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Asia Mining

RPT-COLUMN-Nickel prices coming supply glut but stocks keep falling – by Andy Home (June 7, 2023)

https://www.reuters.com/

LONDON, June 7 (Reuters) – Nickel has been the under-performer of the London Metal Exchange (LME) base metals pack this year. LME three-month nickel sank to a nine-month low of $20,310 per tonne last week and at a current $21,500 is now down by 31% since the start of the year.

Nickel is pricing in a looming supply glut as Indonesia builds out ever more production capacity in its race to be an electric vehicle battery metals giant. The country’s mined output grew by 48% last year and by another 41% in the first three months of this year, according to The International Nickel Study Group.

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China’s EV Battery Sector Is Preparing a New Breakthrough – by Annie Lee (Bloomberg News – June 5, 2023)

https://www.bnnbloomberg.ca/

(Bloomberg) — One of China’s top battery-makers reckons it has cracked a technology to provide even cheaper and more powerful packs for electric vehicles. Gotion High-Tech Co. recently unveiled a lithium-iron-manganese-phosphate battery — LMFP for short — which it says will power an EV for 1,000 kilometers (621 miles) on each charge. Until now, it’s largely the more expensive nickel-cobalt batteries have provided that kind of range.

“It’s an upgrade, it’s a leap for energy density,” Cheng Qian, executive president of Gotion’s international business unit, said in a phone interview from Tokyo.

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EV Makers Confront the ‘Nickel Pickle’ – by Jon Emont (Wall Street Journal – June 4, 2023)

https://www.wsj.com/

Large amounts of the mineral are needed for electric car batteries, but getting it out of the ground and refining it often requires clearing rainforests and generating large amounts of carbon

In the electric-vehicle business, the quandary is known as the nickel pickle. To make batteries for EVs, companies need to mine and refine large amounts of nickel. The process of getting the mineral out of the ground and turning it into battery-ready substances, though, is particularly environmentally unfriendly.

Reaching the nickel means cutting down swaths of rainforest. Refining it is a carbon-intensive process that involves extreme heat and high pressure, producing waste slurry that’s hard to dispose of.

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China’s Monopoly over Critical Minerals – by Katherine Wells (Georgetown Security Studies Review – June 1, 2023)

https://georgetownsecuritystudiesreview.org/

As part of China’s Belt and Road Initiative, the Chinese Communist Party (CCP) has taken to investing in critical mineral mines globally. One of these investment hotspots is the Democratic Republic of Congo (DRC). In 2020, the DRC was the world’s largest cobalt miner, producing 41 of all cobalt resources.

Although not the largest producer of copper – Chile produces 27 percent of the global copper production – the DRC boasts the highest-quality copper reserves in the world, with mines estimated to contain copper with grades above 3 percent, 2.4 percent higher than the average supply globally. The mining industry is central to the DRC’s economy, making up over 90 percent of its exports.

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Whitehaven says coal is a ‘critical mineral’ for defence allies – by Peter Ker (Australian Financial Review – June 1, 2023)

https://www.afr.com/

Whitehaven Coal managing director Paul Flynn has urged the Albanese government to consider coal’s role in powering defence allies like Japan and South Korea when reviewing its list of minerals that are “critical” to economic growth and national security.

Coal is not among the 26 minerals considered “critical” by the Australian government although coking coal for steelmaking is one of the 34 minerals considered “critical” by the European Commission.

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Column: China’s soft economic data will mean lower commodity imports, but not yet – by Clyde Russell (Reuters – June 1, 2023)

https://www.reuters.com/

LAUNCESTON — A run of weak economic data in China is likely to show up in softer imports of key commodities, albeit with a lag given the time taken to physically ship resources from around the globe.

The manufacturing indicator, the official Purchasing Managers’ Index (PMI), dropped to a five-month low of 48.8 points in May, the National Bureau of Statistics (NBS) said on Wednesday. This was the second month the measure was below the 50-level that separates expansion from contraction, and it was also weaker than the median forecast for a rise in May to 49.4 from April’s 49.2.

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Tensions with China not impacting this Chinese-owned lithium mine in Manitoba – by Naimul Karim (Financial Post – June 1, 2023)

https://financialpost.com/

The Tanco mine, one of Canada’s two lithium producers, hopes to expand against the odds

Ottawa surprised the mining world with its decision in November to bar three Chinese companies from buying stakes in Canada’s lithium businesses due to national security concerns.

Since then, investments from Chinese miners into Canadian companies that own properties containing minerals, such as lithium, copper or nickel, that are in high demand and needed for the energy transition away from fossil fuels have been unheard of.

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Shift to clean energy accelerating, but coal investments too high, report says – by Victoria Milko and Aniruddha Ghosal (Associated Press – May 25, 2023)

https://apnews.com/

JAKARTA, Indonesia (AP) — Energy security concerns — worsened by the war in Ukraine — and policy support from rich countries are likely to help investments in clean energy outpace spending on fossil fuels, the International Energy Agency said in a report issued Thursday.

But investments in coal are on course to rise by about 10% in 2023, nearly six times what the IEA has estimated they should be for the world to end its reliance on fossil fuels and achieve emissions cut goals for countering climate change, it said.

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Ottawa drove China out of Canada’s lithium industry, but questions linger over costs – by Naimul Karim (Financial Post – May 23, 2023)

https://financialpost.com/

Here’s what you need to know about the move’s impact on miners, critical minerals and even the TSX

Last November, the federal government ordered three Chinese companies to divest from three junior Canadian lithium explorers. The step was taken amidst an increasing demand for critical minerals such as lithium and copper that are expected to play a key role in the world’s shift away from fossil fuels.

The move seemed to be a part of a larger step taken by Western nations to offset China’s dominance in the critical minerals sector and divert supply chains towards friendlier countries. It’s been about half a year since Ottawa’s surprise announcement, and the three Canadian miners who were impacted have now managed to fill the gaps left by the ban on Chinese capital.

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West Africa: Macron’s Visit to Mongolia Was Focused On Ensuring France’s Uranium Supply – by Jan Van Der Made (Radio France International/All Africa.com – May 23, 2023)

https://allafrica.com/

Access to rare earth minerals and Russia’s war against Ukraine topped the agenda on French President Emmanuel Macron’s historic visit to Mongolia. But the joint declaration signed during the meeting also underlines France’s attempts to find an alternative uranium source for its nuclear reactors.

As it stands, France depends to a large extent on uranium sourced in West Africa. That supply chain, however, is under threat because of social and political unrest in the region. The 18-article joint declaration, which trumpets “strengthening political, economic, commercial and defence cooperation”, also notes that both countries will also cooperate in the energy sector.

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OPINION: The Philippines should seek to bond with U.S. on metals – by Makoi Popioco (Nikkei Asia – May 24, 2023)

https://asia.nikkei.com/

While access to new bases and expanded military cooperation between the Philippines and the U.S. have grabbed headlines, an important economic component, namely collaboration on the processing of critical minerals and green mining, is emerging as another possible area of partnership.

Although details remain sketchy, potential “friendshoring” in this area by the U.S. could be pivotal to Manila’s efforts to expand its critical minerals sector. It could also provide an opportunity for the U.S. to show how it will operationalize President Joe Biden’s Indo-Pacific Economic Framework, which is widely perceived as lackluster so far.

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OPINION: Mining companies need to look at new ways to reduce biodiversity impacts – by Tom Drabble (Benchmark Minerals.com – May 22, 2023)

https://source.benchmarkminerals.com/

Critical mineral deposits crucial to the clean energy transition can be found across the globe. As mining companies cannot control where geological deposits form, they are forced to tackle whatever challenges are present in the location of which they are found. One of the largest challenges within the environmental “E” of ESG is how to prevent biodiversity loss due to company operations.

It is crucial that biodiversity is considered and appropriately monitored at all stages, from acquisition through to mine closure and rehabilitation. Strategies for biodiversity management of a mine site should begin with an environmental impact assessment and mitigation strategies and targets set.

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Australia Tries to Break Its Dependence on China for Lithium Mining – by Natasha Frost (New York Times – May 23, 2023)

https://www.nytimes.com/

Half of the world’s supply of the critical battery ingredient is mined in Australia, which ships virtually all of it to China. The government and business are betting they can change that.

Deep in rural Western Australia, Pilbara Minerals’ vast processing plant looms above the red dirt, quivering as tons of a lithium ore slurry move through its pipes.

The plant turns the ore from a nearby quarry into spodumene, a greenish crystalline powder that is about 6 percent lithium and sells for about $5,700 a ton. From there, the spodumene is shipped to China, where it is further refined so it can be used in the batteries that power goods like cellphones and electric cars.

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Column: Lithium slump puts China’s spot price under the spotlight – by Andy Home (Reuters – May 19, 2023)

https://www.reuters.com/

LONDON, May 19 (Reuters) – High-flying lithium has come crashing back to earth. A super-charged two-year rally, which saw Chinese spot lithium carbonate prices rise by tenfold, went into brutal reverse over the first part of this year. The spot price slumped by 70% between November and its low point in April.

The battery metal was knocked off its heights by early-year weakness in China’s electric vehicle (EV) market, still by some margin the world’s largest. The temporary demand hit rippled back up through the Chinese battery chain, generating a collective destocking cycle and killing the spot market.

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Top Stock Fund Wagers BHP, Rio Tinto Will Weather Iron-Ore Slump – by Georgina McKay (Bloomberg News – May 17, 2023)

https://www.bnnbloomberg.ca/

(Bloomberg) — A top equities fund manager is backing BHP Group Ltd. and Rio Tinto Ltd., betting they can withstand softer iron-ore prices and will benefit as China’s reopening boosts demand for the commodity.

Australian producers are attractive as they have relatively low operating costs and high exposure to the mainland, the world’s largest consumer of the steel-making ingredient, according to David Wilson, who oversees the equivalent of $5.3 billion at Australia-focused First Sentier Wholesale Geared Share Fund. The fund has returned 10% this year, beating more than 90% of its peers.

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