Ronald Rieder’s Post

Copper a strong investment theme. Goldman Sachs analysts forecast that the global refined copper market is likely to see a deficit of 428,000 tons in 2024, with expectations that copper prices in London will hit $12,000 a ton within the next 12 months, which adds further support for miners in the sector. The role and relevance of copper in the just energy transition and the resultant demand has served as key driver behind BHP's (BHPL-TRQX) proposed acquisition of Anglo American (AMS-JSE), excluding its SA assets (Kumba Iron Ore and Amplats), to meet the growing global demand for copper. Commenting in the company's 2023 Annual Report, BHP Chairman Ken MacKenzie stated: “The world needs copper for renewable energy, nickel for electric vehicles, and iron ore and higher-quality metallurgical coal for steel to build new infrastructure." With one of the world's biggest mining groups investing to take advantage of the potential upside in copper, isn't it a investment theme worth considering? #ClaritybyInvestec #investing #stocks #equities #mining #copper Note: This post is for informational purposes only and should not be considered as financial advice.

See link below to a Stockhead News article outlining the need for new #copper #discoveries and the incentive price required for them to be developed. It also touches on #exploration and #mining #emerging jurisdictions including #Ecuador to meet future #copper supply shortage. #Titan Minerals #TTM has four 100% owned projects in #Ecuador where it has significant exposure to large scale #copper porphyry and epithermal #gold. https://lnkd.in/gCM25Zdv

🔝CAPITAL RAISING & CORPORATE FINANCE 🏦 • ⛏️Mining M&A Intensifies⚠️❕ A literal land grab for metal-and-mining assets has led to a spike in M&A activity, especially in emerging markets. Mining M&A continues to abound with Reunion #Gold being among the latest companies to ink a deal. The Toronto-based company’s recent $638-million combination with G Mining Ventures Corp. promises to establish a new, leading intermediate #goldproducer. A sale was rumored to have been in the works for months—especially among investment bankers. Every year, a coterie of metals-and-mining dealmakers convene at the PDAC Conference in Toronto to discuss the latest goings-on in the #industry. During off hours, and over “copious bottles of wine,” these experts typically bring up a range of topics, including potential takeover targets, one attendee tells Global Finance. This year’s event in March was no different, and Reunion was among the names flagged as being in play. And why not? Reunion, under the helm of CEO Rick Howes, owns a high-grade project in Guyana—a mining-friendly jurisdiction—and is on track to extract gold by 2027. The company is also flush with cash. Late last year, Reunion sold an 8.6% stake to Luxembourg-based La Mancha Resource Capital for $35 million. It also secured $70 million in additional funds via a separate financing deal. And Reunion isn’t the only mining company buyers have been circling. In April, Nexus Uranium CEO Jeremy Poirier stated that it was time to “evaluate strategic alternatives” or “an outright sale” for a gold mining project in Nevada. Meanwhile, Defense Metals just tapped a London-based boutique, HCF International Advisers, to review options for a rare earth element project in British Columbia. Then there’s First Quantum Minerals, which is currently shopping around what it considers “nonstrategic assets.” For many mining players, the timing to ink a deal is right. After all, gold, demand hinges on the fact that the precious metal acts a hedge against sticky #inflation. And in general, #commodity companies are consolidating at a fast clip whereas other sectors have been somewhat sleepy. The scarcity of some metals, plus the changing dynamics of geopolitics and the advent of green energy trends, have inspired would-be sellers to get off the sidelines. Close observers saw this play out last year, when deal value across the global mining market totaled $121 billion. That’s a 75% spike compared with 2022. There was also a slight uptick of 5% in deal volume between 2022 and 2023. Sixteen deals took place in 2023 with values exceeding $1 billion—a 33% jump compared with 2022. Mining remains one of the busiest sectors, similar to last year. Per Dealogic, global M&A volume in the space saw 97 deals in the month of January, 69 in February, 77 in March, and, at last check, 30 in April. Deal value for the year currently exceeds $26.74 billion. … Why Buy❓… ‼️Read more…

Hedge fund manager Pierre Andurand predicts that copper prices could reach $40,000 per ton in the next few years. He attributes this potential surge to a doubling of demand growth for copper due to the electrification of the world, including electric vehicles, solar panels, wind farms, as well as military usage and data centers. Andurand, who manages approximately $2 billion in assets, believes that we could see prices up to $40,000 per ton over the next four years or so. However, he also mentions that this price level might not be sustainable indefinitely as eventually, a supply response is expected, but that supply response will take more than five years. It’s also worth noting that the demand for copper in the transport sector alone is projected to increase by 11.1 times by 2050, compared to 2022. Electric vehicles, for example, contain more than a kilometer of copper wiring. Additionally, the demand for copper needed to expand the global electricity grid is projected to increase by 4.8 times by 2050, compared to 2022. By 2030, the copper supply gap is projected to approach 10 million tons, according to BloombergNEF estimates. So, based on these factors, it seems plausible that copper could reach $40,000 a ton. But not for several decades. You can read the full article here: https://bit.ly/4aFKNvs #mining #copper

Copper needs to reach $12,000 a ton to incentivize large-scale investments in new mines, said Olivia Markham, who co-manages the BlackRock World Mining Fund. Markham says further gains are necessary to encourage miners to sign off on projects required to avoid major deficits during the energy transition. “When I look at the price today, I think it’s well below the pricing levels we need to incentivize new greenfield production,” Markham said in an interview with Bloomberg on Wednesday. “Structurally, we need more copper units, and currently I don’t see those big blocks of new supply coming through.” BlackRock has been among the most bullish voices in the copper market for years, and by degrees that sentiment is echoing across the industry as buyers contend with an unprecedented shortage of mined ore. Markham’s forecast is underpinned by an analysis of the soaring costs miners incurred in building copper projects recently, with an average spend of about $30,000 for each ton of production capacity. #copper #commodities #resources #mining #metals

The past year has undoubtedly been challenging for companies in the lithium, rare earths and critical minerals sectors. Tight capital markets have also made it difficult for some ASX-listed entities to raise capital. On the flip side, depressed commodity prices can present potential buying opportunities for those looking to invest now and expand their presence in the sector while asset prices remain low.   Boards of ASX-listed juniors must carefully consider how best to fund potential growth plans while conserving cash, and this usually involves deploying scrip as a form of consideration in M&A transactions. In this article, Andrew Ricciardi, Tom Barrett and Luke Paganin provide a brief list of key considerations to keep in mind when thinking about paying with scrip. Read more: https://lnkd.in/gx_2F8NQ #mergersacquisitions #funding #mining

“Humanity benefits from the metals it produces.” How do we begin to tell this story so it can be better understood and more widely accepted….?

First Quantum’s share price collapsed as a result of the turmoil, shedding more than 60 per cent of its value last year. The company is currently worth about $6.8 billion, while Barrick is worth about US$30 billion.Bristow has been looking to transform Barrick — formerly the world’s biggest gold miner — into a major copper producer. The company is building a big copper mine in Pakistan, and previously made an informal takeover approach to First Quantum that was rebuffed, Bloomberg reported in June.  https://lnkd.in/gXKmxWtr

HEADER: ⚖️ Why 90% of Mining Marketing Fails and How to Be in the Winning 10% 💡 In the dynamic realm of junior mining, the line between success and stagnation often hinges on two pivotal aspects: market intelligence and corporate governance. My experience has led me to a simple yet often overlooked formula: marketing is 90% listening and 10% messaging. This balance eludes many in the mining sector, where the focus on the latter often overshadows the critical role of attentive market engagement. "Embrace Active Listening and Market Alignment" 🎧 Understanding market needs and expectations is not just about selling a project; it's about presenting a financial product that aligns with macroeconomic and commodity trends, offering investors a gateway to capitalize on future possibilities. Investors ultimately are placing bets on macroeconomic conditions and commodity trends, expecting the right yield if their bets are right. "Strengthen Trust Through Transparent Governance" 🔍 However, the significance of the investment vehicle's structure often gets lost in translation. Corporate decisions—be it share rollbacks, governance missteps, or delayed filings (as seen in the case of Blue Moon Metals Inc. )—can sever the vital link between investors and their sought-after exposures. Such disconnects render investments futile, undermining trust and value. My attempts to communicate these concerns to the directors of companies like Blue Moon Metals Inc. , which pursued below-market financings to the detriment of shareholder value, underscore a broader industry challenge. Despite a project's inherent value, misaligned corporate actions can lead to significant market disconnects, as evidenced by the 85% decline in stock value following governance issues. "Align Corporate Practices with Investor Expectations" 🤝 The message I wish to impart is clear: Governance matters. The share price reflects not just the asset but the entirety of the company, including the conduct of its management and directors. Investors weigh these factors heavily in constructing their portfolios, seeking confidence in their exposures to commodities and economic landscapes. As we move forward, junior mining companies must prioritize listening over mere marketing, ensuring their structures and governance practices align with investor expectations. Only through this alignment can we foster trust, stability, and ultimately, success in the mining industry. #MiningIndustry #CorporateGovernance #MarketIntelligence #InvestorRelations #JuniorMining #CriticalMetals #SustainableMining #InvestmentInsights #EconomicTrends #MiningGovernance #CommodityMarkets #StrategicInvesting #ResourceManagement #FutureOfMining #EthicalInvesting #Zinc #Gold #Copper #Silver #McClintockGroup #TSXV #CSX

While critical minerals are an essential #commodity for the #energytransition and other ancillary technologies, the sector has not avoided some of the financing, #investment and inventory shocks that have been felt across the wider market. The global pipeline for exploration, #mining and #extraction projects faces underinvestment risk, and the endurance of high interest rates are keeping inventory costs high, with stock offloading an increasing tool to ringfence margins. As the demand for transition #metals and technologies are quickening, the expert panel will consider priorities for expanding mine #supply in the long-term at #GTRCommodities this month. Discussion will include how to navigate high #capital and operating costs, and the strategies for optimising #corporatefinance as well as managing short-term cash flow and working capital needs. 📢 Jean-Luc Fiorenzoni (PwC) 📢 Antonio Nanez (Citi) 📢 Dhaval Shah (AfriMet Resources) 📢 Alessandra Hool (ESM Foundation) Join over 500 commodity trade and finance market leaders from international and regional companies for a day of unrivalled networking and thought-provoking discussion. 👉 Secure your booking by visiting https://lnkd.in/dw6uf2Jy or contacting [email protected]. #GTRCommodities #Commodities #CriticalMinerals #WorkingCapital #Cashflow