Sydney, August 3 (Argus) - Two钒 mining development enterprises in Queensland plan to start up the upstream production of vanadium pentoxide (V₂O₅) by the end of next year, seizing the development opportunities brought about by the rapid growth in global demand for energy storage batteries.
One of the enterprises is the Vico Group. This company has been engaged in the midstream production of vanadium electrolyte at a pilot plant in Townsville with an annual capacity of 35 megawatt-hours since 2023. It plans to expand the electrolyte production capacity to 300 megawatt-hours per year by 2028. The company has also planned for the Debella mine (with an annual production capacity of 8,700 tons) to produce vanadium pentoxide next year.
The second company, Richmond Vanadium Technology (RVT), also plans to start production at the Lilywell Mine (with an annual capacity of 12,701 tons) by 2027.
Meanwhile, the third enterprise, Critical Minerals Group (CMG), plans to start the production of vanadium pentoxide at the Linfield mine (with an annual capacity of 10,577 tons) by 2030. The company intends to first build a factory in the Parker Specialized Activation Industrial Park in New South Wales, relying on purchased vanadium pentoxide raw materials, and complete a vanadium electrolyte production line with a capacity of 24 million liters (equivalent to 350 megawatt-hours) by 2028.
There are currently six钒 mining development enterprises in the advanced stage in Queensland, including Vico, Richmond Vandal Technology, and Key Minerals Group. The remaining enterprises are still in the early exploration stage or have not announced the production schedule. The seventh钒 enterprise, QEM, informed Agence France-Presse on July 28 that due to difficulties in the process flow and high capital investment, the commercial value of the project is currently low in the current market environment. It has suspended the development work of the Julli Creek mine.
Current global supply and demand situation
Data from the United States Geological Survey in 2026 shows that currently, China holds a dominant position in global vanadium supply and demand. In 2025, China's production of vanadium dioxide accounted for 73% of the global total output.
The most core downstream application of vanadium is the vanadium redox flow battery (VRFB). Compared to lithium-ion batteries, this type of battery has significant advantages in large-scale application: it is non-flammable, has minimal performance degradation, the recovery rate of vanadium materials reaches 99%, and its energy storage duration is three times that of lithium-ion batteries.
The International Energy Agency (IEA) stated in the "2026 Global Energy Review" that in 2025, the global installed capacity of energy storage increased by 108 gigawatts, with the growth rate rising by 40% compared to 2024. Among this, China's installed capacity accounted for 60% of the global total.
The International Energy Agency predicts that the global installed capacity of energy storage will increase from 86 gigawatts in 2023 to 7,600 - 12,000 gigawatts in 2030. Depending on the different policies of various countries, the installed capacity will reach 20,000 - 35,000 gigawatts by 2040.
The International Energy Agency has pointed out that data centers will become the main driver for the expansion of global energy storage capacity. It is estimated that in the United States, 50% of the new electricity demand in 2030 will come from data centers. Although not all data centers will be powered by renewable energy, large-scale battery energy storage systems can address the intermittent nature of wind power and photovoltaic power generation, thereby ensuring stable power supply for data centers from new energy sources.
The government of Western Australia in Australia has now issued a tender to prepare for the construction of a 50-megawatt-hour vanadium-based energy storage station with an investment of 150 million Australian dollars (equivalent to 105 million US dollars).
Although the demand growth logic for all-vanadium liquid flow batteries is clear, it remains to be seen whether local Australian enterprises, without additional government support, can supply the market at competitive prices.
Price expectations and industry challenges
In its pre-feasibility study released on July 20th, the Key Minerals Group predicted that after the mine starts production, the price of vanadium pentoxide will remain between $5.9 and $8.7 per pound for the first 25 years.
In the initial exploration study in 2024, QEM set the price expectation at $11.56 per pound. The company has since determined in 2025 that the project no longer has any practical implementation value.
The price estimates of the above two enterprises are both higher than the upper limit of the spot price of 98% flake vanadium pentoxide in Rotterdam as recorded by Agence France-Presse. The current price of this product on July 28 was $5.5 per pound. At the same time, it is also significantly higher than the domestic market price. On July 29, the factory price and the offshore price of 98% vanadium pentoxide in China were both stable, at $5 per pound and $5.15 per pound respectively.
The increase in the price of sulfur has become another major challenge faced by the key mining group. The company plans to purchase 1 million tons of sulfuric acid annually from outside sources, while burning imported sulfur particles and producing 3 to 4 million tons of sulfuric acid within the factory. The company states that as long as the price increase of sulfuric acid does not exceed 20% of the current level, the project can remain profitable.
Affected by the supply shortage caused by the US-Iraq conflict, the price of Chinese offshore sulfuric acid as reported by Agus surged by 178% in June, reaching $382.5 per ton; subsequently, as demand weakened, the price dropped to $345 per ton on July 30. The sharp fluctuations in sulfuric acid prices may continue to pose risks to the van smelting projects in Australia.
For an industry to start smoothly, it is highly likely that it will require substantial government support.
On July 18th, Queensland's Minister for Natural Resources and Mines, Dale Rast, informed Agence France-Presse that the state government had invested 115 million Australian dollars to build a shared public processing facility, aiming to reduce project risks, encourage the development of local smelting industries, and strive to turn Townsville into a "key mineral processing center with global competitiveness".
Rast added that Queensland will increase its investment in key mineral sectors by 52.5 million Australian dollars in the 2026-2027 fiscal year, but did not specify the specific projects to be supported.
The local government stated that钒矿 enterprises can pay a usage fee to lease the public base. The fee will be negotiated on a case-by-case basis depending on the usage intensity of each enterprise. The specific standards fall under commercial confidentiality.
Currently, Vico is the only vanadium enterprise that has signed a contract to establish a presence in this base. The other five vanadium development enterprises in Queensland have all declined to respond to interview inquiries, not indicating whether they plan to establish a presence in the base, nor have they commented on whether the public base can provide sufficient policy support for the enterprises' operations.
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New price
Agis has recently launched a new sponge titanium export price index for China. This index was introduced under the circumstances where the supply of sponge titanium became tight due to the conflict between Russia and Ukraine, and more and more international buyers began to accept and purchase Chinese-produced sponge titanium. It serves as an international price reference. The new prices will be released on Tuesday and Thursday in the Agis International Metal Daily and the Agis Metal website.
In addition to the export price of sponge titanium from China, Agence France-Presse also releases price assessments for other products in the titanium industry in Europe, the United States and China. The main price assessments include:
Titanium sponge, 99.6% Ti, ex-factory from China
Titanium sponge, 99.7% Ti, ex-factory from China
Titanium sponge with 99.7% titanium content, produced in China
Titanium sponge, 97.5% Ti, TG-Tv 5X30mm, fob from China
Titanium concentrate 50% TiO2 ex-works China
Titanium dioxide 93pc min rutile grade ex-works China
Titanium dioxide 93pc min rutile grade fob China
Titanium sponge TG100 12x25mm long-term contracts du Rotterdam
Titanium sponge TG-Tv 10x30mm du Rotterdam
Ferro-titanium min 70% Ti dp/duty-free Rotterdam (per kg Ti)
Ferro-titanium Russian min 70% Ti du Rotterdam (per kg Ti)
Titanium 6Al 4V ingot fob US producer
Titanium scrap 6Al 4V bulk weldable del US dealer/processor
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