The price of tantalum (element symbol Ta, atomic number 73), a rare metal essential for building AI servers and data centers, has soared to record levels in the first half of this year. China is gearing up to dominate the tantalum supply chain.
According to the Shanghai Securities Journal, citing statistics from the China Nonferrous Metals Industry Association, prices for key metals in the AI industry, including tin, tantalum, and indium, have surged in the first half of this year. Tin prices rose by 40%, tantalum by 158%, and indium by 60%. Among these, tantalum saw the highest increase. The spot price of tantalum ore jumped from about 2,600 yuan per kilogram at the end of last year to approximately 6,900 yuan by the end of June. In March, it peaked at 7,300 yuan per kilogram (about $1,410).
Tantalum is primarily used in three sectors: tantalum capacitors, semiconductor target materials, and high-temperature alloys. While a typical server contains 30 to 50 tantalum capacitors, NVIDIA's AI server, the 'GB200,' uses between 3,000 and 5,000, marking a nearly 100-fold increase in usage. Despite the surge in demand, supply remains limited. Tantalum is found in very small quantities, with the Democratic Republic of the Congo, Rwanda, and Nigeria accounting for over 80% of global production. In March, a mine in Congo halted operations due to heavy rains and landslides, exacerbating supply shortages.
China is securing long-term supply contracts with tantalum mines and is working to acquire technology for high-purity refining. Dongfang Tantalum, a leading player in China's tantalum industry, signed a long-term purchase agreement for 3,600 tons of tantalum-niobium alloy with Brazil's Taboca Mining this year. Additionally, Dongfang Tantalum recently raised 1.2 billion yuan through a capital increase, which will be invested in wet and dry refining and high-end product production lines.
A representative from the Chinese industry stated, 'China is a global leader in tantalum processing, but the self-sufficiency rate for raw materials is low, and the technology for ultra-high-cost tantalum powder and semiconductor-grade high-purity tantalum refining has not yet reached global top levels.'
* This article has been translated by AI.
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