HardAssetsInvestor

Written by Tom Vulcan  |

December 03, 2010

Guy Darby: China, High-Tech Driving Minor Metals

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The chairman of the Minor Metals Trade Association shares his outlook on the rapidly evolving strategic and rare earth metals industry.

HardAssetsInvestor.com was lucky to have the chance to talk recently with the current chairman of the Minor Metals Trade Association, Guy Darby, about both the development of association and some of the issues faced by minor metals industry itself.

Tom Vulcan (Vulcan): How has the role of the MMTA changed, if at all, since I last spoke with the MMTA back in 2008?

Guy Darby (Darby): Membership has pretty much doubled since 2007-08, which illustrates a real appetite for the association. It is the largest trade body in the world representing the industry in minor metals and rare earth metals. As far as trade is concerned, we have representation now in the association from cradle to grave: producers, traders, consumers and the relevant service industries that work with us, whether they be banking, legal, assaying, weighing or warehousing. It is an all-inclusive association.

Vulcan: Have you seen a significant increase in the number of North American members in the past couple of years?

Darby: When I took on the role of association chairman, one of the areas I wanted to focus on was the globalization of the association. It was, historically, European focused. It started off life in the 1970s very much as a traders' luncheon club that met to harmonize and standardize contracts between traders involved in the minor metal industry. I wanted to go beyond Europe, not least because the metals we handle are traded globally.

We commenced with North America, where we had a core membership base, and we've seen numbers grow. I'm pleased with the way things have gone and growth continues. That's one reason why we are holding our annual conference in Philadelphia next May.

Vulcan: Will we see any other, formerly minor, metals join the ranks of those traded on the London Metal Exchange [LME]?

Darby: In fact, we were approached last year by the LME to see if there would be much appetite for an alternative price discovery system for a range of minor metals. There was recognition that the volumes would not be there for a traded product per se, but perhaps there was an alternative to a journalistic price discovery system such as the London Metal Bulletin.

An alternative system was evolved by the MMTA/LME working party and this system was put to the membership who marginally voted against it. Although voted down, I think it was a very interesting and useful exercise and illustrates how the MMTA is presented with opportunities which can benefit its membership.

Vulcan: Did the MMTA play any part in the European Commission's "Raw Materials Initiative"?

Darby: We met with the relevant EU body, listened and nodded sagely and pointed out that, whilst on the one hand they are looking to promote strategic raw materials by having these initiatives, they are also doing a good job in destroying the industry for strategic raw materials in Europe by their REACH [Registration, Evaluation, Authorisation and Restriction of Chemical substances] legislation.

Our members, however, will become involved as the initiative does involve such things as recycling and the possibility of production within the EU.

Vulcan: What is the purpose and strategic goal of the MMTA?

Darby: We are a body that represents our members' interests. And we are looking to grow the association into a global body. Right now, we are certainly looking to bolster our rare earth involvement. Similarly, we have identified appetite from the tantalum/niobium industry and have set up a working party that will identify how the MMTA can best serve this community, especially in light of the "blood minerals" legislation in the United States, which is beginning to effect thinking in Europe as well.

Vulcan: What would you say are the interests of most importance to the MMTA currently?

Darby: I think you start off on basics. We have implemented norms for the metals that we are involved in. A great vehicle of exploration is our website, and if you go onto that you'll see that a great deal of work has gone into standardizing our metal norms. We do have various committees, an example of which is trade/lobby, which looks at European legislation on metals. We also have committees responsible for arbitration/mediation, warehousing and, of course, our very successful annual conference.