PYX Resources Ltd (LSE:PYX, NSX:PYX) has laid out expectations that the price of zircon will hold firm in the new year as demand continues to outdo supply.
Such market imbalance has meant zircon remained above US$2,200 per tonne for much of this year, the producer pointed out in a shareholder update, marking an increase on historic levels.
“We believe that this deficit of zircon supply will continue,” PYX added.
“The new mines coming into production are not enough to compensate for the reduction in supply coming from the large mines reaching the end of their mine lives.”
PYX was awarded a licence to export ilmenite and rutile ores from Indonesia in August, allowing it to produce and trade zircon from the country.
A 10-year exploration and mining licence was also granted for PYX’s Tisma Mineral Sands project this year, which the company said offers “long-term visibility over [a] highly prospective project”.
PYX reported year-to-date premium zircon production of 9.7 kilo tonnes in the third quarter of this year, in line with its five-year plan.
“Our focus remains steadfast on continued sustainable growth, as the company looks to increase exports, sales, and production, and work concurrently with our local communities and the Indonesian Government to meet our ambitious growth plans,” PYX added.