(Bloomberg) — Some of the world’s biggest investors are throwing their weight behind a plan to reform the mining industry so it can safely meet the growing demand for minerals and metals needed for the green transition.
Investors overseeing a combined $11 trillion, including California State Teachers’ Retirement System and Legal & General Investment Management, are among the first to back the Global Investor Commission on Mining 2030, according to a statement on Wednesday.
https://www.project-syndicate.org/
The IMF recently warned that the pursuit of net-zero emissions by 2050 will “spur unprecedented demand for some of the most crucial minerals,” leading to “soaring costs” that could “derail or delay the energy transition.” The rising crescendo of alarm is justified: “crucial minerals” loom as the main bottleneck to decarbonization.
WASHINGTON, DC – Will a shortage of minerals short-circuit the clean-energy transition? National governments – including the United States, Japan, Britain, and Canada – the European Union, and international organizations such as the World Bank, the International Monetary Fund, and the International Energy Agency are raising the alarm.
As the IMF puts it, the pursuit of net-zero emissions by 2050 will “spur unprecedented demand for some of the most crucial metals,” leading to “soaring costs” that could “derail or delay the energy transition itself.”
China’s demand for many major commodities has been growing at “robust rates,” Goldman Sachs said in a recent note. The investment bank observed that China’s demand for copper has risen 8% year on year, while appetite for iron ore and oil are up by 7% and 6%, respectively, all beating Goldman’s full-year expectations.
“This strength in demand has largely been tied to a combination of strong growth from the green economy, grid and property completions,” the Goldman report observed.
https://www.northernminer.com/
The discrepancy between mining company valuations and commodity prices is at its worst levels in decades, the Precious Metals Summit in Colorado heard this week.
“This is probably the worst disconnect I’ve seen in over 20 years,” Haytham Hodaly, senior vice-president for corporate development for streaming pioneer Wheaton Precious Metals (TSX: WPM; NYSE: WPM), told the conference.
With ingenuity, a 6.5bn-tonne problem may be dodged
Everyone wants more metals. In recent months Britain has inked a deal with Zambia, Japan has sealed one with Namibia and the EU has shaken hands with Chile. The bloc’s negotiators also started talks with the Democratic Republic of Congo; America’s, meanwhile, visited Mongolia. This scattershot campaign, which is also targeting the Philippines and Saudi Arabia, has a single aim: obtaining the minerals required for rapid decarbonisation.
Seventy-two countries, accounting for four-fifths of global emissions, have committed themselves to net-zero targets. According to the Energy Transitions Commission (etc), a think-tank, hitting them by 2050 will require 15 times today’s wind-power capacity, 25 times more solar, a tripling of the grid’s size and a 60-fold increase in the fleet of electric vehicles (EVs).
(Bloomberg) — Digging up the metals that go into power grids and electric cars is crucial to the energy transition. While the mining industry has plenty of reserves to tap, it faces a worrying shortage of young workers needed to get materials out of the ground.
In regions like Canada and the US, enrollment or graduation from university courses related to mining engineering slipped in recent years. The dilemma adds to the challenges miners face as they scramble to boost output of everything from copper and nickel to cobalt and lithium, just as many nations view supplies as a matter of national security and users rush to secure metal.
The leaders of Brazil, Russia, India, China and South Africa have held closed-door discussions on the possible expansion of their BRICS economic bloc
JOHANNESBURG — The leaders of Brazil, Russia, India, China and South Africa held closed-door discussions Wednesday on the possible expansion of their BRICS economic bloc, a move they’ve framed as a way to amplify the voice of developing nations, but which also serves the geopolitical interests of Beijing and Moscow.
A decision on whether to accept new members had been expected late Wednesday, the second day of a three-day BRICS summit in Johannesburg. But officials said that was looking unlikely and a declaration might be made on Thursday.
https://www.northernminer.com/
Broken supply chains, geopolitical tensions, war, inflation, rising energy costs, food crisis, droughts, famine, depleting mines. Welcome to the 2020s! The age of abundance is dead. The patterns defining this decade suggest more volatility is on the way, especially in the things that matter most — food, energy and shelter.
It’s why investors should be focusing on commodities. A perfect storm of tight supply that spans minerals, oil, gas, food and water is approaching. The modern world has been spoiled with years of cheap and plentiful supply. But that’s set to change.
From copper to wheat to natural gas, the cost of some of the world’s most important products is crashing, bringing long-awaited relief for consumers that were stung by last year’s soaring prices.
The commodity crunch unleashed by Russia’s invasion of Ukraine has taken a sharp reversal, with a Bloomberg gauge dropping more than 10% since the start of the year to the lowest since 2021. Driving the disinflationary trend are a world economy flirting with recession, Europe’s industrial slump and China’s weaker-than-expected emergence from Covid Zero policies.
For good or for ill, metals are the new oil. We need more “rare earths” and “everyday earths” to build the technologies of the future and make real a carbon transition. The geopolitics around mines, minerals, and the processing of metals are heating up. For that reason, the U.S. needs a more sophisticated strategy to ensure that the U.S. and our allies have access to mines and minerals.
The amount of minerals needed for a carbon transition will require a vast expansion of mining and the processing of minerals. For example, given current technologies and techniques, we will need to increase the production of cobalt and lithium by 40 times for the electric batteries needed to move from internal combustion engines to electric vehicles.
(Bloomberg) — The dark side of ESG investing has the potential to undermine a whole generation of clean-tech strategies.
Adam Matthews, chief responsible investment officer at the Church of England Pensions Board, said the risks posed to the renewables boom via the mining industry aren’t getting nearly enough attention. The upshot, according to the 47-year-old, is that portfolios intended to uphold environmental, social or good governance principles may end up being exposed to human-rights abuses and environmental damage via supply chains.
LONDON, Feb 1 (Reuters) – Base metals have enjoyed a strong start to the year, the London Metal Exchange (LME) index rising by 9.4% over the course of January on high hopes for China’s post-COVID reopening.
However, analysts are cautious that China’s recovery may not live up to bullish expectations and that prices have got ahead of themselves, judging by the latest Reuters base metals poll.
(Bloomberg) — In the rush of the 2000s commodities boom, the world’s biggest miners earned a reputation as swashbuckling dealmakers, taking on rivals in an onslaught of hostile offers, massive mergers and vicious bidding wars.
Then it all fell apart. A series of disastrous transactions meant balance sheets got shredded, bosses got fired and investors were furious. And so, for the past decade, miners have focused on mining and the mega deals mostly dried up. But now their penitence is over.
https://www.theglobeandmail.com/
A sharp reversal in commodity prices – hitting everything from copper, to crude oil, to wheat – is sapping investor enthusiasm for the resource sector and dismantling predictions of a supercycle that would immediately reshape the global economy.
As in many speculative booms, rising interest rates are largely to blame for the pullback. But investors are equally culpable, after they fell for age-old commodity price hype – no matter how many times they’ve already been burned.
LONDON, July 18 (Reuters) – Spikes in energy and grain prices following Russia’s invasion of Ukraine in February, coupled with the suspension of nickel trading on the London Metal Exchange in March due to a disorderly market have prompted regulators to take a closer look at the commodities sector.
WHAT ARE THE CONCERNS?
There are many. A surge in food and energy prices has pushed inflation to the highest levels in decades, piling financial strain on households and political pressure on regulators.
