Will the (new) expansion of air traffic drive up the price of rhenium?
Ryanair’s stock has plummeted, possibly because the Irish company has not received enough aircraft from Boeing. While the aircraft supplier appears to be running out of planes, more and more people want to travel despite massively rising ticket prices. The U.S. aircraft manufacturer supplies Ryanair and other airlines with 737 Max jets and is months behind on deliveries. Boeing delivered 130 aircraft in the first quarter of 2023/2024, already well above the 90 aircraft it had built at this time last year. In addition, Boeing is outperforming its competitor Airbus, which was only able to deliver 127 aircraft, fewer than the 142 aircraft delivered at the beginning of the previous year.
Aviation has potential once again
Despite delivery backlogs, things are looking good for Ryanair. The brief 3% dip in the share price was likely a temporary market reaction to lowered expectations regarding passenger numbers for this year. Ryanair initially projected 185 million passengers for the year, but later adjusted this figure to 183.5 million. Nevertheless, this still represents a significant increase compared to the previous year’s 168.6 million passengers. According to NTV, the International Air Transport Association has nearly doubled its profit forecast for airlines this year, from $4.7 billion to $9.8 billion. This further demonstrates that aviation is back! To meet the growing demand for travel, Boeing and Airbus will certainly need to build and deliver more aircraft.
No turbines without hafnium and rhenium
Special heat-resistant alloys containing hafnium or rhenium are used in the construction of their turbines. These two commodities ensure that the turbine engines do not deform during flight due to high temperatures.
Undervalued rhenium
In some cases, metal prices already suggest growing demand. For instance, the cost of hafnium skyrocketed a few months ago. The metal is not only indispensable for turbines but is also used for semiconductors, fuel rods, and in medicine. In contrast, rhenium’s price development has remained almost Zen-like in its calm. How much longer will this last? As more and more aircraft turbines need to be built, the demand for rhenium will also grow.
Ultimately, hafnium and rhenium could form a kind of “rope team,” pulling each other’s prices upward. Undervalued rhenium currently offers interesting return opportunities for investors. However, hafnium also remains an exciting investment metal, with its price having risen again recently.