ILU Iluka Resources Limited

By Rhiannon Hoyle 

SYDNEY--Global miners including Rio Tinto PLC and Iluka Resources Ltd. have long made a pile of profit from digging up a sludgy commodity known as mineral sands, then shipping it to countries such as China where it is used to whiten bathroom tiles or in household paints.

Now, these miners are shooting to be at the forefront of technological change--supplying the same commodity for use in 3-D printing. They are working on ways to cut the cost of producing titanium dioxide, the compound commonly produced from mineral sands, and investing in technologies that will make it more attractive for the 3-D printing industry.

In doing so, they hope to protect profits from future swings in demand for titanium dioxide. Prices of the mineral sand rutile have fallen more than two-thirds from their peak in 2012, amid a slowdown in the pace of demand from traditional users. That has forced miners to slash output: Iluka--the world's second-biggest producer of titanium dioxide, with mining facilities in the U.S. and Australia--dug up 23% less raw rutile in the first nine months of 2015 versus a year earlier. Rio Tinto, the No. 1 producer, has closed furnaces in Canada and South Africa and says its global operations are running at about 60% of their capacity.

3-D printing--also called additive manufacturing--offers great potential to diversify the market for mineral sands. The technology has transformed within a decade from a niche industry making models, prototypes and smaller items such as hearing aids to one that has attracted investments from companies including jet-engine maker General Electric Co. and appliance giant Whirlpool Corp. These manufacturers want stronger, more lightweight materials that don't cost more than the ones that they currently use.

3-D printing involves slicing a digital image of an object into thousands of layers, which printers then recreate one at a time in plastic, metal or other materials. A powdered form of the chosen material, such as titanium dioxide, is used to create the three-dimensional object from a computer design. In the case of titanium, the powder is melted layer by layer with a laser to create the item.

While high costs to slow print speeds have constrained the 3-D printing industry, there are signs of more rapid growth. Consultancy Wohlers Associates Inc., based in Fort Collins, Co., predicts it to be worth US$21.2 billion in 2020, up from US$4.1 billion last year.

"It is potentially a turbocharger over time on demand for titanium dioxide," said David Robb, Iluka Resources's managing director.

The size of the market for 3-D printing powder--which includes forms of titanium, as well as steel, cobalt and other raw materials--is set to increase at a compound rate of 24% each year through 2020 to be worth US$500 million, according to MicroMarket Monitor, an India-based research company. It foresees 3-D printing being increasingly adopted in the manufacturing of some components used in the automobile and aerospace industries.

To be sure, 3-D printing currently accounts for a small segment of the titanium-dioxide market and miners say it may be years before it contributes to their profits in a big way. Nearly 90% of titanium dioxide produced goes into pigments for paints, paper and plastics.

While mineral sands account for only a fraction of Rio Tinto's profits compared with iron-ore sales, they are the main business of the world's other top two suppliers, Iluka and Stamford, CT.-based Tronox Ltd.

Iluka is diverting a portion of its mineral-sands output to an industrial unit in Rotherham, a former steelmaking center in northern England. There, scientists for closely held Metalysis are testing a technology that they hope will simplify and dramatically reduce the cost of producing titanium powder. Iluka, owns 18% of Metalysis.

Rio Tinto is also "positioning ourselves on a technical side and a production side" for a potential spurt in demand for 3-D printing powder, said diamonds and minerals chief executive Alan Davies.

The mining giant has teamed up with The Natural Sciences and Engineering Research Council of Canada and École de Technologie Supérieure, an engineering school in Montreal, and is supporting four other academic projects assessing the production of titanium metal powders that could be used in 3-D printing, Mr. Davies said.

Boeing Co., which already makes several hundred types of aircraft parts using 3-D printing, including air duct components, has been investigating a process called electron-beam melting, as it works well with titanium.

Boeing said it is continuously reviewing 3-D printing methods, believing the technology offers "the potential for widespread use" to create titanium parts for its aircraft.

However, Boeing said titanium powder is currently much more expensive than aluminum and steel, so there needs to be a strong business case for it to replace those materials.

Still, Iluka says new planes tend to contain about three times the titanium of older models.

"If you have a process that systematically changes out some of the componentry or engines with a lighter and equally strong metal, it is really a compelling case," said Rio Tinto's Mr. Davies.

Write to Rhiannon Hoyle at rhiannon.hoyle@wsj.com

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(END) Dow Jones Newswires

November 11, 2015 16:14 ET (21:14 GMT)

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