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Strong tailwinds for King River Resources’ (ASX:KRR) high purity alumina amid booming LED industry

Highlights

  • KRR continues to make impressive progress to be a significant producer of high-value high purity alumina (HPA).
  • The recently released pre-feasibility study (PFS) outcomes for the Kwinana HPA project support its swift transition to a more detailed definitive feasibility study. 
  • The key market driver for >4N HPA is the escalating demand from the large and growing LED and EV industries. 
  • LED lights, which have high efficiency and low-electric consumption, are encouraged by governments worldwide, with subsidy programs offered by many to the manufacturers.

King River Resources Limited (ASX:KRR) has been making some serious strides in the development of high purity alumina (HPA), with the Company ticking off significant milestones during the past couple of months. 

RELATED ARTICLE: King River Resources’ Kwinana HPA project on fast track with production of 5N purity precursor

Notably, KRR has completed the pre-feasibility study (PFS) for Kwinana high purity alumina (HPA) project, demonstrating the potential for the Company to be a significant HPA producer. The Company plans to produce HPA at Kwinana-based processing plant through its ARC HPA process, which uses readily marketed aluminium chemical feedstock. 

ALSO READ: HPA PFS operational highlights paint rosy outlook for King River Resources (ASX:KRR)

Source: KRR update, 16 June 2021

The recent successful HPA developments come at an opportune time as the demand for high-quality HPA is expected to grow substantially. The key market driver for ≥99.99% purity (>4N) HPA is the escalating demand from two very extensive and growing industries – light-emitting diode (LEDs) and electric vehicles (EVs). 

With this backdrop, let us explore how KRR, with its latest stream of developments, is poised to reap benefits of the soaring HPA demand, especially from thee growing LED market. 

RELATED ARTICLE: King River Resources’ June quarter marked by stellar PFS outcomes for HPA project

HPA usage in LED industry

While high purity alumina represents a niche market, it enjoys significant potential owing to critical application in synthetic sapphire for use in LED lights.

Significantly, these sapphire substrates are used substantially in LED manufacturing, thereby providing the HPA market with a significant growth opportunity.

Governments encouraging switchover to LEDs

Many governments across the globe, including that of China and the United States, advocate the switch to LEDs, which produce the same output while consuming less electricity. Moreover, the governments continue to offer subsidy programs to the manufacturers to drive the LED production. 

RELATED ARTICLE: King River Resources (ASX:KRR) hits a key milestone with production of high-purity titanium dioxide

LED lights have high efficiency, low-electric consumption, more brightness, and low-cost compared to incandescent light. Such key advantages of LEDs are expected to fuel its usage, which in turn is projected to provide positive momentum to future HPA demand in both the domestic and industrial sectors. 

What does HPA’s demand outlook look like? 

The growing housing sector is expected to heat up the demand for LED bulbs as well as for semiconductors and electronics industries, typically coming from smartphones, smartwatches, and others.

In the PFS, KRR has indicated that the market of >4N HPA is expected to grow at 13.7% per annum, with growth forecast projected at 53,000 tonnes in 2028. On the other hand, the supply might not be sufficient enough to meet the demand for high-quality HPA. 

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Source: Copyright © 2021 Kalkine Media

King River Resources’ initiatives to extract high-value HPA take on a greater significance in light of high-quality 4N HPA suppliers being limited across the globe. With HPA demand rising, the Company is well-positioned to capitalise on the lucrative market opportunity.  

KRR stock was trading at AU$0.027 on 25 August 2021 (AEST 10:36 AM), up 3.846% from its last close.

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