Iluka's Supply Problematic

Submitted by Sharemarket News on 30 May, 2011 - 10:20

Iluka Resources (ASX:ILU) chief executive David Robb says that product supply will be problematic in the coming years, with deficit in some cases.

"We don't give price forecasts, (but) we do think that supply is a problem, and all of our markets are very tight, arguably deficit in some cases," said Robb on Sunday. "There is simply not enough supply, and customers have idle plants.

"We don't see an answer to that for some years.

He added that the tight supply could be assumed to result in "sustained pricing momentum." The mineral sands company is using surplus cash either to "reward shareholders" or to grow organically.

"So that will be the priority, it will be growing organically, it will be disciplined, and it (the cash) will go back to shareholders if we don't have a better use for it."