The largest mining companies believe copper is set for a fascinating 12-18 months.

Recently, they shared outlooks at the Deutsche Bank annual copper CEO conference.

Here are your key takeaways: On the bullish side, disruption is expected to be substantial due to the Grasberg incident in Indonesia.

The mine is 3-3.5% of global copper mine supply and it will remain out of action for an extended period, after the mud rush at the start of September.

No bueno. Furthermore...

Niobium is the critical metal you never heard of.

And there is a funny reason...

This niche mining market was recently valued at $3.5 billion/pa, forecast to grow by 30% by 2030.

Here's your Niobium 101 to better understand this unique sector: 1. To start, it has a bit of an identity crisis

The primary mineral for niobium is columbite (or niobite).

Thus, you might have heard its other name, columbium.

And this all leads to its buddy...

BHP & Rio Tinto are the world's largest mining companies.

$237 billion in market value*, combined.

As leaders, their outlook is a crucial signal for investors.

Here's what they see ahead for copper: BHP views long-term fundamentals as favourable.

Commodity demand to be supported by:
- population/economic growth
- energy transition
- data centres (AI)
- substitution/thrifting

However, commodity markets to remain volatile over the next 18 months.

Beyond that horizon...

Understanding the different processing methods is key to investing in gold & silver miners.

Here is gold processing 101, to help you review news releases, reports and economic studies:

(I promise you'll want to bookmark this) Whether you're new to mining investing or have only invested in explorers, processing is THE step.

After all, a bulky resource is not money in the bank (yet!).

Processing refers to steps needed to turn the mined ore into a saleable product, in this case, gold & silver.

Gold hit a new all-time high this week.

Newmont, Agnico and Barrick are the world's largest gold miners.

Together represent over $120b in market value.

Here's what they expect ahead (plus the extra perk of holding gold producers): Gold production globally in 2023 was over 3,000t. China, Australia and Russia were top 3.

Over the last decade, production has been stable, despite the important price lift in recent years.

We rarely see such a subdued reaction in other commodities.

But gold is different...

As mining investors, we're always hunting for information.

While I don't believe in copying anyone's thesis, paying close attention to sentiment is paramount.

Here are some of my favourite quotes on commodities (including copper and lithium): → Via @LowellResFM $LRFM

You can't do anything without copper!

Lowell runs an exploration fund with exposure to $MKG $SXG $SRI

Freeport McMoran is the largest copper producer in the US and worth ~$54 billion.

Yet it flies under the radar.

You may have just seen them in the news (due to CFO Kathleen Quirk being appointed as new CEO), so...

Here's an overview plus their outlook for the commodity: Freeport produced more copper than BHP in 2022, or about 9% of mined production*.

While being much smaller in market value.

Is this an opportunity for you, as an investor?

Let's see how they stack up.

📊 @CostmineIntel | @synergyrescap

Investing in mining and metals is a long-term passion of mine.

This year I posted several 101s for most metals and minerals to help others get started.

You all seem to enjoy these, so here are the best, neatly tucked into 1 thread: The king copper, to start on the right foot, my fellow investors:

https://twitter.com/33749800/status/1712940058473623891

Where is copper going in 2024? The billion lb question...

Top investment banks assumed they knew what was coming.

But things have changed over the last few weeks.

BMO, Deutsche Bank and others say we're in for a surprise: During LME Week in October, sentiment was gloomy.

ICSG even forecasted a surplus of nearly half a million metric tons.

Large mine ramp-ups at Kamoa-Kakula in DRC $IVN, Quellaveco in Peru and QB2 $TECK in Chile were supposed to flood the market, as they'd reach full capacity.

The US proposed new regulations as part of the IRA to limit Chinese/Russian content for EVs.

With China's leading role in raw materials and batteries, this could have a BIG impact.

Here are some of the implications for anyone investing in lithium or EVs: Many have tried

Some stocks will benefit, and others will be shunned (will get to it in a sec).

Firstly, what has changed exactly?

Glencore is the 3rd largest mining company and valued at $70 billion.

They are betting BIG on growth.

Given their 2040 outlook, particularly for copper, hard to fault their investment strategy.

Here's what they see ahead and what we can all learn: In their base case, $GLEN views copper production falling -36% by 2040 (from 2022 figures), when considering ONLY operating mines and projects currently under construction.

By the same year, they believe demand will reach a massive 60Mt.

(that's a gap! 🔪🐊)

📊 @WoodMackenzie

Copper is the most important metal.

While prices have been weak this year, this remains true:

No copper, no energy transition.

Here's your “Copper Investing 101” to help you start or expand your exposure: You may be already investing in lithium or other minerals.

Copper must be the same, right?

Not quite.

It has unique characteristics.

Whether you're new to mining or not, understanding the nuances will benefit your portfolio.

10 cheap (or free) tools every mining investor needs:

(some may definitely surprise you) 1. Research aid: Airtable

An easy-to-use relational database to gather relevant data and then dive deeper into it to derive powerful insights.

I'm obsessed with Airtable - use it every single day.

$20/mo and up, free tier

airtable.com/invite/r/jQlnr…

Graphite is the most overlooked battery mineral.

Sure, lithium gets a lot more eyeballs, but it makes sense for investors to pay attention to its neighbour.

Here are 5 reasons to consider adding graphite to your portfolio: (plus a few graphite stocks at the end of the thread)

Let's *charge* ahead.

Lithium has taken the world by storm.

Simply put: the energy transition relies on it.

Yet its price has fallen since ATH in 2022, and lithium miners and explorers are hurting.

But this also creates a stellar contrarian setup for investors. So...

Here are 5 reasons to add (more) lithium stocks to your portfolio:

Let's go!

1) To start, rising quantities of batteries are desperately needed to push electrification forward.

Electric vehicles require efficient and lightweight power storage (aka batteries) that can solve range anxiety.

Hence, more -and better- batteries are needed.
EV sales are on track to reach a record-breaking 14m this year.

4 years ago, only 2.5% of total cars sold were electric.
This year, they’re expected to reach 18%.

📊 @IEA

2) The rising EV demand fuels the need for metals and minerals used in batteries, particularly:

• lithium
• copper
• cobalt
• nickel
• graphite

I expect significant shortfalls overall. But you don’t need to take my word for it:

$ALB, a leading producer with operations across the Americas and Australia, estimates 2030 demand will reach 3.7MT LCE (lithium carbonate equivalent) → 🔖

This is +15% from their previous forecast, aided by IRA (Inflation Reduction Act in the US) and strong EV demand.

Fastmarkets sees demand slightly under, at 3.5MT LCE by 2033.

So despite short-term choppiness, the long-term outlook appears extremely bullish.

📊 @FastmarketsMM

3) Lithium is a core component of most modern batteries.

Why?

Because it is the lightest metal in the periodic table, the least dense solid element, and it is programmed to give its charge away. It’s perfect as material in batteries.

Lithium ions are released by the cathode and received by the anode, what we see as charging and discharging.

‘The element's high electrochemical potential makes it a valuable component of high energy-density rechargeable lithium-ion batteries.’ -USGS

Here’s a closer look:

📊 @cenmag

In the case of NCA, a common type, ~7% of the cathode is lithium.

Other popular battery chemistries are NMC -Nickel-manganese-cobalt- and LFP - Lithium-ferrous-phosphate-. More types exist with various proportions of materials, designed to prioritise specific metrics.

Options for substitution are likely to increase, but they are nowhere near as widely used.

One example is sodium batteries. While this type can be a meaningful part of the market, it has significant performance restrictions which makes them less attractive, at least with current technology. Sodium-ion batteries are generally better suited for large-scale energy storage systems where weight and energy density are not as crucial.

4) While lithium is widely available in earth’s crust, producing a chemical that meets battery specifications (‘battery grade’) is more complex.

In fact, the largest producing countries have healthy reserves. The past 5 years of production barely made a dent.

Note: USGS reports production, reserves and resources annually as contained lithium, hence conversion factors must be applied

But refining? That’s another story. Capacity doesn’t translate into supply directly, seldom comes exactly in time as planned, and is heavily concentrated in China.

Key challenges are summarised in this thread → 🔖

Plus ‘battery grade’ or high purity can vary between suppliers.

5) When you look at the whole metals market globally, lithium is still a small portion.

Tiny really. In 2021 S&P data puts this figure at $5B and by 2022, the market just exceeded $11B using Fastmarkets data (at 321,000t LCE)*.

While iron, gold, copper & aluminium dominate (and in turn are dwarfed by oil at $3T), lithium is still just emerging with plenty of upside for investors → 🔖

As a nascent space, growing pains are inevitable.

All in all, both experts and producers see a massive need for capital in years to come.

Benchmark Mineral Intelligence puts the figure in the range of $54 to $116B by 2030. In comparison, copper, a much bigger market, may require up to $250B over the same period, according to $BHP.

And that’s it.

We need batteries, ergo, we need lithium.

I think it’s safe to say they have become the new oil, as @elonmusk said → 🔖

These ideas can help you in the decision to allocate (more) capital to lithium miners and explorers.

To sum up:
1) EVs are in
2) EVs need batteries
3) Batteries need lithium
4) Producing lithium is not easy
5) Lithium as a market still in its infancy

🔖 Additional context/sources to follow

*Market sizing analysis uses production figures from USGS and other sources, and then the spot price at the time of analysis

#EnergyTransition #Lithium #Decarbonization


As promised...

🔖 Dig deeper:

$ALB 2030 demand estimates →

https://twitter.com/paola_rojas/status/1669831011092537344

Nuclear remains deeply controversial.

Many prefer to just ignore the subject altogether.

But nuclear energy (enabled by uranium) provides ~10% of the world’s electricity*.

This is just a fraction of the potential.

And there are more reasons to be bullish: Sprott says we are starting an energy transition materials secular bull market.

Highlights the need to:

• speed up the global energy transition
• secure critical minerals supply

All after a decade of underinvestment, which magnifies the task ahead.

(Indeed)

📊 @Sprott

Major players such as BHP and RIO have been saying this for a while.

The amount of metals and minerals required for the energy transition is massive.

Only 1 thing to do: more investment.

Here are 5 basic strategies to start (or expand) your allocation: For reference, even the largest miners can't hold a candle to big tech.

Earlier this month, $APPL reached $3T while these titans were only $250B combined.

(I'm including a full breakdown of BHP/RIO's outlook in a sec)

Now, let's talk about these strategies.

Australia released this week the much anticipated 'Critical Minerals Strategy 2023–2030'.

If successful, this could make Australia a global superpower in the space and foster investment in mining, energy and tech.

Here are your key points: The main goal is to produce more minerals (and we are blessed!) while embedding Australia in supply chains for:

• lithium-ion, vanadium flow batteries
• advanced medical equipment
• defence industry tech
• LED lighting
• optics

and others!

Programs already exist:

Here are 10 Podcasts you need to listen to, as a mining and metals or energy transition investor:

(the best of all by the end) 10. Commodities Focus

Experts from @SPGCIMetals and more in detail discussion regarding commodities (energy very often discussed).

2/mo

podcasts.apple.com/us/podcast/com…

BHP and Rio Tinto are the world's largest miners.

Together represent ~$250b in market value.

Recently, they shared outlooks at the Bank of America Global Metals, Mining & Steel Conference in Barcelona.

Here are your key takeaways, investor: BHP views long-term fundamentals to be favourable.

Global commodity demand to be supported by:

- population growth
- urbanisation
- rising living standards

And they project the economy to grow 2.5x by 2050.

Warren Buffett is bullish on copper.

Wait... what?

Yes.

I reviewed materials and video from Berkshire Hathaway's annual shareholders meeting in Omaha.

So here's how: Berkshire Hathaway is a sprawling empire that holds dozens of businesses, both privately owned and listed.

Yet the jewels of the crown are 3:

• Berkshire Hathaway itself, the insurance business + investments
• BNSF Railway bnsf.com

and one more...