials, and as

such are very sensitive to a multitude of structural and processing factors. This characteristic is very beneficial, because it gives designers great control over the properties of

composites, allowing the tailoring of these

materials to individual applications. However,

l~Thls section draws heavily on Stanley L. Channon, ‘ ‘Industrial Base and Qualification of Composite Materials and Structures (An Executive Overview)” (Alexandria, VA: Institute for

Defense Analysis, May 1984). Presented as a working paper for

a Department of Defense-sponsored colloquium/workshop on

Composite Materials: Standardization, Qualification, Certification,

Washington, DC, May 1984,

Ch. 7—Substitution Alternatives for Strategic Materials ● 327

with the greater design flexibility also comes

the need for strict materials and processing tolerances during production runs, Addressing

the concerns arising from the sensitivity of

composites to each manufacturing step, the

composites industry has adopted elaborate certification and qualification schemes. These procedures are needed to ensure the quality and

uniformity of the various materials, through the

many times they change hands, used in the

production of composites.

Qualification and certification is more complex for composites than for traditional materials for several reasons,

The composites industry is very fragmented–

there is very little vertical integration. There

are many processing steps entailed in the production of composites, and rarely, if ever, does

one company engage in all these segments of

the business. Most composites companies are

specialized, each concentrating on a segment

of the industry,

While this may not increase the amount of

testing needed to ensure product quality and

uniformity, it causes confusion with regard to

testing needs and data interpretation.

Composites are fundamentally different in

their structure and behavior than traditional

materials. The well established testing and

characterization techniques used for traditional materials are not suited for composites. Appropriate composites testing techniques have

been developed, but on an ad hoc basis with

little industrywide agreement.

There is no uniform procedure for certifying and qualifying composite materials and

structures; every product is handled differently, on a company-by-company basis.

The composites industry has no industry association to pursue the interests of the composites industry as a whole. There is no organization through which the industry can work on

qualification, certification, and standardization

problems common to many of the involved

companies.

Developing the data package necessary for

qualification of composite materials and struc-
328 Ž Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

tures is very time-consuming and expensive

(especially considering the small quantities of

materials often associated with composite

orders). The battery of tests required to qualify a material may cost $20,000 to $200,000 or

more, depending on the scope of testing. While

these costs are borne by the composites user

for the initial supplier’s material, alternate suppliers may be required to assume part or all of

their qualification costs. The new suppliers

may be required to perform costly full-scale

tests if bench-scale evaluation suggests significant differences between their material and

the primary material. Qualification of a new

supplier for an existing material may require

3 to 6 months for most structural applications.

Whenever any change is made in the composites used in rocket nozzles, full-scale testing—taking up to a year—is required. This

costly testing limits the number of suppliers for

any given application.

In addition to being costly, the complexity

of the qualification process may discourage innovation. Once a composite has been qualified

for a particular use, changes in the material or

its production are usually disallowed for that

application. This, along with designers’ preference for proven materials, tends to restrict

the number of available qualified materials.

There is also a need for standardization of

material specifications and test methods for

composites, Standards are currently generated

by a variety of government and industry groups,

but it is customary to rely on specifications

from fiber and resin suppliers. The government

specifications are rarely used because they are

too broad or out of date. Industry groups such

as the American Society for Testing and Materials (ASTM), the American National Standards

Institute (ANSI), the Society of Automotive

Engineers (SAE) and others generate composites standards, but the process is slow and often

includes compromises accepted in order to

broaden the applicability y of the specifications.

ASTM test methods find frequent use in industry, but many companies develop their own test

methods because of preferences in testing

equipment and procedures.

Regarding the need for standardization of

composite materials, a recent industry survey

concluded:

Although the majority of industry and government personnel would prefer to see standards adopted for the composites industry, it is

recognized that this will not be accomplished

easily. A major resistance to standardization

emanates from the suppliers of materials who

fear that the identity of their materials would

be lost. , . Some opponents to standardization

feel that this would retard technological innovation in the industry whereas proponents feel

that the industry will advance more rapidly if

standards are adopted. Some feel that the timing is inappropriate for standardization because the industry is still in a dynamic state. 101

Composites technology also faces other institutional barriers similar to those for ceramics, although it is probably far ahead in

most aspects, The technology has found its major application in the aircraft and automotive

industries and has been supported and pushed

by those industries and by the government. The

extensive government research in composites

has been centered primarily in the Department

of Defense. The interest in composites for use

in military aircraft, and the accompanying lack

of public information, however, has been blamed

for slowing technology transfer between the

government, academia, and industry.

101 Ibid., p. 22.
CHAPTER 8

Policy Alternatives for Strategic Materials
Page

- Potential Contribution of Alternatives to Specific Material Supplies.. ............331

Chromium ... . *,,0***,*****.,,.,***,*.***..*..*......**..,.* 334

Cobalt *.o***. *.. ... ,.. . . 334

Manganese * . 334

Platinum Group Metals .., ,,, . o . . * * * * ., . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 335

Existing Laws and Strategic Materials Policy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 335

National Materials and Minerals Policy, Research and Development Act. ,......335

National Critical Materials Act of 1984 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 338

Defense Production Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 340

Strategic and Critical Materials Stock Piling Revision Act . ...................340

Stevenson-Wydler Technology Innovation Act of 1980 . . . . . . . . . . . . . . . . . . ,.....341

Formulation of Strategic Materials Policy ● . 342

Goals, Objectives, and Priorities of Strategic Materials Policy .................343

Providing Information About Federal Research and Development Activities .. ...347

Mineral Production and Processing ● . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 350

Exploration for Domestic Strategic Resources . . . . . . . . . . . . . . . . . . . . . ..........351

Domestic Production of Strategic Materials . . . . . . . . . . . . . . . . . . . . . ............353

Encouraging Foreign Production of Strategic Materials . . ● . . . . . . ● . ● ● . ● ● ● ● ● ● ,.356

Implications of Diversification of Supply for Ferroalloy Production . ...........361

Substitution and Advanced Materials . . . . . . . . . . . . . . . . . . . . . ...................362

Direct Substitution Options ● .*, ,***. ,., ... ... . 363

Providing Substitution Information to Industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 365

Developing Substitute Alloys ● . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...• ● ● ● . ● .36 6

The Potential of Advanced Materials. . . . . . . . . . . . . . . . . . . . . ... ...,...........368

Government Support of Research and Development .. . . . . . . . . . . 369

Education Needs and Advanced Materials . . ’ ., . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 370

Transfer and Diffusion of Advanced Materials Technologies . .................370

Conservation and Recycling of Strategic Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . 371

Information Needs and Recycling . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 372

The Impacts of Federal Activities on Recycling . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 374

Developing New Recycling Technologies ... *,, ,. .*.,, 376

List of Tables

Table No. Page

8-1. Technical Prospects for Reducing U.S. Import Vulnerability for

Chromium, Cobalt, Manganese, and the Platinum Group Metals ...... .......332

8-2. Probable Degree of Government Involvement Needed in

Long-Term Strategies to Reduce Vulnerability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 336

8-3. Selected Federal Agencies With Strategic Material Responsibilities. . ● ,.,.....344

8-4. Policy Alternatives for Formulation of Strategic Materials Policy .., ......,..345

8-5. Distribution of R&D Funding for Critical Materials by

Materials and by Technology Goal . 348

8-6. Distribution of Critical Materials R&D Funding by

Stage of the Materials Cycle . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 349

8-7. Policy Alternatives for Exploration, Mineral Production, and Processing, ...., 352

8-8. Policy Alternatives for Substitution and Advanced Materials . . . . . . . . . . . . . . . 364

8-9. Policy Alternatives for Recycling Strategic Materials ● ● ● ● ● ● * . ● ● ● ● ● ● * ● . * . * .,.373

. . .,

. -- . . .’. , k- - -

.-J . . , .- -e .- .—- -,. .‘ . . . -

-=. .- .,, . .——.-z +

——=-F —- -— :‘-. c . -. . . . . = -+7 — -. ‘ - - – . - .- .= .%- K - ‘ . . .- ,. < ..- -t ~. * .’ . .- . . , ---

. . . , ------ . . . T .f , -’ - . . ‘. -a — L-.-* .~-..~*- , : - “ ~ . . -- -+.4,-T -+... :g; “ .

.- -r -m

. . --- . . *-,: G- . .; * - ,- . . . . .- +“~,-~. - “ , , - , ..——. >— .

. .
CHAPTER 8

Policy Alternatives for Strategic Materials

The central premise that underlies concern

about strategic materials can be stated as follows: the United States must import a number

of materials that are essential to the national

defense and to domestic industry. For a number of these materials, the bulk of the supply

comes from countries or regions that are either

politically unstable or ideologically hostile to

the United States. As a result, the United States

may face disruptions in the supply of these

materials, disruptions that could be damaging

to the national defense or industrial strength

of the country.

The National Defense Stockpile and the priority allocation system provided under the Defense production Act address the problem of

maintaining an adequate supply of materials

for national defense. These policies and procedures, however, are not meant to protect the

U.S. industrial economy from disruptions in

the supply of strategic materials except in times

of war or national emergency.

The technical approaches that are the subject of this report can help reduce the vulnerability of the United States to disruptions

in the supply of strategic materials. The approaches can be grouped into three categories:

mineral production and processing, conservation and recycling, and substitution. Policy

options for the implementation of these approaches, including the formulation of coordinated Federal strategies for strategic materials,

are the subject of this chapter.

Two general observations apply to the discussion in this chapter. First, most of these

technical approaches are long-term in nature.

Some of the alternatives, such as the development of substitute materials for the most demanding applications, may require 10 years or

more to be brought to fruition. Second, private

industry, not the Federal Government, is the

primary producer, importer, and consumer of

strategic materials. Therefore, it is private industry that will make most decisions about the

location of new mineral development, about

the use of conservation and recycling technologies, and about the development and use of

substitute materials.

The Federal Government can influence private decisions through such actions as support

of research and development or use of tax and

other economic tools to influence investments.

The degree of government involvement considered appropriate or desirable depends on the

policymaker’s assessment of the likelihood and

effect of supply disruptions, on his or her philosophy of the relationship of government and

industry, and on the economic and technical

resources available for this issue in the wide

range of national affairs.

Potential Contribution of Alternatives to Specific Material Supplies

Prospects for reducing vulnerability must be

assessed on a material-by-material basis. The

potential contribution of each alternative

differs for each strategic metal under examination; however, taken in sum, these alternatives can contribute significantly to net reduction of U.S. vulnerability to disruptions of

supplies of strategic materials.

Table 8-1 illustrates how each technical alternative relates to the first-tier strategic materials

(chromium, cobalt, manganese, and platinum

group metals) that are addressed in detail in

this study. These alternatives are summarized

briefly below. Detailed discussion of the technical alternatives to import vulnerability is provided in chapter 5 (production and processing),

331
Table 8-1.—Technical Prospects for Reducing U.S. Import Vulnerability for Chromium, Cobalt, Manganese, and the

Platinum Group Metals

Chromium (Cr) Cobalt (Co) Manganese (Mn) Platinum group (PGM)

U.S. apparent consumption 319,000 short tons

(1982)a

U.S. import dependence (1982 )a85%

Recycling in 1982 12%

(purchased scrap)b

Domestic production in 1982a 0%

5,592 short tons 672,000 short tons

(1 1,184,000 Ibs)

92°/0 990/ o

61 short tons

(1,787,000 troy ounces)

800/0

80/0 Not estimated 19°/0 (excludes toll refined)

0 % About 2°/0 of apparent

consumption

About $1.58-$1.68 per long

ton unit (22.4 pounds) of 46

to 48°/0 of Mn metallurgical

ore.

$197 million

0.40/0 of apparent

consumption

Dealer Price:

platinum —$327/troy oz.;

palladium —$67/troy oz.

Price in 1982a

Turkish chromite: $100/short ton

($110/metric)

South African: $47/short ton

($52/metric).

$120 million

Cathode 99°/0 Co:

$12.90/pound

Value of imports into the

United States in 1982C

(including gross weight)

Import sources (1979-1982)a

(Bold-faced countries are

primary producers)

$143 million $554 million

Chromite: South Africa (480/o); U.S.S.R.

(170/0); Philippines (130/.); Other

(220/0). Ferrochromium: South Africa

(440/o); Yugoslavia (90/.); Zimbabwe

(90/.); Other (380/.).

Ore: South Africa (330/0);

Gabon (260/o); Australia

(200/0); Brazil (120/0); Other

(9%) Ferromanganese:

South Africa (430/.); France

(260/o); Other (31 O/O).

South Africa (400/o); U.S.S.R.

(370/o); remaining 23°/0

(distributed among 8 countries) represents reserves in

excess of 200 million short

tons.

Zaire (37%); Zambia (130/o); Canada (80/0);

Belgium-Luxembourg (80/0); Japan (70/o);

Norway (i’ ”/o); Other (lsO/o).

South Africa (560/o); U.S.S.R.

(160/O); U.K. (11 O/O); Other (l T”/o).

Location of major world

reserves d

South Africa and Zimbabwe (920/o); the

remaining 8°/0, distributed among

more than 10 countries, represents

reserves in excess of 100 million

short tons of chromite. Chromite

typically ranges from 22 to 38°/0

chromium content.

Very good for noncritical applications;

for critical applications, extensive

applied R&D will be needed. Basic

research breakthroughs may be

needed to develop substitutes in the

most critical applications.

Fiber-reinforced plastics and some

other composite materials may compete with stainless steels in some

critical applications over time.

Zaire (500/0); Zambia (130/0); Cuba (70/.);

U.S.S.R. (50/o); the remaining 250/. of

world reserves (2 million short tons) is

distributed among 12 countries.

South Africa (790/o); U.S.S.R.

(190/0); remaining 20/0 (20 million

troy ounces) is in Canada, the

U. S., and Columbia.

Prospects for increased

substitution

Good for many applications; additional

R&D needed for critical applications

such as superalloys. Qualification

requirements may limit practical use of

these substitutes.

Poor—substitutes for Mn in

steelmaking (which

accounts for 900/0 of consumption) are not promising.

Alternatives to PGM exist in many

applications; in critical applications, prospects for direct

substitution are poor in the near

and medium term.

Potential for displacement

by advanced materials

Reasonable prospects for incremental

phase-in of advanced materials in near

and medium term; long-term prospects

(2010 and beyond) may be great in heat

engine applications.

Limited: various composites

may compete with steel in

specialized applications.

Breakthrough in basic

research is probably

needed for other materials

to replace PGM as a catalyst.

Potential for increased

recycling

Good—major obstacles are economic.

Reduced downgrading, improved

obsolete scrap recovery, and

recovery of Cr values from steelmaking wastes appear to be the major opportunities, although data is

out-of-date. Scrapped catalytic converter shells could become source of

Cr; recovery of Cr from steel making

wastes also may add to supplies.

Good—economic factors are primary

impediments to recycling, although

advanced technologies may have to be

developed to maximize recovery of

superalloy scrap. Obsolete superalloy

scrap, spent catalysts, and other

postconsumer uses will be a growing

potential source of cobalt. For 1980, an

estimated 2,350 short tons (4.7 million

Ibs) of Co was not recycled or was

Poor—unless technical

advances make Mn recovery

from slag economical.

Excellent—recycling of PGM from

automotive catalysts could provide 400,000 to 500,000 troy

ounces of PGM annually in the

mid-1990s. Obsolete electronic

scrap could also be a major

recycling source if high costs of

disassembly are overcome.

downgraded.
Table 8=1.—Technical Prospects for Reducing U.S. Import Vulnerability for Chromium, Cobalt, Manganese, and the

Platinum Group Metals (Continued)

Potential for mo~e efficient

use through design,

processing, and manufacturing technologies

Prospects for production

and processing:

Potential for Significant

domestic production

Potential for supply

diversification abroad

Potential to retain

domestic processing

capacity

Prospects for substantial

reduction in current levels

of U.S. dependence by the

year 2000 using the above

alternatives.

Most promising technical

routes to reducing U.S.

import dependence by 2000

Chromium (Cr) Cobalt (Co) Manganese (Mn) Platinum group (PGM)

Incremental gains; a major breakthrough akin to the AOD process,

which reduced chromium losses in

stainless steel production is not

foreseen.

Very poor—known deposits are low

in quality and probably WIII not be

exploitable except in a national

emergency; however possibility of a

new discovery of a promising

deposit cannot be ruled out entirely

In addition, Iimited quantities of

chromite may be produced as a byproduct if nickel-cobalt Iaterites are

developed.

Poor to fair—probably would require

U.S. development assistance or incentives to promote production in

Turkey, the Philippines, and several

other countries.

Loss of processing capacity is

expected to continue in near term

with stabilization of domestic

industry at a reduced level in long

Very good—in superalloy production Good—manganese required

and parts fabrication; however, more per ton of steel could be

efficient manufacturing will reduce reduced significantly by the

scrap materials most preferred for year 2000 (from the current

recycling. level of 36 Ibshon to 25

Ibshon).

Poor—without subsidy or major price Very poor—known deposits

rise. Good with subsidy. Maximum

simultaneous development from existing mine sites could provide 10

million pounds (5,000 short tons) of

cobalt annually for a 10- to 15-year

period. Production economics varies by

mine site. Mine owners have cited

prices ranging from $16 to $25 per

pound as needed where cobalt is the

primary mine product. At other sites,

prices of nickel and copper need to be

considered in determining whether

coproduction would be profitable.

very low in quality. Possible

discovery of a promising

deposit cannot be ruled out

entirely.

Good prospects—but viability depends Good—several alternative

on copper and nickel markets because suppliers exist, including

cobalt is a byproduct from mining of Mexico, Australia, Brazil,

these materials. Improved technologies and Gabon.

for laterite processing in the U.S. may

be transferable overseas.

Good—processing capacity is expanding Loss of processing capacity is

due to recycling efforts expected to continue in near

term with stabilization of industry at a reduced level to

term to” meet specialty steel industry meet-specialty steel industry

needs. needs.

Fair Good Fair

Substitution Recycling Continuation of conservaRecycling

tion trends in steelmaking

Design, processing, and manufacturing Diversification of supplies

technologies

Diversification of supplies Domestic production Replacement of steel in some

substitution applications by aluminum or

plastics

Uncertain—will depend on

basic research in catalyst

chemistry.

Fair to good—initial plans to

develop one domestic site

anticipate palladium and

platinum production equivalent

to 9 % of total U.S. PGM consumption in 1982. A decision on

the project is expected in 1985.

Much higher production levels

may be achievable if other sites

are developed.

Poor—unless major new discoveries are made (U.S. has

most promising unexploited

deposit).

Good—domestic refining capacity

has increased to meet recycling

needs.

Good

Recycling of automobile catalysts

and electronic scrap

Domestic production

au s, De~a~t~ent of Interior, Bureau of M ,nes, Mineral c~mm~dlty .c&mmarle~ 7984 washln~t~n, Dc u s Govemnlent p~lntln~ Off Ice, 19&3) Figures on apparent consumption may d Iffer f:cm apparent Consumption ftgures In table A or ch. 1 because of different reporting conventions used In different Bureau of M Ines statistical series

bu s, Department of Interior, Bureau of Mines, M/nera/ comm~d,ty Summaries 7983 (washlnqton,DC. us. Government prlnt,ng Of f,ce, 1982) Estimates of purchased scrap as a percentage Of apparent COflsumptlon In 1982 are preliminary estimates which may be sub)ect to rewslon Appreciable quantities of manganese contained In ferrous and nonferrous scrap and steelmak(ng slag are recycled Howwer, scrap

recovery specifically to recycle manganese IS mlnlmal

Cu,s, Department of Interior, Bureau of Mines, M/nera/s yearbook Vo/ I, Me/a/~ and Minerals 7982 (Washington, DC U S Government prlntlng Off Ice, 1983), table 10, pp. 54-55.

du.s. Department of Interior, Bureau of Mines, “Mineral Commodity Profiles 1983” (chromium, cobalt, manganese, and plat!num group metals),

SOURCE: Office of Technology Assessment, 1984.
334 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

chapter 6 (conservation and recycling) and

chapter 7 (substitution and advanced materials).

Chromium

The United States is dependent on South

Africa and the Soviet Union for most of its

chromium, half of which is used in stainless

steels. Major opportunities exist to conserve

chromium, especially in nonessential applications for stainless steel where substitutes (e.g.,

aluminum and plastic) are widely available. For

critical applications, some promising lower

chromium stainless steels are now under development—primarily by government. These

will need substantial additional work before

they will be available for use. In some applications, chromium is so essential that a breakthrough in basic research may be needed to

find substitutes. Although recycling of stainless steel scrap has reached a high level, reduced downgrading and improved recovery of

obsolete scrap and steelmaking wastes could

help add to chromium supplies. Because

known domestic chromite deposits are very

poor in quality, diversification of foreign suppliers may be a more attractive option than development of known domestic chromite deposits. Discovery of higher quality domestic

chromite deposits appears unlikely but cannot

be ruled out.

Cobalt

Of the first-tier strategic materials, cobalt

offers the greatest range of technical alternatives to current supply patterns, which are

dominated by Zaire and Zambia. Ongoing manufacturing trends in the aerospace industry are

encouraging highly efficient use of cobalt in

the fabrication of jet engine parts, and this

trend is likely to continue in the future. With

advances in recycling technologies, it should

become technically possible to recover much

more of the several million pounds of cobalt

contained in downgraded scrap or waste that

is not recovered each year. Substitutes are already available for cobalt in many applications.

In addition, some low-or no-cobalt substitutes

have been developed which could replace cobalt in some superalloys-–the application of

greatest concern because of their importance

in jet engines. These will need to be thoroughly

tested and qualified for use before they can be

employed. Over the long term—beyond the

year 2000—promising advanced materials may

increasingly be used in jet engines, potentially

reducing the need for superalloy (and hence

strategic materials) in this critical application.

Evaluations of known domestic deposits suggest that more than 10 million pounds of cobalt could be produced annually for a 15- to 20-

year period if the four most promising sites

were developed simultaneously. At current cobalt prices, none of these sites would be profitable to develop. Moreover, at some sites, cobalt

would be a coproduct or byproduct of other

metals production so that production economics would not depend on cobalt alone. Federal

subsidies, such as a guaranteed purchase price,

would probably be needed for a protracted

period for sustained cobalt production to

occur.

Manganese

Options for reducing U.S. reliance on the Soviet Union and South Africa for manganese

supplies are largely limited to conservation in

steelmaking and developing greater diversity

among foreign suppliers. The ongoing process

of upgrading U.S. steelmaking facilities and

processes should make it possible to reduce total manganese requirements (excluding home

scrap) for each ton of steel from about 36 to

25 pounds by the year 2000. Manganese ferroalloy requirements, especially, could be reduced–falling from about 16 to about 8.3

pounds per ton by the year 2000. A commitment to changing supply patterns to reduce

reliance on South Africa and the Soviet Union

could also reduce U.S. vulnerability, since several other major foreign producers exist. As

with chromium, virtually no exploitable domestic manganese deposits are known at this time.

Unless a major new deposit is found, prospects

for significant domestic production will remain

slight.
.

Ch. 8—Policy Alternatives for Strategic Materials • 335

Platinum Group Metals

Alternatives for reducing U.S. dependency

on South Africa and the Soviet Union for platinum group metals (PGMs) include increased

recycling of automotive catalysts and electronic scrap and development of domestic

PGM deposits. Between now and 1995, the annual amount of potentially recoverable PGM

from scrapped cars will grow from about

110,000 to 700,000 troy ounces or more, If

500,000 troy ounces of this were to be recycled,

an amount of PGM equivalent to 25 percent of

1982 U.S. PGM consumption for all uses would

be added to U.S. supplies. PGMs are of such

high cost that they are used very efficiently,

and the incentive for conservation is high. The

United States also has one of the world’s most

promising deposits of PGM that has yet to be

exploited in the Stillwater Complex of Montana. One mine site in the complex is now being evaluated for possible production, raising

the possibility of appreciable domestic production by the end of the decade. Initial plans call

for production of about 175,000 troy ounce of

PGM, about 9 percent of total U.S. consumption in 1982. Over the long term, much higher

production levels may be achievable if additional sites within Stillwater and elsewhere are

brought into production,

Existing Laws and Strategic Materials Policy

There are many ways in which the Federal

Government can assist and guide the private

sector in implementing the aforementioned

technical approaches if it chooses. Options

range from dissemination of information and

data, to sponsorship of research and development (R&D), to provision of incentives and subsidies to encourage private actions. Over the

years, congressional concern about strategic

materials has led to adoption of several laws

which provide a relatively comprehensive statutory framework for Federal activities of this

kind. Laws such as the Defense Production Act

and the Strategic and Critical Materials Stockpiling Revision Act provide basic authorization

to undertake a full panoply of activities related

to strategic materials, such as development of

substitutes, development of processing technologies, and development of domestic production

capabilities when such activities are deemed

necessary for national security or would help

achieve stockpile objectives.

Two recent Federal laws have emphasized

the need for high-level executive branch policy coordination of strategic materials R&D

activities. The National Critical Materials Act

of 1984 directed the establishment of a National

Critical Materials Council in the Executive Office of the President to assist in executive

branch strategic material policy formulation

and coordination, and oversee a new Federal

advanced materials R&D program. The 1980

National Materials and Minerals Policy, Research and Development Act placed increased

emphasis on materials R&D in the Federal Government, and articulated a national materials

policy. Table 8-2 compares the potential contribution of the technical alternatives to material supplies with the degree of government

action that may be needed to achieve that contribution, while major Federal laws that provide potential vehicles for implementing these

actions are discussed briefly below.

National Materials and Minerals Policy,

Research and Development Act

(Public Law 96-479)

In 1980, Congress enacted the National Materials and Minerals Policy, Research and Development Act to provide a basic coordinating

framework for executive branch material policy decisions. The law gave heightened visibility to substitution, recycling, and conservation

as well as to mineral development to meet U.S.

material policy objectives, and emphasized the

importance of government support for R&D in

addressing material problems. A key purpose
336 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table 8-2.—Probable Degree of Government Involvement Needed

in Long-Term Strategies to Reduce Vulnerability

Extent of Nature of government actions Likely timePotential government Direct frame to

contribution action needed Information subsidy achieve

Material to reduced to achieve and Research and to implement outcome once

alternative vulnerability potential monitoring development alternative action initiated

—. Chromium:

Recycling Large

Substitution:

Noncritical Large

applications

Critical Medium

applications

Supply diversity Small to medium

Domestic Small, without

production new discoveries

Cobalt:

Recycling and Large

conservation

Domestic Large

production

Substitution Medium

Supply diversity Medium

Manganese:

Conservation Large

Supply diversity Large

Domestic Small

production

Substitution Small

Platinum group metals:

Recycling and Large

conservation

Domestic Medium to

production large

Substitution:

Noncritical Large

applications

Critical Probably small

applications

Supply diversity Probably small

Advanced materials:

Ceramics Potentially

large

Composites Potentially

large

Moderate

Moderate

Moderate to

extensive

Extensive

Extensive

Moderate to

extensive

Extensive

Moderate to

extensive

Extensive

Modest

Extensive

Extensive

Not assessed

Modest

Probably

modest

Modest

Not assessed

Not assessed

Extensive

Extensive

KEY:

Large—200/0 or more of 1982 U.S. consumption.

Medium—5 to 20°/0 of 1982 U.S. consumption.

Small—less than 5°/0 of 1982 consumption.

Near-term—within 5 years.

Medium-term—within 15 years.

Long-term–beyond 2000.

Modest—Little required beyond current level.

Moderate-Some new actions needed.

Extensive—Major new actions required.

X = Increased activities in this area.

? = Not assessed.

SOURCE: Office of Technology Assessment.

x

x

x

x

x

x

x

x

x

x

x

x

?

x

x

x

?

?

x

x

x

Possibly

x

Possibly

x

x

x

x

Possibly

x

Possibly

x

Minor

Minor

x

x

No

No

No

Probably

x

Probably not

x

Possibly

Probably

No

x

x

?

No

Probably not

No

?

?

Possibly

Possibly

Near-term

Medium-to

long-term

Long-term

Long-term

Long-term

Near-to

medium-term

Near-term

Medium-to

long-term

Long-term

Near-to

medium-term

Long-term

Long-term

?

Near-term

Near-term

(possible)

Near-term

Long-term

Long-term

Long-term

Long-term
Ch. 8—Policy Alternatives for Strategic Materials ● 337

of the Act was to provide better mechanisms

for coordinating Federal material-related programs, which presently are highly decentralized, being administered by a host of agencies

with differing missions, objectives, and perspectives.

The Act declared that “it is the continuing

policy of the United States to promote an adequate and stable supply of materials necessary

to maintain national security, economic wellbeing and industrial production with appropriate attention to a long-term balance between

resource production, energy use, a healthy

environment, natural resources conservation

and social needs.”1

The 1980 Act encompassed all materials that

are related to industrial, military, and essential civilian needs. However, strategic materials

were given high visibility in the Act, which defined materials as:

. . . substances, including minerals, of current

or potential use that will be needed to supply

the industrial, military and essential civilian

needs of the United States in the production

of goods or services, including those which are

primarily imported or for which there is a prospect of shortages or uncertain supply, or which

present opportunities in terms of new physical properties, use, recycling, disposal or substitution . . 2 (The definition excludes food and

energy fuels.)

The law also called on the president to submit

to Congress, on a one-time basis, a “program

plan” containing such existing or prospective

proposals and executive branch organization

structures “as he finds necessary” to implement key sections of the Act.

In April 1982, president Reagan submitted

to congress his materials and minerals program plan required by the Act. The 22-page

document summarized actions to be taken in

four major areas—land availability, materials

research and development, minerals and materials data collection, and the strategic and

critical materials stockpile.3 The plan assigned

‘Public Law 96-479, sec. 3.

ZPublic Law 96-479, sec. 2(b).

aThe White House, National Materials and Minerals Program

Plan and Report to Congress (Washington, DC: N. P.) April 1982.

responsibility for coordination of national

materials policy to the Cabinet Council on Natural Resources and the Environment. R&D coordination not involving policy questions was

assigned to the interagency Committee on

Materials (COMAT), under the direction of the

White House Office of Science and Technology Policy (OSTP) Federal Coordinating Council on Science, Engineering, and Technology.

Several concerns have been expressed about

the Administration’s discharge of its responsibilities to Congress under the 1980 Act. The

Act required the plan, as a minimum, to contain a program, budget, and organizational

structure for “continuing long-range analysis

of materials use to meet national security, economic, and social needs. ” The plan refers to

a review of the Federal minerals and materials

data system, but makes no specific reference

to establishment of a continuing long-range

analysis of materials, and also did not provide

a budget proposal.

The President’s plan also drew criticism for

overlooking some key areas of emphasis in the

Act. The report focused primarily on minerals

availability issues associated with Federal

lands and on the management of the stockpile;

substantially less emphasis was given to the

R&D components of the 1980 Act. Nor did it

address recycling, conservation, and substitution in detail. Although the Act provided the

President with substantial discretion to select

plan components, critics contended that the

failure to address these issues made the President’s plan inadequate to fulfill the intent of

the Act.

Other implementation difficulties were identified by the U.S. General Accounting Office

(GAO) in a 1984 report to Congress on overall

executive branch responses to the law.4 GAO

pointed out that not all agencies with important materials responsibilities were represented

on the Cabinet Council on Natural Resources

and the Environment, charged with overall policy coordination. Additionally, GAO found that

41-J.s. General Accounting Office, Implementation of the National Minerals and Materials Policy Needs Better Coordination

and Focus (Washington, DC: U.S. General Accounting Office,

Mar. 20, 1984), GAO/RCED-84-63.
338 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

some agencies have made key materials policy decisions independent of council clearance.

The effectiveness of COMAT in providing information for R&D policy decisions was questioned. According to GAO, the President’s fiscal year 1984 budget included an unexpected

$38 million for a major new initiative in materials sciences research by the Department of

Energy’s (DOE) Lawrence Berkeley Laboratory

in which COMAT and even the Cabinet Council had little input. The overall goal of this

initiative was to improve linkages among academic, national laboratory, and industry scientists for the future advancement of hightechnology industries—a responsibility the

President’s plan delegated to COMAT. However, the policy decision concerning redirection of Federal materials R&D and the appropriateness of DOE’s initiative were made

independently by the Director of OSTP before

COMAT had formulated a position on the need

for a new initiative. Moreover, the Cabinet

Council had not reviewed the need for this program, nor had it been developed within the

context of an overall national materials and

minerals R&D program. Another instance cited

by GAO was the failure by the Department of

Defense to coordinate with the Cabinet Council before seeking funds to subsidize domestic

mineral production capacity under Title III of

the Defense Production Act.

Several strategic materials reports required

by law either have been submitted late or not

at all. First, Congress mandated OSTP to prepare and annually revise “an assessment of national material needs arising from scientific

and technological concerns over the next 5

years” and where possible, over the next 10 or

25 years. As of March 1984, the initial report

had not been done, and the office informed

GAO that it had no plans to undertake the

study. (The law did not specify a date for submitting the report.)

The Department of Defense told GAO that

it had prepared a report “assessing critical material needs related to national security” and

“steps necessary to meet those needs” which

was required by the Act. ” However, the report

was required to be submitted to Congress by

October 21, 1981. As of March 1984, the report

had not been submitted, apparently because it

was still under review by the Administration.

A Department of the Interior report, also due

in October 1981, was not submitted until November 1983. Only the Commerce Department

complied fully with the Act. (A more detailed

summary of GAO’s findings can be found in

box 4-A in ch. 4.)

Despite the Administration’s failure to fulfill

the information needs of Congress, many individual agencies appear to be carrying out

their own activities in a way that is reasonably

responsive to the law. Strategic materials R&D

funding has fared well in a time of budget cuts,

and many other initiatives have been undertaken that were not specifically identified in

the President’s plan. For example, in 1984, the

Secretary of the Interior, who also serves as

Chairman of the Cabinet Council on Natural

Resources and the Environment, created a National Strategic Materials and Minerals Program Advisory Committee.

National Critical Materials Act of 1984

(Public Law 98-373)

Signed into law by President Reagan on July

31, 1984, Title II of Public Law 98-373 establishes a statutory National Critical Materials

Council “under and reporting to” the Executive Office of the President to advise and assist the President in formulating critical material policies. The Council is also given key

responsibilities in developing a “national Federal program” for advanced materials research

and technology, and stimulating innovation

and technology utilization in basic and advanced materials industries.

Authorization for Title II will expire on September 30, 1990, unless extended by Congress.

The three members of the Council are to be appointed by the President, with advice and consent of the Senate if the appointee is not already

a Senate-confirmed government official. One

member is to be designated Chairman of the

Council by the President. In selecting mem-
Ch. 8—Policy Alternatives for Strategic Materials Ž 339

bers, particular emphasis is to be given to people with training, experience and achievement

in materials policy, science or engineering, and

at least one member is to have a background

and understanding of environmental issues.

The Council is directed to appoint a full-time

Executive Director, who is authorized to employ

a staff of up to 12 people in carrying out the

Council’s duties under the act, and develop,

subject to Council approval, rules and regulations needed to carry out the Act’s purposes,

The law authorizes the appropriation of $500,000

for fiscal year 1985, and thereafter, such sums

as maybe necessary. As mentioned, Title II authorities will expire at the end of fiscal year

1990 unless specifically extended by Congress.

The Council, among other things, will: 1) assist in establishing responsibilities and provide

for coordination and implementation of critical materials policies (including research and

technology) among Federal agencies; 2) bring

materials issues deemed critical to the Nation’s

economic and strategic health to the attention

of the President, Congress, and the general

public; and 3) ensure continuing consultation

with the private sector in matters related to critical materials; materials research, development, and use; and Federal materials

policies.

In accomplishing these responsibilities, the

Council is to review and appraise Federal

agency programs to determine the extent to

which they contribute to achieving the policy

and directions given by the 1980 National

Materials and Minerals Policy, Research and

Development Act. It is also to be involved in

recommending budget priorities to the Office

of Management and Budget (OMB) for materials activities by each Federal agency and department.

By April 1, 1985, the Council was to submit

to Congress a report on critical materials inventories, and prospective needs for these materials by government and industry, One component of this report is to be a long-range

assessment, prepared in conjunction with

OSTP, on prospective critical materials problems, and to advise about how to address these

problems. The Council is to review and update

its report and assessment as appropriate, and

is to report to Congress at least biennially. The

Council is also to recommend to Congress

changes in current policies, activities, and regulations, as well as new legislation, needed to

achieve the intent of Public Law 98-373, and

Public Law 96-479.

The Council is given a major role in developing and overseeing the national Federal program for advanced materials research and

technology called for by the Act. It is to establish a Federal program plan for R&D in this

area, identifying responsibilities for carrying

out the research and providing for coordination among the Office of Management and

Budget, the Office of Science and Technology

policy, and other appropriate agencies and

offices. The Council is to annually review, and

to report to Congress, on the Federal R&D plan.

The Council is to annually review the materials research, development, and technology

authorization requests and budgets of all Federal agencies to ensure close coordination of

program goals and directions with policies determined by the Council. The Office of Management and Budget is to consider authorization requests in these areas as an “integrated,

coherent, multiagency request” to be reviewed

by the Council and OMB for its adherence to

the national Federal materials program plan in

effect for that fiscal year.

To promote innovation in the basic and advanced materials industries, the Council is to

evaluate and make recommendations about

establishing Centers for Industrial Technology

as provided for by the Stevenson-Wydler Technology Innovation Act of 1980, which is discussed subsequently. The activities of such

nonprofit centers, initially funded by Government but intended to become self-sufficient after 5 years, would focus on generic materials

research.

The Council is directed to establish, in cooperation with other agencies and private industry, a mechanism for the efficient and

timely dissemination of materials property
340 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

data. This is intended to promote innovation

and better use of materials in design. Possible

establishment of a computerized material property data system (using existing resources to

the extent practicable) is to be considered.

Public Law 98-373, like Public Law 96-479 before it, is in many respects process-oriented legislation, intended to give the Executive Office

of the President key responsibilities for critical materials policy. Within the framework

established by the law, the executive branch

is given considerable discretion and flexibility

to establish goals, objectives, and priorities for

critical and advanced material programs. The

law, for example, does not specifically define

the terms “advanced materials” and “critical

materials, ” but instead uses the broad definition of materials provided by public Law

96-479.

Defense Production Act (50 U.S. C. 2061 et seq. )

Enacted in 1950, the Defense Production Act

(DPA) provides several mechanisms for assuring availability of materials and industrial

capabilities needed for the national defense.

Title I authorizes government priorities for allocation of materials in a congressionally or

presidentially proclaimed national emergency

or war.

Title 111 authorizes the President to support

private activities which would expedite “production and deliveries or services” in aid of national defense. Loans and loan guarantees are

authorized for expansion of capacity, development of technological processes, or the production of essential materials, including exploration, development, and mining of strategic

metals. Purchases and purchase commitments

are authorized for metals, minerals, and other

materials for government use or resale. The

President is also authorized to “make provision

for the development of substitutes for strategic and critical materials” when “in his judgment it will aid the national defense. ” Materials

considered excess to DPA requirements can be

transferred to the national stockpile. Title 111

assistance can be used both domestically and

abroad.

In its 1984 reauthorization of DPA (Public

Law 98-265), Congress established new procedures for authorization of Title III projects

which apply when a congressionally or presidentially declared national emergency is not

in effect. Among other things, the law requires

the President to determine that federally supported projects meet essential defense needs

and that the Federal support offered would be

the most “cost-effective, expedient, and practical alternatives for meeting the need, ” The

law requires “industrial resource shortfalls” for

which Title 111 assistance is sought to be identified in the budget (or budget amendments)

submitted to Congress. If more than $25 million in aggregate Federal assistance would be

entailed to meet the industrial resource shortfall, specific authorization by law would be required.

Historically, DPA has been used primarily to

encourage mining of strategic minerals in this

country and abroad. The instruments provided

in the law, however, could potentially be used

for development of substitutes, advanced recycling technologies and other technical innovations considered desirable for national security. In addition, DPA is now viewed as a

means to secure supplies and essential processing capabilities for advanced materials

needed for defense purposes.

Strategic and Critical Materials Stock Piling

Revision Act (Public Law 96-41)

In 1979, Congress revised and updated prior

laws related to the National Defense Stockpile

through enactment of Public Law 96-41. The

law resolved several issues related to changing executive branch strategies for stockpile

management among successive administrations. Among other things, it stated that the

stockpile was for the purpose of national defense only, and established a statutory stockpile goal of having a 3-year supply of materials

on hand to meet national defense, industrial

and essential civilian needs in a national defense emergency or war. It also established a

stockpile transaction fund so that sales of excess materials could be used to acquire new

materials consistent with stockpile goals.
Ch. 8—Policy Alternatives for Strategic Materials Ž 341

Several provisions in the Stockpile Revision

Act have indirect relevance to government support of private activities related to strategic

materials. The law calls for maximum feasible

use of competitive procedures for stockpile acquisitions; however, waivers are authorized,

and this could provide a basis for supply diversification on an ad hoc basis.

The law authorizes upgrading of already

stockpiled materials through refining and processing so that they will be in the form most

suited to current needs. This has prompted the

considerable interest of domestic processors.

A panel of the American Society for Metals

(AS M), for example, recommended in August

1983 that sufficient quantities of substandard

cobalt from the stockpile be provided to industry in order that it could test capabilities to upgrade the material to current standards,’ Of the

46 million pounds of cobalt in the stockpile,

40.8 million pounds were acquired in the 1947-

61 period. More stringent requirements and

consumer specifications have made much of

this cobalt inadequate to meet today’s demanding requirements for many critical applications

unless the cobalt is upgraded. The ASM panel

recommended pilot tests with cooperating private firms to identify preferred procedures to

upgrade the cobalt quality so that it could be

used immediately in a crisis. The recommendation is under consideration by the General

Services Administration (GSA) and Federal

Emergency Management Agency (FEMA).

As in the prior stockpiling law, the 1979 Act

calls on the President to make “scientific, technologic and economic investigations” concerning ‘‘development, mining, preparation, treatment and utilization of ores and other mineral

substances , . .“ These investigations, delegated

by the President to the Secretary of the Interior,

are to be carried out to determine and develop

“new domestic supply sources; devise methods for treatment and use of lower grade ores

and mineral substances; develop substitutes for

essential ores and mineral s.” Investigations

may be carried out on public lands, and with

the consent of the owner, on private lands “for

the purpose of exploring and determining the

extent and quality of deposits of such minerals,

the most suitable methods of mining and beneficiating such materials, and the cost at which

the mineral or metals may be produced.’”

Stevenson-Wydler Technology Innovation Act

of 1980 (Public Law 96-480)

The Stevenson-Wydler Act is intended to

promote development and diffusion of new industrial technologies in the United States. The

law gives the Secretary of Commerce, in cooperation with other relevant agencies, key

responsibilities in stimulating transfer and

diffusion of information about federally funded

technology development to the private sector

and to State or local governments. It requires

each Federal laboratory to establish an Office

of Research and Technology Applications to

facilitate information transfer about activities

within the lab that have potential for successful application by industry. In addition, the law

established a central Federal clearinghouse

(called the Center for Utilization of Federal

Technology) to collect and disseminate information about federally owned or originated

technologies. (This function has been assigned

by the Commerce Department to the National

Technical Information Service. )

The Act also directed the Secretary of Commerce to assist in the establishment of “centers

for industrial technologies’’—centers affiliated

with university or nonprofit institutions set up

to enhance technological innovations, The Reagan Administration, on November 17, 1983, revoked rules for making grants for such centers.

At the same time, it also promulgated rules for

a program for promotion of private sector industrial technology partnerships, indicating

that this program was intended to supercede

the generic technology center program.7 The

new Administration program provides information support to industrial technology part0 f’uh] i(: 1,aw 96-41, sr(, 8[ a ]. This pro~is ion is a cent i nuat io n

of similar pro~’ision~ in prior stockpiling laws.

7F’edcral Rcgi.stcr, Irol. 48, Nro. 223, N o~r. 17, 1983, p. 52289.
342 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

nerships and cooperative R&D arrangements

of corporations, nonprofit organizations, and

government.

The Stevenson-Wydler Act also directed the

National Science Foundation (NSF) to assist in

the support of “centers for industrial technology” under the Act. According to a 1984 Administration report on implementation of Public Law 96-480, NSF’s previously existing

program of support for university/industry cooperative research centers is being used to meet

the requirements of the Act in this respect.8

—.—. ——

‘Secretary of Commerce, The Stevenson- Wydler Technology

innovation Act of 1980, Report to the President and Congress

(Washington, DC: U.S. Department of Commerce, February

1984). According to the report, which was required by Public

The newly enacted National Critical Materials Act of 1984 directs the National Critical

Materials Council established by this law to

evaluate and make recommendations about

establishment of Centers for Industrial Technology to promote innovation and increased

productivity in basic and advanced materials

industries. Among the activities identified for

possible Center involvement were corrosion,

welding and joining of materials, advanced

processing and fabrication technologies, microfabrication, and fracture fatigue.

Law 96-480, the National Science Foundation, in fiscal year 1983,

was supporting eight university/industry centers, including two

centers on polymers, one on ceramics, and one on welding.

Formulation of Strategic Materials Policy

In formulating long-term technical

for reducing import dependency, the

strategies

full range

of available-options, on a material-by-material

basis, must be considered. In some instances,

there may be several options available for each

material. These options could potentially ease

import vulnerability, but entail different costs

and different levels of security. In the case of

cobalt, import vulnerability could be reduced

in several ways, including domestic production, recycling, and substitution. Domestic

production, for example, could make a major

contribution to domestic cobalt supplies, with

complete supply security, but only at a cost to

the government (at 1983 prices) far higher than

simply purchasing cobalt for the stockpile from

world markets. Other options, such as developing promising recycling technologies to the

point where they could be used by industry

would cost less, but would also entail greater

risk, since it cannot be certain that a given research technology will be commercially viable.

It is noteworthy that the implementation of

these and other technical approaches to reducing cobalt import vulnerability all

creased government support.

In other instances, as in the case

substantial long-term reductions in 

entail inof PGMs,

import vulnerability may be achievable with little government action, Private industry is already wellpositioned to take advantage of the growing inventory of PGMs that could be recycled from

automotive catalysts as cars are scrapped; and,

with some limited increase in PGM prices,

nearly 10 percent of current domestic needs

could be provided from one U.S. site, with additional production possible from other sites

in the longer term. Continued monitoring of

industry trends will be needed, but unless one

assumes that a PGM supply disruption is likely

in the near term, government action to encourage recycling or domestic production is probably not needed at this time.

Experience has shown that development of

overall Federal strategies to reduce import vulnerability is a highly complex task. Several Federal agencies have important research responsibilities in the materials field, including the

Departments of Defense, Interior, Energy, and

Commerce; and the National Aeronautics and

Space Administration (NASA). FEMA has lead

agency responsibility for coordination of stockpile planning, and GSA administers it. Many

other Federal departments and regulatory

agencies have indirect effects on materials policy through tax policies, regulation of com-
Ch. 8—Policy Alternatives for Strategic Materials ● 343

merce, environmental protection, Federal land

management, antitrust enforcement, patent

policy, foreign affairs and trade policy, and

other activities. (Selected executive branch

agencies with direct responsibilities for strategic materials are shown in table 8-3.)

This decentralization is, to a certain extent,

unavoidable, and may even be desirable, but

it has made the job of formulating strategic

materials policy difficult for both Congress and

the executive branch. Congress itself has many

different committees with jurisdictional areas

related to strategic materials, including (among

others) House Committees on Armed Services;

Banking, Finance, and Urban Affairs; Science

and Technology; and Interior and Insular Affairs; and Senate Committees on Armed Services; Banking, Housing, and Urban Affairs;

Commerce, Science, and Transportation; and

Energy and Natural Resources. Appropriation

subcommittees are even more diverse.

Through enactment of the National Critical

Materials Act of 1984 and the National Materials and Minerals Policy, Research and Development Act of 1980, Congress has firmly

placed statutory responsibility for coordinating Federal agency activities and decisionmaking with regard to strategic materials research

in the Executive Office of the president. The

policy planning and coordination procedures

required by the 1980 Act, together with the statutory establishment of the National Critical

Materials Council “under and reporting to” the

Executive Office of the president by the 1984

Act, may in time provide coordinated and coherent strategies to guide Federal agency activities to reduce import vulnerability.

As the Administration begins to implement

its new mandate, congressional oversight of the

Administration’s progress in the continuing

implementation of both the 1980 and 1984 laws

will be important. Both laws give the Administration considerable flexibility and latitude

in developing strategies to address strategic

materials issues. They are oriented towards development of effective processes to formulate,

coordinate, and implement materials policy

programs, and by and large do not dictate substance. This flexibility could lead to highly

innovative initiatives in the materials field, but

it also means that continuing congressional

guidance may be needed at times to assure that

the intent of the the two laws is met.

OTA’s analysis of oversight issues has focused on two specific issues that may be particularly relevant as the Administration begins

to implement the 1984 Act: establishing policy

goals, objectives, and priorities for strategic

materials, and upgrading information about

Federal strategic materials R&D activities as a

key step in interagency coordination. These issues are discussed below and are summarized

in table 8-4.

Goals, Objectives, and Priorities of

Strategic Materials Policy

A long-term commitment is needed if technical approaches to the reduction of strategic

materials vulnerability are to succeed. Moreover, the combination of technical approaches

effective for one material will often be inappropriate for another. Recognition that effective planning and policy formulation procedures by the executive branch were needed to

develop coordinated goals, objectives, and

strategies for materials research led to enactment of the National Materials and Minerals

Policy, Research and Development Act of 1980.

However, the expectation that this law would

lead to an effective policy structure for coordination of strategic material activities throughout the government has not been fully realized,

as has been discussed.

With adoption of the National Critical Materials Act of 1984, prospects for improving the

executive branch policy structure will hinge to

a considerable extent on the effectiveness of

the new National Critical Materials Council in

the Executive Office of the President. Section

205(a) of the law gives the Council “specific

responsibility for overseeing and collaborating” with Federal agencies and departments

“relative to materials research and development policies and programs. ” In this role, the

Council is mandated to annually review both

the authorization requests and budget proposals of all Federal agencies conducting ma-
344 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table 8-3.—Selected Federal Agencies With Strategic Material Responsibilities

Off Ice of T echnology Assessment
Ch. 8—Policy Alternatives for Strategic Materials ● 345

Table 8-4.—PoIicy Alternatives for Formulation of Strategic Materials Policy

Arguments for/against

Problem/issue Option Positive Negative

1. The executive branch has had

difficulty in establishing

overall goals, objectives, and

priorities for strategic

materials R&D policy. As a

result, Federal agency

activities are not guided by a

coherent, overall strategy for

long-term reduction in import

vuInerability.

2. Federal R&D activities related

to strategic materials are

dispersed over a large

number of agencies. To coordinate R&D policy, conduct

oversight and establish

priorities, improved survey

information is needed.

Direct the National Critical - — .

Materials Council established by Public Law

98-373 to develop a longterm strategy for

Federal strategic

materials activities, including goals and objectives by which individual

agency activities can be

monitored. The multiyear strategy could be

revised on a 4-year

basis by the Executive

Office of the President,

giving Congress the opportunity to review progress, provide guidance

and clarification as

needed.

Clear direction for strategic

materials policy and longrange plans to address

specific material needs is

required to give continuity and ensure appropriate follow-through for

strategic material

research.

Overly specific congressional guidance could

result in inflexible agency response. Periodic

revision of the overall

strategic materials plan

could lead to excessive

time and expenditures

devoted to policy formulation and planning

activities.

Instruct the National

Critical Materials Council to give high priority

to section 209(a)(3) of

Public Law 98-373 which

calls for cataloging R&D

activity as fully as possible. Such a catalog, if

undertaken on a material-by-material and

objective-by-objective

basis, with updates on a

regular schedule, would

be useful in the budget

review activities of the

council and would help

identify progress

towards meeting goals.

Would give decisionmakers

information needed to

monitor multi-agency

responses to overall

strategic material goals,

identify areas of overlap

or duplication of effort,

and areas where insufficient R&. D is conducted.

*

Could lead to overemphasis on strategic

materials R&D to the

detriment of other

needed materials

research in agency R&D

program planning.

SOURCE Off Ice of Technology Assessment.

terials R&D to “ensure close coordination of

the goals and directions of such programs with

the policies determined by the Council. ” This

process is to be coordinated with the Office of

Management and Budget, which is to consider

material budget proposals as a coherent multiagency request. The new law requires the

Council to prepare and annually revise a Federal program plan for advanced materials R&D.

It seems unlikely that the Council will be able

to succeed in its coordinating functions unless

it is able to articulate overall goals, objectives,

and priorities that could guide strategic materials R&D policy. One important question is

whether Federal research objectives should be

set broadly—i.e., strategic materials in general—or should be targeted as closely as practical to those materials considered to be most

vulnerable. By and large, the approach taken

over the years, and which still prevails, is to

address strategic materials in a generic sense.

This allows agencies to adopt a flexible approach in their research programs, but without centralized administration guidance, it also

results in diffusion of efforts among many

materials.

An alternative approach would be for the

Council to give greatest priority to those materials that are most vulnerable to a supply disruption and most critical to the United States.

38-844 0 - 85 - 12 : QL 3
346 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Such an approach presents some problems.

First, one cannot know in advance which materials will actually be subject to a supply

disruption, so a danger exists that the wrong

materials will be targeted. Inflexible administration and rigid adherence to outdated objectives and strategies could also be potential

problems. Furthermore, much materials research is not specific to individual metals, and

such research might not receive support if

forced into a material-by-material evaluation

in determining support for R&D activities.

However, viewed as a policy tool for establishing overall Federal goals and objectives and for

selecting among alternative strategies for

achieving them, the material-specific approach

could give a clearer sense of direction to Federal efforts to combat materials vulnerability.9

An effective strategy, therefore, might very well

involve a combination of both the generic and

material specific approaches to achieve the objective of reduced import vulnerability.

Federal program planning for strategic materials needs to reflect long-term objectives,

while still being adaptive and flexible in light

of changing circumstances. The 1984 Act’s

budget review mechanism in theory provides

a vehicle for infusing a longer term perspective into agency planning than is provided by

the annual budget-setting process.

This connection is most explicit in the case

of advanced materials R&D, through Public

Law 98-373’s requirement that the Council develop and annually revise a Federal program

plan for advanced materials research and technology. The law itself does not specify the components of this plan, nor does it specifically define the term “advanced materials.” However,

the House Committee on Science and Technology, in its report on the bill, indicated its intention that the plan include at least four elements, including “a listing of major existing

Federal material research and technology programs—to include existing funding and goals

as well as proposed funding levels over the next

gThe need for material specific approaches to reduce export

vulnerability has been discussed by the U.S. General Accounting Office, Report to the Secretary of Interior (GAO/EMO-82-

69), June 3, 1982.

5 years.” Other plan elements identified by the

Committee were: “an assessment of current national materials research and technology needs

and problems . . . identification of priorities for

research to address those needs or problems, ”

and “recommendations for program initiatives

and changes to meet policies and goals as set

forth by the Council.”10

While the law may not explicitly require such

a plan for strategic materials R&D, such an

approach might well be effective should the

Council choose to pursue it. If a more active

congressional role is desired, one option (table

8-4, issue 1) would be for the executive branch

to prepare and submit to Congress a multi-year

strategic materials plan of action on a periodic

basis–say once every 4 years. Congress would

then have the opportunity to review the plan’s

goals and objectives, along with specific measures and estimated funding levels needed to

achieve them.

The multi-year plan could then serve as a

kind of benchmark by which the Council and

Congress could evaluate annual budget requests with respect to strategic materials R&D

activities. In reviewing the plan, Congress

could give the Council and the Executive Office of the President–which have overall

responsibility for materials coordination—

additional guidance on specific issues related

to the multi-year plan.

Structured into the Act is considerable opportunity for congressional review and oversight of the Council’s activities, through its

biennial reporting on critical materials to Congress, its annual reporting to Congress on the

national Federal advanced materials program

plan, and its charge to recommend, when

appropriate, changes in current policies, activities, and regulations, and additional legislation

that may be needed to carry out materials

policy.

In the end, the selection of a framework for

policy formulation depends on the extent to

which Congress wishes to be involved in setting the overall direction, goals, and objectives

IOHouse Report 98-593, Part I, pp. 38-39.
Ch. 8—Policy Alternatives for Strategic Materials . 347

for strategic materials policy, and the extent

to which it wishes to delegate that function to

the executive branch. Establishment of the National Critical Materials Council, and the continuing planning processes required by the

1980 Act, clearly provides legislative authorization for effective policy planning by the executive branch. However, without legislative

oversight and guidance when needed, there is

no assurance that current or future administrations will fully use these policy tools to effectively formulate executive branch strategic

materials policies.

Providing Information About Federal Research

and Development Activities

A sustained program of Federal R&D will be

the cornerstone of any long-term strategy to reduce U.S. materials vulnerability using the

technical alternatives considered in this report.

In the last decade, strategic materials R&D has

received increased emphasis, and recent levels

of research funds appear to be quite healthy,

However, concern exists about the adequacy

of current coordination mechanisms at the interagency level, especially as they relate to the

formulation of policy.

The Federal Government is the primary

sponsor of R&D activities related to strategic

materials. It is also the primary sponsor of

basic and applied research related to development of advanced materials. This is consistent

with the administration’s position that Federal

support for R&D should focus on high-risk or

long-term areas that may not otherwise be addressed by industry.

In fiscal year 1980, about 4 percent ($67 million) of the total Federal materials R&D budget

was directed at strategic materials (excluding

advanced materials) .11 As shown in tables 8-5

and 8-6, nearly 40 percent of this budget was

for chromium research, followed by aluminum,

titanium, nickel, and cobalt. Most of this research was conducted or sponsored by DOE

national laboratories, the Bureau of Mines,

NASA, the National Bureau of Standards

(NBS), and various components of the Defense

Department.

Fiscal year 1980 was the last year for which

the executive branch has published comprehensive information about strategic materials

R&D activities on a material-by-material basis.

Detailed information of the sort portrayed in

the tables have not been issued for subsequent

years on a governmentwide basis. However, it

appears that strategic materials R&D has not

been greatly affected by the general trend

toward reduction of research budgets that has

affected other areas, although some strategic

materials programs (e.g., NASA’s conservation

of strategic aerospace materials program) have

been cut back.

Federally funded R&D has been the driving

force behind the development of advanced

materials. Total Federal expenditures for structural ceramics R&D were $23 million in fiscal

year 1982.12 By fiscal year 1984, Federal expenditures had grown to over $40 million. Recent figures are not available about composite

R&D funding. However, in fiscal year 1980,

over $80 million in composites R&D were expended by Federal agencies. Advanced materials R&D activities are undertaken by several

Federal agencies, including the Department of

Defense, NASA, DOE, NBS, and the National

Science Foundation.

A central thrust of both the National Critical Materials Act of 1984 and the National

Materials and Minerals Policy, Research and

Development Act is to establish a mechanism

that would replace ad hoc materials and minerals decisionmaking within the executive

branch with a coordinated Federal R&D policy. As mentioned, the President’s 1982 materials plan reestablished COMAT under the direction of the Federal Coordinating Council on

Science, Engineering and Technology (FCCSET)
348 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table 8-5.—Distribution of R&D Funding for Critical Materials by Materials and by Technology Goal* ($1000)

‘NOTES Funds may be attributed to more than one goal, where appropriate, upper amounts “direct” program funding for research pnmarlly to Indicated category,

lower amounts “’related” program funding directed tu the categories, but with slgnlflcant potential for Impact In the lndlcated category,

tl Department of Energy

2 Department of Defense

3 Department of the Interior

4 Department of Commerce

5 Natlonai Aeronautics and Space Admlnlstratlon.

SOURCE U S Department of Commerce, Survey Ma feria/s Life Cyc/e Research and Development /n tbe Federa/ Government Flsca/ Year 7980 (N BSIR 81-2359 DOE,

September 1981) The above table may not reflect all Federal funding of research that affect strategic materials For example, Department of Defense support for surface modtficatlon technologies, near. net shape technologies, and retirement for cause research are not Identlfled In the substitution and conser

vatlon columns of the table These programs could result In savings of chromtum, cobalt, nickel and other strategic materials.

for the coordination of Federal materials and ●

minerals R&D activities, directing:

●

●

Assistant Secretary-level representation ●

from the departments and agencies concerned with minerals and materials;

the incorporation into COMAT of the Department of Defense Material Availability s

Steering Committee and the Interagency

Materials Group;

establishment of a working panel within

COMAT to coordinate Federal R&D on essential materials;

establishment of a formal mechanism

within COMAT for information exchange

among agency managers of materials R&D

programs; and

policy resolution of materials R&D questions through the Cabinet Council on Natural Resources and Environment.
.

Ch. 8—Policy Alternatives for Strategic Materials ● 349

Table 8-6.— Distribution of Critical Materials R&D Funding by Stage of the Materials Cycle* ($1000)

Exploration

of

resources Extraction

I Chromium I 151 I - — —

Aluminum 121 —

— —

Niobium 32 —

— —

Cobalt 120 306

30 106

—

Titanium 51 —

I\l–l–

Platinum 38

— —

Manganese 55 251

30 106

I

Nickel I

120 I

251

30 243

Lead 92 —

— —

Tantalum

I l–l–

I

Iron ore

I

—

I

.

— —

Tungsten 57 —

—

I

Direct I

837 I

808

Related 90 455

“ NOTES Funds may be attributed to more than one

lower amounts related program funding

SOURCE U S Department of Commerce Survey

Processing Manufacture Applicatio n

r a w and and

materials fabrication utiIization

550 I10,300

I

60,050 — 420 100

1,555

I

1,000

I

3,000

— — —

180 2,000 3,000

— 200 200

825 810 1,000

381 420 113

250 300 1,000

210 200 200

500

I

200 I500

— — —

660

I

—

I

—

324 200 313

950 I -1 -

— — —

— 100 200

— 200 200

840

I I

—

— — —

470 I — I

430 — —

6,830 15,210 69,350

1,469 1,640 1,239

goal, where appropriate, upper amounts direct

directed to the categories, but with slgnlf!cant

I terta /s L //e Cycle Research and Deve/opfnen( /1

September 1981 I

COMAT was directed to perform an inventory of Federal research and technology activities that would be useful for interagency coordination and for assessing national materials

needs and objectives. The data acquired from

this inventory would be used by the Cabinet

Council to aid in policy decisions pertaining

to R&D.

COMAT’s report, “Inventory of Federal Materials Research and Technology, ” was issued

in June 1983.13 Unlike the survey done for fiscal year 1980, funding levels for strategic

materials research are not separately addressed

1 1~’()[~()r[~ (:fx)r[~l n~i 11]: ( :(}L]I1(; i] for S(:ien[, e, Engineering, and

‘rechnolog~ (;ommittw on \laterials, ZII ten tor~ of 1+’ederal

,I!ateria]s Research and ‘1’cchnologj.: Fiscal J’ear 1982 O$’ashi ngtorl, 11(;: Exe(,ut i~w of fi(f! of the l)resident, office of Science

an(l ‘1’echnolc)g} P(Ji(:y, ]LIII(’ I’18:1).

Evaluation Development

of of Waste

properties materials management Totals

15,570

I

31,616

I

260

300 I

118,492

— 70 890 I

5,000 500 — 11,176

— — — —

1,000 4,000 — 10,212

500 — 70 920

1,190 1,270 397 5,918

100 530 84 1,764

1,000 1,050 — 3,651

500 300 — 1,410

1,000

I

680

I

—

I

2,918

— — 150 150 I

i

1,000 300 247 3,003

— — 288 661

500 860 397 2,788

500 230 293 2,133

— — 265 1,307

— — — —

500 200 1,000

500 — 900

— — — 640

— — 280 280

— 125 — 652

— — 430

26,760 40,601 1,566 101,962

2,100 1,360 1,235 9,588

program funding for research prlmarl Iy to lndtcated category

otentlal for Impact In the Ind Icated category

the Federa/ Governmen( F/sea/ Year 1980 (N BSIR 81 2359 DOE,

or even identified. Nor does the 1983 report

group Federal R&D activities by specific material (e. g., cobalt, chromium) or by program

objective (e.g., minerals development, recycling). Instead, the 1983 inventory lists overall

materials program funding levels for fiscal year

1982 and estimated expenditures for fiscal year

1983 on an agency-by-agency basis. Since the

1983 inventory does not identify strategic

materials research activities, it is of virtually

no use as a policy tool in the development of

material-specific objectives and policies for

R&D.

Moreover, COMAT apparently has not taken

action to assure that individual agencies keep

track of strategic materials research activities

on an agencywide basis, COMAT representatives from several Federal agencies were con-
350 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

tacted by OTA to determine whether detailed

agencywide information on strategic materials

funding had been compiled independently for

fiscal year 1985. Some agencies provided this

information at a relatively detailed level, but

one major department was able to provide only

a partial answer. In this case, OTA was told

that it would take 3 to 6 months to perform a

strategic material R&D inventory if given a formal request.

It would appear, therefore, that COMAT has

not established an effective mechanism to track

and report on interagency strategic materials

research activities, The need for such information in R&D policy formulation is widely recognized as a key step in establishing effective

coordination of all Federal activities related to

strategic materials research, In fact, the 1984

National Critical Materials Act calls on the Executive Director of the National Critical Materials Council to catalog, “as fully as possible,

research and development activities of the Government, private industry, and public and

private institutions” (Public Law 98-373, sec.

209(a)(3)). Such information will indeed be critical if the Council is to effectively exercise its

new responsibility for coordination and review

of Federal strategic materials activities. Consistent with the premise that the executive

branch should have considerable flexibility in

formulating materials programs and plans, the

Act does not specify a timetable for such catalog activities nor identify its content.

Certainly, if effective coordination of strategic materials research were envisioned, information equivalent in detail to the earlier (fiscal

year 1980) survey would be needed. Periodic

surveys of this sort would also be needed to develop a multi-year executive branch plan of action for strategic materials. Given the recent

difficulties the executive branch has had in developing such survey information, congressional oversight and guidance may be needed

if the initial activities of the Council do not give

priority to developing a continuing tracking

system of this sort (table 8-4, issue 2).

Mineral Production and Processing

Currently, there is virtually no production of

cobalt, chromium, manganese, or PGMs from

domestic mines.14 However, prospects are good

for platinum and palladium production from

the Stillwater Complex in Montana, which

could provide about 10 percent of U.S. PGM

needs (as a percentage of 1982 consumption)

if prices increase somewhat, as well as much

larger amounts of PGM if it becomes feasible

to open other sites, (The decision whether to

go ahead with an initial mining project is expected to be made in 1985,) In addition, more

than 10 million pounds per year of cobalt (5,000

lqAbout 2 percent of apparent domestic consumption of manganese is contributed from manganiferious ore containing less

than 35 percent manganese, Platinum group metals have been

produced domestically in small amounts as recently as 1982.

I,arger amounts of manganese and some chromium were

produced during the 1940s witb considerable Federal subsidy.

Substantial amounts of cobalt were produced under Federal subsidy during the 1 950s. Cobalt was also produced in small

amounts as a byproduct of iron production until 1971.

short tons) could be provided for a 10- to 15-

year period if known domestic cobalt deposits were simultaneously developed, production

will not occur unless cobalt prices rise and are

sustained at appreciably higher levels than is

now the case, or unless the government provides a substantial subsidy. Domestic prospects

for production of chromium and manganese

production are not good, owing to the very

poor quality of known domestic deposits.

The United States heavily relies on a few

countries for its supplies of strategic materials,

To some extent, supply diversity could be broadened through greater reliance on other countries which have known deposits of strategic

materials. Of the four metals under study, supply diversity is currently greatest for manganese; greater diversity on manganese supplies will probably depend on the willingness

of producers in Australia, Mexico, and Brazil
Ch. 8—Policy Alternatives for Strategic Materials ● 351

to increase production for export markets. In

the case of chromium, expanded production

in Turkey, Albania, and the Philippines appears to be the primary near-term supply diversification option; in the longer term, limited

amounts of chromite may be obtainable from

deposit types that are now untapped in the

Philippines and New Caledonia. Increased supplies of cobalt maybe obtainable from Canada

as a byproduct of nickel-copper production.

Over the long term, cobalt may be obtained as

a byproduct from Pacific-rim nickel laterite deposits when future nickel demand justifies new

mine operations. Other than the U.S. Stillwater

deposit, significant diversification of platinum

supplies seems unlikely. (See table 5-3 of ch.

5 for a country-by-country ranking of supply

diversification prospects for each of the firsttier minerals.)

OTA’s analysis of alternative policy actions

with regard to minerals production and processing focused on the following areas: potential of intensified exploration assistance to

locate new domestic deposits; possible government subsidization of domestic production; targeting of Federal programs to encourage diversification of foreign supply sources; and

options for addressing problems associated

with declining domestic processing capabilities. The options addressed are summarized

in table 8-7 and discussed below.

The emphasis in this assessment is on technological issues. Therefore, political issues

associated with competing values for Federal

land management are not addressed here.

Some Federal lands are under highly restrictive management policies which limit the circumstances and kind of exploration activities

that can be undertaken, and these restrictions

are seen by some exploration geologists as possibly inhibiting private initiatives to discover

new mineral deposits. In general, Federal lands

being considered for permanent addition to

such restrictive management systems as the

National Wilderness Preservation System are

given some mineral appraisal prior to designation. The reader is referred to a prior OTA

assessment, 15 in which alternative alternative

management strategies and policy issues associated with mineral development on Federal

lands were comprehensively addressed, as well

as several other, more recent publications addressing mineral development issues and Federal lands.16

Exploration for Domestic Strategic Resources

The outlook for the discovery of commercialscale deposits of the first-tier strategic materials

in the United States is generally agreed to be

insufficient to generate more than minor interest by most mineral developers. The U.S. Government spent considerable effort during and

after World War II in seeking high-grade domestic deposits of manganese and chromium,

with only subeconomic deposits to show for

its efforts. Cobalt, while not sought directly, has

only been found in low grades and only as a

result of exploration for nickel, copper, lead,

and zinc. Platinum, the one successful case of

discovery of a commercial-grade deposit of a

first-tier material, is quite limited in terms of

total U.S. demand for PGMs.

Past failures, however, do not mean that

there is no possibility of discovering domestic

deposits of chromium, cobalt, manganese, or

PGMs. Past experience, however, makes exploration less attractive for these materials than

15u. s. Congress, Office of Technology Assessment, ~anagement of Fuel and Nonfuel Minerals in Federal Lands, OTA-M88 (Washington, DC: U.S. Government Printing Office, April

1979). leLegis]ative statu5 of selected bills in the 98th Congress relating to strategic minerals evaluation and Federal lands is provided in Strategic Materials Management, June 15, 1984. Procedures used in regional mineral appraisals on Federal lands

are discussed in John J. Schanz and John G. Ellis, Assessing the

Mineral Potential of the Federal Public Lands (Washington, DC:

U.S. Library of Congress, Congressional Research Service, 1983).

Recent Department of Interior activities related to Federal land

mineral evaluation potential are discussed in U.S. Department

of the Interior, Summary Report: US. Bureau of Mines Department of Interior Programs and Studies Required by the National

Materials and Minerals Policy Act of 1980 (Public La w 96479)

(report submitted to the chairman of the Subcommittee on Transportation, Aviation, and Materials, U.S. House of Representatives Committee on Science and Technology, with cover letter

dated Nov. 10, 1983).
352 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table 8-7.—Policy Alternatives for Exploration, Mineral Production, and Processing

Arguments for/against

Problem/issue Option Positive Negative

1.

2.

3.

Lack of industry interest in

exploring for domestic deposits

of strategic materials.

Known domestic strategic

material sources are economically noncompetitive, and

therefore not currently producing.

Magnitude of production

resources of existing concentrated foreign suppliers inhibit

development of alternate sources.

a. Improve the economics of

domestic deposits of strategic material resources

through tax incentives for

exploration and development.

b. Reduce the cost of exploration by increasing level of

detail obtained by government resource assessments

and by conducting R&D to

improve exploration

technology.

c. Improve ability to predict

location of possible

deposits of strategic

material resources through

increased understanding of

ore formation processes.

Federal subsidies for

domestic mining.

a. Cobalt

b. PGM

c. Chromium and manganese

Use government resources

to expand foreign production

of strategic materials.

a. Improve information about

possible projects.

b. Reduce political risks to

U.S. private sector

investment.

c. International direct/indirect

aid to encourage foreign

projects.

Cost to government arises

only if deposits of strategic

materials are developed.

Costs are limited to tax liability of those deposits.

Could reduce cost of identifying areas of possible

deposits and allow industry to

conduct more exploration

within current exploration

budgets.

Could lead to location of

deposits that cannot be found

by current exploration equipment or methods.

Assure domestic supply.

Reduce likelihood of disruption occurrence.

Could provide an assured

domestic supply of up to 10

million pounds per year over

10 to 15 years.

A relatively small subsidy could

assure near-term production

of 6 to 10 percent of U.S.

needs.

Subsidy would assure production of Cr and Mn in limited amounts over relatively

short time period; might

encourage domestic exploration activities.

Reduces likelihood of

successful supply disruptions.

Relatively inexpensive use of

resources.

Relatively inexpensive use of

resources.

While relatively expensive,

many foreign mining projects

are marginally economic and

could be less costly than

domestic subsidies. Aid can

be coupled with other

developing country needs.

Tax incentives can only

improve project economics by

several percentage points.

They cannot turn deposits

simiIar to known domestic

chromium, cobalt, and

manganese deposits into

profitable ventures.

Actions are not materialspecific and are unlikely to

result in increases in exploration for strategic resources

unless coordinated with other

incentives.

Unlikely to result in discovery

of any deposits of strategic

materials resources until

greater scientific understanding is achieved—a process

that could take many years.

High costs relative to purchasing for stockpile on

world markets. No guarantee

that production period would

coincide with any supply

disruption.

At 1983-84 metal prices, a

substantial Federal subsidy

would be needed so that it

would be cheaper to buy

cobalt on world markets for

the National Defense

Stockpile.

Government action probably not

necessary. Market forces

alone are expected to promote domestic production —

possibly in the next 5 years.

Uneconomic nature of known

deposits would require high

subsidies: for Cr, two or more

times and Mn, seven times

market world prices.

Perpetuates reliance on foreign

sources. If actions are not -

targeted, option could promote competition for

nonstrategic domestic mining

industry.

Results tend to be limited and

difficult to foresee.

Targeting to specific minerals

is difficult. Results are

limited in weak mineral

markets.

As with domestic subsidies,

it would be less expensive at

current prices to purchase

from existing sources for

stockpile.
Ch. 8—Policy Alternatives for Strategic Materials ● 353

Table 8-7.—Policy Alternatives for Exploration, Mineral Production, and Processing (Continued)

Problem Optio n

4 Declining domestic ferroalloy ore a Government subsidies to

processing capability maintain/develop capacity

along with ore sources

b Government support for

modernization efforts and

R&D in emerging

technologies.

SOURCE Office of Technology Assessment

for other minerals, such as copper, lead, zinc,

or bauxite, for which there is a substantial record of success to hearten investors.

The Federal Government generally participates in only the first of the four stages of prospecting and exploration, that of wide-scale

reconnaissance (table 5-2, ch. 5). Information

obtained at this stage helps prospectors select

areas for more detailed survey but is unlikely

to locate signs of a specific deposit. In view of

the prevailing industry belief that commercially

competitive deposits of the first-tier strategic

materials are unlikely to be discovered, an increase in general information would probably

be insufficient in and of itself to encourage

more intensive exploration for these specific

materials, although such information may indeed encourage exploration for other metals.

To increase the potential for discovery of domestic deposits of first-tier materials, the potential profitability of deposits must increase,

the cost of exploration must decrease, or the

likelihood of success of exploration must increase. Further, in order to be efficient in the

use of Federal resources, actions directed

toward these goals should be material-specific.

Table 8-7, issue 1, identifies three approaches

which could be taken.

The first possibility, increase of profitability

of potential deposits, could be approached

through tax policy (e.g., increasing the percentage depletion allowance for specified materials), through exploration loans that have reduced rates or reduced principal when they

lead to the discovery of deposits that eventually

lead to commercial exploitation, and through

mining and metallurgy R&D directed specifiArguments for/against

Positive

Assures processing capability

in time of emergency need.

Improves productivity and

therefore competitive position

of domestic Industry. Could

target development of flexible

production capacity,

Negative

Creates excess global supply.

Closure of some remaining

facilities continues with job

loss in near term.

cally at reducing the cost of exploiting deposits for the first-tier materials as they are likely

to be found in the United States.

The second approach would be for the Federal Government to undertake, either directly

or through contract with private firms, more

detailed prospecting activities, again directed

at specific types of mineral deposits. This approach could also include the development of

improved exploration equipment and techniques, such as the development of geophysical techniques for locating sedimentary manganese deposits, more portable and accurate

equipment for geochemical analysis, and lower

cost core-drilling equipment.

The third approach, increasing the likelihood

of success of exploration, could combine current data collection and analysis procedures

with intensified research into the processes of

formation of deposits of strategic materials,

with the goal of improving the ability to identify areas most likely to have deposits of specific first-tier strategic materials. Predictive geology, based on theories of the formation of

mineral deposits, is in its infancy and certainly

a long-term approach to strategic materials

supply issues.

Domestic Production of Strategic Materials

As discussed in chapter 5, known domestic

deposits of first-tier strategic materials cannot

support profitable minerals production at current prices, Nonetheless, domestic production

could make a contribution to domestic material supplies. Of the materials under study, potential contributions to material supplies (as a
354 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

portion of U.S. requirements) varies from moderate to large in the case of PGMs and cobalt

to small, in the case of chromium and manganese,

Several potentially exploitable PGM deposits exist, the largest of which are located in the

Stillwater Complex in Montana. Commercial

production of PGMs from one site in the Complex is now under evaluation by a private firm.

Other than monitoring progress at the Stillwater site, there appears to be no pressing need

for government involvement in this project at

this time. It has been estimated that, if a decision to go ahead is reached, about 2 years lead

time would be necessary before the mine would

produce PGMs. At current prices, domestic

production of the other first-tier materials

would require a Federal subsidy.

The Federal Government can subsidize—and

sometimes has subsidized—domestic production of strategic materials. During World War

11 and the Korean war, the United States was

able to obtain some of its chromium, manganese, and cobalt supplies through heavy subsidization of production from limited domestic deposits. Between 1948 and 1962, about 14

million pounds of cobalt were produced domestically under Federal subsidy.17 When Federal contracts expired, most domestic production ceased.18

Recent concern about strategic materials has

rekindled interest in domestic production subsidies through Title III of the Defense Production Act (table 8-7, issue 2). Title III provides

several instruments (loans, loan guarantees,

guaranteed prices, or purchase commitments)

that could be used to support industrial processing and production of strategic materials.

Possible subsidization of domestic cobalt production was among an initial list of Administration projects proposed for possible Title III

assistance during congressional debate about

ITJarneS C. Burrows, cobalt: ArI Industry Analysis, a Charles

Rivers Associates Research Study (Lexington, MA: Heath Lexington Books, 1971), p. 111.

IaSome cobalt continued to be produced at Pennsylvania’s

Cornwall Mine until 1971 as a byproduct of iron ore production without subsidy.

reauthorization of DPA for fiscal years 1985

and 1986. In hearings about this legislation, the

U.S. General Accounting Office expressed concern that the Administration had not undertaken adequate cost/benefit comparisons among

candidate Title III projects for which it sought

funding. In April 1984, Congress amended

DPA to authorize a total of $100 million in financial aid to defense industrial projects for

fiscal years 1985 and 1986.19 The amendment

did not preclude a Title III cobalt project, However, it did establish new procedures for the

Administration to follow in seeking Title III

authorization. Except in times of a national

emergency, Title III projects must be presidentially cleared, and a determination made that

the alternative is the most practical means for

meeting a shortfall.

It is not clear whether the Administration has

any plans to initiate a cobalt project, but the

issue of domestic production of strategic materials is likely to continue to be debated in the

future,

Potentially exploitable cobalt deposits in the

United States include the Blackbird Mine in

Idaho, the Madison Mine in Missouri, the

Gasquet Mountain Project in California, and

the Duluth Gabbro Complex in Minnesota. For

domestic production to occur without subsidy,

cobalt market prices, about $6 per pound in

1983 and $11 to $12 in mid-1984, would need

to rise appreciably and be sustained for a protracted period in order for mine owners to assume the risks of production, Each of these

sites has received some scrutiny for possible

subsidy under the Defense Production Act. Although DPA can be used to secure materials

for the stockpile, it has generally been used to

support industrial processing capabilities considered essential for national defense, One

proposed method of subsidy has been a “contingent purchase contract” between the government and mine owner. In such contracts,

a negotiated “floor price” would be set with

the company. The government would be oblilgpublic Law 98-2Nj, the Defense Production Amendments Act

of 1984, was signed into law by President Reagan on Apr. 17,

1984.
Ch. 8—Policy Alternatives for Strategic Materials

gated to buy the cobalt only if the company

were unable to sell it on the open market,

Some evaluation of production economics

from candidate sites has been conducted by the

sponsoring companies, with estimates ranging

from $16 to $25 per pound. However, some of

the estimates have not been revised since 1981,

and none should be considered definitive,

According to the Department of Defense, “contradictory data being quoted and evaluated” led

the Air Force, in 1983, to seek “definitive data

through legal contracting procedure for a

cost/benefit analysis of domestic cobalt production.”20 The form of the Air Force effort, a draft

request for proposal,21 evoked controversy because some believed that a final determination

had been made to go ahead with a pilot plant

project to evaluate the quality of domestically

produced cobalt for defense applications. The

effort did not reach the stage in which such definitive data was submitted, however.

The Blackbird Mine (an inactive mine which

produced cobalt under DPA subsidy in prior

years) is considered the largest potential domestic source. In 1981, the company which

owns the mine estimated that Blackbird could

support an annual production level of 3.7 million pounds (1,850 short tons) of cobalt for a

14-year period if cobalt prices rose and were

sustained at a $20 per pound level or if the government subsidized production. 22 Lead time for

production would be 3 to 4 years. A spokesman for the company recently told OTA that

it now estimates a sustained cobalt price of $16

per pound to be sufficient to bring the mine

into production, owing to discovery of higher

grade cobalt at the site, and improved mine

20Department of Defense submittal entitled “General DoD Comments on the Classifed GAO Statement, ” in U.S. Senate Committee on Banking, Housing, and Urban Affairs, Reextension

of the Defense Production Act, hearing held Sept. 15, 1983,

(Washington, DC: U.S. Government Printing Office, 1983), p. 161.

21 Department of the Air Force, Draft Request for prOpOsal

(DFRP) for Contemplated RFP F33615-83-R-5106: Establishment

of Domestic Cobalt Production, Aug. 30, 1983.

ZZLetter of R.V. Fiorini, Vice-president, General Manager,

Noranda Mining Inc. to Senator Harrison S. Schmidt as reproduced in U.S. Senate Committee on Banking, Housing, and Urban Affairs, Defense Production Act and the Domestic Production of Cobalt Hearing, Oct. 26, 1981, Senate Hearing 97-38

(Washington, DC: U.S. Government Printing Office] p. 143,

● 3 5 5

planning, It has also increased its mine life estimate to 20 years.

Another inactive mine, the Madison Mine in

Missouri, could also support production of cobalt as a primary ore, according to its proponents. Closed since 1961, Madison produced

lead, copper, and nickel, and during the 1950s,

cobalt under a DPA subsidy. Madison’s owner

estimates that the mine could produce 2 million pounds of cobalt annually over an estimated mine life of 20 years. In addition, substantial amounts of cobalt are present in mine

tailings that have accumulated over the years

from lead and zinc mining in the area. These

tailings could provide 300,000 to 500,000

pounds of cobalt annually, using prevailing

lead and zinc recovery technologies, but far

more if other processes were adopted. The

Madison mine owner estimated in 1981 that

a cobalt price of $25 per pound would be necessary to bring the mine into production. Revised estimates apparently have not been made

since then.

The Gasquet Mountain Project, a proposed

mine on National Forest land in California,

would involve production of cobalt and some

chromite as coproducts of nickel production.

A 1981 feasibility study for the project estimated that the lateritic deposits at the site could

support annual production of 19.4 million

pounds of nickel, 2 million pounds of cobalt,

and 50,000 tons of chromite over an estimated

mine life of 18 years. The economic feasibility of the project would thus depend on multiple metals prices, with changes in the relative

value of one metal, compared to the others,

affecting production economics. For example,

if nickel prices were $3.50 per pound, cobalt

production would be viable at $12.50 per

pound. If nickel prices rose to $3.96 per pound,

cobalt would be viable at $8 per pound, but if

nickel prices were $2.21 per pound, a cobalt

price of $25 would be required.23 Nickel prices

in 1983 were $2.20 per pound. A company

ZSDocuments prot~ided to OTA on the Gasquet Mountain Strategic Metals Project by the California Nickel Corp. in March

1983. The figures cited above assume a constant chromite price

of $40 per ton.
356 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

spokesman told OTA that it had not revised its

economic evaluation since 1981.

In assessing the desirability of subsidizing

domestic cobalt or any other strategic material,

several considerations should be kept in mind.

Supply security is the primary argument used

in support of government assistance for domestic cobalt production. To some, the risks entailed in continuing to depend on insecure foreign sources of cobalt is an overwhelming

argument in favor of a domestic production

subsidy even when cobalt could be more cheaply

acquired from world markets for the stockpile.

The supply security aspect of domestic production is most persuasive if the risk that a protracted supply disruption will occur before adequate quantities of cobalt could be acquired for

the stockpile is seen as unacceptable. To those

who think the short-term risks of a supply disruption are not great, stockpiling now, rather

than depleting limited domestic cobalt reserves, seems to provide greater supply security in the long term.

Fluctuating cobalt or coproduct metal prices

have made it difficult to identify the extent of

subsidy that would be needed, compared to

simply buying cobalt on the world markets for

the National Defense Stockpile. If 1980 cobalt

prices ($25 per pound) were to return and be

sustained, domestic production of cobalt would

compare favorably with world prices, and thus

could be cost effective even with minimal government involvement. At 1983 cobalt prices,

about $6 per pound, it would cost the government three to four times as much to buy cobalt from domestic mines than from the world

market. If it is assumed that mid-1984 cobalt

prices (about $12 a pound) will continue, stockpiling from world markets would still be

cheaper than subsidizing domestic production.

Environmental considerations may also delay or potentially curtail proposed projects,

especially when supply security objectives are

not widely perceived as a pressing need. Concerns about possible water pollution and environmental damage to California’s Gasquet

Mountain were raised in the legislative debate

about the 1984 DPA amendments.24 The Blackbird Mine is surrounded by Federal lands, including 40,000 acres which has been classified

as wilderness with a stipulation that it will remain open for cobalt exploration and mining

activities. Although open, actual development

of the mine could be delayed by the process

of establishing Federal regulations governing

access to the site across Federal lands. Water

pollution problems arising from the presence

of arsenic will have to be overcome before

production can begin.

Encouraging Foreign Production of

Strategic Materials

The United States is likely to be dependent

on a few producing countries for most of its

supplies of strategic materials for the foreseeable future. Actions can be taken to increase

the number of countries supplying these materials, thus achieving greater diversity of supplies. However, these actions take time to

implement and are not likely to alter fundamentally the supply patterns in the next decade. Over the long term, a concerted effort to

promote diversity of foreign supply sources of

specific minerals could help reduce overall

U.S. vulnerability to a supply disruption. To

be most effective, these actions must be narrowly focused to address problems that are

mineral-specific and to avoid possible competition with efforts to develop domestic sources.

Potential benefits of supply diversification

strategies will vary by material, Of the first-tier

materials, for instance, prospects for supply

diversification appear to be best for manganese, which already has the most diverse supply. Several alternative supply sources also exist for chromium, such as expanding output in

Turkey and the Philippines. Cobalt diversification, primarily in the Southwest Pacific, depends to a large degree on world markets for

nickel and copper, since cobalt is usually a by-

?4Environmental concerns associated with Gasquet Mountain

were discussed in House debate on the conference report on

the DPA amendments. (Congressional Record, H2538, Apr. 17,

1984.)
product of production of these metals. In the

case of PGMs, the most promising known but

nonproducing deposit is in the United States.

Outside the United States prospects for PGM

supply diversification will depend on new discoveries rather than on the development of

known deposits.

The likelihood that a supply diversification

strategy will succeed also depends in part on

the extent to which the Federal Government

and U.S. industry are willing to accept the risks

and attendant costs associated with bringing

alternative supply sources on line, According

to a 1982 GAO report, direct investment by

U.S. firms in mining and smelting activities in

developing countries has fallen significantly

since the late 1960's and early 1970s.25 Reasons

for this include prolonged weak markets, perceived risks associated with such investments

(due to political uncertainties), and controls on

investment asserted by producer countries. On

the other hand, the involvement of multinational mining firms in developing countries is

still extensive, While equity participation has

declined, firms are willingly supplying technology and management services.

New mining ventures from exploration to

production can cost $1 billion and more. Moreover, mining prospects are long-term ventures.

Exploration activities to discover new deposits can take many years and are often unsuccessful. Once a deposit is identified and found

to be promising, a minimum of 2 to 5 years is

required to bring a new mine into production;

somewhat less time is required to increase output from an existing alternative mine that is

already in operation. Hence, actions taken to

promote diversity of supplies must be planned

and executed far in advance and are not likely

to be successful as a way to avert immediately

the consequences of a supply disruption, Even

if financial obstacles were overcome, supply

diversification strategies have inherent risks.

Near the end of World War II, and through

much of the 1950s, the Federal Government

25[J. S, (jfjnera] A{;{;c)unting office, Federal Encouragement ‘f

hlining ln~estment in 1%~’eloping Countries for Strategic and

Criti{;al Minerals Has Onl~ Been hlarginall~’ Effectitre (Washington, I)C: [J. S. General Accounting Office, 1982].

Ch. 8—Policy Alternatives for Strategic Materials Ž 357

supported development of Cuban nickel resources to diversify U.S. supplies. The effort

was successful in developing Cuban nickel, but

for political reasons the United States has not

had access to this supply since the early days

of the Castro regime.

In some countries the government plays a

very active role in backing international resource projects launched by private firms. In

Japan, for instance, overseas ventures of sufficient importance to be considered “national

projects” are backed by low-interest loans to

both the country in which the project is located

and the consortium of Japanese firms involved

in the project. The government itself serves as

the major stockholder in the consortium.

Among industrialized nations, Japan is unusual

in that half or more of its foreign mining and

smelting investments are in developing countries—as compared to 25 percent among U.S.

firms .28

In the United States, private industry—not

government—plays the primary role in securing mineral supplies from foreign sources, and

this policy is likely to continue. However, the

Federal Government can be a catalyst in promoting private investment overseas, through

the dissemination of essential information, by

facilitating interaction between private industry and foreign owners, and by the targeting

of international aid to private and producer

country mining activities that are related to

strategic materials. The extent and degree of

encouragement considered appropriate can

range from modest to extensive, depending on

the importance given to supply diversification

in overall U.S. strategies to reduce import dependency.

The Reagan Administration has emphasized

information development to encourage private

action. Initiatives include a Department of Interior minerals training program for State Department regional resource officers to improve

the collection of information. It also includes

discussions with market economy countries

about mineral investment problems and the

2~Ibid., p. 5.
358 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

need for more consistent statistical reporting.

In fiscal year 1983, the U.S. Geological Survey

(USGS), in cooperation with Canada, West Germany, Australia, South Africa, and Great Britain, began an International Strategic Mineral

Inventory program to upgrade and standardize resource and production information about

world deposits of chromium, nickel, manganese, and phosphate. Other minerals are expected to be added to the inventory. The USGS

Office of International Geology obtains funding through the Agency for International Development (AID) for various mineral potential

studies of developing nations. These projects

are often cooperatively funded by the developing nation, must be “sold” to AID on the basis

of their assistance to immediate development

needs, and do not necessarily focus on strategic materials. (Phosphate for agricultural purposes is a major item.)

President Reagan has also given new responsibilities to the Trade and Development Program (TDP) of the International Development

Cooperation Agency (IDCA) in order to “broaden

opportunities for the U.S. private sector to participate in the development of and diversification of foreign sources of supply of strategic

materials. “27 The mineral resources group of

TDP received funding of about $700,000 in

fiscal year 1984 which is supplemented by cooperative funding for specific projects. TDP

concentrates its efforts on a small number of

strategic minerals and, as of March 1984, had

issued five reports that identified investment

possibilities in those minerals for U.S. mining

companies in foreign countries.28 TDP also

brings private project promoters and prospective investors together informally to discuss foreign mining and processing projects. The TDP

reports have been thoroughly prepared and are

potentially useful; however, some industry people claim they provide information already

available and that the analysis is not extensive

enough to attract private investment, especially

during periods of depressed minerals markets.

ZTNatjona] Materia]s and Minerals Program Plan and Report

to Congress, op. cit., p. 11.

28Report~ cover manganese in Mexico, cobalt in Morocco and

Peru, and chromium in Turkey and the Philippines.

One TDP report has resulted in a TDP followup contract for a feasibility study to further encourage private industry’s involvement. Future

reports might be more useful if they included

possible followup steps for government action

to be considered by relevant agencies (e.g.,

technical or financial assistance), and joint venture opportunities for the private sector. Although TDP’s approach is promising, funding

levels may be too low to realize any substantial improvement in diversified minerals

sources.

Other Administration efforts have involved

the development of a model bilateral investment treaty. When adopted by individual countries, such a treaty may improve a country’s

investment climate, but does not necessarily

create mineral investment opportunities,

An alternative or complementary approach

would be to target or give special priority to

strategic materials in U.S. bilateral assistance

programs, or as part of U.S. responses to multilateral assistance in which it participates (table

8-7, issue 3). The 1980 National Materials and

Minerals Policy, Research and Development

Act emphasized the importance of such activities by calling on the President to “assess the

opportunities for the United States to promote

cooperative multilateral and bilateral agreements for materials development in foreign nations for the purpose of increasing the reliability of mineral supplies to the Nations.”29

Major multilateral and bilateral programs

applicable to mineral development are highlighted in box 8-A.

Multilateral programs, established by the

United Nations, the World Bank group, and

other international organizations, have been

the primary means (albeit indirect) for U.S.

assistance for mining and smelting activities

in developing countries. These programs, according to the GAO report, have had a limited

impact on increasing supplies of strategic

materials of importance to the United States.

Of 45 mineral-related projects during 1971-80,

most involved copper, lead, zinc, and iron ore,

Zesec. 4(g) of Public Law 96-479.
Ch. 8—Policy Alternatives for Strategic Materials ● 359

Box 8-A—Bilateral and Multilateral Assistance Approaches for

Mining Investment in Other Countries

Bilateral Approaches:

●

●

Overseas Private Investment Corporation

(OPIC) was established in 1969 to facilitate

flow of private U.S. capital and skills to the

Third World through insurance, financial

guarantee, direct loan, and promotional

programs. Mining and energy initiatives

were instituted in 1977 to help revive investor interest in developing country mining

projects. Although OPIC does not support

a significantly large number of projects, the

mining projects that it does support are generally targeted to strategic minerals.

Export-Import Bank was created in 1934 to

provide financial support for U.S. export

sales through direct loans, financial guarantees to private lenders, and commercial and

political risk insurance. Unlike most assistance programs, Ex-Im operations are not

limited to developing countries. Programs

were directed toward specific mineral

needs during World War II and the Korean

war using the Reconstruction Finance Corporation and the Defense Production Act

as sources of funding. Since then, however,

lending (for mining equipment exports) has

been limited and has not focused on strategic minerals. The Bank has no control over

the mix of incoming applications it processes. Weak markets and inability to compete effectively with foreign counterparts

have resulted in only a few mineral projects.

Multilateral Approaches:

• Development Banks (e.g., the World Bank,

Asian Development Bank, and Inter-American Development Bank) tend to devote

small shares of their overall funding to

mineral projects and have no mechanism

to target “U. S.” strategic materials when

the strategic materials of other involved nations are different. Priorities for addressing

basic needs of people limit mineral projects

to those which are viewed as a way to improve foreign exchange earnings and balance of payments postures. Development

bank activities sometimes conflict with U.S.

domestic mining interests by promoting the

development of foreign competition.

U.N. Revolving Fund for Natural Resources

Exploration was set up in 1973 to help increase natural resources exploration in developing countries and expand the world’s

known resources base. Its mission is to address what experts perceive to be the greatest mining-related problem for developing

countries: insufficient exploration. While

exploration costs generally are not great

compared with mine development costs,

the risks are greater due to a lower probability of success. Therefore, funding is difficult to obtain–even from development

banks. The Fund, which contracts actual

work to the private sector, deals in exploration projects exclusively although it does

have the authority to do follow-up feasibility studies. Of 11 projects completed in

1983 and 5 continuing on through 1984,

none involved first-tier strategic materials.

According to GAO, by 1982 the Fund had

not yet demonstrated its capabilities convincingly, having had financial and initial

problems in convincing governments to use

its services, and in obtaining contributions

to set up the fund.

International insurance plans to safeguard

foreign investment have been proposed but

never implemented, due to lack of agreement on how to arbitrate disputes, negotiate claims, finance the plans, or distribute

voting rights. Recent proposals and sponsors include: International Investment

Insurance Agency (1966), World Bank; International Resources Bank (1975), U.S.

Government; Inter-American Fund for Energy and Minerals (1979), Inter-American

Development Bank.
360 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

and only four involved strategic materials. Multilateral programs that support exploration

activities, such as the U.N. Revolving Fund for

Natural Resources Exploration, have some potential to result in new discoveries of strategic

materials.

Several bilateral aid programs could be specifically targeted to encourage U.S. firms to invest in mining activities for strategic materials,

Past efforts have been only marginally successful, as was brought out by the GAO report,

Among other things, the report found that existing programs were not oriented toward providing solutions to what are, after all, mineralspecific problems (the TDP studies, a notable

exception, were only beginning at the time of

the GAO study) and that there was a lack of

coherent investment strategies to guide implementation actions over the long term.

One of the often stated impediments to mining firm investment abroad is the fear of political instability, A mining firm will launch a

project only if it believes that the project will

yield an adequate after-tax return on equity

over a specified time period. Political risk insurance can reduce the political component of

economic decisionmaking. The Overseas Private Investment Corporation (OPIC), established by Congress in 1969, provides such insurance as well as financing (loans and loan

guarantees) to U.S. firms investing in developing countries. Its involvement in mineral projects, however, has been limited due to the

weakness of markets and, in the area of natural resources, it concentrates on energy projects. OPIC, like the Export-Import Bank (see

box 8-A), assists rather than subsidizes foreign

projects. Thus, it can improve the competitive

posture of U.S. firms but not the markets

wherein firms must operate.

GAO cited policy and procedural restraints

on OPIC’s activities as limiting factors on the

number and type of mineral projects it supports. As a public corporation, OPIC must assure that, overall, its investments generate a

positive return. To do so, its investments are

broadly based in terms of industries and countries served. Loans granted by OPIC are restricted by legislation to small businesses,

which disqualifies the majority of mining firms.

Loan guarantees (up to $50 million) are available only for the production phase of mining

projects. OPIC political risk insurance maximum ($125 million) may not be consistent with

the real costs of most mineral investment activities today, although it does provide 20-year

coverage of the entire mineral exploitation

process from exploration through production.

The President’s materials plan does not address foreign aid or loans as an instrument of

national minerals policy. When more limited

means do not encourage the diversification of

sources, it may—given the perception of risk—

be appropriate for the Federal Government to

engage in direct financing support for exploitation of, or creation of demand for, these

diversified sources. Stockpile needs and other

Federal Government purchases, for example,

could be directed at creating demand for unexploited strategic materials deposits. Loans

and loan guarantees could assist countries both

directly and indirectly in exploiting mineral resources. For instance, prospective mining

projects are often located inland, without adequate in-place transportation and energy infrastructure. Developmental aid for such supporting projects could overcome economic

obstacles to mine development, provide investment opportunities for U.S. firms, and, at the

same time, stimulate the overall economic

growth of a developing nation.

In using both multilateral and bilateral mechanisms, a clear distinction must be made between the needs of the domestic mining industry and those of U.S. firms involved in the

international mining industry, Policies developed for one may be viewed as detrimental by

the other. The domestic mining industry today

faces increasing competitive pressure from foreign mining that is supported by governments

that are more concerned with generating foreign exchange or jobs than with profits. Many

of these ventures may be supported either

directly or indirectly by public sector international development banks. The domestic industry, which is guided by the principles of the free
Ch. 8—Policy Alternatives for Strategic Materials ● 361

— —

market, says it cannot continue to compete in

global markets under these newly emerging

and unfamiliar rules of competition. Conversely, U.S. firms involved in foreign mining

projects can take advantage of them. Clearly, for

commodities where domestic mining competes

with foreign mining, a policy choice must be

made that serves both sectors or just one. Fortunately, inherent in the nature of “strategic

materials” is the fact that little, if any, domestic mining occurs for these commodities at

present. If policies are specifically targeted,

they would have less chance of being detrimental to the domestic mining industry and greater

likelihood of success in diversifying U.S. supply sources.

Implications of Diversification of Supply

for Ferroalloy Production

Diversification of ore suppliers offers only

a partial solution for decreasing the potential

for interruption of supplies of chromium and

manganese, Since the bulk of chromium and

manganese ore is processed into ferroalloys for

use in the production of steel, stainless steel,

and superalloys, it is also necessary to ensure

that ferroalloy production facilities will be

available to process ore obtained from a variety of suppliers.

The domestic ferroalloy industry was once

the major supplier of ferroalloys to the U.S.

steel industry, but this position has been eroded

by foreign suppliers such as South Africa,

France, and Brazil. This decline can be attributed largely to nontechnical factors, particularly:

●

●

●

policies by foreign governments and international organizations that provide financial incentives that encourage development

and operation of ferroalloy production in

developing countries, primarily in conjunction with operating mines;

higher cost for U.S. labor in comparison

to labor costs in other producing countries;

current exchange rates that, due to the

strong U.S. dollar, favor the use of imported products over domestic production;

and

● higher capital investment required of domestic producers in order to meet stringent U.S. environmental and safety requirements.

The domestic ferroalloy industry has a number of strengths, including large, in-place capacity for production of ferroalloys; adaptability of furnaces between various manganese,

chromium, and silicon products (although conversion between products is, in some cases,

limited by design of electrical or pollution control systems) and proximity to markets for ferroalloy products that allows quick response to

special orders for nonstandard products.

One way to assure ferroalloy processing

availability would be to encourage the construction of processing capacity along with

chromium and manganese mines, but this

method would provide excess worldwide capacity and be wasteful of capital investment.

A second alternative is to maintain a ferroalloy

processing capability in the United States, one

designed to be flexible both in products (ferrochromium, ferromanganese, silicon, and ferrosilicon, and specialty products such as calcium

silicon) and in production rates (with plants designed for rapid expansion of capacity).

New technology may change the outlook for

the domestic ferroalloy industry in two ways.

First, process improvements, such as increased

use of automated equipment and computer

control, may increase labor productivity, reduce energy consumption, and raise the quality of products. These improvements, in turn,

would improve U.S. competitiveness, since

high labor and energy costs are a contributor

to the high cost of domestic production, and

the quality of products for specialty steels and

superalloy can protect and strengthen the U.S.

position in these markets. The second major

technical change facing the industry is the

adoption of plasma arc and high-voltage electric furnaces. These advanced furnaces, which

are in the latter stages of development and the

first stages of commercial use, may offer lower

operating costs and improved energy efficiency

over the submerged arc furnaces now in use.

However, they must be built to replace furnaces now in use, which will require the in-
362 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

dustry to make major capital investments.

These new furnaces are applicable both to domestic and to foreign production, so it is possible that the domestic industry could be left

behind its foreign competition if it is slow to

adopt the new processes.

Since the immediate problems of the ferroalloy industry arise from political and economic factors rather than technical ones, the

principal response of the government (if it is

to respond) is likely to be political, In the longer

term, however, there are more options (table

8-7, issue 4). First, the Bureau of Mines can

work with industry to develop process improvements, particularly in the area of automation and computer control, that increase

labor productivity and reduce energy and material consumption. Second, financial incentives, such as increased depreciation, tax

credits, or low-interest government loans could

be used to encourage the adoption of new ferroalloy furnaces. Third, the government could

use its influence in international lending organizations to encourage the use of development

loans for projects other than ferroalloy facilities. Fourth, additional support, either as loans

or grants, could be provided to the ferroalloy

industry to include in plant designs the potential to increase capacity or shift between

products rapidly when supplies of imported

ferroalloys are unavailable and ores must be

processed for domestic industries.

Substitution and Advanced Materials

In discussing substitution, it is useful to

differentiate between two broad classes of

alternative materials: direct substitutes, i.e.,

materials that, while not necessarily preferred,

could replace materials now in use; and advanced materials, which may displace currently used materials in time because the new

material offers a clear advantage in performance, cost, or other benefit. In contrast to direct substitutes, which may require only minor design changes for use, advanced materials

often require redesign of products for optimal

use.

Direct substitutes are immediately available

for many applications that now use first-tier

strategic materials. However, this is not the

case for some applications that are most critical to the national defense and the U.S. economy. As discussed in chapter 7, the Federal

Government sponsors considerable R&D aimed

at finding direct substitutes for strategic materials, Much of the research has focused on

development of lower chromium alloys as potential replacements for stainless steels of highchromium content, and on alternative jet engine superalloy which contain reduced amounts

of cobalt or other strategic materials. This research adds to the choices of materials available to designers. However, institutional and

economic barriers impede acceptance of these

materials so that many will not be fully developed. Substitutes used in highly demanding applications need to undergo extensive testing

and qualification before they can be used. Industry has little incentive to undertake this testing unless the substitute offers a clear advantage over currently used materials.

Besides direct substitutes for materials now

used, the Federal Government also plays a primary role in sponsoring research on advanced

materials, such as advanced ceramics and composites, and rapidly solidified metals. These

materials have long-term promise to change

current requirements for strategic materials—

although to what extent is difficult to predict

due to the need for redesign of product components. In some applications, net savings in

strategic materials may occur, while in other

applications, product redesign could lead to increased use of strategic materials.

Many barriers must be overcome before use

of these advanced materials becomes widespread. Some barriers are technical, arising

from the materials themselves or from the need

to improve current processing techniques so
Ch. 8—Policy Alternatives for Strategic Materials Ž 363

that reliability is increased. Others are institutional and economic. Some of these materials

are much more expensive than currently used

materials, although costs may go down in time

as processing problems are overcome. From

the institutional side, widespread use of these

materials may have to await establishment of

standards and specifications for their use, as

well as greater emphasis on these materials in

engineering curricula.

An emerging import vulnerability issue concerns adequacy of domestic processing and

manufacturing capabilities for advanced materials. Most advanced materials are made

from raw materials which are plentiful in this

country. However, the manufacturing capabilities (including technology and technical knowhow) to produce qualified materials suitable for

the most demanding applications is distributed

among several nations. Most advanced materials are in limited production status at this

time. As they become more frequently used, the

extent to which the United States should attempt to become self-sufficient in all stages of

production of these materials is likely to be increasingly debated.30

Table 8-8 shows selected policy alternatives

with respect to substitution and advanced

materials. Although some policy issues associated with direct substitutes and advanced

materials are held in common, there is enough

divergence to merit separate discussion, as is

done below.

Direct Substitution Options

The Federal Government is the primary

sponsor of R&D on direct substitutes for strategic materials. Except in times of a supply

shortage, industry has little incentive to conduct such activities unless the substitutes afford a clear benefit of cost or performance.

3oFOr ~ discussion of initial self-sufficiency issues associated

with the advanced composites industry, see Stanley L. Chamon,

Industrial Base and Qualification of Composite Materials and

Structures (An Executive Overview) (Arlington, VA: Institute for

Defense Analyses, 1984). Concern about U.S. reliance on foreign sources and a sole domestic supplier for polyacrylonitrile

(PAN), used in production of some carbon composites, was one

issue discussed in the legislative debate about reauthorization

of the Defense Production Act in 1984.

Emphasis on substitution research among

Federal agencies has accelerated since the mid1970s. Several Federal agencies, including various defense agencies, NASA, the Bureau of

Mines, and the DOE national laboratories undertake or sponsor strategic materials substitution research. Despite recent budget cutbacks, Federal funds available for substitution

research appear to be quite healthy, with some

gains and losses among different Federal agencies. The Bureau of Mines substitution research effort has increased recently, while

NASA’s Conservation of Strategic Aerospace

Materials (COSAM) program has been cut

somewhat. The COSAM program has resulted

in some superalloys with reduced cobalt content that have the potential to directly replace

existing superalloy. These materials have not

received extensive development beyond the

laboratory stage. A more fundamental purpose

of the COSAM program was to sponsor basic

research that would shed light on the function

that strategic materials play in superalloys.

(Table 8-5 shows total U.S. expenditures for

substitution on specific strategic materials for

fiscal year 1980, the last year in which governmentwide data is available.)

Federal sponsorship of substitution research

is generally conceded to be essential if research

programs are to be undertaken on a sustained

basis to find direct substitutes for strategic

materials. However, this research alone will

not do much to reduce overall vulnerability

unless promising substitutes are developed to

the point that they can be used by industry. The

time lag between initial laboratory development of an alternative material and the stage

in which it is ready to be used is often protracted; many expensive and time-consuming

intermediary steps must be surmounted before

the material can be considered “on the shelf.”

The extent to which the Federal Government

needs to be involved in narrowing this gap depends on the relative weight that is given to

substitution in an overall strategy to reduce import vulnerability.

Actions the Federal Government could take,

besides its continuing important role as the primary sponsor of research on substitutes, are

identified in table 8-8 and discussed below.
364 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table 8-8.—Policy Alternatives for Substitution and Advanced Materials

Arguments for/against

Problem/issue Option Positive Negative

 Direct substitution:

1.

2.

Information about available

substitutes which would entail

less use of strategic materials

may be difficult for small firms to

obtain, hence delaying their ability to respond to a supply disruption and possibly impeding

initiative to ease import dependency in advance of supply

difficulties.

Work on promising laboratory

substitutes that could reduce

strategic material requirements is

often ended at an early stage

because of lack of industry incentives to develop these materials

on their own, and because Federal

agency research funds may not

be provided for the long period of

time needed to develop substitutes fully for commercial use.

Advanced materials:

3.

4.

5.

—

Problems in coordinating advanced materials R&D at the

executive branch level have long

been apparent. The new National

Federal program for advanced

materials R&D, established by the

National Critical Materials Act of

1984 (Public Law 98-373) is intended to overcome this difficulty. The

flexibility given to the executive

branch in formulating this program, could lead to innovative

approaches, but a danger also

exists that congressional intent

will be misconstrued.

Advanced materials use may be

impeded by lack of qualified

engineers, designers, and

material scientists trained in the

use of these materials.

Widespread adoption of advanced

materials may require development of more uniform testing

methods, material specifications,

and procedures for certification

and qualification than currently

exists, as well as an improved

and updated data base to

facilitate use of advanced

materials.

Sponsor a substitution information program to

disseminate information to

industry, giving private sector (testing societies, trade

associations, universities,

and industry) key roles in

designing and implementing

the program so that it is of

maximum utility to end

users. Option appears most

promising as a means to

reduce chromium overspecification in stainless steel.

Sponsor a joint governmentindustry effort to develop

selected promising substitutes to the point where they

can be commercially used,

focusing on lower chromium

alloys that could reduce

chromium requirements for

stainless steel.

Exercise oversight functions

on the Administration’s

Federal program plan for

advanced materials R&D, to

establish early and continuing guidance to the

National Critical Materials

Council and other implementing agencies about program direction, goals, and

specific initiatives.

Provide startup education and

curriculum development

grants to U.S. universities to

expand faculty and to

stimulate research and

graduate/undergraduate programs in advanced material

studies and in design with

these materials.

Sponsor initial activities in

conjunction with testing

societies, industry, and

academia and relevant

Federal agencies to develop

guidelines and data requirements for testing methods,

specifications, procedures,

and design with advanced

materials.

Would enhance U.S. substitution

readiness—especially in the

case of chromium, for which

major opportunities to conserve chromium in nonessential application exists; would

provide “continuing visibility”

for strategic material concerns by setting up an institutional program to disseminate

information.

Could result in long-term reduction in import vulnerability if

substitutes were successfully

developed so that they could

be used by industry; Federal

sponsorship of applied

research to develop direct

substitutes may not be justified unless more substitutes

are developed to the point

where they could be commercially used.

Would help the administration

establish goals for Federal

activities with respect to

advanced materials; would

give greater visibility to

advanced materials in the

executive branch, Congress,

and the country as a whole.

May help U.S. maintain

competitiveness of its advanced material industries

through research and training

of personnel needed to

establish domestic

capabilities.

May encourage more widespread use of advanced

materials by providing greater

certainty to material producers and consumers about

conditions in which they can

be appropriately used.

Information could become

obsolete quickly; industrial

users may not have as great

a problem in obtaining such

information as is sometimes

contended (i.e., industry

would have a great incentive

to find this information in the

event of a supply difficulty).

Long-term nature of commitment, plus the expense of

developing particular alloy

substitutes may mean that

other options (e.g., diversification of supplies and recycling) would be more useful.

Government has limited experience with alloy development and should leave

development to industry

alone.

Oversight process, if taken

to an extreme, could lead to a

disproportionate expenditure

of EOP staff resources on

meeting congressional information demands, which

would be contrary to the

intent of Public Law 98-373 as

expressed in its legislative

history.

Industries that stand to

benefit from such educational

activities should assume

primary responsibility for

meeting their technology and

personnel needs through contributors to educational

institutions.

Government should not attempt

to “force” premature uniformity on a developing technology. Evolution of needed

information systems can best

be accomplished incrementally by users and suppliers

as the need arises.

SOURCE: Off Ice of Technology Assessment.
Ch. 8—Policy Alternatives for Strategic Materials ● 365

These actions are of two kinds: greater government involvement in developing the information needed to facilitate industry use of new

materials; and greater Federal support for the

post-laboratory development of direct substitutes.

Providing Substitution Information to Industry

Many on-the-shelf technologies and materials

could lower strategic materials consumption

in the United States, and potential substitutes

are at various stages of development. These

alternative materials and technologies are well

known to defense industries, automakers, and

other large or technologically advanced industries. However, many small or technically unsophisticated firms ordinarily would not have

easy access to information about specific materials, technologies, and applications in which

substitution could lessen strategic materials

use. Difficulties in obtaining information about

alternative materials might lengthen their substitution response time in a supply disruption—

a critical concern, especially for firms that are

not likely to receive an allocation preference

in the event of a supply disruption of major

proportions,

The need for a more effective mechanism for

collecting and transferring information about

strategic materials substitutes to industry and

end users has long been recognized by the

materials community (table 8-8, issue 1). Several major conferences on materials, as well

as various testing societies and industry organizations, have recommended that a substitution information program of one sort or

another be an essential component of strategic materials policy.31 Some steps have been

taken by government agencies, trade organizations, and professional organizations to improve substitution information availability, but

slrI’he i m [)() rta n(; e of suhst itutio n information is illustrated i n

recommendations made at a workshop on (conservation and substitution for critical materials held in 1981 at Vanderhi]t [’ ni\rersity under sponsorship hj’ the Departments of Commerce and

the Interior. of 27 recommendations, 10 invo]ved development,

compilation, and dissemination of information related to substitution, conservation, and d isplacemerlt of (:ritical metals,

these have been conducted on an ad hoc basis

without a sustained focus.

Information programs of varying scope and

complexity have been proposed. At the most

basic level, an ongoing program of conferences, seminars, and information dissemination has generally been seen by the materials

community as a relatively inexpensive and effective way to heighten industry awareness of

research developments relevant to strategic

materials substitution and conservation opportunities. Many Federal agencies and private

organizations have contributed to such programs in the past, but a continuing program

of this sort does not exist.

Others see a need for a national information

repository for substitution studies, including

studies on alternative materials, analyses of

alternative processing techniques, substitution

case histories, and directories of experts on

particular technologies or material substitutes.

Much of this information may be available

through individual agencies or through the National Technical Information Service (NTIS),

which has been given augmented responsibilities by the Reagan Administration to transfer

information about Federal technology development to the private sector. But the demands

placed on NTIS may be too diffuse to address

effectively the particular issue of strategic

materials substitution.

At a more ambitious level, various organizations and individuals have proposed establishment of a “substitution information stockpile”

to provide engineers, designers, and procurement officials with highly technical information needed to make decisions about available

substitutes. As generally proposed, this “information stockpile” would identify, systematize,

and compile detailed information about the

properties and potential applications for currently available and qualified alternative materials. Often, systematized information about

alternative processing and fabrication technologies that could conserve strategic materials

is seen as an essential component of the information stockpile. The primary purpose of such

a stockpile would be to reduce response time
366 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

in a supply disruption. However, it is possible

that more firms would adopt their own contingency strategies for reducing their dependency on imported materials if they were aware

of available substitution opportunities.

Even though often proposed, specific steps

toward development of an information stockpile have been limited. Part of the reason for

this may be that developing a proper format

for the information—a technical handbook or

computerized data bank that could be available

to industry—could be quite difficult. Safeguards, for example, would have to be built into

the system to assure that the information, however presented, clearly delineates those applications in which qualification is required from

those in which it is not, Another reason may

be a concern that a handbook or data bank

could quickly become obsolete, presenting stale

information of little value. Hence, revision and

updating of the information stockpile would be

essential. Finally, testing societies and trade

associations have limited resources available

for such purposes, while the Federal Government has focused most of its substitution effort on research.

Although some components of an information program—conferences and library repository, for example—have broad relevance to

strategic materials, the substitution bank concept would probably be of greatest practical use

for chromium—especially as used in stainless

steel. Designers frequently overspecify (use

higher chromium content stainless steels than

may be needed) in many noncritical applications. Stainless steel is used in a wide variety

of applications throughout the economy; an

estimated 60 percent of this demand is for applications in which adequate substitutes are

available, or in which some substitutes maybe

developed after a period of R&D. Ready access

to information about these substitutes could

help the consumer of chromium for nonessential uses to respond to a supply disruption and

ease problems the government might have in

allocating available chromium to essential uses.

Initial work on chromium substitution options includes a major report by the National

Materials Advisory Board and an industry survey by the Metal Properties Council, which is

an active supporter of the substitution bank

concept. (This latter effort has been supported

in part by NBS.) In this regard, it should be

noted that a nonprofit entity, called the National Materials Property Data Network, Inc.,

has recently been established to explore ways

for providing computerized data on engineering materials. 32 Additional work to define the

feasibility and parameters of an information

stockpile would be needed.

Development of a substitution information

program would require extensive interaction

between government and the private sector, including participation of testing societies, trade

associations, professional societies, and industry. This need for extensive private sector

involvement in development and use of the information program may mean that the government’s key role would be sponsorship—not actual conduct—of the program. For example, the

government could provide funds to a testing

society, a university, or other nonprofit organization, to establish a nonprofit center with

a specific mission and charter to develop information about substitute materials and new

technologies that would help conserve strategic materials. Participation of key Federal

agencies, such as national laboratories, NASA,

NBS, the Bureau of Mines, and the Department

of Defense could be structured into the center’s

charter.

Developing Substitute Alloys

As a general proposition, the Federal Government’s role in developing substitute materials often ends at an early stage of laboratory

research. Research results may be published,

but it is usually left to private industry to decide whether additional development steps

should be taken. Thus, many strategic material

substitutes are not placed on the shelf by federally sponsored research, nor are they likely

to be fully developed by industry unless the

Ozsee National Materials Advisory Board, Materials Properties Data Management Approaches to a Critical National Need

(Washington, DC: National Academy Press, 1983), NMAB–405,

for a discussion of the need for upgrading U.S. materials properties data bases.
Ch. 8—Policy Alternatives for Strategic Materials . 367

—

new material is seen as providing significant

cost or performance benefits compared to currently used materials.

Substitute materials used in critical applications, such as in powerplants and chemical

plant processing, must be extensively tested after their initial development in the laboratory,

Depending on the application, it can take 5 to

10 years and several million dollars to develop

and qualify new materials or processes to the

point that they can be used by industry,

Many—perhaps most—of the direct substitutes that have been developed with Federal

funds would be more expensive (at current

prices) than the materials they would replace.

A few are potentially cost competitive with currently used materials and thus might be used

by industry if the qualification hurdle were

overcome.

Given this situation, the question arises as to

what steps, if any, could be taken by the Federal Government to bring potential substitutes

closer to commercial use? One alternative

would be for government to support a cooperative effort with the private sector to select,

fully test, and qualify (where necessary) a few

materials with significant potential to reduce

critical material needs (table 8-8, issue 2). Most

of this effort would probably involve contracts

with industry, testing societies, and universities to carry out key roles, Once these materials

were fully developed, they would be available

for use by industry or could serve as a kind of

standby “national emergency alloy system, ”

analogous to the national emergency steel system developed in World War II.

Such a step would not necessarily entail a

major new Federal program: it could be accomplished through selective targeting of strategic

materials development activities to focus on

those materials considered to be most critical

to U.S. substitution preparedness. Both the Defense Production Act and the Stockpile Revision Act authorize the President to develop

substitutes for strategic and critical materials.

Federal agencies, such as the Department of

Defense, Bureau of Mines, and NASA, from

time to time sponsor test heats and other development activities of substitute materials on

a cooperative basis with industry. Moreover,

the Federal Government has sometimes sponsored new materials for qualification by testing societies, Oak Ridge National Laboratory

is now sponsoring a 9 percent chromium steel

for use in powerplants, for example,33 and the

Department of Defense has played a key role

in the commercialization of many materials

considered essential for defense purposes.

Obviously, because many substitutes are potential candidates for augmented development

activities, considerable care would be needed

in selecting the materials. Selection of any

materials for further development work would

depend on many considerations, including

their technical prospects, degree of industry interest, and potential contribution to reducing

import vulnerability relative to other strategies

(e.g., stockpiling or recycling).

For example, as discussed in detail in chapter 7, several superalloy with reduced cobalt

content, intended as direct replacements for

superalloys now used in jet engines, are now

under development, These will not be available

for use unless they undergo several years of additional testing. It has sometimes been proposed that steps be taken to prequalify such

low-cobalt substitutes (presumably by government) so that they would be available for use.34

Because of rapid changes in materials used in

jet engines, these substitutes could be partially

obsolete by the time they are fully developed.

Therefore, other options—ranging from stock-

—.

33This stee] ~~as not del,e]oped to reduce import ~wlnerability,

but as part of the breeder reactor program. It is intended to

replace both a 2?4 percent chromium steel and a 18 percent chromium steel now used in powerplants, so that the design of a particular powerplant will determine whether more or less chromium is used. It has been speculated that this steel may

eventually replace 18 percent chromium stainless steels in some

other applications, although, to date, this has not occurred. Federal expenditures in data development and other activities associated with qualification of the material are estimated to be about

$5 million since 1978. An estimated $2 million in private services have been donated to the effort. The 9 percent chromium

alloy is expected to be used commercially in some applications

in 1984.

aqsee, for example, the discussion in U.S. Department of

Commerce, Conservation and Substitution Technolog.v for Critical Materials: Proceedings of Public Workshops, June 15-17,

1981, p. RI-1.
368 • Strategic Materials: Technologies to Reduce U.S. Import Vulnerability —

piling to recycling to aggressive pursuit of advanced materials—could be more effective in

reducing vulnerability in this application.

Fewer options are available for reducing

chromium import vulnerability for stainless

steel, however, and despite appreciable research efforts, an estimated 40 percent of the

chromium used in stainless steel is considered

irreplaceable. At present, several low-chromium alloys that could substitute for higher

chromium stainless steels in some applications

are in the early stages of laboratory development. (Table 7-4 in ch. 7 shows selected examples.) Current substitution research is addressing applications in the midrange of difficulty

(technically feasible substitutes could be developed after a period of intensive R&D). Full development of substitutes for this midrange of

applications could ease allocation decisions in

a supply disruption so that available chromium

could be used in those applications for which

no alternatives are likely to be available,

Targeting a few of the most promising lowchromium substitutes for augmented development would require in-depth analysis of their

current status, needed development steps and

associated costs, and applications in which

they could reduce critical and strategic material needs. Substantial input from industry, testing societies, and academic institutions would

be needed both to identify the most promising

materials, and to undertake most of the indicated development steps, Given the costs that

could be entailed—the Oak Ridge qualification

process discussed above cost an average of $1

million per year over a 5-year period—such a

program would have to be conducted at a small

scale, with no more than two or three materials

undergoing augmented development at any

given time.

Ultimately, whether it would be desirable to

establish a cooperative government and industry program of this sort depends on the prominence that is assigned to substitution in overall Federal strategies for reducing import

dependency. Development of direct substitutes

is a medium-term (5 to 15 years) response for

reducing import dependency, so that actions

taken now will not have an immediate effect.

At the same time, it maybe difficult to justify

Federal applied research on direct substitutes

unless the end result is to reduce overall U.S.

import vulnerability. This may not occur unless ways are found to develop promising substitutes to the point to which they can be used

by industry.

The Potential of Advanced Materials

Strategic materials displacement is not a primary reason for the current interest in advanced ceramics, various composite materials,

rapidly solidified alloys, and other advanced

materials that are the subject of intensive R&D

efforts by government and industry. Rather,

these materials promise special performance

benefits compared to currently used materials.

However, advanced materials usually contain

little or no cobalt, chromium, manganese, or

PGMs, and therefore, over the long term they

have promise to displace or reduce some strategic material requirements. Often, reduced

strategic material requirements will be an indirect benefit of using these materials. Since

redesign of component systems may be necessary for optimal use of advanced materials,

overall savings in strategic materials are difficult to predict.

Advanced materials—unlike direct substitutes for currently used materials—have the potential to provide the basis for important new

U.S. industries, while at the same time reducing requirements for strategic materials in

some applications. Advanced ceramics may become a multibillion dollar business, with potential markets projected to reach over $20 billion by the year 2000, However, at present, the

competitive posture of the United States in advanced ceramics lags behind Japan in the area

of electronic components, and the United

States is in some danger of losing the race for

market supremacy in engineering ceramics,

Other countries, including Great Britain and

some Western European countries, are also vying for expanding world markets.

A 1984 Commerce Department study of the

advanced ceramics industry indicated that neither the United States nor Japan was in the
Ch. 8—Policy Alternatives for Strategic Materials ● 369

clear lead with regard to advanced ceramic

engineering materials. However, the Department predicted that the United States could fall

behind Japan if current trends continue. Japanese success was noted in the following areas:

●

●

●

●

●

●

domination of electronic components

made of advanced ceramics;

domination of supplies of advanced ceramic powders;

greater and more organized R&D efforts;

superior performance/cost characteristics

of Japanese demonstration products;

reputation for accepting short-term losses

and investing in long-term product-market

development; and

record in developing and implementing

superior commercial manufacturing processes and technologies.35 

The potential importance of an internationally competitive advanced materials industry

to the U.S. economy, and the stance of the Federal Government in encouraging such industrial activities, is likely to be an increasingly

visible issue in the years to come. In general,

the alternative roles that the government could

play in fostering a strong domestic ceramics

industry are likely to be identified and debated

within the broader context of the overall posture of government-industry relations, not in

the context of strategic material issues. Regardless of the extent of government involvement

in encouraging U.S. competitiveness in this

area, a number of technical and institutional

problems will have to be overcome before these

materials come into general use. Therefore, the

discussion here is focused on issues of Federal

involvement in research, development, information transfer, and education, rather than on

the full spectrum of alternative policies to encourage advancement of this sector of the economy. 36

35 ~]. S. I)el)a rt ment of Commerce, A Competitive A Ssessmen t

OF the Lr.,$. Ad~’anced Ceramics industry [Springfield, VA: Nationa] Technical Information Service, 1984), p. 64.

a6Readers who are interested in alternative Federal roles in

strengthening the international competitiveness of the U.S. advanced ceramics industry are referred to the Commerce Department’s assessment identified in the previous footnote. The

broader issues associated with alternative government actions

Government Support of Research and Development

It is generally thought that the United States

leads the world in basic research with regard

to advanced materials. Funding of advanced

materials R&D activities in the United States

appears to be generally healthy. However, continuation of a strong basic research effort will

probably be needed for many years. Manufacturing processes and fabrication technologies

are areas in which more emphasis in R&D is

generally considered necessary. The high costs

of fabricating composites, for example, arises

in part from labor-intensive and time-consuming processes. In advanced ceramics, key needs

are to improve powder production and to develop reliable processing technologies to produce flaw-free ceramics economically. Improved nondestructive evaluation techniques

are critically needed in both composite and ceramic applications.

As with other areas of material research, several Federal agencies, including NASA, NBS,

the Bureau of Mines, various Defense Department agencies, and the DOE national laboratories, undertake or sponsor advanced materials research. Much of the government

research is undertaken on a contractual basis

with industry. Information sharing among researchers, including various government agencies and those firms directly involved in R&D,

is generally considered by researchers to be effective. However, coordination of policy with

respect to advanced materials, particularly at

high levels of the executive branch and with

Congress, has been fragmented.

As discussed previously, the National Critical Materials Act of 1984 calls for the establishment of a “national Federal program for advanced materials research and development, ”

giving key responsibility to the National Critical Materials Council in the Executive Office

of the President for implementing the program,

—-————

involving transfer of new technologies to the private sector are

discussed in 4’Development and Diffusion of Commercial Technologies: Should the Federal Government Redefine Its Role?”

(Office of Technology Assessment Staff Memorandum, Industry, Technology and Employment Program, March 1984.)
370 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

The Council, among other things, is directed

to prepare and annually review a Federal program plan for advanced materials R&D. The

plan is to designate key responsibilities for carrying out research, and is to provide coordination with the Office of Management and

Budget, the Office of Science and Technology

Policy, and other appropriate Federal offices

and agencies,

The Council is also to review annually the

materials research, development, and technology budget requests of all Federal agencies to

ensure close coordination of the goals and

directions of such programs with policies determined by the council, The Office of Management and Budget, upon reviewing individual agency budget requests, is to consider them

as an “integrated, coherent, multiagency request” to be reviewed by the Council and OMB

for adherence to the national Federal materials

program plan for each fiscal year.

The process established by the 1984 Act can

be expected to give far greater visibility to research needs associated with advanced materials than has existed heretofor. However, in

keeping with the process orientation of most

congressional laws pertaining to materials

R&D, the law gives the Council considerable

discretion in putting together components of

the plan. For example, while the law makes it

clear that the program is to include R&D from

“basic phenomena” through processing and

manufacturing, it does not define the term “advanced materials, ” thus giving the Council flexibility in determining which classes of materials fall under the program plan, The Council

will also have discretion in determining overall goals and objectives of such a plan. As a result, congressional oversight and guidance may

be needed to determine whether the Council’s

program accurately reflects Congress’ intent

in establishing the program (table 8-8, issue 3).

Education Needs and Advanced Materials

Considerable concern exists about the adequacy of current engineering curricula and

training of engineers and designers in the use

of advanced materials, Most curricula in engineering schools are designed to familiarize

engineers with materials that are most prevalently used today, such as metals. Progress in

advanced materials fields—the materials which

will come into greater prominence in the

future—may hinge in part on the success of

engineering curricula to make engineers and

designers familiar with processing technologies, and product design associated with advanced materials, Although many U.S. universities are important research centers in one or

more advanced material areas, U.S. universities are turning out comparatively few people

in some advanced materials fields. In the area

of ceramics, for example, only 36 identifiable

doctorates were estimated to have been granted

in the 1982-83 school year by U.S. universities.

The Federal Government can assist U.S. universities to increase their emphasis on advanced materials if it so desires, Various assistance programs administered by the National

Science Foundation, and academic research

and curriculum development activities supported by other Federal agencies could be used

to channel increased support for advanced

materials activities in universities,

One option would be to provide initial educational development grants to several universities for a specified time period (e.g., 5 years),

after which time the university would assume

full responsibility for the program. Because

these programs could have clear benefits to private industry, industry might contribute to

such an effort. The startup funds could be used

to attract new faculty, support research, assist

in acquisition of needed instruments, or participate in other activities that would be needed

to establish a sound curriculum and research

program, Industry-university cooperation and

coordination could be encouraged through

advisory committees comprised of industry

and government representatives and through

internships and collaborative research projects,

Transfer and Diffusion of

Advanced Materials Technologies

Advanced materials are currently in an early

stage of commercial application. A key issue

in their ultimate acceptance and adoption by

industry on a widespread basis will be the ex-
Ch. 8—Policy Alternatives for Strategic Materials Ž 371

tent to which reliable engineering data (including clearly defined procedures for testing

materials), materials specifications and physical property data, and standards can be developed in a form that is readily accessible to

users.

As discussed in chapter 7, current U.S. problems in maintaining an upgraded materials

property data management system in general

are acute. In the case of many advanced materials, including rapidly solidified metals, ceramics and some composites, absence of accessible information is a major constraint to their

widespread use, Data on advanced materials

is held largely by the research community and

by the few firms that have been integrally involved in their early development or that have

proprietary data for specialized applications.

A kind of catch-22 is involved in this situation:

designers will not use new materials until they

have data on their behavior in engineering applications, but until the materials are used by

designers, that data will not exist.

The formal codes, reliability standards, specifications, and other forms of information that

would aid product design engineers select

materials are not generally available for advanced materials. Development of such information will be a long-term process, and it may

be many years before general agreement is

reached about the proper form of such information.

Although testing societies, private industry,

and trade associations, generally determine

material standards, the Federal Government

can play an important facilitating role if it

chooses, Several Federal agencies, including

the Department of Defense, DOE, NBS, and

NASA all have important programs related to

advanced materials, and have been integrally

involved in maintaining materials data bases

that could be of considerable relevance to

standard-setting activities.

A cooperative effort by government and industry to undertake initial work to develop

organizing concepts, define information needs,

and identify appropriate formats for needed

engineering data could be an important preliminary step toward advanced material standard-setting. Such a cooperative endeavor would

require extensive interactions between testing

societies, industry, academia, and government,

with each contributing key inputs to the process. One possible arrangement (table 8-8, issue

4) for facilitating such interaction would be for

the Federal Government to partially sponsor

(with contributions by relevant industries) a

nonprofit center associated with a testing society, a university, or other nonprofit institution. A similar approach is being used to explore the feasibility of establishing a national

materials properties data network with primary

reference to metals.

Conservation and Recycling of Strategic Materials

OTA’s analysis indicates that ongoing trends

in industry have led to more efficient use of

materials in processing and manufacturing.

These trends are expected to continue as firms

upgrade facilities and adopt new manufacturing processes.

In steelmaking, for example, manganese requirements for each ton of steel produced are

expected to be reduced from 36 to 25 pounds

by the year 2000. Somewhat greater savings (in

terms of imported manganese) are likely because of increased use of scrap and improved

manganese recovery rates. Near-net shaping

processes used in the aerospace industry will

also reduce cobalt raw material requirements

for superalloy production, although this will

also be accompanied by a reduction of home

and prompt industrial scrap preferred for recycling. The incentive to conserve PGMs is very

high, owing to their high cost; thus, improvements in catalyst design that would reduce

PGM use can be expected to be adopted quickly.

Some modest improvements in chromium uti-
372 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

lization can be expected, but the rapid phasein of the argon-oxygen decarburization (AOD)

process in making stainless steel is now nearly

complete, and no major breakthroughs appear

imminent. As a rule, material-conserving technologies will be adopted because of product

quality and cost competitiveness reasons, not

because of concern about strategic materials.

Important opportunities also exist to increase

supplies of cobalt, chromium and PGMs through

recycling. In the case of PGMs, the chief opportunity for increased secondary production

is through recycling of automotive catalysts;

an emerging industry structure is developing

to collect and process these catalysts. Opportunities to extend cobalt supplies include improved recycling of cobalt values from obsolete

superalloy scrap and recovery of cobalt from

spent catalysts used by the petroleum industry. Although stainless steelmaker now derive

one-fourth of their chromium needs from purchased scrap, losses from three areas—downgrading, failure to recover obsolete scrap, and

losses of chromium in steelmaking wastes—

are substantial. See table 6-6 in chapter 6 for

a detailed listing of recycling opportunities.

Increased recycling not only augments strategic material supplies, but also has environmental benefits associated with reduced landfilling and disposal of wastes, Recycling also

offers energy conservation benefits, since scrap

already embodies initial energy requirements

needed to process raw ores into concentrated

form, Energy savings from recycling aluminum

scrap, compared to manufacturing the same

product from virgin materials, can exceed 90

percent, and for copper, iron and steel, lead,

and zinc, savings of over 60 percent have been

noted. 37 Because the first-tier minerals covered

by this report are produced and often partially

processed abroad, net energy savings to the

U.S. from increased recycling of these materials would only accrue as an alternative to increased domestic production, however.

JTNationa] Association of Recycling Industries, Recycled Metals in the 1980s (New York: National Association of Recycling

Industries, 1982), p. 174.

Economic barriers (arising from the added

cost of collecting, sorting, transporting, and reprocessing obsolete scrap and waste) and institutional impediments (e.g., difficulties in

organizing collection systems and the reluctance of consumers to use recycled materials)

are the major constraints on recycling.

Appreciable advances in recycling technologies have been made in recent decades, owing

in part to Bureau of Mines’ R&D efforts, and

industry initiatives. In general, few technical

problems need to be overcome to increase recycling of PGMs, cobalt, and chromium. However, in some applications—especially superalloys—advanced technologies may have to be

developed before major advances can be made

in current levels of recycling, Increasing complexity in materials used in products in general also means that continuing R&D will be

needed to meet future recycling needs,

OTA’s analysis of recycling issues focused

on several areas of possible congressional concern: adequacy of information about current

and prospective levels of recycling; the need

for evaluation of the indirect effects of Federal

programs and policies on recycling in order to

identify possible changes that could facilitate

recycling; and the possible need of a pilot plant

project to demonstrate advanced superalloy

recycling technologies. These issues, and associated options, are summarized in table 8-9 and

discussed below,

Information Needs and Recycling

Recycling’s potential to reduce import dependency can only be roughly estimated unless

reliable information is available about both current levels of recycling nationwide and about

quantities of unrecovered scrap and waste that

could potentially be recycled if economic or

technical conditions changed. Current statistical series provide incomplete information

about annual levels of recycling because they

focus on the purchased component of scrap

supplies, and do not estimate potentially recyclable materials that are not recovered. Increased emphasis on compilation of recycling

data and trend analysis seems needed if pol-
Ch. 8—Policy Alternatives for Strategic Materials ● 373

icymakers are to have a realistic picture of the

prospective role that recycling could play in

reducing U.S. dependency on imported materials (table 8-9, issue 1).

From time to time, agencies such as the Bureau of Mines and the National Materials Advisory Board have produced relatively comprehensive materials flow models for individual

metals or applications. These models have appreciably increased understanding of overall

recycling levels, but have been prepared infrequently, with little or no followup or consistency in procedures used. The need for materials flow information is especially apparent

in the area of superalloy recycling—an area that

changes rapidly, affects use of several strategic materials, and is of obvious importance to

national security. Most current information

about the flow of superalloy scrap is based on

conditions in 1976—the last year for which a

comprehensive materials flow model for superalloy scrap was prepared by the government.

Efforts to update this model using 1980 data—

but 1976 scrap ratios–do not fully reflect the

important changes that have occurred in superalloy recycling since then.

Analysis of long-term trends in conservation

and recycling is also needed on a periodic basis, especially since the two often influence

each other in complex ways, Adoption of nearnet shape technologies by aerospace manufacturers will reduce the amount of preferred

scrap generated in the fabrication of superalloy

parts. This means that obsolete scrap and lower

quality manufacturing scrap will comprise an

increasing portion of the materials potentially

available for recycling. Similarly, efforts such

as the Air Force retirement-for-cause program

to extend the life cycle of jet engine parts could

reduce the amount of obsolete scrap available

Table 8-9.—Policy Alternatives for Recycling Strategic Materials

Arguments for/against

Problem/issue Option Positive Negative

1. Annual statistical series do

not provide an adequate picture of current and prospective recycling levels; detailed

information is out of data

and not prepared on a

regular schedule.

2. Adjustments in Federal programs and policies could

encourage greater recycling

of strategic materials, but

the necessary evaluation of

these programs has not been

done by the Administration.

3. Advanced recycling

technologies for superalloy

may not be developed by

private industry because of

low metal prices.

Supplement current data

with in-depth “cradle-tograve” data and analysis of Cr, Co, Mn, and

PGM or other materials

as appropriate on a

regular schedule.

Call for an executive

branch evaluation, with

recommendations to

Congress, about ways

to structure Federal programs related to taxation, real property procurement and disposal,

environmental regulations, etc., to encourage

strategic materials

recycling.

Authorize one or more

pilot-plant projects to

demonstrate technical

feasibility of reclaiming

individual elements

from superalloy scrap

or other advanced scrap

recovery processes.

Better information about

recycling is needed for

realistic appraisal of

recycling’s prospective

role in reducing import

dependency.

Could lead to eventual

If

changes in Federal programs which would be

helpful to recycling firms

in increasing recycling

levels.

technical merit of

research processes is

demonstrated in pilot

project, it may be possible to recycle most of the

superalloy scrap that is

now downgraded or lost.

(An estimated 2.8 million

pounds of cobalt was

lost in superalloy scrap

alone in 1980.)

Could add to industry

paperwork requirements

Federal Government should

not attempt to favor one

mineral form over

another; overemphasis on

recycling could inhibit

domestic mining activities related to strategic

materials.

Option provides less

immediate supply security than domestic production and depends on successful outcome of pilot

project to determine commercial feasibility;

government should not

be involved in commercialization of new

technologies.

SOURCE. Off Ice of Technology Assessment
374 • Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

for recycling. These interrelationships are discussed in greater detail in chapter 6.

Superalloy applications are not the only area

where current data are inadequate for identifying current and prospective recycling levels.

opportunities for recovering more chromium

from obsolete stainless steel products and steelmaking wastes can only be roughly estimated

since most of the available national data date

from 1976 and 1974, respectively. Important

improvements have occurred since then. Similarly, monitoring of PGM recycling from automotive catalysts and electronic scrap will

clearly have to be emphasized in the years to

come in order to develop accurate information

about recycling trends in this industry.

Analysis of industry trends and the revision

of scrap material flows on an annual basis is

probably not necessary or desirable, but it

would be desirable on a periodic basis, perhaps

once every 4 or 5 years. The Bureau of Mines,

which sponsored the superalloy analysis discussed above as well as a similar scrap flow

model of chromium recycling in stainless steel,

would be a logical agency to undertake this

analysis. Cost of preparing new material flow

models would vary, but would probably be less

than $100,000 per application addressed. The

original appropriation for the two models mentioned above was provided to the Bureau of

Mines under the Defense Production Act

through the Federal Emergency Management

Act. Update of these models would cost about

$50,000 per application.

At present, limited national level information

is available about “hidden inventories” of strategic materials that could potentially be recycled in the event of a supply disruption.

(Stockpile management estimates about recycling levels in a supply disruption are based

on economic analysis, not estimation of

materials.) Hidden inventories include scrap

inventories that for one reason or another are

not reported to the Bureau of Mines and potentially reclaimable mining tailings and industrial waste materials. Such inventories can be

quite large. At one Gulf area petroleum catalyst recycling operation, for example, perhaps

as much as 7 million pounds of cobalt-nickel

aluminate slag has accumulated over the years.

This material would not be economic to recover without major increases in cobalt prices,

and some technical problems in recovery

would have to be overcome. In a supply disruption of protracted length, however, it may

represent a recoverable resource. In addition,

a large quantity of strategic materials are

present in mine tailings which maybe potentially reclaimable. Although information is

available about strategic material content of

some of these tailings (e.g., cobalt tailings from

lead zinc mining in Missouri), their national

magnitude is not known accurately.

The importance of information can, of course,

be overstated. It would not be necessary, or

even desirable, to attempt to inventory comprehensively all low-grade sources of strategic

materials, for example, to derive plausible estimates of the magnitude of such resources. Nor

are current information deficiencies so great

as to prevent identification of applications and

materials in which there is potential for major increases in current recycling levels. However, an institutional mechanism for periodic

reexamination of recycling and conservation

trends and opportunities would be highly useful in policy formulation.

The Impacts of Federal Activities on Recycling

The Federal Government influences recycling of strategic materials both directly and

indirectly. Direct effects arise from its R&D

activities aimed at improving recycling technologies. This research has had a demonstrable effect in encouraging increased recycling

of strategic materials; many currently used

processes were initially developed with Federal support.

Indirect effects—some positive and some

negative—arise from a wide variety of Federal

policies and programs that are not specifically

aimed at recycling. Such activities as taxation,

regulation of transportation rate setting, environmental policy, and procurement and disposal of materials by Federal agencies can af-
. - . . . .

Ch. 8—Policy Alternatives for Strategic Materials ● 375

feet material flows in the economy. Several

recent laws have attempted to remove inadvertent bias in Federal regulations that may favor

virgin raw materials over recycled materials,

but the recycling industry continues to be concerned that Federal policies may discourage

recycling.38

The National Materials and Minerals Policy,

Research and Development Act called on the

president to:

. . . assess Federal policies which adversely or

positively affect all stages of the materials cycle, from exploration to final product recycling

and disposal including but not limited to, financial assistance and tax policies for recycled

and virgin sources of materials and make recommendations for equalizing any existing

imbalances, or removing any impediments,

which may be created by the application of

Federal law and regulations to the market for

materials . . 39

The President’s materials plan did not specifically address this issue. (The plan placed such

analysis in the overall context of its regulatory

reform assessment, an approach that is not specific enough to suggest improvements for strategic materials recycling.)

Such an evaluation and recommendation

process—especially if focused on strategic

materials—could help identify possible changes

in Federal programs that could encourage

greater or more effective recycling of strategic

materials (table 8-9, issue 2). This cannot be

done with a narrow focus simply on strategic

materials: overall objectives and missions of

Federal programs must be taken into account,

even if a particular program or policy may adversely affect recycling.

Nonetheless, there may be ways to encourage

recycling while meeting these broader objectives. One area meriting further examination

concerns possible connections between waste

disposal policies and recycling. Spent cobaltss~”[)r a rji scussion of the (;o n cerns of the recycling 1 IId USt ry

about Federal policles, see ,NJational Association of Recycling

Industries, RecJrcled Lletal.s in flrc 1980s (New’ York: National

Association of Reclcling Industrlcs, 1982), pp 167-177.

a~[~uhli~ [,a\\, !36-479, 5(?(:. 4(8).

molybdenum hydroprocessing catalysts, for example, may contain trace amounts of lead and

arsenic that may make them potentially hazardous. Although spent catalysts are not a

listed hazardous waste, generators of spent

catalysts often treat them as such, and as potentially subject to Federal regulations which

restrict storage of hazardous wastes on site to

90 days. As a result, within 90 days, generators of spent catalysts must decide whether to

send the material for recycling or to landfill the

material at an approved site. In the late 1970s,

recyclers of spent cobalt catalysts would often

pay generators $300 per ton to obtain this material in order to recycle molybdenum. In the

1982-83 period, generators often needed to pay

the freight to have the spent catalysts sent to

the single U.S. firm still recycling those catalysts for molybdenum values. As a result, landfilling is often a more attractive option, and

simply storing the material on site while waiting for metal values to increase is precluded.

An estimated 270,000 pounds of cobalt were

not reclaimed from spent hydroprocessing

catalysts in 1982.

The impediments to recycling cobalt catalysts are thus largely economic in nature, arising from the low value of metals at the present

time, but Federal hazardous waste regulations

may inadvertently cause premature loss of cobalt values. It would be inappropriate to change

Federal policy with respect to hazardous waste

simply to facilitate recovery of strategic materials in circumstances such as this. However,

with appropriate safeguards, it may be possible to develop alternatives to encourage recycling of strategic materials while safeguarding

concerns about public health and safety arising from hazardous waste storage. Possible

alternatives to encourage recycling of strategic materials from some hazardous waste include intensifying the recycling R&D activities

by the Bureau of Mines to assist industry in developing effective reclamation technologies;

possible use of guaranteed purchase agreements under the Defense production Act to

defray the expense of reclamation when it is

currently not economic; longer term but temporary storage of some hazardous wastes contain-
376 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability —

ing strategic materials in regional repositories

where they would be available for subsequent

recycling; and possible use of “waste end” taxation, which could make landfilling less attractive as a disposal option by taxing generators

of wastes when they are landfilled.

Increasing interest exists in strategic material recycling opportunities associated with

surplus Federal property—especially that of the

Department of Defense. GAO is currently auditing Department of Defense scrap generation

levels and possible alternative means of disposal of scrap at the request of the House

Armed Services Committee. However, the GAO

effort is focused principally on aluminum—not

on superalloy scrap.

Military aircraft contain large quantities of

strategic materials that are potentially recyclable at the end of their service life. Currently,

most jet engine parts are declared surplus and

are sold as scrap at the end of their useful service life, Generally, obsolete superalloy scrap is

downgraded for its nickel and chromium content, so that other metals (e.g., cobalt) are not

beneficially used.

Alternatives to disposal of surplus scrap

could have strategic material conservation

benefits. The Department of Defense and the

General Services Administration can promote

advancement of recycling technologies and

processes by contributing surplus scrap to

demonstrate advanced recovery methods.

A model and precedent for a government-run

recycling program exists. For nearly a decade,

the Department of Defense has conducted a

precious metals recovery program (including

platinum, palladium, and rhodium) from surplus, damaged, or outdated government property. The recycled materials are refined to a

high level of purity and may then be used as

government-furnished materials in defense

contracts and in certain other government contracts. Savings to the government from this program have been very large because the costs

of recovering and refining PGMs are cheaper

than purchasing new material.

At current cobalt prices, this would not be

the case with regard to superalloy reclamation.

An Air Force working group established to assess a feasibility study on a cobalt reclamation

process for obsolete jet engine parts reached

the conclusion that it would be cheaper for the

government to sell these parts as scrap, given

current cobalt prices, (The working group did

not identify costs associated with the various

alternatives.) This argument fails to take into

account the strategic benefits of having a domestic capability to reclaim individual elements from scrap in the event of a supply

emergency.

Besides evaluation of agency programs to determine whether changes may be needed in

Federal policies with respect to recycling, the

Federal Government can heighten visibility of

recycling industry issues through special

studies.

The National Materials and Minerals Policy,

Research and Development Act of 1980 established a continuing assessment function in the

Commerce Department to undertake case studies

of specific material needs to ensure “an adequate and stable supply of materials to meet

national security, economic well-being and industrial production needs. ” To date, studies

have been completed on the steel industry, and

the aerospace industry, and a study on the domestic mining industry is in progress, Although such studies may address recycling to

some extent, special assessment of key components of the recycling industry would aid in

understanding the role recycling could play in

providing strategic and critical materials and

in the identification of economic ‘and institutional barriers to increased recycling.

Developing New Recycling Technologies

Recycling of strategic materials often entails

highly sophisticated technologies and processes. The increasing complexity of materials

used in end products, such as jet engines and

automobiles, and the general trend toward

more stringent material specifications, require
Ch. 8—Policy Alternatives for Strategic Materials • 377

adjustments in segregating and processing

scrap by recyclers. As a result, extensive R&D

activities are often needed to keep pace with

changes in end products.

Substantial technical advances have been

made in recycling technologies in recent years,

and many of these advances have been supported by government research. Increasingly,

as government funds for general recycling research have become more limited, available

funds have been targeted on strategic materials, including processes and technologies to

effectively reclaim them from low quality

materials (e. g., obsolete scrap) that are not now

processed.

Several Federal agencies, including the Department of Defense, NASA, and the Environmental Protection Agency, have sponsored

recycling R&D activities relevant to strategic

materials. However, the Bureau of Mines is the

primary Federal recycling research agency. Recent Bureau projects have emphasized, among

other things, development of processes to enhance recovery of cobalt, nickel, and chromium from materials such as superalloys and

stainless or specialty steel scrap and wastes.

Funding of strategic materials recycling activities has been maintained at a high level through

reprogramming of funds from other areas.

Normally, industry itself assumes the key role

in actually developing new technologies arising from Bureau research. Many currently

used processes pertaining to recycling of steelmaking wastes, cemented carbides, and other

materials were originally developed or sponsored by the Bureau of Mines. At least seven

companies, for example, are using a Bureaupatented process which permits effective recovery of cemented carbide scrap, with its cobalt values.

Current metal prices do not justify private

investment in post-laboratory development of

some experimental recycling technologies—

especially those for superalloys—that promise

to substantially improve recycling of strategic

materials, Superalloy raw materials provided

through recycling will increasingly depend on

effective obsolete scrap recovery since manufacturing processes are reducing the amount

of home and prompt scrap available.

Several commercially used processes can be,

and to a limited extent have been, used to recycle obsolete superalloy scrap to provide master melts suitable as raw materials for jet engine superalloy. Alternative processes that

reclaim individual elements from the scrap in

highly purified form have been demonstrated

only in the laboratory.

Experimental reclamation processes of this

sort have been developed under Bureau of

Mines’ sponsorship, and independently by

some companies. Proof that they would work

in commercial-scale operations has not been

ascertained, and an additional 2 to 5 years of

work may be needed to reach definitive conclusions.

One Bureau-sponsored experiment, undertaken

in the late 1970s, demonstrated the technical

feasibility of separately reclaiming individual

elements from superalloy scrap, including

cobalt, chromium, and nickel—an important

breakthrough if the technical merits of the

process hold up outside of the laboratory. Industry feasibility studies for a pilot plant and

small commercial facility showed promising

profit potential at 1980 prices (cobalt was then

selling at $25 per pound), but when prices fell,

so did interest in the project. (The price of cobalt that would allow this process to break even

is confidential information with the company

that developed the feasibility study.) Other Bureau of Mines’ processes, including one which

rapidly dissolves metals out of the superalloy

scrap, may also have the potential to advance

superalloy recycling technologies. Some private firms, as discussed in chapter 6, have undertaken laboratory research in the area of

reclamation. One of these firms currently recovers cobalt from various scraps (including

superalloy grindings) for use in cemented carbides, and is considering possible applicability of the process for recycling superalloy per

se.

Although government’s role in commercializing specific new technologies is usually limited, overriding national objectives, such as na38-844 0 - 85 - 13 : QI, 3
378 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

tional security, may justify exceptions. Further

development of advanced superalloy recycling

processes may well be such a case. One alternative would be for government (in consultation with industry to select the most promising

candidate processes) to sponsor one or more

pilot plant projects to demonstrate advanced

reclamation processes—either at a government

facility or under contract with industry (table

8-9, issue 3). The costs of a pilot plant project,

probably entailing $5 million or more per project facility plus $1 million to $2 million in operating costs, need to be viewed in terms of the

potential benefits and increased supply security that could accrue to the United States in

the event that such technologies are commercially viable. Commercial availability of such

technologies could give U.S. firms the technical capability to recycle most of the cobalt that

is now lost or downgraded, estimated at 2.8

million pounds in 1980.
Appendixes
Appendix A

Review of Previous Lists and Methods of Selection

Most lists of strategic materials are based, implicitly at least, on the two strands of criticality and

vulnerability. A 1981 report by the Congressional

Research Service listed the following criteria for

defining a materials import “vulnerability” (as distinguished from import “dependency ’’):1

1. Critical need for the material.

2. Lack of adequate domestic resources (including both a total lack and an insufficiency).

3. Limited potential for substitution.

4. Lack of alternative sources of supply (including politically stable sources and geographically close sources).

It will be noted that factors (1) and (3) have to do

with criticality of use, and factors (2) and (4) with

vulnerability of supply. On the basis of these factors, the Congressional Research Service defined

the following as “materials of particular concern”:

Bauxite/aluminum

Cobalt

Chromium

Columbium

Manganese

Platinum-Group Metals

Tantalum

Titanium

A “semiquantitative” index for rating strategic

materials on the basis of vulnerability was devised

by the Strategic Studies Institute (SSI) of the U.S.

Army War College in 1974.2 The index was based

primarily on five factors affecting vulnerability to

“coercive pressures from foreign suppliers, ” as

follows:

1. Availability of domestic reserves.

2. Availability of substitutes,

3. Number and location of foreign suppliers.

4. Ideology of foreign suppliers.

5. U.S. stockpile objectives (based, at that time,

on 1 year’s wartime needs).

Materials selected for the SSI assessment were

the 20 minerals for which the United States imported half or more of its requirements, plus tungsten. The authors included tungsten, even though

U.S. import dependency for tungsten was below 50

percent, because the ratio of U.S. production to

consumption was “rapidly decreasing” and because

ICongressional Research Service, A Congressional Handbook on U.S.

Materials Import Dependency/Vulnerability, cited in note 2, p. 341 ff,

ZAlwyn H. King and John R. Cameron, Materials and the New Dimensions of Conflict, Strategic Studies Institute, U.S. Army War College

(Carlisle Barracks, PA: 1974) available from National Technical Information Service, U.S. Department of Commerce, Springfield, VA 22151

(AD/A-004263).

of “the unusual circumstances that the Communist

countries possess about 75 percent of world reserves.” 3

Of the 21 materials, 10 were eliminated “because

of favorable combinations of such factors as adequate U.S. reserves, declining domestic demand,

available substitute materials, availability of technology to process low-grade ores, and proximity of

foreign supplies.”4 The other 11 minerals were assigned index numbers and ranked by relative vulnerability, as shown in table A-1.

The SSI does not describe exactly how the index

numbers for each material were derived. The text

implies that the index numbers are the sum of numerical values assigned (on the basis of the authors’

judgment) to each of the five principal factors mentioned above. The selection of these factors gives

far more weight to vulnerability of supply than to

criticality of use. However, it is evident from the

text that factors other than those five entered into

the ratings. For example, the authors’ discussion

of individual materials refers to the essential uses

of each, as well as the availability of substitutes. In

any case, as the authors state, the numbers do not

refer to anything quantitative but were based on

“qualitative assessment, ” that is, their own

judgment.

In 1977, one of the authors of the SSI study revised the vulnerability index in an attempt to refine it and make it more quantitative.5 The 1977 version of the SSI Index included 27 factors, each rated

for the importance of its influence on economic,

political, and military vulnerability of materials. Table A-2 shows the factors and their ratings.

Of the 27 factors on the list, no more than 5 are

related to criticality. Not one explicitly mentions

the essential uses of particular materials. Yet one

must assume that essential uses are implicit in the

rating scheme, at least in the selection of materials

to rate and in assessing the availability of substitute materials.

A further complication in the rating scheme is

that each of the 27 factors is also assessed for the

slbid,, p. 5. 1981 estimates indicate that China holds 47 percent of the world reserve base of tungsten, and another 11 percent is in the Soviet Union and North Korea. Both Canada and

the United States have large reserve bases of tungsten; Canada’s

is 15 percent of the world trade.

‘Ibid.

5Alwyn H. King, Materials Vulnerability of the United States—An Update, Strategic Studies Institute, U.S. Army War College (Carlisle Barracks, PA: 197’7), available from the Defense Technical Information Center, Defense Logistics Agency, Cameron Station, Alexandria, VA 22314,

381

38-844 0 - 85 - 14 : QL 3
382 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table A-1.—Strategic Studies Institute Index of Relative Vulnerability:

1974 Ranking

Vulnerability

index Principal or major exporters

34 Soviet Union, South Africa

32 Soviet Union, Canada, South Africa

27 Canada, Peru

23 Brazil, Gabon

22 Jamaica, Canada

20 Australia, Canada

20 Canada, Zaire

16 Canada, Brazil, Zaire

14 Canada, Norway

11 Canada, Mexico, Spain

6 Malaysia, Thailand

Material

Chromium . . . . . . . . . . . .

Platinum metals . . . . . . .

Tungsten . . . . . . . . . . . . .

Manganese . . . . . . . . . . .

Aluminum . . . . . . . . . . . .

Titanium . . . . . . . . . . . . .

Cobalt . . . . . . . . . . . . . . .

Tantalum . . . . . . . . . . . . .

Nickel. . . . . . . . . . . . . . . .

Mercury . . . . . . . . . . . . . .

Tin . . . . . . . . . . . . . . . . . .

SOURCE: Alwyn H. King and John R. Cameron, Mater/a/s arrd the New Dimensions of Conf/ict, Strategic Studies Institute,

U.S. Army War College (Carlisle Barracks, PA, 1974)

Table A-2.—Factors Affecting Materials Vulnerability Index: 1977 List

Effect on Vulnerability

Factor Economic Political Military

Domestic reserves:

Availability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Cost of developing. . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Domestic production industry:

Present capability. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Cost of augmenting . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Substitute materials:

Present availability . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Cost of research to develop . . . . . . . . . . . . . . . . . . . . .

Time required to develop . . . . . . . . . . . . . . . . . . . . . . .

Additional domestic resources:

Present availability . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Cost to develop suitable processes . . . . . . . . . . . . . .

Time to develop suitable processes . . . . . . . . . . . . . .

Probability of discovery if not available . . . . . . . . . . .

Cost of additional exploration . . . . . . . . . . . . . . . . . . .

Foreign suppliers:

Number of controlling companies. . . . . . . . . . . . . . . .

Number of supplier countries . . . . . . . . . . . . . . . . . . .

Political stability of supplier countries. . . . . . . . . . . .

Ideology of supplier countries . . . . . . . . . . . . . . . . . . .

Productive capacity of supplier countries . . . . . . . . .

Economic sufficiency of supplier countries . . . . . . .

History of political relations with U.S. . . . . . . . . . . . .

U.S. dollar involvement in supplier country . . . . . . . .

L

L

L

L

L

s

L

L

L

L

L

L

L

L

L

L

L

M

M

M

M

L

L

M

M

M

L

M

M

s

s

L

M

M

M

L

L

s

M

s

M

L

L

L

L

M

M

M

M

M

M

L

s

s

s

Accessibility of supplier countries

(supply routes) . . . . . . . . . . . . . . .

U.S. stockpile:

Present U.S. stockpile objective . .

Actual quantity in U.S. stockpile . .

Customary industry stockpile . . . .

Trend in usage of critical material . . .

. . . . . . . . . . . . . . . s s L

L

M

M

M

L

M

M

M

L

M

M

s

. . . . . . . . . . . . . . .

. . . . . . . . . . . . . . .

. . . . . . . . . . . . . . .

. . . . . . . . . . . . . . .

Proportion of national consumption directly related to

military requirements. . . . . . . . . . . . . . . . . . . . . . . . . . . .

lmportance of secondary sources (recycling) . . . . . . . . .

s

M

s

M

L

M

KEY: L = Large

M = Medium

s = Small

SOURCE: Alwyn H. King, Mater/a/s Vu/nerabMty of the United States—An Update, Strategic Studies Institute, U.S. Army War

College (Carlisle Barracks, PA: 1977).
Appendix A —Review of Previous Lists and Methods of Selection ● 383

direction of its influence on vulnerability; that is,

whether it currently contributes to a significant increase, a moderate increase, or a decrease in the

vulnerability of material supplies. All these factors,

including their importance and direction, are given

numerical values, the sum of which is the “relative

vulnerability index” number of each material. Figure A-1 shows the results for four materials.

The authors suggested using this numerical index

to help set priorities for stockpiling, allocation of

funds to research and development, and other such

decisions. A pitfall in using this index, or others

like it,6 for such purposes is that it may convey a

misleading impression of certainty or objectivity.

The use of index numbers to show “relative vulnerability” may be a convenience but does not at all

evade the necessity of applying subjective judgment—as the authors of the index recognized. Judgment is involved at every step: in deciding what factors to include, how much importance each should

be given, how to rate a material in relation to a specific factor (e. g., “political stability of supplier countries”), and so on.

Another attempt to construct a systematic rating

system for strategic materials was the Critical

Minerals Index pilot study done by the U.S. Department of the Interior’s Office of Minerals Policy and

Research Analysis in 1979.7 Designed to be used as

warning of potential problems, the index included

two components: one to measure the likelihood of

disruption of supply (i.e., vulnerability) and the

other to measure the cost of disruption or, conversely, the importance of the minerals to the U.S.

economy (including factors of vulnerability and

criticality). The scheme proposed to use the subjective judgment of a panel of experts to assign

index numbers for both components to specific

minerals.

Examples of events considered possibly disruptive to supply were:

●

●

●

●

●

●

Collusive price agreements (cartels).

Shifts in demand.

Embargoes.

Labor strife.

Transportation bottlenecks.

Violent conflicts, including local rebellion, regional war, riots, border skirmishes, blockades,

and sabotage.

‘An index with some similarities to the Strategic Studies Index, with

a clearer description of how it is constituted, is in Bohdan O. Szuprowicz,

HOW to Avoid Strategic A4aterials Shortages (New York: John Wiley &

Sons, 1981), p. 8ff and p. 285 ff.

7Robert L. Adams, Barbara A. White, and James S. Crichar, Developing a Critical Minerals Index: A Pilot Study, Office of Minerals Policy

and Research Analysis, U.S. Department of the Interior, July 1979.

Figure A-1 .—Strategic Studies Institute Relative

Vulnerability Index: 1977 Ranking

t

3,400 -

3,200 “

3,000 “

2,800 -

2,600 -

2,400 -

2,200 -

2,000 -

1,800 -

1,600 -

Aluminum

(bauxite)

1

NOTE: Overall Index number IS the sum of military, polltlcal, and economic

index numbers

SOURCE: Alwyn H King, Maferlals Vulnerabl/ffy of the United States — Arr UKJ

date, Strategic Studies Institute, U S Army War College, (Carllsle

Barracks PA: 1977)

Factors suggested for inclusion on the cost side

were:

●

●

●

●

●

●

●

The magnitude and duration of the disruption.

Total annual U.S. demand for the mineral.

Availability of alternative sources of supply;

e.g., domestic or other foreign sources.

Time required to deliver alternate supplies.

Availability of substitutes.

Time required to adopt substitutes.

Expectations of those controlling investment

about the future of alternative supplies and of

substitute technologies.
384 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

The Critical Minerals Index was simply proposed

in a pilot study. Its authors did not apply it to produce a list of minerals.

A different approach to a rating system for strategic materials, making no attempt to produce overall index numbers, was proposed by the British Institute of Geological Sciences (IGS) in a 1982

Memorandum to a Committee of the House of

Lords in Parliament.8 Dividing the factors that define a strategic material into the vulnerability and

criticality strands, the institute’s vulnerability list

included:

1.

2.

3.

4.

5.

6.

7.

8.

9.

Import dependence (besides net import dependence, this factor included total import dependence, recognizing that some of Britain’s

minerals processing and export industry relies entirely on the import of raw materials).

Concentration of supplies to Great Britain.

Concentration of world production.

Indirect import dependence, involving a long,

complex chain of supply.

Concentration of world reserves (or “economic resources”).

Reliability of producer countries.

Market mechanisms, which include:

Ž the lead time to develop new productive capacity.

• the proportion of materials tied up in longterm contracts, compared to the amount

available on the “free” market.

● the potential for cartel formation, on the basis of shared interests and values of producers.

The potential for recycling.

The adequacy and security of supply links on

land and sea.

The IGS memorandum pointed out that many of

the measures for vulnerability can be quantified,

some quite simply. To show the concentration of

suppliers to Great Britain, the IGS devised an index based on the total number of supplying countries and the share they supply; the same kind of

index was used to denote concentration of world

production, Reliability of supply, on the other hand,

cannot be quantified because it depends on such

considerations as political stability, ideology, or

“excessive economic nationalism, ” which are matters of qualitative judgment.

On the criticality side, the institute mentioned the

range of uses, the availability of substitutes, the nature of British industries consuming the material,

@Institute of Geological Sciences, Strategic Minerals, Memorandum

submitted to the Parliament, House of Lords. Select Committee on the

European Community (Subcommittee F), Feb. 18, 1982.

and a number of measures of the economic importance of the material, all of which, the IGS conceded, were difficult to analyze and apply.

Altogether, the IGS concluded that criticality cannot be quantified readily. The quantitative pointers

are either crude or trivial. The more important

questions—defining the national interest, judging

the importance of one manufacture in relation to

another, determining whether substitutions for a

material are possible and how long it would take

to effect substitutions— are all matters of judgment.

However, it is possible to combine judgments about

these factors into a subjective criticality rating of

high, medium, or low for each material.

Overall, the IGS rating scheme separated the vulnerability and criticality strands; disentangled factors which can be quantified from those which cannot; quantified different factors, each in its own

terms; and gave subjective ratings to factors that

cannot be measured adequately by quantitative indicators. No effort was made in the scheme to combine all these unlike “apples and oranges” into a

common index number.

In their statement to the House of Lords, the

authors concentrated on describing their rating

scheme rather than applying it to produce a list of

strategic materials. They did select 15 materials to

illustrate how the scheme would work. Two of the

15 materials were selected to show the independence of vulnerability and criticality. Fluorspar is

critical for the production of aluminum and steel,

but is mined in Great Britain and thus is not regarded as vulnerable. Vermiculite has high vulnerability because Great Britain is entirely dependent

on imports from one dominant supplier (South

Africa), but it is not critical because substitutes are

readily available. Of the 13 other materials used to

illustrate the IGS rating scheme, the authors said

that most “are likely to manifest high degrees of

both vulnerability and criticality, and would therefore be identified as strategically important.” They

are:

Aluminum Nickel

Columbium Phosphate rock

Chromium Platinum-group metals

Cobalt Tantalum

Manganese Tin

Molybdenum Tungsten

Vanadium

The materials selected are strategic to Great Britain but not necessarily to the United States,

Molybdenum, for example, would not appear on a

list of U.S. strategic materials because the United

States is the world’s largest producer and exporter

and holds more than half of the world’s resource

base—a great deal more than any other country.
Appendix A—Review of Previous Lists and Methods of Selection • 385

A simpler scheme, based on the aggregate judgment of an expert panel, was used by the British

Materials Forum on Strategic Materials.’ Applying

the concepts of degree of criticality and degree of

vulnerability to the metals used by British industry, the forum reported that “the following group

of eight metals emerged as meriting the highest priority in the newly defined strategic sense’’:10

Chromium Manganese

Cobalt Vanadium

Columbium Molybdenum

Tungsten Platinum-group metals

All members of the forum agreed on the rating,

and all the metals were thought to merit equal rating. Again, the materials listed are strategic from

the British point of view,

For each metal on the Materials Forum list, the

criticality aspect was brought out by examining the

metal’s more important uses in key industries. To

help assess vulnerability, the forum members

looked at the ratio of reserves to production in each

of the major producer countries of the world to estimate which countries are likely to become dominant in the future. The group recognized that the

reserves-to-production ratio is a “static” indicator

of reserve life (and could very well change as new

The Materials Forum, Strategic Metals and the United Kingdom, cited

in note 3.

10 Ibid., p, 3,

reserves are discovered or as countries’ rates of production change). The members used qualitative

judgment, as well, in estimating probable future

diversity of supply and in evaluating the political

factors involved in vulnerability of supply.

The flavor of the forum’s evaluation is suggested

by the following excerpt from its discussion of chromium:ll

Although the physical long-term supply situation

for the world as a whole looks reasonable. . nevertheless, 97 percent of the presently known reserves

of chromium are located in South Africa and adjacent Zimbabwe. The relatively small reserves located in other countries indicates that their present

levels of production are unlikely to be maintained

for more than 10 to 20 years (unless new reserves

on a very substantial scale are found and then developed commercially within this time scale). Thus,

along with many other consumer countries, the

U.K. could steadily shift towards a greater dependence on South Africa and Zimbabwe for chromium supplies, whatever countries are supplying

us at present. Since these two countries are surrounded by political uncertainties, or at least such

is the generally accepted view by most Western

countries, then imports to the U.K. need to be

regarded as becoming increasingly “vulnerable” in

the future.

IiIbid., p. 6.
APPENDIX B

Import Sources of Materials

Judged to be Nonstrategic, 1978-82

1982 net

import 1982

reliance Commodity Import sources (1978-81) by percent supplied consumption

4

45

W

b

74

52

w

69

3

N A

c

7

100

87

61

100

NA

43

36

w

72

NA

w

36

22

1

2

43

100

75

386

Aluminum

Antimony

Arsenic

Asbestos

Barite

Bismuth

Cadmium

Cement

Cesium

Copper

Corundum

Fluorspar

Gallium

Gem stones

Germanium

Gold

Gypsum

Hafnium

Ilmenite

Indium

Iodine

Iron ore

Iron and steel

Lead

Lime

Mercury

Mica sheet

Nickel

Canada(62), Ghana(11), Norway(4), Japan(4), Other(19)

Metal: Bolivia, China(34), Mexico(10), BelgiumLuxembourg(7), Other(n)

Ores and Concentrate: Bolivia(36), Canada,

Mexico, Chile(8), Other(18)

Sweden, Mexico, France, Other(13)

Canada(97), South Africa(3)

China(24), Peru(21), Chile(13), Morocco(11), Other(31)

Mexico, Peru(26), Great Britain, West

Germany(9), Other(23)

Metal: Canada(27), Australia, Mexico(n), South

Korea(9), Other(35)

Canada, Japan(15), Mexico(7), Spain(7), Other(22)

Compounds: West Germany(95), Great Britain(4),

Canada and France(1)

Pollucite: Canada(100)

Chile(32), Canada(22), Peru(14), Zambia(11), Other(21)

South Africa(100)

Mexico, South Africa, Italy(4), Spain(3),

Other(3)

Switzerland, Canada, West Germany(10),

China(6), Other(7)

South Africa, Belgium-Luxembourg( 23), Israel,

India(n), Other(16)

Belgium-Luxembourg( 50), West Germany,

China(12), Switzerland(n), Other(15)

Canada(52), Soviet Union(20), Switzerland(17),

Other(11)

Canada(73), Mexico, Spain(3), Other(2)

Negligible

Australia, Canada, South Africa(6), Other(l)

Belgium-Luxembourg( 32), Peru(28), Japan(n), Great

Britain(9), Other(20)

Japan(81), Chile(18), Other(l)

Canada(64), Venezuela, Brazil(9), Liberia(7),

Other(4)

Europe, Japan(34), Canada, Other(15)

Ore, concentrate and bullion: Peru(32), Honduras,

Canada, Australia(9), Other(13)

Pigs and bars: Canada(39), Mexico, Peru(8),

Australia(8), Other(8)

Canada(94), Mexico(6)

Spain(34), Japan(21), Italy(12), Algeria(10), Other(23)

India(83), Brazil(n), Madagascar(4), Other(2)

Canada(44), Norway(n), Botswana(9), Australia(8),

Other(28)

4,740,000

33,200

w

267,300

4,140,000

Reported: 1,050

4,087

65,000,000

NA

1,980,000

650

800,000

Reported: 10

$ million: 1,700

46

Troy oz: 3,800,000

18,800,000

Crystal bar: 50

Sponge: W

920,000

NA

3,950

61,150,000

88,100,000

1,171,500

14,900,000

76-lb flasks: 50,700

1,800

174,000
Appendix B—Import Sources of Materials Judged to be Nonstrategic . 387

1982 net

import 1982

reliance Commodity Import sources (1978-81) by percent supplied consumption’

9

31

71

15

NA

W

NA

8

50

2 0

5 9

8

100

3

W

W

NA

12

48

w

53

w

Ammonia

Peat

Potash

Pumice

Rare earths

Rhenium

Rubidium

Salt

Selenium

Silicon

Silver

Sodium sulfated

Strontium

Sulfur

Tellurium

Thallium

Thorium

Tit. dioxide

Tungsten

Yttrium

Zinc

Zirconium

Soviet Union(38), Canada(23), Mexico, Trinidad

and Tobago, Other(2)

Canada, West Germany(1)

Canada, Israel(3), Other(3)

Greece, Italy(13)

Monazite: Australia(89), Malaysia(8), Thailand(3)

Chile(49), West Germany, Other(4)

Canada(100)

Canada(38), Mexico, Bahamas, Other(21)

Canada, Japan(17), West Germany(8), Great

Britain(8), Other(23)

Canada, Norway (22), Brazil, South Africa(7),

Other(32)

Canada(37), Mexico, Peru(23), United Kingdom(5),

Other(n)

Canada(98), United Kingdom(l), Other(l)

Mexico, Other(l)

Canada(58), Mexico(42)

Canada(43), Fiji(14), Hong Kong(13), Peru(9), Other(21)

West Germany, Belgium-Luxembourg(9), Japan(6),

Other(4)

France, Canada(6), Netherlands(6), Malta(3),

Other(5)

West Germany, Canada, Great Britain,

France, Other(30)

Canada, Bolivia, China(14), Thailand(7),

Other(39)

Monazite: Australia, Malaysia(8), Thailand(3)

Zenotime: Malaysia, Australia

Yttrium concentrates: Malaysia, Canada, Japan

Ore and concentrates: Canada, Peru(17),

Mexico(8), Other(16)

Metal: Canada, Spain(8), Mexico(6), Australia(6),

Other(16)

Zirconium: France, Japan(23), Canada(5), Other(4)

16,000,000

1,160,000

6,600,000

590,000

21,500

Reported: 2.5

NA

42,050,000

550

330,000

Troy oz: 144,000,000

1,278,000

15,000

11,440,000

85

w

15 (nonenergy)

721,000

7,400

140

891,000

Reported: 100,000

Zircon: Australia, South Africa(10), Other(2)

astatistics are for apparent consumption in short tons, except where indicated.

byv = withheld to avoid disclosing company proprietary data.

CNA =. not available

dlg82 import and consumption data is unavailable. 1981 data is reported here.

SOURCE: 1983 Mineral Commodity Summaries, U.S. Department of the Interior, Bureau of Mines. All the data presented above contain 1982 statistics.

The import sources are 4-year averages for the years 1978-81.
—

Appendix C

Overview of Second-Tier Materials

Bauxite and alumina are the raw and semiprocessed materials from which aluminum is made.

They are considered to be strategic materials because of the high U.S. import reliance and because

of the size and importance of the aluminum industry. For several reasons, however, bauxite and alumina are not in the first tier of strategic importance:

many of the end uses of aluminum are not highly

critical and can easily be replaced by substitute

materials; the sources of bauxite and alumina supply are fairly diverse and relatively reliable; and,

since the United States is the world’s largest aluminum producer, accounting for 25 percent of the

world’s production of aluminum, the U.S. market

is very important to foreign suppliers.

Alumina (aluminum oxide) is produced from

bauxite, and it is made into aluminum for use in

products such as alloys, chemicals, and abrasives,

Aluminum alloys offer widely varying combinations of mechanical strength, ductility, electrical

conductivity, and corrosion resistance. Some alloys

have strengths approaching those of steel. Similar

to most other materials, the worldwide recession

caused declines in the consumption of bauxite and

alumina in 1982 (see table C-l).

Containers and packaging account for over 20

percent of total aluminum consumption and are the

largest end use for the material. Almost as large is

the amount used in construction, for such products

as residential siding, doors and windows, roofing,

mobile homes, curtain walls, bridge rails, and guard

rails. The automobile industry accounts for about

10 percent of U.S. aluminum consumption for such

items as body, brakes, steering, pistons, trim, electrical uses, and metallic paint. Other transportation

uses—marine vessels, rail cars, military vehicles,

aircraft, and recreational vehicles—account for

another 10 percent of consumption. Aluminum cable with steel reinforcing has replaced copper for

high-capacity electrical transmission lines. This

Table C-1.–U.S. Consumption of Bauxite, 1978-82

Apparent consumption

Year (thousand metric dry tons)

1978 . . . . . . . . . . . . . . . . . . . . 5,300

1979 . . . . . . . . . . . . . . . . . . . . 5,106

1980 . . . . . . . . . . . . . . . . . . . . 5,824

1981 . . . . . . . . . . . . . . . . . . . . 5,555

1982 . . . . . . . . . . . . . . . . . . . . 4,048

SOURCE: US. Department of the Interior, Bureau of Mines, Mirrera/ Commodity

Summaries 1984.

and other electrical uses account for still another

10 percent of the aluminum used in the United

States,

Approximately 10 percent of U.S. bauxite consumption goes into nonmetallic applications. Aluminous chemicals are used for water and sewage

treatment, dyeing, leather tanning, and sizing paper. Bauxite is also used in high-alumina cement,

as an absorbent or catalyst by the oil industry, in

welding rod coatings, and in fluxes for steelmaking. High-alumina abrasives and refractories are

used in glass and ceramic products.

For many of the important uses of aluminum

there are adequate substitutes; e.g., steel and wood

can be used in residential construction. Zinc-based

diecastings and chromium-plated steel were replaced

by aluminum in the automobile industry, and a

shortage of aluminum could conceivably reverse

this substitution. Copper can be used in electrical

applications, and glass, plastics, paper, and steel

can be used in packaging. For some transportation

uses, magnesium and titanium can be used instead

of aluminum, albeit at significantly increased costs.

Approximately 97 percent of U.S. bauxite supplies come from Jamaica, Guinea, and Suriname.

Alumina is imported from Australia, Jamaica, and

Suriname. Australia is the world’s largest producer

of bauxite. As table C-2 shows, many other countries have large reserves and production capacities

of bauxite; e.g., Brazil, India, Guyana, Greece, and

Yugoslavia. Thus, there is a wide diversity of world

suppliers, each with large reserves.

The United States is the world’s largest producer

of aluminum and therefore the world’s largest market for bauxite. It appears unlikely that raw

materials producers would refuse sales to this country, lest they risk losing their share of this rich

market.

The United States has a small bauxite mining industry, but reserves are relatively limited. The Bureau of Mines has conducted research on producing alumina from alternative materials such as

clays, alunite (a potassium-aluminum-sulfur mineral), coal wastes, and oil shales, The United States

has large resources of these materials and could

meet most of its aluminum raw materials needs if

the appropriate technology were developed. A private industry consortium, Alumet, has done work

on producing alumina from domestic alunite. A

large deposit of alunite discovered in Utah in 1970

could supply domestic aluminum producers for

388
Appendix C—Overview of Second-Tier Materials ● 389

Table C-2.—Bauxite: U.S. Imports, World Production, and Reserves

Sources of U.S. imports (1979.82):

Country Percent

Jamaica. . . . . . . . . . . . . . . . . . . . . .. ...39

Guinea. . . . . . . . . . . . . . . . . . . . . .. ....32

Suriname. . . . . . . . . . . . . . . . . . . . . .. ..10

NOTE: 1982 U.S. net import reliance = 96 percent.

World mine production and reserves, 1982 (thousand metric dry tons):

Mine production Reserves

Country Amount Percent Amount Percent

Australia. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23,621 32 4,600,000 21

Guinea . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,908 15 5,900,000 26

Jamaica . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,380 11 2,000,000 9

Brazil . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,186 6 2,300,000 10

Soviet Union . . . . . . . . . . . . . . . . . . . . . . . . . . 4,600 6 300,000 1

Greece . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,853 4 650,000 3

Yugoslavia . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,668 5 400,000 2

Hungary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,627 4 300,000 1

Suriname . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,059 4 600,000 3

India . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,854 2 1,200,000 5

Guyana . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 953 1 900,000 4

United States . . . . . . . . . . . . . . . . . . . . . . . . . 732 1 40,000 <1

Other market economy countries . . . . . . . . 4,820 6 3,100,000 14

Other central economy countries . . . . . . . . 2,180 3 200,000 1

World total . . . . . . . . . . . . . . . . . . . . . . . . . . 74,441 100 22,500,000 100

SOURCE:U.S. Department of the lnterior, Bureau of Mines, Mirrera/ Commodity Summaries 1984.

years. But alunite is a lower grade alumina raw material than bauxite, and the processing is currently

more expensive than the standard Bayer process

used on bauxite. Although the technology is available (the Soviets are now producing alumina from

alunite), it it uneconomic in the United States at this

time.

Beryllium is the second tier because of its critical end uses and because one U.S. company is the

sole processor of raw ore for beryllium in the entire free market world. Because of its relatively high

price, use of beryllium is not widespread. But

where it is used, it appears to be highly critical,

especially to defense. Arguing against a higher strategic rank for beryllium is the fact that the United

States is apparently capable of supplying most of

its own needs. (U.S. production figures are not

available, so this conclusion is not certain.) Also,

beryllium is used in relatively small amounts, so

transportation of imports is not a significant

problem.

Forty percent of U.S. beryllium consumption

goes to the aerospace industry and to nuclear weapons. Although the details of the military uses of

beryllium are classified, beryllium is known to be

a particularly good reflector of neutrons, Known

aerospace applications have been in missiles, aircraft brake disks, aircraft frames, satellites and

space vehicles, and inertial navigational systems for

missiles and aircraft. Another large application (35

percent of consumption) is in beryllium-copper alloys in electronic components, including highstrength, noncorrosive housings for underwater cable repeater stations, contacts, and heat sinks, A

relatively new use is in ceramic beryllium oxide

substrates for complex electronic circuitry.

Consumption patterns of beryllium reflect its defense and aerospace uses. Table C-3 shows that consumption has actually been increasing, even in hard

times.

Beryllium’s special properties include light

weight, high strength, high thermal conductivity,

and neutron moderating and reflecting capability.

There are some substitutes for beryllium metal

(steel, titanium, graphite composites) and berylliumTable C-3.–U.S. Consumption of Beryllium, 1978-82

Apparent consumption

Year (short tons)

1978 . . . . . . . . . . . . . . . . . . . . . . . 271

1979 . . . . . . . . . . . . . . . . . . . . . . . 303

1980 . . . . . . . . . . . . . . . . . . . . . . . 321

1981 . . . . . . . . . . . . . . . . . . . . . . . 303

1982 . . . . . . . . . . . . . . . . . . . . . . . 150

SOURCE: U.S. Department of the Interior, Bureau of Mines, Minera/ Cornmodlty

Summaries 1984
.

390 Ž Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

copper alloys (phospher bronze), but not without

a substantial loss of performance. Synthetic sapphire can be used in place of beryllium in some

electronic uses.

Some beryllium ores are imported, but exact

figures for net import reliance are not available because domestic production data are withheld to

avoid disclosing company proprietary data (see table C-4). Before 1969, the United States was over

90 percent import-dependent. In that year, a domestic plant opened to convert imported and domestic beryl and bertrandite to to beryllium oxide. This

plant is the only known ore processing facility in

the market economy countries. It appears that the

United States is capable of meeting its own beryllium requirements to a substantial degree, U.S. reserves are very large (28,000 tons) in relation to the

1982 consumption of 328 tons, and reported imports for 1982 were moderate—108 tons. Also, in

the case of beryllium, distance from sources of supply is not an important factor. Because the material is used in relatively small quantities, it could

be airlifted if necessary.

Columbium (niobium)l is included as a secondtier strategic material because it is entirely imWolumbium and niobium are two names for the same metal. The name

columbium is favored by engineers and is generally used in describing

the composition of alloys, while niobium is the accepted name in the

scientific community. Since this report is directed toward engineering

applications of strategic materials, the name columbium is used here,

ported—mostly from a single source, Brazil—and

because it is used in a variety of essential industries. It is not in the first tier, however, because

there are a number of substitute materials. Also, it

is used in limited quantities and could be airlifted

from foreign suppliers if necessary. Table C-5

shows a trend of increased use of columbium, except for the recession year of 1982.

High-strength, low-alloy (HSLA) steels owe their

strength and toughness in part to a fine-grained

structure. Columbium is used in HSLA’s at levels

ranging from 0,01 to 0.04 percent by weight to help

attain this structure. With the trend toward more

use of HSLA steels to replace plain carbon steels,

consumption of columbium has increased. The addition of ferro- and nickel-columbium to hightemperature superalloy imparts strength and carbide stability. For stainless steels, too, columbium

provides carbide stability.’ There are substitutes for

columbium, but not without performance penalties;

vanadium and molybdenum in HSLA steels; tantalum and titanium in stainless and high-strength

steel and superalloys; molybdenum, tungsten, tantalum, and ceramics in high-temperature applica2At high temperatures and pressure, molecular hydrogen dissociates

into atomic hydrogen, penetrates steel (or other metals), and reacts with

the carbon in the steel to form methane. This causes the metal to fail.

This hydrogen attack is decreased with the addition of carbide stabilizers,

such as chromium, molybdenum, tungsten, vanadium, and titanium as

we]] as columbium,

Table C-4.—Bertyllium: U.S. Imports, World Production, and Reserves

Sources of U.S. imports (1979.82):

Country Percent

Brazil . . . . . . . . . . . . . . . . . . . . . .......38

China . . . . . . . . . . . . . . . . . . . . . .......40

South Africa . . . . . . . . . . . . . . . . . . . . ...5

Rwanda . . . . . . . . . . . . . . . . . . . . .. .....4

Other . . . . . . . . . . . . . . . . . . . . . .......13

NOTE: 1982 U.S. net import reliance = W,

World mine production and reserves, 1982 (short tons):

Mine production

Country Amount Percent Reserves

Brazil . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 28 Not adequately

South Africa . . . . . . . . . . . . . . . . . . . . . . . . . . 3 2 delineated

Rwanda . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 3

Argentina . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 1

United States . . . . . . . . . . . . . . . . . . . . . . . . . W NA

China . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . NA NA

Other central economy countries . . . . . . . . 8 0 63

World totala. . . . . . . . . . . . . . . . . . . . . . . . . 126 100

aDoeS not Include United States and China.

NA—Not applicable

W—Withheld to avoid disclosing company proprietary data

SOURCE U S Department of the Interior, Bureau of Mines, kfirreral Commodity Summaries 1984,
—

Appendix C—Overview of Second-Tier Materials • 391

Table C-5.—U.S. Consumption of Columbium, 1978-82

Apparent consumption

Year (short tons)

1978.. .., :. . ... ., . 3,293

1979. , . . . . . . . . ... ... 3,560

1980 ..., . . . . . . . . . . . . . . . . 3,767

1981, . . . . . . . . . . . . . 4,059

1982, . . . . . . . . . . . . . . . . . . . . . . 3,300 --—

SOURCE US Departm-entoft;e Interior ~ureauof Mines Mlnera/C&modffy

Summar/es 1984

tions. Some of these substitutes are themselves considered strategic .

Columbium deposits exist in the United States,

but none are producing, nor are they likely to in

the near future. The United States imports all its

columbium, either in the form of concentrates and

tin slags or as ferrocolumbium. Brazil dominate s

U.S. imports and indeed world supplies. Its re -

serves will last for hundreds of years (see table C6), The only other major source of U.S. imports is

Canada, and its deposits are low-grade. A singl e

overwhelmingly dominant source of supply make s

for increased vulnerability even when the sourc e

is friendly and well-endowed with reserves.

Natural industrial diamonds are included as

second-tier strategic materials because U.S. import

dependence on them is 100 percent and because

no substitutes are available, Another factor making

for uncertain supply is that industrial diamond output depends largely on gemstone production and

is not directly related to industrial diamond demand. Diamonds are not included in the first tier

for two reasons: with the advent of a huge diamond

industry in Australia, the western world’s nearly

complete reliance on African nations will disappear, and even from the limited area of southern

Africa, supply has been quite reliable in the past.

Table C-7 shows the trend in industrial diamond

consumption in the United States.

The major use of industrial diamond stones is in

drilling for minerals. Dies, core bits, cutting tool

points, and electrical machinery also use natural

diamond stone. Synthesized polycrystalline diamonds are competitive with natural stones in some

applications where small stones are suitable, but

synthesis of large industrial diamonds is not currently commercial. It is expected that eventually

half of the demand for natural stones can be

replaced by synthetics.

Although the United States currently mines no

industrial diamond stones, there are diamond deposits near the Colorado-Wyoming border. The

United States is the world’s largest consumer of natural industrial diamond stones. As with several

other strategic materials in the first and second

tiers, supplies are limited to a rather small group

of producers. Currently, the main sources of supply of natural stones are South Africa, Zaire, Belgium-Luxembourg, and Great Britain, as shown in

Table C-6.—Columbium: U.S. Imports, World Production, and Reserves

Sources of U.S. imports (1979.82):

Country Percent

Brazil . . . . . . . . . . . . . . . . . . . . . . . . . ..75

Canada . . . . . . . . . . . . . . . . . . . . . . . . . 6

Thailand . . . . . . . . . . . . . . . . . . . . .. ...6

Other . . . . . . . . . . . . . . . . . . . . . .......13

NOTE 1982 U S net import reliance = 100 percent

World mine production and reserves, 1982 (short tons):

Mine production Reserves

Country Amount Percent Amount Percent

Brazil . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,165 - 83 4,000,000 93

Canada . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,417 15 175,000 4

Nigeria . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90 1 100,000 2

Zaire . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 <1 50,000 1

United States . . . . . . . . . . . . . . . . . . . . . . . . . Small NA Negligible NA

Other market economy countries . . . . . . . . 98 1 9,500 0

Other central economy countries . . . . . . . . NA NA NA NA

World total. . . . . . . . . . . . . . . . . . . . . . . . . . 15,780 100 4,334,500 100

aDoes not ,n~lude united states or central economy countries

NA—Not applicable

W—Withheld to avoid disclosing company proprietary data

NOTE Amer/can Metal Market (Mar ?9, 1983) reports that China has 400 million metric tons of columblum.beanng Iron ore

The Japanese are plannlng to extract the colu!nblum during steelmaklng

SOURCE U S Department of the Interior, Bureau of Mines, A4/nera/ Commodify .%mmarles 1984
392 . Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table C-7.—U.S. Consumption of Natural

Industrial Diamond Stones, 1978-82

Apparent consumption

Year (million carats)

1978. . . . . . . . . . . . . . . . . . . . . . . 3.7 “

1979. . . . . . . . . . . . . . . . . . . . . . . 4.0

1980. . . . . . . . . . . . . . . . . . . . . . . 3.4

1981 . . . . . . . . . . . . . . . . . . . . . . . 3.7

1982. . . . . . . . . . . . . . . . . . . . . . . 2.9

SOURCE’US Departrnant of the lnterioL Bureauof Mines, Minera/Commodity

Summaries 1984.

table C-8. Australia is beginning full-scale production from its enormous reserves, with production

expected to be about 2 million carats in 1983 and

15 million to 20 million carats in 1985, and could

easily become the world’s largest producer of industrial diamonds. Other countries with substantial, identified deposits are Ghana, Botswana, and

the Soviet Union.

Natural graphite sources are well-diversified and

its end uses are less critical as those for other

materials considered here. Graphite is, however,

considered strategic to some degree because of its

wide-ranging uses and the many industries that employ it. Moreover, natural graphite comes in several forms, and certain uses require one particular

form. Of these specific varieties, some are found

in a very few places in the world. Because of its

uses in the basic industries, demand for graphite

has dropped with the 1982 recession, as shown in

table C-9.

Of the many varieties of graphite (with distinctive characteristics and uses) the primary types are

flake, lump, and amorphous. Amorphous is the

cheapest, at $60 to $80/short ton, flake in the midrange at $200 to $l,000/short ton, and lump, the

most expensive at $800 to $2,00()/short ton. Natural graphite is used mainly to raise the carbon content in steel production. It is also used in refractories, for dressings and molds in foundry operations,

and as lubricants. Because of its superior ability to

conduct heat, crystalline flake is the only type of

graphite used in crucibles.

Substitute and alternative materials do not perform as well as graphite for most applications. For

example, in steelmaking, graphite goes into the

metal more easily than do other sources of carbon

because it does not emit as many volatiles. One significant functional substitution exists, however,

Teflon and similar materials are increasingly used

for bearings, so that the need for graphite lubricants

for steel bearings has declined.

No natural graphite was produced domestically

in 1982, although one deposit in Texas has been

mined recently, and another in Alabama is being

investigated. There are also deposits in Alaska,

Idaho, Montana, New York, and Pennsylvania

which are not economically viable at present.

Table C-8.—Natural Industrial Diamonds:

U.S. Imports, World Production, and Reserves

Sources of U.S. imports (1979-82)

(diamond stones):

Country Percent

South Africa . . . . . . . . . . . . . . . .......60

Zaire . . . . . . . . . . . . . . . . . . . . . .......14

Belgium-Luxembourg . . . . . . . ........7

United Kingdom. . . . . . . . . . . . ........7

Other . . . . . . . . . . . . . . . . . . . . . .......12

NOTE: 1982 US. net import reliance = 100 percent

World mine production and reserves, 1982 a (million carats):

Mine production Reserves

Country Amount Percent Amount Percent

Soviet Union . . . . . . . . . . . . . . . . . . . . . . . . . . 8.5

Zaire . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8.6

South Africa . . . . . . . . . . . . . . . . . . . . . . . . . . 5.8

Botswana. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.6

Ghana. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.6

Australia. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0.5

China . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.6

Other market economy countries . . . . . . . . 2.4

World total. ., . . . . . . . . . . . . . . . . . . . . . . . 34.6

25

25

17

19

2

1

4

7

100

80

150

70

125

15

500

20

30

990

8

15

7

13

2

50

2

3

100

alncludes all natural industrial diamonds

SOURCE’ U S. Department of the Interior, Bureau of Mines, A4inera/ Commodity Summaries 1984
Appendix C—Overview of Second-Tier Materials ● 393

Table C-9.—U.S. Consumption of Natural Graphite,

1978.82

Apparent consumption

Year (thousand short tons)

1978 . . . . . . . . . . . . . . . . . . . . . . . W

1979 . . . . . . . . . . . . . . . . . . . . . . . 74

1980. . . . . . . . . . . . . . . . . . . . . . . 49

1981 . . . . . . . . . . . . . . . . . . . . . . . 55

1982. . . . . . . . . . . . . . . . . . . . . . . 43

W—Withheld to avoid disclosing company proprietary data

SOURCE:US Department of the lntenor, Bureau of Mlnes,Minera/Commodity

Summaries 1984

U.S. demand for graphite is met by imports of

crystalline flake from Madagascar, lump and chip

from Sri Lanka, and amorphous from Mexico. Korea, the Soviet Union, and China also export graphite to the United States. In general, reserves of

graphite around the world are large and are not isolated in any particular geographic region, but specific types of graphite are highly localized. Table

C-10 illustrates the U.S. imports, world production,

and reserves.

Sri Lanka, sole world source for lump graphite,

attempted to take advantage of the situation by escalating prices in the 1970s. This encouraged endusers to begin designing out requirement for lump

graphite. As a result, Sri Lanka’s market for its

lump graphite is shrinking. It is this potential to

substitute one type of graphite for another that puts

graphite into the second tier of strategic materials.

Titanium and rutile are considered together

here, because rutile is one of the ores from which

titanium sponge (metal) is produced. Most rutile is

consumed in the production of titanium dioxide

pigment (see table C-n for consumption statistics).

Titanium has critical uses in certain industries—

in particular, aerospace—and thus is strategic to

some degree. It is not included in the first tier because the main sources of supply, of both rutile and

titanium metal, are political allies of the United

States and are considered secure suppliers. Also,

substitutes do exist for many uses. Moreover, synthetic rutile can be produced from domestic ilmenite, another titaniferous ore.

U.S. consumption of titanium metal increased in

recent years as the commercial and military aircraft

fleets were built up, as shown in table C-12.

The major end use (60 percent) of titanium metal

is in jet engines, airframes, and space and missile

applications, where it is valued for its high strength

and light weight. Another 20 percent of titanium

consumed in the United States goes into steel and

aluminum alloys, where titanium is used to remove

oxygen and nitrogen and to toughen the alloys.

Table C-10.—Natural Graphite: U.S. Imports, World Production, and Reserves

Sources of U.S. imports (1979-82):

Country Percent

Mexico . . . . . . . . . . . . . . . . . . . . .. ....63

South Korea . . . . . . . . . . . . . . . . . . . . ...4

Madagascar . . . . . . . . . . . . . . . . . . . . ...6

China. . . . . . . . . . . . . . . . . . . . . .. ......8

Brazil . . . . . . . . . . . . . . . . . . . . . ........8

Other . . . . . . . . . . . . . . . . . . . . . .......12

NOTE: 1982 U.S. net import reliance = W.

World mine production and reserves, 1982a (thousand short tons):

Mine production Reserves

Country Amount Percent Amount

South Korea . . . . . . . . . . . . . . . . . . . . . . . . . . 39 6 Large

India . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49 8 Moderate

Mexico . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 6 Large

Austria . . . . . . . . . . . . . . . . . . . . ... , . . . . . . . 27 4 Large

Madagascar . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 2 Large

Sri Lanka . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 1 Moderate to large

United States . . . . . . . . . . . . . . . . . . . . . . . . . W — 1,100

Other market economy countries . . . . . . . . 5 3 9 Moderate

Other central economy countries . . . . . . . . 383 63 Large

World total. . . . . . . . . . . . . . . . . . . . . , . . . . 608 100 1 70,000a

aThiS flgure E from Bureau of Mines’ statistics which aggregate reserves by COntinent.

W—Withheld to avoid dlsclos!ng company proprietary data

SOURCE U S Department of the Interior, Bureau of Mines, Mlnera/ Commodity Summaries 1984
394 • Strategic

—.— .—

Materials: Technologies to Reduce U.S. Import Vulnerability

Table C-11.— U.S. Consumption of Rutile, 1978-82

Reported consumption

Year (short tons of concentrates)

1978 . . . . . . . . . . . . . . . . . . . . . . . 253,000

1979 . . . . . . . . . . . . . . . . . . . . . . . 314,000

1980 . . . . . . . . . . . . . . . . . . . . . . . 298,000

1981 . . . . . . . . . . . . . . . . . . . . . . . 285,000

1982. . . . . . . . . . . . . . . . . . . . . . . 239,000

SOURCE US Department of the anterior, Bureauof Mlrres, Mirreral Cornrnodtty

Summarres 1984

Another 20 percent is used in the chemical processing industry, power generation, and marine and

ordnance applications.

In some uses, high-nickel steel and superalloy

can substitute for titanium alloys. For aircraft and

space applications, high-strength, low-weight composite materials are being introduced to replace

titanium. Also, new aluminum alloys produced by

powder metallurgy techniques (discussed in ch. 7)

provide alternatives to titanium in aerospace applications.

There is some rutile mining in the United States,

but most of the material is imported (see table C13). The major import source is Australia, with minor amounts coming from Sierra Leone and India.

Brazil has by far the largest reserve base in the

world, but current production there is limited.

Sources of supply are quite diverse, with producers including Italy, South Africa, and Sri Lanka, as

well as the other countries mentioned.

Ilmenite, a titaniferous ore which is abundant in

this country, can be used to produce synthetic rutile, from which titanium can be made. A new synthetic rutile plant is being planned by a firm which

mines ilmenite in Florida. The process to be used

is the same as the one in current use in Australia.

For most domestic producers of metal (mainly located on the west coast) it is cheaper to import rutile from Australia than to use synthetic rutile derived from domestic ilmenite. According to an

industry source, the costs of starting up more synthetic rutile plants and shipping the produce to domestic sponge producers are the only barriers to

U.S. self-sufficiency in titanium raw materials.

Major U.S. import sources for titanium sponge

metal have been Japan, China, the Soviet Union,

and Great Britain (see table C-14). The United States

has enough processing capacity to produce all the

titanium metal required for domestic consumption,

but about 35 percent of capacity was idle in 1982,

Tantalum performs essential functions in certain

products, and some of those products themselves

meet critical needs, Others are nonessential. The

present major U.S. import sources for tantalum are

judged not to be highly reliable, which adds an element of risk. Yet worldwide ore production is quite

substantial and diverse. For these combined reaTable C-12.—Rutile: U.S. Imports, World Production, and Reserves

———

Sources of U.S. imports (1979.82):

Country Percent

Australia . . . . . . . . . . . . . . . . . . . . .. ...69

South Africa . . . . . . . . . . . . . . . . . . . . ...9

Sierra Leone . . . . . . . . . . . . . . . . . . . . ..14

Other . . . . . . . . . . . . . . . . . . . . . ........8

NOTE 1982 U.S. net import reliance = W

World mine production and reserves, 1982 (thousand short tons of concentrates):

Mine production Reserves

Country Amount Percent Amount Percent

Australia. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

South Africa . . . . . . . . . . . . . . . . . . . . . . . . . .

Sierra Leone . . . . . . . . . . . . . . . . . . . . . . . . . .

Sri Lanka . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

India . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

United States . . . . . . . . . . . . . . . . . . . . . . . . .

Brazil . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Italy. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Central economy countries . . . . . . . . . . . . .

World total. . . . . . . . . . . . . . . . . . . . . . . . . .

243

52

53

14

9

W—

—

10

381a

64

14

14

4

2

NA

o

0

3

100

10,000

7,000

4,000

6,000

4,000

3,000

100,000

6,000

3,000

143,000

7

5

3

4

3

2

70

4

2

1 0 0

aExciudeS U S production

NA—Not applicable

W—Withheld to avoid disclosing company proprietary data

SOURCE U S Department of the Interior, Bureau of M!nes, &f frrera/ Commodity Summaries 7984
Appendix C—Overview of Second-Tier Materials ● 395

Table C-13.—U.S. Consumption of Titanium Sponge,

1978.82

Reported consumption

Year (short tons)

1978 . . . . . . . . . . . . . . . . . . . . . . . 19,854

1979 ...., . . . . . . . . . . . . . . . . . . 23,937

1980 . . . . . . . . . . . . . . . . . . . . . . . 26,943

1981 . . . . . . . . . . . . . . . . . . . . . . . 31,599

1982. . . . . . . . . . . . . . . . . . . . . . . 17,328

SOURCE U S Department of the Interior, Bureau of Mtnes, Minera/ Corrtmod/ty

Summaries 1984

sons, tantalum is in the second tier of strategic

materials.

As indicated in table C-15, annual U.S. consumption of tantalum is small, on the order of 1 million

pounds per year.

The largest share of U.S. tantalum consumption

(54 percent) goes into electronic capacitors. Capacitors are used in all areas of electronics: computers

and office equipment, telecommunications, instruments and controls, consumer, and automotive.

Some areas of capacitor use maybe considered essential and others not. For example, in the United

States, consumer electronics accounts for about 12

percent of tantalum capacitors. (In Japan, by contrast, two-thirds of tantalum capacitors are used for

this purpose.) Moreover, where size and stability

are not essential features (as in consumer products),

aluminum electrolytic capacitors are competitive

and can substitute for tantalum capacitors. Thus,

only a limited proportion of tantalum use in capacitors may be regarded as critical.

Another important use of tantalum (27 percent)

is in cemented carbide metalworking tool bits. As

an additive, tantalum carbide improves hot hardness and crater resistance in tool bits. Columbium

carbide is a suitable substitute for the purpose.

About 9 percent of tantalum consumption goes into

high-temperature superalloys for critical parts

(blades and vanes of gas-turbine engines for aircraft). The other principal use of tantalum is in mill

products, mainly used by the chemical industry for

such items as corrosion-resistant heat exchangers

and tank linings. Substitute products are glass-lined

containers, graphite, Hastelloy C, titanium, and zirconium.

The United States imports 90 percent of its tantalum in the form of concentrate and tin slags. The

largest supplier is Thailand, with smaller amounts

coming from Canada, Malaysia, and Brazil. Malaysia and Thailand ship substantial amounts of tantalum-containing tin slags, a source that is likely to

decline as the old tin slags become depleted, Canada is the largest source of natural tantalum minerals, but Australia may eventually supply a larger

portion. In addition, there are reserves of tantalum

in Nigeria and Zaire. Nigeria’s tantalum is a byproduct of columbium production; demand for

Nigerian columbium may decline as production of

columbium oxide in Brazil gears up. Nigerian tantalum production may then drop accordingly. Table C-16 contains statistics relating to tantalum,

No significant mining of tantalum has occurred

in the United States since 1959. This country has

3.4 million pounds of tantalum resources in identified deposits, but they are uneconomic to develop

at current prices. For several years world tantalum

prices have been falling, which probably indicates

confidence about future raw materials supply. As

Table C-14.—Titanium Sponge: U.S. Imports, World Production, and Reserves

Sources of U.S. imports (1979-82):

Country Percent

Japan. . . . . . . . . . . . . . . . . . . . . .. .....85

China . . . . . . . . . . . . . . . . . . . . . .......11

Soviet Union. . . . . . . . . . . . . . . ........4

NOTE” 1982 U S net import reliance = W

World mine production and reserves, 1982 (short tons):

Mine production Reserves

Country Amount Percent Amount Percent

Soviet Union . . . . . . . . . . . . . . . . . . . . . . . . . . 44,000 53 50,000 39

United States . . . . . . . . . . . . . . . . . . . . . . . . . 15,600 19 33,500 26

Japan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18,600 23 36,000 28

United Kingdom . . . . . . . . . . . . . . . . . . . . . . . 2,600 3 5,500 4

China . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,500 2 3,000 2

World total. . . . . . . . . . . . . . . . . . . . . . . . . . 82,300 100 128,000 100

w—Withheld to avoid disclosing company proprietary data

SOURCE U S Department of the Interior, Bureau ot Mines, Mneral Commodity Summarfes 7984
396 Ž Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table C-15.–U.S. Consumption of Tantalum, 1978.82

Apparent consumption

Year (short tons)

1978 . . . . . . . . . . . . . . . . . . . . . . . 560

1979. . . . . . . . . . . . . . . . . . . . . . . 720

1980. . . . . . . . . . . . . . . . . . . . . . . 590

1981 . . . . . . . . . . . . . . . . . . . . . . . 630

1982. . . . . . . . . . . . . . . . . . . . . . . 530

SOURCE: U.S. Department of the lnterioLBureauof Mines, A4inera/Comrnodity

Summaries 1S4.

mentioned below, production capacities of developing nations for both tin and tantalum have been

rising.

Tin is included in the second tier mainly because

it occurs geologically with tantalum. Because of this

geological pairing, tin supplies share characteristics of vulnerability with tantalum.

Tin consumption in the United States is shown

in table C-17. Tin is used in cans and containers,

electrical applications (solder), and in construction

and transportation. Substitutions for most of these

uses are widely available. There are a multitude of

alternative materials for tin cans and containers.

Epoxy resins can be used in place of solder in some

nonelectrical uses, and aluminum or copper base

alloys or plastics can be used in place of bronze.

Lead-base bearing alloys and plastics can be used

for tin-containing bearing metals as well. Thus, the

essential use of tin is limited to electric solder.

Nonetheless, because the material is pervasive in

many industries, a serious interruption of supply

might cause severe economic dislocation, until substitutes could be adopted.

The United States relies on imports for 72 percent of its tin requirements. Major import sources

at present are Malaysia, Thailand, Bolivia, and Indonesia. Quite a few other countries have large deposits (China, Soviet Union, Burma, Brazil, Australia, Nigeria, the United Kingdom, and Zaire), as

shown in table C-18. In the developed world, a British mining consortium is going ahead with the first

commercial use of a suction dredge for the seabed

mining of tin in sands off the coast of Cornwall.

Small quantities of tin are produced domestically,

as a byproduct of molybdenum mining in Colorado,

and from placer deposits in Alaska and New Mexico. Over 20 percent of the tin consumed in this

country comes from recycled scrap.

There is a large inventory of tin in the U.S. stockpile, which essentially serves as another supply

source, since sales are made constantly to reduce

the surplus, From July 1980, when tin sales began,

to the end of 1982, over 10,467 tonnes of tin were

disposed of from the stockpile. This amounted to

approximately 7 percent of U.S. apparent consumption over that period.

Vanadium is on the second-tier list because of its

critical uses. It is employed in a variety of steel and

Table C-16.—Tantalum: U.S. Imports, World Production, and Reserves

Sources of U.S. Imports (1979-82):

Country Percent

Thailand . . . . . . . . . . . . . . . . . . . . .. ...42

Canada . . . . . . . . . . . . . . . . . . . . .. ....11

Malaysia . . . . . . . . . . . . . . . . . . . . .. ....9

Brazil . . . . . . . . . . . . . . . . . . . . . ........8

Other . . . . . . . . . . . . . . . . . . . . . .......30

NOTE: 1982 U.S. net import reliance = 92 percent.

World mine production and reserves, 1982 (short tons):

Mine production Reserves

Country Amount Percent Amount Percent

Brazil . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 115 31 1,500 4

Canada . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85 23 3,000 9

Australia. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85 23 7,500 22

Thailand . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 3 10,000 29

Nigeria . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 3 5,000 15

Zaire . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 3 3,000 9

Malaysia. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — o 2,000 6

Mozambique . . . . . . . . . . . . . . . . . . . . . . . . . . NA NA NA NA

Other market economy countries . . . . . . . . 50 14 2,000 6

Other central economy countries . . . . . . . . NA NA NA NA

World total. . . . . . . . . . . . . . . . . . . . . . . . . . 367 100 34,000 100

NA—Not applicable.

SOURCE: U.S. Department of the Interior, Bureau of Mines, Mir?era/ Commodity Summaries 1984,
Appendix C—Overview of Second-Tier Materials ● 397

Table C-17.—U.S. Consumption of Tin, 1978-82

Apparent consumption

Year (short tons)

1978 . . . . . . . . . . . . . . . . . . . . . . . 70,304

1979 . . . . . . . . . . . . . . . . , . . . . . . 76,262

1980. . . . . . . . . . . . . . . . . . . . . . . 60,068

1981 . . . . . . . . . . . . . . . . . . . . . . . 60,012

1982. . . . . . . . . . . . . . . . . . . . . . . 44,364

SOURCE” US Department of the anterior, Bureau of Mines, Minera/Cornrnodity

Summaries 1984

alloy products and as a chemical catalyst. Of the

possible substitutes for vanadium, many are themselves more strategic. U.S. vanadium supplies and

processing capacity are sufficient to meet this country’s requirements. Yet a considerable amount is being imported at present, which adds an element of

vulnerability. Altogether, vanadium probably belongs near the bottom of the list of second-tier strategic materials.

Vanadium is another material that is used in comparatively small quantities, as shown in table C-19.

About 80 percent of the U.S. vanadium consumption is used as a microalloying agent in steelmakTable C-18.—Tin: U.S. Imports,

ing. Vanadium imparts hardening properties to

steel by means of grain refinement. It is used in

high-speed tool steels and high-temperature rotors

because it forms stable carbides and resists hightemperature abrasion. It is used in crankshafts, pinions, and gears because of its shock and wear resistance, The high strength-to-weight ratios of steels

containing vanadium (HSLA and full-alloy steels)

make these steels valuable in weight-saving components. Because of its various uses in steel products,

demand for vanadium is tied to the demand for

steel.

Ten percent of U.S. vanadium demand is in titanium alloys, where it provides strength and workability. The rest of U.S. vanadium consumption is

in the chemical industry, where vanadium is used

as a catalyst, mainly in the production of sulfuric

acid.

Many metals are interchangeable with vanadium

to some degree in alloying; examples are columbium, molybdenum, manganese, titanium, and

tungsten. Platinum can be used in place of vanadium as a catalyst in the chemical industry.

World Production, and Reserves

Sources of U.S. imports (1978-81):

Country Percent

Malaysia . . . . . . . . . . . . . . . . . . . . .. ...39

Thailand . . . . . . . . . . . . . . . . . . . . .. ...21

Bolivia . . . . . . . . . . . . . . . . . . . . .. .....17

Indonesia . . . . . . . . . . . . . . . . . . . . .. ..13

Other . . . . . . . . . . . . . . . . . . . . . .......10

NOTE” 1982 US net import reliance = 72 percent.

World mine production and reserves, 1982 (short tons):

Mine production Reserves

Country Amount Percent Amount Percent

Malaysia. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57,600

Soviet Union . . . . . . . . . . . . . . . . . . . . . . . . . . 40,800

Indonesia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40,200

Thailand . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28,700

Bolivia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29,500

China . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16,500

Australia. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14,000

Brazil . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,500

Great Britain . . . . . . . . . . . . . . . . . . . . . . . . . . 4,400

Zaire . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,400

Nigeria . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,000

Burma. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,900

United States . . . . . . . . . . . . . . . . . . . . . . . . . Negligible

Other market economy countries . . . . . . . . 12,100

Other central economy countries . . . . . . . . 4,000

World total. . . . . . . . . . . . . . . . . . . . . . . . . . 265.600 a

22

15

15

11

11

6

5

4

2

1

1

1

1,320,000

1,100,000

1,705,000

1,320,000

1,080,000

1,650,000

385,000

440,000

286,000

220,000

308,000

550,000

77,000

231,000

66,000

10.738,000

12

10

16

12

10

15

4

4

3

2

3

5

1

2

1

100

aExcludes U.S. production

SOURCE: U S Department of the Interior, Bureau of Mines, &firrera/ Commodity Summaries 1984
398 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Table C-19.—U.S. Consumption of Vanadium, 1978-82

Apparent consumption

Year (short tons)

1978 . . . . . . . . . . . . . . . . . . . . . . . 8,164

1979 . . . . . . . . . . . . . . . . . . . . . . . 10,168

1980 . . . . . . . . . . . . . . . . . . . . . . . 8,521

1981 . . . . . . . . . . . . . . . . . . . . . . . 9,584

1982. . . . . . . . . . . . . . . . . . . . . . . 6,406

SOURCE. U S. Department of the Interior, Bureau of Mines, Minera/ Commodity

Summaries 1984.

Overall, U.S. net import reliance for vanadium

(24 percent) is not as high as for most other strategic materials, but this is due in part to the depressed

state of the steel industry in 1982. The foreign

sources of supply are not very diverse; the majority

of vanadium imports originate in South Africa, as

table C-20 indicates. The major world deposits are

located in South Africa, the Soviet Union, the

United States, and China. These same countries are

the world’s leading producers of vanadium. In this

Table C-20.—Vanadium: U.S. Imports,

country, vanadium is usually mined as a coproduct

or byproduct of uranium or phosphorus; an exception is the vanadium mine in Hot Springs, Arkansas. Because of this geological pairing, continued

U.S. production may be somewhat uncertain, since

it depends to a considerable degree on the market

for unrelated minerals. Although the United States

has the reserves to be self-sufficient, market forces

may at times favor imports.

Vanadium can also be recovered from iron slags

and petroleum residues. Japan and the United

States are the only countries currently producing

vanadium from petroleum. The United States uses

Venezuelan crude oil as a vanadium resource.

Vanadium is also imported in semiprocessed form

as ferrovanadium, largely from industrialized countries. Canada, Belgium, Luxembourg, and West

Germany supply approximately 90 percent of U.S.

ferrovanadium imports. Canada processes U.S. and

South African ores into ferrovanadium and then exports it to this country.

World Production, and Reserves

Sources of U.S. imports (1979.82):

Country Percent

South Africa . . . . . . . . . . . . . . . . . . . . ..54

Canada . . . . . . . . . . . . . . . . . . . . .. ....10

Finland . . . . . . . . . . . . . . . . . . . . . . . . . ..7

Other . . . . . . . . . . . . . . . . . . . . . .......29

NOTE: 1982 U.S. net import reliance = 24 percent.

World mine production and reserves, 1982 (short tons):

Mine production Reserves

Country Amount Percent Amount Percent

South Africa . . . . . . . . . . . . . . . . . . . . . . . . . . 13,200 36 8,600,000 47

Soviet Union . . . . . . . . . . . . . . . . . . . . . . . . . . 10,500 29 4,500,000 25

China . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,000 14 1,800,000 10

United States . . . . . . . . . . . . . . . . . . . . . . . . . 4,100 11 2,400,000 13

Finland . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,470 10 100,000 1

Australia. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110 <1 270,000 1

Other market economy countries . . . . . . . . 120 <1 600,000 3

World total. . . . . . . . . . . . . . . . . . . . . . . . . . 36,500 100 18,250,000 100

SOURCE’ U.S. Department of the Interior, Bureau of Mines, Minera/ Commodity Summaries 1984
Index
Index

A{:oje JVlining, 145

Ar]iabatic engines, 298-299

Aclianced ~orning electrode (A(~E], 76

Adiance(] materials

ceramics, 22, 25, 286-301, 324-327, 347. 368-369

chromium substitutes 22-23

cobalt substitutes, 25

{:om pos ites, 268, 301-313, 327-328, 347

data collf;~;t ion and analysis, 318-319, 324-326, 371

import (1 epf>nden cc, 363

institutional harriers, 323-328

]egislati~re actions and, 118-119, 338-340

long-range or(ler intermetalli{: materials, 313-314

o~’er~ ie~ir, 285-286

polic} options, 35

ra~)id s(jlidi f’icat ion, 283, 314-317

resear{:h and (I(; k’[; lo])rll(;rlt, 35, 118, 347, 3[;9-370

Adtran(;e(l Llateria]s I)ekwlopment l)ro~r am, 326

Ad\ranced ~)rocessing technolo~ies

ele(;t ron ic scrap, 253-254

o~rf]rlrie~~r, 216

])rospects for, 2,57

sta i n]ess steel, 274-276

Stcf!l , 232, 235-237

so pera 1 I()}rs, 24-25, 220-221, 227

Aerospace appl i(:atioos. Set? Avia

/\ fri(:a n c i~r i] d isordc r, 90

Agen{; }r for I ntf; rnati onal I) f;\rf; lop

A,qnell’ hl i ni n~, 1 [;3

257, 279-284

ion ap~)li(:at ions

nerrt [ A 1 1)], 358

A i r F’o rx:f; , 22 (j, 22 ~, 2 ~ 1, ~~ 1, 327, :]~ ~, 3 ~[;

A i r For’(;[; hfateri als 1,aborat or}, 301, 317

A i r-melting prxx:ess[; s, 222

Albania, 141, 143-144, 162

A ] l)a n Jr R[!sea r(:h (je n t e r, 153, 272

A] [;oii , 317

A 1 ]f; ~hf; n Jr I,u{j IL1 m St f;el (jor>p, Resea r’(; h (~f;n t (; r, 27 ~1

Al]o}” certifi(: ation processes, 319-323

A]lo} s1[)[)]s, 22{1, 230, 276-277

A It ernat i Ire al 103 com mere ial izat i on, 34-35

A 1 t c r n a t i ~’c ap p I’() a c h [:s. ,5’ec ‘1’e(:hrlologi(::]l” a~)[]roaches

A] u m i not hf:rm ic (, A-’I’ ] ])rocf; ss, 157

Alum i n u m alloys, 317

A rnax, 161, 163-165, 175-176, 200

Ameri(:an Cf; ramics So(:iet}r, 325

American (jhrome & (~hern ical (;o.. 1 bp

American Chrome [;o., 150

/\nlcri(:an S(~(;iet} for Nqf;tals IASNI), 341

Amf]ri can Societ } for ‘1’est ing of Materials (AS’1’hi), 272,

320, 328

American Sof; ict\r of’ Llechanica] Engint!ers IAShJI E), 272,

320, 328

Anl(J(:(J L1 inf:rals, 167

/\ na(:() n(la hli nf)rals (; ()., 151, 152, I 97

An(lrus, Cf;(;i] H., 1 1 4

A n g]o A m f;ri(; a n, 147, 178, 193

AnKlo ‘1’r[~lls\t]{~l-( ;[)rlsoli(latf;(j (:0. I,td., 178

A n s(, h o t z .\ 1 i n i n g, 170

Applications

ceramics, 294-301

chromium, 12-13, 53, 62-66, 78-80

cot)dt, 13, 54, 66-70, 78, 80, 101

composites, 305, 308, 311-312

essential, 12-13, 46, 78-80

ferroallo}rs, 63, 187, 2~33

future, 77-78

future consumption estimates, 64, 70, 72-74, 78-80

import consumption charrges and, +1

]ong-range ordf:r intf:rrnetallic materials, 313, 314

manganese, 13, 55, 71-72, 187

platinum ,qroup meta]s, 13, 56, 72-77, 79, 80

rapid sol id i ficat ion mat f;ri a 1s, 315-317

superallo~’s, 63, 67, 278, 281-284, 290

types, 61

Ar~[~~~-o~\,~[;Il-~l[; [;:~rt]L~ ri~at ion (A(]I)), [j[j, 2 I 6-21 ~, 248,

251

AK N4C0, 274

ArnlJr hl at f;rials ancl hlfx:hanics Resf;ar(; b (l[;ntf~r

(Ahlhl RC), 316

Associated hlanganesc, 178, 184

Australia, 160, 161, 163, 179-182

Autonloti~f) a])pl ications

cf)ramics, 297-300

chromium, 62-63, 80

cobalt, 67

corn posit f:s, 308, 311-312

future changes, 78

future consumption estimates, 8 0

platinum group mf;ta]s, 72-74, 79, 80

rapid so] i[lifi cat ion mat f]rials, 31 [j, 317

superallo~rs, 284, 290

Autonloti\7e gas turbine (AGT], 244, 299-300”

Automotilre Gas Turbine (ACT) program, 299, 301

i4utonloti[re Prduc;ts Ili~ision of AiR~;sea r(; h, 298

Autornoti\e Propulsion Research and I)[:\’(]lO1)Ill[;r~t Act

(Title III of Publi(: l,a~fr 95-238), 299

Aiiation applications

ceramics, 300-301

chromium, 63-64, 78-79

cobalt, 67, 101

(composites, 305, 311

long-range orcler interrnetallic matf;rials, 313. 314

rapid solid ificat ion matf;rials, 315-317

superal]o~’s, 278, 281-284, 290

Bacterial ]eacbing, 132

Bayf;r Group, 139

13(:1, I,td., 163

Bell System, 101

Bent; ficiat ion, 135, 153, 187

Bcnquet Corp. < 145

Bf;thlf>hern Stfwl, 178

Bioenginf;ering, 13 2

Bird Ri~’er df;pos it, Canada, 147-148

Hlackbir(j Nline. I(]aho, 168-170, 173, 174, 355, :356

401
402 Ž Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Hl;]st I (l rll;lf’(:~, 188, 2:15-2:1[;

130~:s, ] . (:illf!t), 1 [)8

Honao, ” 173

[~ot~tkrtlnii, l[io, 1 (i 1, 1 (i:]

f{(]t~it’{ln:i f~S’1’. 1 fi~l

I{r;]z i], 1-11, 144, 177-1 H:3

Hrit isll ( ;Ilronlf! & ( ll](!IIlit::ll ( 1o., 157

HII rrtIu of” hli[~[;s

(;hronliu[n rt!ltittwi il(:ti~itit;s, 143, 15:i

(:ot)cllt r[:!ill(xl il(;ti~’itit’s, 170, 17 Tj- 174

f~x])l[~rdtion I’f!liit[![i ;I(t i~’itif!s, 208, 20!)

lf;rr(JcIllojI ])rf)ci~l(:tion ~ltti~itit!s, 3 3

nl;ing;i[](’st: Iscliitcd d(;ti~iti[;s, 183-187

~)lr]ti]lunl gll)ll~) lllf’tc]l~ r(;l;ltt!(l il(ti[’iti[:S, 200”

rtx:> (;I ill: ii(.t ii’it itx, :ifi, 225, 251, 2 5:1-2 54. 258-25!1, :374,

:17$>, ,177

s~ll)stit(]tion il(;ti~’iti{;s, 34, 1 14, 2(i7, 272, 275-277, :1(}:1

Hurllll(li, 162

Hllsh\’ol(j (;ompl(!k, south :Ifri(:a, 139. 145-146, 1{15

( :,lt)ill(!t ( ;01111(: i] 011 ~iltlll’il] ~(?SOLII’(:f!S cII1(] h; Ilf’i I’OIIIUeIlt,

117$ 118. :1:17 -:]:)8

(;iilil’t)rlli;l \’i( L(JI (;[)I])., 132, 170. 17 1

(;illlllill (!, 145

( J ii 11 ~1(1 il

(:llr[)mium ~)ro(i(l(:t ioIl, ” 1-17-14 8

(ol)illt ~)ro(iu(;lion.” l(io-l(j4

r)i(. k(!l strike (Ii 1{169, 1(;, 94-97, 10:], 257

~)];ltinum gI’()\I~I IIl(!tii]S pro(iu(;tion, I<lo-l\l ], 1!) ], 1{]4

(;ilrdjds ])rojf;(;t, IIrtlzil, 180-183

(n{l I’\)[)Il)(; ilI’~)011 (, OIllp[)Slt f!>, :]()~, :]()~], :~()~-:~()(i, ‘] ] I

(JarlJ[)IIm;]tr ii [onl~)[)sitt?s, 302, :103, :;05-:] 06, 311

(jai’t)OIl St[![!IS, 220, 230, 276

(:;lI.t~orllrl(i~lrll (:()., 2{l(j-297

(:~iI’l)otll[;l’tlli[, i)ro(t;ss, 157

(::irolnlt)t, lll[; ., 170

(jart(;]s, 8(;-87

(;art[?r, ]inlnl~r, 111, 11 4

(:asting twhnolo$q’, 24-25, 220, 23(i-2 :17

(:atdj’sts, fi9, 80, 101! 245-248, 375

(J;~talj’ti(; (;on~[!rtt;rs

altcrr]tlti~c te(:hI](Jlogif;s, 24:1-244

[)latinum groui) nlf~tdl substitutes, 24:1-244

rt:(;~r(;ling, 21, 28, 1! lH. 239-243, 240-25(1

S(}(:on[!han({ In:ll’kct, 242-243

stainless stwl sut)stitutcs, 274

strat[!gi( mct[lls USC. 14, 72-74, 79, 2;18-2:3!1

Slli)pl}’ (iisruptif)n Stl’ilt(?gi CS, 244-245

(Jcn][;nt[!(l (;art)i(ics. 67, 80, 101-102, 254. 275

(jt; nt[!r for (~f?ranli(; Rescar(;h, Rutgc[s [ lni~crsit~’, 327

(: f;ntcrs for IIldllstri{ll ‘]’ WhIl[)]()~}’, 342

(Jerami(; (;a])a(; itors, 75-77, 80

(l(!I’;IIIli(:/g] {lSS IIlilt I’i X (: OIIlpoSit(; S,” 303, ~)06-~~8

(j(; rikllli(; S

;lir(;r;ti’t turhin[; engin[? a~)])lications, :100-301”

(;onljwsitc matrix. 303, 306-308

(;utting tool applictltions, 294-295

(iat:] (:oll[!ct ion and analy’sis, 324-326

he;it ~;ngine applications, 297, 325-327

h[!ilt [? X(:hiII)~CI’S, 29[;-297

~{j’~-’~()-l, f]fjtl-:](j{) ]I]ilI’k[~t [~l(:to I’S, _ -.

()~’(:r~’if!~~, 286, Z[j[i

l)ro~)(:r ties, 2H[j

[)1’ OS])(?(:t\ 101’, 22. 25, 2(;7-268, 288, 2{10, 292

r(!>t)ar(,ll {i 11(1 ({(!\ ’[!loI)IIIE)Ilt, 268, 2:):1-30 1. :j 25-327, :34 7

St:lti O1lill’\r (~n~ill(’ ;i[)~)li(:;it ions, :\() 1

\ f:hi(; lt: ii I)~)li(:iltio IIS, 297-:100”

L\r(!:l I’ i)i)l)l i(:iltiolls, 2<15-296

(;(~r<i]]li(: ‘1’(?(:h Ilolo ~\” for ,\(\\<II](:(:(i Il[!at hj]l~int;s i)r, )-

~r{][ll 1)1:111, :326

( IOI-t ifi(;atioIl, :j 19-:32:1, 127-1128, I(i[)

( :[’rt ifi(](l ,llloj I)r(](lll(,ts, 224-225

(; 11 ,1’1’ [( :(j[l~~)[lt[lr t I;]rnlonizing ;l~)l)l i(.[itio[l> ‘1’;iilor(!(l]

S)’st(’nl, 277

(Jllcmi(:dl il[)~)l i(:tltiol)h, [i 1, 65, (j(j, (;9, 72, 74

( ;l][;l]l i(;i]l (;~ltil]\$jt$, 24[j. ,$(?[? (11.$() (;iltiil\’\t S

(:ht:\ I’(III Kt:sot;r[x+ (lo. ((; h[![[”()[l (’S/\], 1[)7

(Jl]ina, 178, 182

( jlll’O1l)it[! ]’[!fl’{]( :tO1’l(!s, [j(j

( ; h 1’()[11 iU 111

, I i ~ [) 1 i (,,1 t i ( I IIS, 12-1 :j, 5:1, [j2-(j(j. 70-80”

(;()]ls(~r~<]t ioI1. 21. 21.7, 218, 2:19, 248-251

t. ( I I 1s (I II ~ ~ )t i( ) n, I :1, 44, 5:1, [)2. [i:], 65, 7P-H()

~l(]]I]t;sti(, I)ro(ili(,t ion, 1!1-20, 5:1-b4, 12(;. 148-154, :155

1(’rr[)( l]r(]l]liuln, l[i, 1{)-21. 44, 5:1, fj:~, 1 :18, 1 :1!), 141-147,

I 54-1 5{)

ior(;ign [Irod[]ctiorl,” 12(;, 1:IH-14H

in]~x)rts. 53, :)4, 1:38

[)\’or\’i(!; l’, 5:1-54

~)oteIlti;il sour(x?s, 12[; , 147-148, 152-15:1

pro(;[!ssillg, 1:1(;, 153159

])l’()(ill(:t i()ll, 14, 1{1-21, 136-139

])rospects for, 153-154, 334

\ u t)st i t u t i ( )n, 21 -2:1, (i T1-66, 268-277, 2 ~{j, ~~~, ~[j~, Z{)(),

:1 [;(;

su]~])lj (Iisru])tions, 15-16, 48, {) I-94, 103, 104

(~hromiunl nlf;t;ll, 15&15{)

(Iia. Afinertl Aut]an S.A. dc (~.\’., 178, 183, 184

( ;It;a I] ,Air fl(;t ( l~uhli(; I,aw’ 91-604 iIn(i ;iI[l[;Il(lIl][;llts), 72

(Jloswi [Iic f’orging, 220-221

(Jo,]t i rigs, 275, 282, 305, 310

(;obalt

:ipj)lictit ions. 13, 54, [;[; -70, 78, M), Iol

(; O1lS[!l’~’:lt ion, 24-25, [j9, 10 I -102, ~ ] 5, 21 []-~~(), 222, 225,

‘)4 -.5-248, 254

(,()[ls(lnl])t ion, 13, 44, 54, [;7, 68, 70, 7{1, 80, !1{1, 277-278,

~{)()

(lonlcst i(: pro(l u(:t ion, 55, 126, 167-174, 354-35[;

f’orf:ign ])rodu(;t ion, 126, 160-167

i reports, 54, 159

()\’t!I’\’ic Lv, 54-55

potential SOUI’(:[!S, 126, 147, 162, 165-172, 21 (), 246

pro(; cssing, 24-25, 137, 160-1 [51, 171, 173-177

product ion, 14-15, 23-24, 31-32, 137, 159

])ro(~uct ion subsi(iies, 126, 171-173

prospects for, 173-174, 334

substitution, 25, 68, 69, 70, 99, 1() 1, 279-284, 290

su[)I)l~ disrul)t ions, 16, 48, 97-104

(lo~){~lt panic Of 1978-79, 16, 63-64, 97-104, 257

(;of rcmmi, S. A., 165
Index ● 4 0 3

(jriti(:a] Nl;itf)riiils (;olln(;il. 2{1

(lumrnin l+:n~inc (h)., 299

(:utting tool” a]j]]lications. 294-295

(:\’R I), 178. 18:1
404 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

platinum group metals, 72, 74-77, 79, 80

Electrolytic chromium metal, 156-158

Electrolytic processes, 135, 157

Electronic scrap, 251-254

Elkem Metals, 158, 189-190

Embargoes, 87-94

Energy production facility construction, 65

Engelhard Corp., 193, 194, 201, 253

Environmental Protection Agency (EPA), 243, 251

Essential uses, 12-13, 46, 78-80, See also Applications

Etibank, 146-147

Eutectic superalloy, 283-284

Exploration

description, 129-131

domestic, 26, 28, 201, 204, 206-211

foreign, 142-143

land-based resources, 201, 204, 206-209

ocean-based resources, 209-211

policy options, 4, 32, 351, 353

prospects for, 126, 201, 204

research and development, 208-209

technology, 20, 131, 204-208

Extractive metallurgy, 135, 153, 174

Falconbridge, 161, 163-165, 194, 201

Federal Clean Water Act, 251

Federal Emergency Management Agency (FEMA),

172-173, 341, 342, 374

Ferbasa, 144

Ferroalloys

applications, 63, 187, 233

chromium, 16, 19-21, 44, 53, 63, 138, 139, 141-147,

154-159

domestic production, 20-21, 33, 44-45, 126, 136, 154,

157-159, 189-190, 361-362

foreign production, 15, 16, 19, 53, 126, 136, 139,

141-147, 157, 179-180, 183

imports, 15, 44-45, 55, 94, 138, 139, 177, 179, 189

manganese, 15, 26-27, 44, 55, 154, 177, 179-180, 183,

187-190

nickel, 175

policy options, 33, 361-362

prospects for, 26-27, 126, 141-142, 159

supply disruption and, 33, 45, 136-137

technology, 154-156, 187-188

Fiberglass composites, 305

Fiber-reinforced superalloy (FRS), 308, 310, 311

Finland, 141, 144, 154, 160, 164

Ford Motor Co., 295, 299

Foreign production

chromium, 126, 138-148

cobalt, 126, 160-167

ferroalloys, 15, 16, 19, 53, 126, 136, 139, 141-147,

157, 179-180, 183

manganese, 126, 178-184

platinum group metals, 126, 192-195

policy options, 32-33, 356-361

potential sources, 147-178, 162, 166-167, 180, 195

prospects for, 125-127, 162, 194

supply disruptions and, 91-92, 97, 102

Forging technology, 220-221

Foster Wheeler Corp., 156

Fuel cell stations, 77-78

Full alloy steels, 229, 230

Fuqua, Don, 116, 118

Gabon, 178, 179, 181, 183

Gag Island, Indonesia, 167

Garrett Turbine Engine Co., 282, 299

Gasquet Mountain Project, California, 150, 152, 168,

170-171, 355-356

Gas turbine applications, 244, 298-301, 310, 311, 313

Gecamines, 165

Gemini Industries, 240

General Accounting Office (GAO], 118, 173, 337-338, 354,

358, 360, 376

General Electric, 67, 281, 301

General Mining Union Corp. Ltd. (Gencor), 178

General Motors, 63, 299

General Services Administration (GSA), 157, 190, 341,

342, 376

Genetic theory, 204, 208

Geology, 128-129, 137, 159, 177, 199, 201, 204

Globe Metallurgical Division of Interlake, Inc., 159

Gold Fields of South Africa Ltd., 195

Goodnews Bay Placer Mine, Alaska, 196, 198, 200

Grande Carajas Development Project, Brazil, 180-183

Greece, 139, 144

Groote Eylandt Mining Co., 180, 182

Grumann Corp., 305

GTE Corp., 254

GTE Sylvania Corp., 225, 296-297

Gulf Chemical & Metallurgical Co, (Gulf C&M), 247

Hadfield steels, 71, 229

Hall Chemical, 176-177, 247-248

Hanna Mining, 175

Hanson Properties, 198

Heap leaching, 132, 187

Heat engine applications, 297, 325-327

Heat exchanger applications, 296-297

Hellenic Ferroalloys S. A., 144

Hellenic Industrial Mining & Investment Co., 144

High-strength, low-alloy (HSLA) steels, 63, 229, 230

Home scrap, 215, 222, 233, 235, 248

Hot isostatic pressing (HIP], 226, 280-281

Hot isothermal forging, 24, 221

House Armed Services Committee, 376

House Committee on Science and Technology}, 115,

117-118, 346

House Subcommittee on Seapower and Strategic Critical

Materials, 113

House Subcommittee on Transportation, Aviation, and

Materials, 117-118

Hydrometallurgy, 135, 171, 174

Hydroprocessing catalysts, 246-248, 375. See also

catalyst s

ICOMI, 178, 182

Impala Platinum Holdings, 165, 192, 194, 195
Index . 405

Ijmuiden Hoogo\rens B\’, 16 7

I reports

chromium, 53, 94, 138

cobalt, 54, 159

composite components, 304

ferroa]lo~rs, 15, 44-45, 55, 94, 138, 139, 177, 179, 189

form of, 44-45

]et”e] of, 42-44

manganese, 15, 44, 55-56, 177, 179

platinum group metals, 15, 57

uses of, 44

Import \ulnerabilit\’

ad~anced materials, 363

alternatilre approach prospects, 331-335

extent of, 41

ferroalloy production and, 136

Go\’ernment role in, 4-5

nonfue] m inera] dependence, 42, 44-45

problem of, 3, 5, 7, 41

reduction strategies, 3-5, 7, 11

substitution strateg}r, 264

In(;o

chromium activities, 141

coba]t activities, 160-164, 175

platinum group metal activities, 193, 194, 200”

rec~rcling actilrities, 225

superal]oys acti~rities, 322

Inco Alloy Products Co., 281

Inco Alloy Products Research Center, 273

Incone] allo}rs) 67, 322

1nco Research & Development Center Inc., 245-246

India, 141, 144, 178, 180, 181

Indonesia, 162, 167

Inmetco, 250

In situ leaching, 132, 187

Interdependence, 105-106, 108, 110

Interlake, Inc., 145, 159

International assistance, 358-360

International Council of Copper Exporting (;ountries

(CIPEC), 87

International Development Cooperation Agenc~’

(II)CA), 32, 165, 184, 358

International Harvester Co., 276-277

International Mineral & Chemical, 139, 178

International Nickel Co., 322

International Strategic Mineral In\rentory, 358

Ion implantation, 275-276

Iron aluminizes, 314

I ronmaking, 235-236

Isothermal forging, 25, 221

Japan, 293, 295, 298, 357, 368-369

Johns Man\ille Sales Corp., 197

Johnson Matthey, 165, 192, 201, 240, 252

Kawasaki Steel, 141

Kennicott Copper, 200

Ladle technology, 232, 236

Larco, 175

Large-scale fue] cell stations, 77-78

LASERGLAZING, 275

Laser technology, 275

LAYERGLAZING, 275

Lewis Research Center, 301, 327

Life extension strategif:st 216-217, 225-227, 281, 282

IJong-range order intf>rmetallic mat f>rials, 3 I 3-314

Longyear, E. J., 208

Machiner}’ sector applications

ceramics, 294-296

chromium, 65-66

cobalt, 67, 80

definition, 61

future materials requirements, 80

Madagascar, 141, 144-145

Madison Mine, Missouri, 168, 170, 173, 355

Magnets, 69-70, 101

Manganese

applications, 13, 55, 71-72, 187

conservation, 27, 215, 218, 230, 232, 233, 235-238

consumption, 13-14, 55, 71, 72, 79, 80

domestic production, 55, 126, 184-187

ferroal]o~rs, 15, 44, 55, 154. 177, 179-180, 183,

187-190

foreign production, 126, 178-184

imports, 15, 44, 55-56, 177, 179

over~riew, 55-56

potential sources, 126, 181, 184, 209-210

processing, 26-27, 136, 187-190

production, 15, 25-27, 136, 177-178

prospects for, 180-181, 185-186, 189-190, 334

steelmaking use, 187, 227-237

substitution, 27, 55, 290

supply disruption, 15, 91-92

Manganese metal, 189

Mansfield, Mike, 110

Maraging steels, 68

Marcona Iron Mine, Peru, 162, 166

Marinduque, 165

Marko Materials Inc., 316

Materials for Advanced Turbine Engine (MATE)

Program, 281

Materials policy

congressional actions, 112-119

conservation and recyc]ing, 371-378

coordination issue, 105, 107, 109, 111, 117-118, 343

elements of, 104-105

formulation issues, 342-350

goal, objective, and priority setting issues, 343-347

mineral production and processing, 350-362

National Commission on Materials Policy

recommendations, 107-109

National Commission on Supplies and Shortages

recommendations. 109-112

Paley Commission recommendations, 106-107

research and development inventory issue, 347-35o

responsibility for, 114-119

self-sufficiency v. interdependence issue, 105-106

statutory framework, 335-342
406 ● Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

substitution and ad~anced materials, 362-37 I

Materials program plan, 30, 172, 347-349, 360, 375

Metallgesellschaft, 141

Metallurgic Hoboken Overpelt, 165

Metallurg, In{;., 139, 141, 150

Metal Matrix Composite Program, 308, 310

Metal matrix composites, 303, 308-310

Metal Properties Council, Inc. (MPC), ‘274, 366

Metals Reser\e Co., 150

Metaux Speciaux, 161, 164, 165

Mexico, 178, 181, 183-184

Middleburg Steel & Alloys. 156

Mine development, 130, 131

hlineral activity, 129-131

Minera] depletion, 84-85

Minerals & Resources Corp., 193

Mining and Minerals Policy Act of 1970, 30, 114

Mining technology, 128, 131-132, 153, 173, 186-187,

200-20 1

Nlintek (Council for Mineral Technology], 146

Missouri Lead Belt deposits, 168, 170, 173

Morocco, 164-165

Mount Isa Mines Ltd., 147

hlulti]ayer ceramic capacitors (M1.CS], 76

National Aeronautics and Space Administration

(NASA)

adkr a need materials ac tikr it ies, 299, 301, 306, 308,

310, 311, 327

research role, 30

substitution activities, 34, 267, 272, 281, 282, 322,

323, 363

National Bureau of Standards, 34, 217

National Commission on hiaterials Policy (NCMP),

107-109

National Commission on Supplies and Shortages,

109-111

National Critical Materials Act of 1984 (Title II of

Public Law 98-373), 118-119, 338-340, 343, 346,

350, 369-370

National Critical Materials Council, 118-119, 338-339,

343-344, 350, 369-370

National Defense Stockpile, 5, 96, 99, 102. See also

Stockpiling

National Laboratories, 34

National Materials Advisory Board (N MAB), 48,

185-186, 201, 209, 259, 366

National Materials and Minerals Policy, Research

and Development Act of 1980 (Public Law

96-479), 29, 30, 36, 116, 118, 335, 337-338, 343,

358, 375, 376

National Materials Policy Act, 115

National Materials Propert} Data Network, Inc., 366

National Science Foundation (NSF], 327, 342, 370

National Technical Information Service (NTIS), 365

Near-isothermal forging, 221

Near-net-shape technologies, 24-25, 220-221, 227

New Caledonia

chromium production and processing, 141, 142, 145

cobalt production, 161, 162, 165, 175

Ni-Cal Technology Ltd., 171, 174

Nickel aluminizes, 313-314

Nickel metal, 175

Ni(;ke] strike of 1969, 16, 94-97, 103, 257

Nippon Mining, 163

Nonconventional energy systems, 77-78

Nondestructive e~aluation (NDE], 216-217

Noranda Mining of Canada, 168-170

Nerd Resources Corp., 147

Oak Ridge National Laboratorlr ([lRNI.), 270, 272,

313, 319-320, 326, 327

Obsolete scrap, 215, 218-220, 222, 224, 248, 249, 254

Ocean resources, 24. 26, 209-211

Office of Management and Budget (OMB), 118-119,

339

Office of Science and ‘1’echnology Policy, White

Ilouse (OSTP], 30, 116, 118, 338

Ontario Research Foundation, 148

O1)en pit mining, 132, 153, 173

Organic matrix composites, 304-305

Outokumpu Oy, 144, 164

O\erseas Pri\ate Investment [corporation (OPIC], 360

Oxicie dispersion strengthened (ODS] superallo}’s,

281-282

paley Commission, 106-107

Palhdium, 14, 28, 72, 76, 79, 80, 190-191, 197, 200,

251, 253

Pal)ua New Guinea, 142, 1477 162

Parts life extension. Sef; IJife extension strategies

Peru, 162, 166

PGMs, 146

Philippines

chromium production and processing, 141, 143, 14 5

(;obalt production, 160, 161, 165

Pittsburgh Pacific Processing Corp., 250

Placer deposits, 131, 200

Placer mining, 132

Plasma arc reduction processes, 156

Plasma furnaces, 155-156

Platinum group metals (PGMs)

applications, 13, 56, 72-77, 79, 80

conservation, 28, 57, 77, 215, 218-219, 239-245,

251-253, 376

consumption, 14, 44, 56, 72-80, 239, 240

domestic production, 57, 126, 190, 192, 196-201,

354

foreign production, 126, 192-195

imports, 15, 57

overt’iew, 56-57

potential sources, 126, 195-200

processing, 137, 193, 200-201

production, 15, 27-28, 137, 190-192

prospects for, 335

substitution, 28, 76, 243-244

supply disruption, 244-245

Political embargoes, 87-94

Polyacrylonitri]e [PAN), 304

Polymer matrix composites, 304-305
Index ● 4 0 7

Siilt Z~itt[}l’ I ll(i Ll\t ri(’t)au, ;l, (;,, ] (i2

s:]]] ~:],, (;(),., ] :]\j< 1 ~[], ] []J

Santini. James, I 11

S(:ott, I lu~k 1 1[)

Sm;on(iar~ rf;f’in in:, 2 :\6

St!(;ond{iry $(; I’{ip, 215

S(;(;urity! of supp]~, 83

African ci~til disorcicr factors, 90-91

(Uanad ian ni(; ke] strik(~ of 1969, 16, 94-{)7, 103. 257

(;:1 rt[!ls i] fl[i, 86-87

(;()])i~}t [)ani(; of” 1978-79, 16, 63-64, 97-102, 257

dcrn an[i surge factors, 85-86

(~ [!p] et iu n of’ resou r[; es factors, 84-85

effects of disruptions, 102-104

So\ict emhargo of” 1949 and, 15, 91-92, 103, 104

So\iet resour(;e war factors, 87-90

[ ‘,S. emi)argo of Rhodesian chrnm ium and. 15-16,

92-94, 103. 1 0 4

Sec also Import Lulnerahilit}; Nlateria]s 1)oli(;~

St;lf-sllffi(:i[;rl(;}r, 105-106

Sherritt Gordon, 161, 163, 164

Shicldalloy Corp., 157-158

S i] i(;onla ngan[?sft, 55, 188-189

Sili(,on nil ri(lc (:[;ranli(:s, 295

S1, N. 165, ]75

So(:ictc (i(: ]i] ‘1’iehaghi, 141, 14 5

Soc;it;t} of AutonlotiIc I+; ngineers (SAfi), 328
408 . Strategic Materials: Technologies to Reduce U.S. Import Vulnerability

Solution mining, 132, 153, 187

South Africa

chromium production, 139, 141, 145-146, 156

cobalt production, 160, 165

manganese production, 178, 179, 181, 184

platinum group metals production, 190, 195

strategic materials production, 14-15, 19, 26, 27

Soviet Union

chromium and manganese embargo, 15, 91-92, 103,

104

chromium production, 138, 141, 146

manganese production, 178, 179, 182

minerals policy, 105-106

nickel strike role, 96

platinum group metals production, 190, 191, 194

Rhodesian chromium embargo role, 93, 94

strategic materials production, 14-15, 19, 26, 27

Stainless steel

advanced processing technologies, 66, 236, 274-276

conservation approaches, 218, 248-250

materials consumption, 80, 238

materials substitutes, 270-274

overview, 230

qualification and certification of substitutes,

319-320

recycling, 239, 240, 242, 248-250

substitution, 268-276

Stationary engine applications, 301

Steel

classes, 229-230

chromite use, 66

conservation approaches, 218, 227-238

manganese composition, 71-72, 187, 227-232

maraging, 68

materials consumption, 80

processing efficiency, 232-237

process waste recycling, 250-251

tool, 68

Stevenson-Wydler Technology Innovation Act of 1980

(Public Law 96-480), 30, 119, 341-342

Stillwater Complex, Montana, 148, 151-153, 191,

196-198, 354

Stillwater Mining Co., 197

Stillwater PGM Resources, 197

Stockpiling, 105, 107, 110, 112-114, 117, 167, 172,

173, 340-341

Strategic and Critical Materials Stock Piling Act of

1946, 112

Strategic and Critical Materials Stock Piling Revision

Act of 1979 (Public Law 96-41), 30, 45, 113,

340-341

Strategic materials

changeability factors, 57-58

conservation prospects, 254-259

criticality of, 46-48

definition, 11, 45, 51

first-tier production and processing, 136-137

geology, 128-129

legislative policy guidance, 29-30

mineral activity, 129-131

processing, 135-137

production, 14-15, 136-137

selection process, 51-52

supply prospects, 125-128, 132-135

vulnerability of, 48-51

See also Chromium; Cobalt; Manganese; Materials

policy; Platinum group metals

Strategic Materials Act, 112

Submerged arc electric furnace, 154, 187-188

Subsidies and assistance, 30, 112, 126, 150, 167,

171-173, 190, 340, 354-356, 360, 362, 370, 374

Substitution

alloy steel chromium, 276-277

chromium, 21-23, 63-66, 268-277, 279, 282, 284, 290,

366

cobalt, 25, 68, 69, 70, 99, 101, 279-284, 290

criticality of materials and, 47

data collection and analysis, 34, 277, 318-319,

365-366

definition, 17

development stage, 366-368

institutional factors, 318-328

manganese, 27, 55, 290

platinum group metals, 28, 76, 243-244

policy options, 33-35, 365-366

prospects for, 266-268, 277-279

qualification and certification, 319-323

research and development, 263, 267-268, 270,

272-274, 281-284, 321-322, 363

role of, 263-264

stainless steel, 268-276

superalloy, 267, 277-284

viability factors, 265-266

See also Advanced materials

Substitution information system, 34, 277, 318-319,

365-366

Sumitomo Metal Mining, 165

Superalloy

advanced processing technologies, 24-25, 220-221,

227, 257, 279-284

applications, 63, 67, 278, 281-284, 290

composition, 277-278

conservation approaches, 219-227, 377

fiber-reinforced, 308, 310, 311

future requirements, 79

near-net shape processes, 220-221, 227

prospects for, 278-279

qualification and certification of substitutes,

320-323

rapid solidification process, 316

recycling, 24, 37, 101, 221-225, 227, 257, 377

substitution, 267, 277-284

Surface deposits, 131

Surface mining, 132

Surface treatments, 274-276, 282, 305, 310

Synthetic fuels, 78

Tambao, Upper Volta, 181, 184

Technological approaches

characteristics of, 17, 19
-—

Index . 409

chromium, 19-23

{;oba]t, 23-25

components of, 17

conser~ration, 36-37

implementation of, 29-31

manganese, 25.27

mineral product ion and metal processing

a tern at 1 ilws, 31-33

platinum group meta]s, 27-28

policj options, 4

prospects for, 331-335

substitution alter nati~’es, 33-35

Tenelon steel, 230

Thermal barrier coatings (T13CS], 282, 310

Titanium aluminizes, 314

‘1’()(}] st~!els, 68, 275

‘1’0}0 Soda, 158

‘1’o~’ota h!otor Co., 308, 312

Trade and I)e~relopment Program (TI)P], 32, 165, 166,

184

Transport at ion

chromium, 144-147

Cot):]lt, 137, 160, 163, 164, 166

manganese, 178, 180, 181, 183, 184

platinum group metals, 137

\’ul nerability of, 127

Transportat ion se(;tor a})plications

ceramics, 297-301

chromium, 62-64

COt)alt, 67

definition, 61

platinum :roup meta]s, 72-74

Sce also Automobile applications; Aiiation

a p p] ic a t i o ns

Trans,aal Consolidated, 139

‘1’rans~aal Nlining. 139

Trident hlining & Industrial Corp., 145

Trimming, 230

‘1’rurnan, Harr-}, 106

‘1’ungsten fiber-reinforced superallo~ (TFRSI, 310, 311

‘1’Llri)(](:h:]rgers, 290, 298

TLlrkej’, 1 :]CJ, 1 ~’1 , 1~fj-14 7

Twin Cities Research Center, 174

200 series stainless steel, 71

300 series stainless steel, 270, 272

Uganda. 162

Underground mining, 132, 153, 173, 200

Union Carbide, 139, 141, 145, 147, 184, 304, 320

United States Steel, 167, 178, 183, 230

United Technologies, 308

UN. Re\~ol\,ing Fund for Natural Resources

Exploration, 360

Upper Volta, 181, 184

Urucum Mineraco S, A., 182

U.S. Army Tank Autornoti\re Command (TACONI)

program, 299

U.S. Geological Sur\e\’, 192, 195, 209, 358

[Jtah International, 1 8 3

i’acuurn melting processes, 222, 224

\Tale do Rio Doce (CL’RD), 178, 183

lrehicle applications. See Automotive applications

J’ein deposits, 131

\roest-Alpine, 156

J’ulnerabilit}r of suppl}’, 48-51

Watt, James B., 45

Wear applications, 295-296

Western ILlining, 161, 163

11’estern Platinum, 146, 165, 193-195

Westinghouse, 156, 301

World resource depletion, 84-85

Wright-patters[jn Aeronautical ].aborat[)r}r, 226

Yugosla~’ia, 139, 143

Zaire, 159, 160, 165-166, 174

Zairian cobalt panic of 1978-79, 16, 63-64, 97-104, 257

Zambia, 159, 160, 166, 174

Zirnbab\\e, 139, 141, 147

Zimbabwe Mining & Smelting Co., 147