Dennis M.

Zogbi
Paumanok Publications, Inc.
Marketeye Installment
December 31, 2019

Tantalum Supply Routes for Mil-Spec Capacitors:

Ore to Powder to Part
Tantalum, a key dielectric material for capacitors, is also considered a “strategic
material” by the United States Defense Logistics Agency (DLA) because of its unique
attributes. This article addresses the unique supply chain for tantalum capacitors that
carry a military specification.

By Dennis M. Zogbi
CEO and Founder
Paumanok Publications, Inc.

The Market For Tantalum:

In 2019 Paumanok Publications, Inc. estimates that approximately 5 million pounds of
tantalum ores and concentrates were consumed in the global market in the form of
engineered powder, wire, rod, ingot and sheet. Of the 5 million pounds consumed about
55% will be sold into the electronics industry; primarily in the form of anode for capacitor
and in the form of semiconductor targets. The remaining 45% of tantalum was
consumed in alloy additives, industrial processing equipment, cemented carbides, fine
chemicals and some additional specialty product lines.

 Tantalum in Electronics:
 A more granular look at tantalum consumption in electronics reveals that
capacitors and semiconductors are the most important market drivers; but
additional minor markets, such as surface acoustical wave filters and thin film
resistors also consume tantalum raw materials. It is also important to note that
demand from the electronics industry has averaged from 50% to 70% of total
tantalum demand over the past 30 years.

 Tantalum in Cemented Carbides:

 Tantalum is also consumed in a myriad of additional industries outside of
electronics and related to metallurgy and the creation of alloys and compounds.
The most important and separate is the cemented carbide business, where
tantalum is used as a grain inhibitor in professional cutting tools. The tantalum
aids in controlling the microstructure and morphology of the carbide insert or
wear part during sintering.

Tantalum as a Strategic Material:

Because of tantalum’s use as a hardener for cemented carbides (which are in turn used
to cut steel), tantalum has been considered a “strategic material” by the United States
Department of Defense. The Defense Logistics Agency (DLA) had stockpiled tantalum
ore and powder for decades, and was at one time a key supplier of tantalum to the

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 Dennis M. Zogbi
Paumanok Publications, Inc.
Marketeye Installment
December 31, 2019

electronics industry through auctions of their tantalum stocks. In fact, the DLA has a
market share position in all Paumanok tantalum material studies prior to 2001. After the
price of the ore skyrocketed in the year 2000, the DLA made a significant return on
investment for their annual sale of tantalum ore. After all stocks were sold off in 2001,
the DLA never replenished its supply. In 2013 the DLA reported a shortfall of tantalum
and suggested that it replenish its supply by 2017. This plan has been modified but not
as of yet implemented as of 2019.

Tantalum Capacitor Military Specifications:

Even though the use of tantalum as a hardener for cutting tools was considered strategic
for the military of the past, its use as a dielectric in tantalum capacitors should be
considered strategic for the military of the future. Tantalum is an excellent dielectric for
use in space electronics because of its high heat handling capability and high
capacitance in a small physical case size. The following military specifications contain
tantalum anodes-

Figure 1: Tantalum Capacitor Military Specifications

 MIL-PRF-39003 - Fixed, Electrolytic (Solid Electrolyte), Tantalum,

 Capacitors, Fixed, Electrolytic (Solid Electrolyte), Tantalum, Established
Reliability, General Specification
 MIL-PRF-39003 - Fixed, Electrolytic (Wet Electrolyte), Tantalum WETS
 MIL-PRF-39006 - Capacitor, Fixed, Electrolytic (Nonsolid Electrolyte), Tantalum,
Established Reliability, General Specification
 MIL-PRF-55365D - Capacitor, Fixed, Electrolytic (Tantalum), Chip, General
Specification
 MIL-PRF-49137 - Capacitors, Fixed, Electrolytic (Solid Electrolyte), Tantalum,
Molded, Conformal Coated and metal Cased with Plastic End-Fill, Non-
hermetically Sealed, General Specification
 MIL-PRF-55365 - Capacitor, Fixed, Electrolytic (Tantalum), Chip
 MIL-PRF-83500 - Capacitors, Fixed, Electrolytic (Nonsolid Electrolyte), Tantalum
Anode and Cathode, General Specification

Why Aerospace and Defense Use Tantalum Capacitors:

Capacitors are used for bypass, decoupling and filtering in all electronic circuits. Some
circuits are demanding with respect to environment, and in harsh environments, where
high temperature accompanies small form factor, tantalum is preferred. In the case of
mission critical electronic systems for spacecraft and aircraft, capacitors that meet
military specification are preferred, especially when higher voltage circuits are involved
(i.e. 25 and 35 volts) and combined with high capacitance (2.2 to 1,000 microfarads)
requirements in a small space. The military specifications for tantalum have been in
place for decades, and their performance is well known and well documented, and this is
why they are preferred by military design engineers at the following companies.

©2019 Paumanok Publications, Inc. All Rights Reserved- [email protected]

 Dennis M. Zogbi
Paumanok Publications, Inc.
Marketeye Installment
December 31, 2019

Figure 3: Top Consumers of Tantalum Capacitors for Defense and Space Applications:
2019

1. The Boeing Company

2. Airbus EADS
3. United Technologies
4. Lockheed Martin
5. General Dynamics
6. BAE Systems
7. Northrop Grumman
8. Raytheon Company*
9. Finmeccanica
10. Thales*
11. L-3 Technologies
12. SAIC
13. Rockwell Collins*
14. Orbital Sciences Corp
15. Crane
16. Loral*
17. Many Others

*Passive Component Intensive Defense Platforms

Future Outlook For Tantalum in Defense Electronics:

Tantalum capacitors are considered mission critical to the future combat systems of the
United States and its allies. The use of tantalum capacitors on spacecraft, and satellites
is well documented in the Paumanok technical library. As is its use in defense aircraft.
The key applications for tantalum in defense electronics include power supplies and
munitions. All major tantalum capacitor operations supplying military specification
tantalum capacitors will be owned by foreign investment by the end of 2020.

Tantalum Capacitor Vendors for High Reliability Markets:

The major vendor of tantalum capacitors to the United States Military is Vishay
Intertechnology, who acquired market access through its purchases of Sprague Electric,
Mallory Capacitor, Tansitor Capacitor, and the wet tantalum capacitor operations of
KEMET Corporation. KEMET is their closest competitor, with key competitive positions
in almost every tantalum mil-spec. AVX also competes in Mil-Spec Tantalum
Capacitors, but only in the most valuable segments. Recent market entrants include
Firadec-Exxelia, and CDE Electronics (See Figure 2).

©2019 Paumanok Publications, Inc. All Rights Reserved- [email protected]

 Dennis M. Zogbi
Paumanok Publications, Inc.
Marketeye Installment
December 31, 2019

Figure 2: Vendors of Military Specification Tantalum: Capacitors: 2019

MANUFACTURER MIL-PRF-39003 Solid MIL-PRF-39003-WETS MIL-PRF-39006 MIL-PRF-55365 MIL-PRF-49137 MIL-PRF-83500
VISHAY √ √ √ √ √ √
KEMET √ √ √ √ √
AVX √ √
CDE √ √
FIRADEC √
*Molded axial, molded radial, hermetically sealed and wet slug are used almost exclusively in high-reliability circuits.
Companies such as Evans Capacitor produce hybrid solutions that also employ tantalum

The Challenging Supply Chain for Tantalum Ore, Powder and Wire:
Ownership of the raw materials consumed in US military specification tantalum
capacitors will also be outside of US control by the end of 2020. Ore production has
switched largely to central Africa in direct response to outside military and political
influences on the supply chain. Over the past decade (2010-2019), key hard and soft
rock mining operations for tantalite have been either idled or permanently closed in
Australia, Canada, and Mozambique; leaving the majority of demand to be satisfied by
mine and artisanal sources in DRC, Uganda and Rwanda, Ethiopia and Brazil continue
to be the only two consistent ore vendors over the past 30 years (long supply routes).

The sophisticated processing of tantalum into anode materials, especially high

capacitance value per gram dielectrics; is largely a Japanese and German dominated
business. The United States has one high CV/g powder processing plant serving the
capacitor industry and that is KEMET Blue Powder Corporation in Nevada, which will
come under Taiwanese ownership by the end of 2020.

Tantalum has been the subject of international scrutiny for decades following the United
Nations designation that the metal is a “conflict mineral.” This creates added layers of
costs associated with legal bills, compliance, freight that other dielectrics and electronic
components do not have to address.

Competing Technologies To Tantalum In Electronics:

In each industry where tantalum competes, there are alternatives to the metal, however,
the primary reason why industries use tantalum is because of its known reliability. The
metal has been in continuous use for decades in multiple industries, especially defense
and space electronics and and its performance and behavior is well documented. The
market for tantalum capacitors exists, because in electronic design, there are only so
many ways to provide capacitance, and each dielectric, especially tantalum, has a
market value because the design engineer is limited in choice due to parameters of
voltage, temperature, altitude, capacitance, frequency and volumetric efficiency.

 Alternative Capacitor Technologies:

 As we have established, the electronics industry can account for between 50%
and 70% of tantalum raw material consumption and is the true variable that
impacts global demand for the metal over time. In electronics, tantalum capacitor
substitutes, include the ubiquitous and mass produced high capacitance
multilayered ceramic chip capacitor (MLCC); the conductive polymer, molded
4

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 Dennis M. Zogbi
Paumanok Publications, Inc.
Marketeye Installment
December 31, 2019

chip aluminum electrolytic capacitor (solid polymer aluminum), and the niobium
oxide molded chip capacitor (NbO capacitor). All three of these alternative
capacitor products have targeted tantalum capacitor displacement as a primary
strategy of going to market, and the vendors who produce these alternative
dielectrics prey upon the shortcomings of the tantalum supply chain in order to
propel their product forward through the market. However, as is the case with
MLCC, which have done the most to disrupt tantalum supply, as the capacitance
increases, the available voltage decreases, and this creates value opportunities
for tantalum in voltages above 6.3 Vdc, so we find tantalum in many advanced
electronic applications.

 The solid polymer aluminum chip capacitor is also of great interest and a threat
to the larger case size tantalum chips, because it offers high capacitance in a
small form factor just like tantalum and offers the customer a product with an
abundant and stable supply chain (bauxite or aluminum); however the
disadvantage is that the product line is limited and the capacity to produce these
products is also limited and the same exact advantages and disadvantages of
solid polymer aluminum are evident in the NbO capacitors as well.

 Alternative Thin Film Technologies:

 In targets, tantalum is used as a thin film diffusion layer during the semiconductor
manufacturing process, and there are alternative targets that can be used here
such as Tungsten, Molybdenum and Titanium, with the only disadvantage for
tantalum being its challenging supply chain; however its advantage, according to
primary sources in the semiconductor industry is its known reliability which is a
critical factor in such an advanced process. Tantalum also offers high thermal
and electrical stability with copper, good adhesion to silicon, few grain
boundaries, high bonding strength and uniform grain thickness, which in
summary means the engineer knows how the material will apply itself when its
sputtered.

Summary and Conclusions:

Electronics are the primary market driver for tantalum and we expect its continued use in
both capacitor anode and as a diffusion layer in semiconductor manufacturing. Tantalum
capacitors, the major driver for tantalum materials, will continue to be needed in the
high-tech economy especially in mission critical circuits where known reliability and
volumetric efficiency are key criteria in component selection.

The supply chain for the tantalum materials begins in the ground as ore, with the
majority of the world’s supply now coming from artisanal mining operations in Central
Africa and Brazil, with HIGH CV/g processing occurring in Japan, Germany and the USA
(KEMET Blue Powder- now being bought by Yageo of ROC).

The major manufacturers of tantalum capacitors for defense applications includes

Vishay, AVX and KEMET.
5

©2019 Paumanok Publications, Inc. All Rights Reserved- [email protected]

 Dennis M. Zogbi
Paumanok Publications, Inc.
Marketeye Installment
December 31, 2019

The major consumers of tantalum capacitors for bypass, decoupling, detonation and
filtering are Boeing, EADS, UT, LM, GD, BAE and Raytheon.

ADDITIONAL RESOURCES:
Tantalum Capacitors: World Markets, Technologies &
Opportunities: 2019-2023 ISBN # 1-893211-11-8 (2019)
http://www.paumanokgroup.com/capacitors-analysis/tantalum-capacitors-world-markets-
technologies-opportunities-2019-2023-isbn-1-893211-11-8-2019.html

TANTALUM: STATE OF THE INDUSTRY: 2018: And World Market

Outlook: 2018-2023 ISBN: 1-893211-75-4 (TA2018)
http://www.paumanokgroup.com/homepage/tantalum-state-of-the-industry-2018-and-
world-market-outlook-2018-2023-isbn-1-893211-75-4-ta2018.html

Tantalum Capacitor Markets In Defense Electronics: 2017-2022

ISBN: 1-893211-49-5 (TA2017)
http://www.paumanokgroup.com/tantalum-capacitor-markets-in-defense-electronics-
2017-2022-isbn-1-893211-49-5-ta2017.html

©2019 Paumanok Publications, Inc. All Rights Reserved- [email protected]