The price of Iridium has surged up to 130% in the last three months surpassing the Bitcoin 81% surge. An increase in Iridium prices has shocked Battery making industries. Here in this article, you will know why this rare metal has gained so much value?
Iridium is one of the least abundant Elements found on Earth, Approximately 40 times less abundant than gold with an atomic number 77 represented as Ir, a Tough and brittle metal.
It is a by-product of platinum extraction used in the chemical and electronics industries. It has a high melting point and resistant to corrosion.
Iridium doesn’t have a big market as other elements like platinum, gold, and silver. Thus, its production has a significant impact on its price. According to Johnson Matthey Plc data Iridium, also used for spark plugs, has risen to $6,000 an ounce. This makes it 3-fold more costly than gold.
As the demand for a product increases, we all know that as the supply tightens, the price surges. This is what happened with Iridium.
Here are few reasons for its tight supply
- Due to Covid-19, there has been a severe disruption in the supply of Iridium from south Africa, which accounts for 81% of the global world’s iridium supply.
- Since there is a small market for it globally, miners don’t mine much of Iridium, irrespective of the price surge.
- Moreover, a significant Mining company named Anglo-American platinum has been shut due to water leaks, thus tightening the supply.
Enough reasons for its limited supply!!
As Emma Townshend, an executive at Impala platinum said that Iridium supply is not increasing, but its demand is.
Here are few reasons for its increased demand
- Iridium is used in making lithium crystals used in 5G technology, high-performance spark plugs, and medical devices.
The manufacturing of crystals for the SAW (acoustically acoustic surface wave filters) for the manufacture of lithium tantalate crystals for 5G was the primary application, said Karolina Jackiewicz Lipmann Walton & Co. She further stated that “This market will grow as we transition to 5G and other emerging technology.”
- According to some new research, there’s a role of Iridium in the Green hydrogen Economy, which further increased its demand. Most of the hydrogen produced today is made through the methane steam reforming process, and it gives Carbon dioxide as a by-product. Green hydrogen production has a small market right now. But industries are coming forward to become carbon neutral. When talking about Iridium’s future. It can be used to produce green hydrogen during water electrolysis. That’s why the interest of investors has been piqued for Iridium.
- Ships carry some water in their ballasts for stabilization, and they dump it after every trip. This water is not suitable for aquatic life. This new law states to treat that water before discharging, and Iridium is a vital metal to process that water.
“Because of its high melting point, hardness, and corrosion resistance, Iridium is very suitable for many industrial applications,” says John Plasard, Mirabaud investment company analyst.
These qualities are particularly sought-after by mobile phones, which have increased demand as 5G technology is developed and theoretically a significant factor in transitions to electric cars in hydrogen fuel cells.
References:
Iridium, the rare commodity outperforming Bitcoin year-to-date (valuethemarkets.com)
Iridium, an Ultra-Rare Metal is surging even higher than Bitcoin this year – Craffic
