2023-11-07 10:34 Source: China Mining News Editor: Miner Materials Network
　　Bismuth is the most diamagnetic of all metals and the only non-toxic heavy metal. It is widely used as a substitute for lead, in pharmaceuticals, and in atomic research. Bismuth holds significant potential for applications in fields such as aerospace, chemical engineering, precision electronics, and nuclear industries. It is often referred to as the “green metal,” the “health metal,” and the “environmentally friendly metal.” The pricing mechanism for bismuth is primarily based on manufacturer-agreed quotations; global influence of futures contracts has yet to be established. Globally, bismuth prices are broadly consistent with those in China, and both are generally at relatively low historical levels. China ranks first worldwide in terms of bismuth reserves, production, and exports. However, bismuth prices do not fully reflect the scarcity of this resource, and it would be advisable to strengthen market regulation.
　　I. Global Bismuth Pricing Mechanisms and Price Trends
　　(1) The pricing mechanism for bismuth is primarily based on manufacturer-agreed quotations, and futures contracts have yet to gain global influence.
　　Bismuth is a rare, minor metal with a relatively small market size, and a mature global bismuth futures market has yet to emerge. Bismuth pricing is primarily based on manufacturer-agreed quotations, supplemented by auction bidding. Shanghai Colored Metals Network and Shanghai Steel Union, among others, publish daily prices for bismuth ingots and bismuth oxide, serving as reference for industry participants. In 2013, bismuth futures were listed on the Pan-Asia Nonferrous Metals Exchange; however, due to excessive speculation, trading was halted following the Pan-Asia Nonferrous Metals Exchange’s announcement of restructuring in 2015. In May 2023, bismuth ingot futures contracts were launched on the Wuxi Stainless Steel Electronic Trading Center, but trading volumes remain modest, and the market has yet to achieve global influence.
　　(2) From 2000 to 2022, the trend of bismuth prices generally exhibited an inverted U-shaped fluctuation.
　　From 2000 to 2005, bismuth prices remained generally stable. From 2006 to 2007, China restructured its bismuth production enterprises and eliminated outdated capacity, leading to a global shortage of bismuth supply and a sharp rise in bismuth prices—reaching a peak of over US$31,000 per ton. After that, prices fluctuated at high levels until 2014, though the rebound peaks never exceeded the earlier highs. In 2014, global bismuth supply increased, causing bismuth prices to fall from US$24,900 per ton that year to US$9,990 per ton by 2016—a level not seen since 2006. Since then, prices have continued to fluctuate and decline. In 2020, bismuth prices dropped to US$6,000 per ton, reaching their lowest point in more than two decades. Over the past two years, bismuth prices have staged a modest rebound from their bottom, stabilizing above US$8,000 per ton and showing a steady upward trend—but overall, prices remain at relatively low historical levels.
　　II. Global Bismuth Resource Pricing and Market Conditions
　　(1) Global bismuth reserves are concentrated in Asia.
　　Bismuth is one of the rarest elements on Earth and is typically found as a byproduct in lead and tungsten mines. Most bismuth is produced as a byproduct during the extraction and processing of metals such as lead, tungsten, and copper. Global bismuth reserves are usually estimated based on the bismuth content in lead resources. In 2017, global bismuth reserves were approximately 370,000 tons, with major reserves located in countries including China, Vietnam, Mexico, Bolivia, and Canada. Asia holds bismuth reserves of 293,000 tons, accounting for about 79% of the world’s total reserves.
　　(2) Global bismuth production continues to grow, and the center of production capacity is gradually shifting to China. Bismuth producers have a certain degree of influence on bismuth pricing.
　　First, since 2000, global bismuth production has increased by roughly fourfold. Specifically, from 2000 to 2006, annual production rose from 4,200 tons to 15,000 tons—a more than threefold increase. Since 2007, bismuth prices have generally declined, yet annual bismuth production has continued to fluctuate and rise by nearly 30%, remaining at around 20,000 tons over the past two years. Overall, supply has exceeded demand.
　　Second, the global center of bismuth production has gradually shifted from the Americas to Asia. Twenty years ago, countries such as Peru, Mexico, and Bolivia were major global producers of bismuth; however, due to factors including resource availability, environmental regulations, and rising costs, bismuth production has significantly declined. Since 2005, more than 70% of global bismuth production has been relocated to China. In 2021, global bismuth production totaled 20,000 tons, with Asia accounting for 99% of the total capacity. Of this, China produced 16,000 tons (80%), while Laos produced 2,067 tons (10%).
　　Third, the bargaining power of bismuth producers has gradually become more dispersed as production capacity shifts. Twenty years ago, bismuth production was concentrated primarily in countries such as Peru, Mexico, and Bolivia. As China’s production capacity has expanded, Chinese producers have increased their global market share. However, producers remain broadly dispersed, and the industry concentration in bismuth concentrate production is relatively low, leaving bismuth producers with insufficient bargaining power.
　　Fourth, the recovery rate of bismuth from scrapped products is low, falling below 1%. It is extremely difficult to recover and recycle bismuth from pigments and pharmaceuticals. Bismuth in alloys is most likely to be recycled secondarily, yet its recovery rate remains relatively low.
　　(3) Global bismuth consumption continues to grow modestly, with consumption regions generally concentrated but undergoing structural evolution. Consumers have relatively strong influence on bismuth pricing.
　　First, global bismuth consumption continues to grow, yet it remains lower than production levels. Consumption is concentrated in regions such as Europe, the United States, China, and Japan. In 2022, total global bismuth consumption reached 15,340 tons, of which 6,000 tons were consumed in Europe (39%), 4,760 tons in China (31%), 2,100 tons in the United States (14%), and 730 tons in Japan (5%). Compared to 2005, bismuth consumption in 2022 increased by approximately 2,400 tons. However, in 2022, bismuth consumption was still 4,660 tons lower than production levels. Over the past three years, influenced by factors such as the pandemic, global bismuth consumption has experienced short-term fluctuations.
　　Second, in terms of usage structure, the chemical industry accounts for the largest share of global bismuth consumption; however, different countries place varying emphases. In the United States, 67% of bismuth consumption is directed toward chemicals used in cosmetics, industry, laboratories, and pharmaceuticals, while 8% is used for low-melting-point alloys and metallurgical additives, and 25% is allocated to other sectors. In Europe, the primary sectors consuming bismuth are pharmaceuticals and the chemical industry. In Japan and South Korea, the electronics industry is the dominant sector for bismuth consumption.
　　Third, downstream consumers have strong bargaining power in the bismuth ore market. Currently, the major international bismuth ore companies include Canada’s 5N Plus and Belgium’s MCP Group. Both are key global suppliers of bismuth ingots and bismuth chemicals and wield considerable influence in the global bismuth market.
　　(4) The countries involved in the global import and export of bismuth are relatively concentrated, while the importing and exporting countries are relatively separated. Bismuth exporters have a certain degree of influence on bismuth prices.
　　First, 88.2% of global bismuth product exports come from four countries: China, Belgium, South Korea, and the United States. In 2022, the world’s top four bismuth-exporting countries were: China with 6,129 tons (64.6% share), Belgium with 886 tons (9.3% share), South Korea with 805 tons (8.4% share), and the United States with 559 tons (5.9% share). As production centers shift, so too does the global hub for bismuth exports.
　　Second, the four countries—U.S., Germany, Belgium, and Japan—imported 77.8% of the world’s bismuth products. In 2022, the top four global importers of bismuth products were: the U.S. at 3,102 tons (43.5% share), Germany at 1,358 tons (19.1% share), Belgium at 703 tons (9.8% share), and Japan at 387 tons (5.4% share).
　　Third, countries such as the U.S. and Europe export high-value-added products like bismuth chemicals and bismuth alloys. While their imports of bismuth concentrates remain highly dependent on China, this dependence has been gradually declining. In 2021, about 77% of the bismuth concentrates imported by the U.S. and 30% by Europe came from China. However, in 2010, Europe’s imports of bismuth concentrates from China accounted for as much as 84%. In 2021, 55% of Europe’s bismuth concentrate imports came from Vietnam.
　　III. The Market Situation of China’s Bismuth Resources and Its Impact on Pricing Mechanisms
　　(1) The trend of domestic bismuth prices is broadly consistent with that of the international market.
　　China is a major player in the bismuth industry and an important force in the global bismuth market. It has conducted extensive explorations into the bismuth market. Domestically, bismuth price trends generally align with those in the international market, yet there is insufficient intensity in price regulation. Various factors—such as China’s bismuth production levels, export trade policies, environmental inspections, and capital speculation—continue to influence global bismuth prices. For example, in 2006, as domestic mines faced stricter environmental regulations and the export tax rebate for bismuth was canceled, global bismuth prices rose rapidly. In 2013, speculative activities in the Pan-Asia Nonferrous Metals Exchange and subsequent regulatory measures led to sharp fluctuations in bismuth prices.
　　(2) China boasts the world’s largest reserves of bismuth, with high-quality reserves concentrated primarily in Hunan Province and Jiangxi Province.
　　Bismuth deposits in China are widely distributed, yet their resource reserves are highly concentrated. Bismuth deposits can be found in 16 Chinese provinces, with Hunan and Jiangxi provinces boasting particularly favorable resource endowments. As of 2022, China’s bismuth resource reserves totaled 162,300 tons, of which Hunan Province accounted for 126,000 tons, representing 77.6% of the national total. The city of Chenzhou alone has proven bismuth metal reserves accounting for approximately 73% of the national total and 50% of the global total. The South China region of China is the world’s most important bismuth-producing area; roughly 80% of the world’s confirmed bismuth resources originate from tungsten-polymetallic deposits.
　　(3) China ranks first globally in bismuth production, yet its pricing influence does not match its production advantage.
　　First, bismuth in China is primarily a byproduct and intermediate product of the refining and purification processes for metals such as tungsten, lead, copper, tin, and silver. Over the past two decades, bismuth production has grown by roughly 16 times overall. Before 2000, China's bismuth ore output remained below 1,000 tons. In 2001, China joined the World Trade Organization, marking the beginning of a new cycle in the mining economy. As prices of minerals like lead, tungsten, and copper rose and production increased, so did the output of bismuth-bearing ores. China's bismuth production surged from 770 tons in 2000 to 11,700 tons in 2006—a roughly 15-fold increase. This growth was largely driven by small, polymetallic coexisting mines, with significant increases coming from privately-owned small mines in Chenzhou City, Hunan Province; Ganzhou City, Jiangxi Province; and Gejiu Area, Yunnan Province. In 2007, China initiated efforts to consolidate and restructure its mineral resource development, closing small-scale and technologically outdated bismuth smelters, which led to a decline in bismuth production. However, production began to rebound after 2008. Since 2011, China's annual bismuth output has generally ranged between 15,000 and 16,000 tons, accounting for about 80% of global production.
　　Second, China’s bismuth production areas have shifted from a relatively concentrated distribution to a more diversified pattern. In 2007, China’s bismuth output was 8,900 tons, with Hunan Province and Jiangxi Province accounting for 5,000 tons and 2,300 tons, respectively—altogether representing 82% of the country’s total output. By 2022, China’s bismuth output had risen to 15,500 tons, with Hunan Province and Jiangxi Province contributing 5,300 tons and 4,000 tons, respectively; their combined share had declined to 60%. With advances in bismuth refining technology, some smelters have stepped up their efforts to recover bismuth comprehensively, and regions such as Henan, Gansu, and Shanxi have gradually emerged as new supply bases for bismuth ore raw materials in China.
　　Third, there are many bismuth-producing enterprises in China, and most of them are small-scale, with low production volumes and relatively low technological levels. Bismuth is primarily a byproduct of processing other metallic minerals, resulting in low barriers to entry and a large number of small mines. In China, companies with significant bismuth concentrate production include Hunan Nengjiang Nonferrous Metals Co., Ltd., Chenzhou Xiongfeng Environmental Protection Technology Co., Ltd., Chenzhou Xiongchuang Nonferrous Metals Co., Ltd., Jiangxi Copper Industry Group Co., Ltd., Guixi Dashanyuan Industrial (Group) Co., Ltd., Henan Yuguang Gold & Lead Co., Ltd., Jiyuan Jinli Gold & Lead Group Co., Ltd., Gansu Jingyuan Gaoneng Environmental New Materials Technology Co., Ltd., and Shanxi Taigu Shengde Nonferrous Metals Co., Ltd. However, market concentration is low, and overall production is rather dispersed, making it difficult to exert concerted pricing power.
　　(4) China’s bismuth consumption has been growing slowly overall, and consumers are in a buyer’s market, giving them bargaining power.
　　First, China’s bismuth consumption has generally been on the rise. From 2004 to 2022, China’s annual bismuth consumption increased from 2,500 tons to 4,760 tons, representing a growth of 190.4%. The expansion in consumer demand stems primarily from three factors: first, the robust demand for bismuth oxide in the electronics industry; second, the steady growth in bismuth consumption in the pharmaceutical and chemical sectors; and third, the increasing use of bismuth as a substitute for lead.
　　Second, China’s bismuth consumption is primarily concentrated in traditional sectors, with the majority going to the bismuth oxide industry as well as to fields such as pharmaceuticals, alloys and soldering materials, and metallurgical additives. Specifically, 41% of bismuth consumption is in the bismuth oxide industry, mainly used for the production of chemical reagents, bismuth salt manufacturing, glass and ceramic coloring, and inorganic synthesis; 28% is consumed in the pharmaceutical industry, primarily for the preparation of medicinal formulations; 21% is used in bismuth alloys and soldering materials, leveraging bismuth’s low melting point to improve alloy melting characteristics; and 8% is consumed as a metallurgical additive.
　　(5) China is the world’s largest exporter of bismuth products, yet its pricing influence and export scale advantages remain mismatched.
　　First, China is the world’s largest exporter of bismuth products. In 2022, China’s bismuth exports totaled 6,129 tons, with the main destinations being the United States (1,657 tons, accounting for 27.0%), Germany (1,596 tons, accounting for 26.0%), the Netherlands (1,150 tons, accounting for 18.8%), India (330 tons, accounting for 5.4%), and Japan (211 tons, accounting for 4.9%). The primary exported products include bismuth ingots and bismuth oxide. Due to the global oversupply of bismuth, China’s pricing influence still does not match its advantages in export scale.
　　Second, China mainly imports high-value-added bismuth products, though the total volume is relatively small. China primarily imports high-value-added bismuth products from countries including South Korea (140 tons), the United States (17 tons), Germany (15 tons), and Japan (12 tons). Additionally, China also imports bismuth ore raw materials from Kazakhstan (61 tons).
　　IV. Recommendations
　　First, strengthen the research and development of technologies for the comprehensive utilization of bismuth ores.
　　Second, we must strengthen the R&D and application of high-end bismuth materials, transforming bismuth’s resource advantages into industrial and economic strengths.
　　Third, strengthen the reserve of bismuth ingots.
　　Fourth, enhance the international participation and influence of bismuth ingot futures contracts.