Japan and South Korea have joined forces to secure supplies of a rare metal crucial to high-grade steel production, investing $1.8bn in a Brazilian mining group that is the largest producer of niobium.
Competition for niobium, which is used to increase the hardness of steel alloys, increased last year when East China Mineral Exploration and Development Bureau, a Chinese state-owned miner, struck a deal to buy a controlling stake in Globe Metals & Mining, an Australia-listed group with niobium assets in Africa.
China’s booming steel industry has made it the world’s top importer of niobium, leaving Japanese and Korean steelmakers wary of supply shortages that could disrupt production of the profitable high-end products in which they increasingly specialise, such as seamless pipes used in nuclear power plants and oil rigs.