Imagine a closet stuffed with a billion envelopes. One has a check for $100,000 inside. Do you go hunting?
Anthony Lipmann does. One in a billion is the concentration in the Earth’s crust of an element named rhenium, part of a group of so-called minor metals notable for two reasons: They’re exceedingly difficult to obtain, and they’re spectacularly important for certain industries. That’s why Lipmann loves them—the more technology frees us from our earthly bonds, the more we discover how linked we are to forms of nature we didn’t know existed.
Lipmann is a scavenger. Based just outside London, he makes his living in the hinterlands of commodities, finding the stuff most can’t and picking up what others discard. His business model is deceptively simple: Identify something rare that manufacturers need, figure out how to get it, then step in when gaps in the supply chain appear. Most of his inventory—which includes germanium, zirconium, ruthenium, indium, tellurium, hafnium, tantalum, and tungsten, to name a few—is stored in warehouses in the U.K. and other European countries, ready to go at a moment’s notice. “My guiding principle is demand,” he says. “If someone wants something to put in a product, even if it’s toxic or radioactive, if it’s genuinely needed for an industrial purpose and not a weapon, I think that’s a legitimate reason to get involved.”
Thallium is a good example, though it’s not something Lipmann stores because it’s not nice stuff. Once a rat poison, it’s found new uses in the technological age, including in the lenses of high-end document scanners. But it’s strictly controlled in many countries due to its extreme toxicity. So when Nippon Sheet Glass Co. realized it needed some, executives at the Japanese company reached out to Lipmann Walton & Co.
It took two years to track down a trove of thallium that had been produced in Kazakhstan in the early 1980s, then somehow found its way to a warehouse in Rotterdam. European Union regulations meant it couldn’t be moved, but after about a year of jostling and a nighttime mission to repackage the goods, it started making its way to Japan. The cargo traveled in batches, but each ton went a long way, so the Japanese were happy. “I get a huge kick now out of scanning a piece of paper,” says Lipmann, who was paid $9 million for his troubles. “There might be a bit of thallium we supplied in it.”
The end of July found him in northern Chile. Standing on the edge of Chuquicamata, one of the world’s largest open-pit copper mines, Lipmann watched massive trucks hauling hundreds of tons of rock across the floor below. From that height, they looked like sandbox toys.
Trace metals are often found alongside more abundant ones like copper. Chile claims the No. 1 spot in the rhenium league tables, with Codelco supplying about 7% of the world’s output last year, most of it from its Chuquicamata mine. Rhenium is silvery-gray, extremely dense, and heat-resistant. A small quantity combined with nickel produces a superalloy that enables blades in jet engines to withstand very high temperatures without stretching. This makes turbines more efficient, which is why demand for the metal has been rising.
Prices were 12 times higher about a decade ago, so companies figured out ways to recycle rhenium, causing the price to slump. It’s still essential, but with an annual production of about 50 tons in 2018, it’s too niche for bigger trading companies. Lipmann—whose mantra is “low in volume, high in value”—remains a fan, though.
Slight of build, he often wears bookish glasses and has gray, disheveled hair, giving him a look more science teacher than adventurer. Yet speak to him for a few minutes, and he comes alive, tales of his exploits tumbling out. “A metals trader can spend his whole career without ever setting foot on a mine,” he says. “But I’m not interested in that type of life.”
Because rare metal values can skyrocket overnight and collapse just as fast with the advent of new technologies, neither producer nor consumer tends to want more than necessary on their balance sheets. Lipmann will assume this risk. Unlike brokers who stick to matching buyers with sellers in exchange for commission, he buys, transports, and stores his elements unhedged, exposed to the vagaries of the market.
One time a customer reneged, and Lipmann wound up with some 1.5 tons of rhenium parked in a warehouse. That caused some sleepless nights until a random contact he’d made while scouring junkyards in northern England informed him that Rolls-Royce Holdings Plc needed rhenium for a new jet engine design. Lipmann landed the contract in the mid-1990s and has been stocking the stuff ever since. For him the story sums up the life of a metals merchant: “The cost is being at total risk. The privilege is that you have customers.”
Right now, Lipmann is excited about germanium, which is used for fiber-optic cables as well as in the solar industry. The market is tiny, but supplies have recently been constrained. “I did 10 kilos of germanium scrap last night,” he says. “I was doing it at 10 o’clock in the evening.”
His path to this life wasn’t straightforward. His father founded the company he runs, but neither foresaw that he’d become a metals trader, too. The younger Lipmann dreamed of becoming a writer; armed with a degree from Oxford in English literature, he got a job as a cub reporter at a provincial British newspaper. His journalistic career burned fast and in no way bright. “At the end of my first week, my editor said, ‘Anthony, is there anything you prefer to do?’ ” Lipmann recalls.
He boarded a train to London for an interview and landed a job with a small metals broker. These were unreformed days for the London Metal Exchange, a world of rough East End kids who indulged in boozy lunches and fistfights and who hazed colleagues by leaving them bound in chairs on elevators. Despite his somewhat posh upbringing, Lipmann gained acceptance by reeling in big clients, notably one who ordered thousands of tons of aluminum a day. Yet he yearned to be more hands-on. History provided an opportunity. The former Soviet Union was full of master metallurgists, and when it unraveled, metal began to flow from East to West. Lipmann reopened his father’s mothballed business, which handily carried his name. As word got out, faxes came rolling in. Did he have any use for some T-42 tanks? How about some MiG wings? Such military gear, some of it black market, carried its share of pedestrian metal but also more interesting materials. He speaks fondly of a special type of magnesium.
On visits to submarine bases, spaceports, and junkyards across Russia and the rest of the former USSR, Lipmann encountered sellers who were sometimes dangerous and often desperate. “We had deals where I shouldn’t have done it,” he says. Cash, usually dollars, was the preferred payment—say, $100,000 in big notes—with helpful Estonian banks facilitating the transactions. “It really was cowboy land out there, but he was able to take it and make a success of it,” says Douglas Hunter, a metals trader at Wogen Resources Ltd. in London who worked with Lipmann in the 1990s.
In Armenia, Lipmann was led on a long journey through fields of tomatoes and cucumbers to arrive at a pigsty. He feared it was a trick or a trap, but it wasn’t. Inside was a vodka still, fashioned from titanium, that had once belonged to the state. Lipmann laid hands on the apparatus, which his companions took as a commitment to purchase. He went through with it. “You bought it because you’d gone six hours and tapped something,” he says.
Lipmann, who subscribes to the notion that “atoms have no allegiances,” tries not to let politics interfere with business. “If Iran offered me rhenium, I would buy it” for as long as it’s allowable under European law, he says. That said, he has limits: North Korea and the Democratic Republic of Congo, where he says corruption is rife, are two countries he won’t deal with.
But of course he’s happy to benefit from politics when the opportunity presents itself. The escalating global trade war is a case in point—the more barriers are erected between countries, the more work there will be for middlemen like him. “It’s going to be a delight,” he says with a grin.
And he retains a journalist’s curiosity about the world. In Chile, his itinerary was a mix of homage to the past and peek at the future. He asked his hosts to detour to Chuquicamata’s cemetery, where he walked between miners’ graves while jotting down notes in a journal. Buried among the Chileans, Bolivians, and Brazilians there was an Ernest Alexander Smart, born in Durham, England, on Sept. 28, 1885—a reminder that Lipmann wasn’t the first Briton to be lured to this mineral-rich desert.
The next stop was Codelco’s rhenium plant, a bright orange-and-green building in the port district of Mejillones, a three-and-a-half-hour drive from the mine. The process is an industrial secret, but in somewhat simplified terms, the molybdenum-rich material left from copper extraction is roasted to remove sulfur, with rhenium captured from the resulting gas. What you get after a couple more steps are pellets. Lipmann was impressed, proclaiming the facility “the NASA of rhenium” after his tour.
The entire process takes about two months, so even if prices are low, the supply side of the market can be slow to react, which means Lipmann sees good potential for it to increase. Besides which, he says, metals go in and out of fashion. Zirconium, a byproduct of the nuclear industry, was once used mainly to harden copper alloys. Now it’s at the heart of what he calls “the incredible new world” of amorphous alloys, which are showing up in 5G-compatible mobile handsets. Lipmann has some in stock that he bought 20 years ago on a hunch, or perhaps as a calculated bet. All he’ll say is he liked it because it’s shiny.