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The Investing News Network looks at what's happened in Australia's mining market so far in 2021, and what could be ahead in the second half of the year.
Click here to read the previous Australia mining update.
After an uncertain 2020 for the Australian mining industry, the resource market showed signs of a sharp recovery in the first six months of the new year.
Here the Investing News Network looks at what's happened in Australia's mining sector so far in 2021, and what could be ahead in the second half.
Australia mining update: A look back at H1
Following a chaotic 2020, where the Australian resource industry showed resilience, 2021 kicked off on a bright note.
During the first three months of the year, Australia's mineral exports improved as the world economy rebounded from the impact of the COVID-19 pandemic.
"Australian miners have found their product in high demand, helped by the impact of government and central bank measures abroad," the Office of the Chief Economist's (OCE) March quarterly report reads.
In that period, the OCE's Resources and Energy Export Values Index rose 11.8 percent from the March quarter of 2020 — a 1.8 percent rise in prices added to a 10 percent gain in volumes.
Speaking at the recent Noosa Mining Conference in Queensland, EMR Capital's Owen Hegarty said Australia has outperformed almost every other country on the mining front.
"We have remote locations, (and) wonderful principles, policies and practices when it comes to occupational health and safety," he said.
The resource sector is looking strong for the expert in the next few years as demand continues to grow, backed by a sharp recovery, a growing population and the green energy transition.
"Commodities have a very strong demand going out for the longer term — supply side is the problem," he said, pointing to the lack of reinvestment from some of the bigger miners, paired with lead times for permitting and licencing approvals all of which are taking longer.
"There's only one thing that can happen to prices under those sorts of circumstances, and that is they will be under tension," he added.
Looking at how top Australian commodities performed, the iron ore price has remained strong in the first few months of the year, as a recovery in demand in some of the advanced industrialised nations has added to strong Chinese demand. That paired with low Brazilian supply has kept prices high.
"In the coming year, it is likely that the iron ore sector will make a significant contribution to (gross domestic product) growth, as high prices and margins drive growing volumes," the OCE said back in March. "The coal sector is likely to make only a modest contribution to growth in the first half of the outlook period."
Meanwhile, Australian miners and explorers continued to make progress at their projects, following a historic year for capital raising. In fact, according to Refinitiv, 2020 brought the highest total activity in the country since 2015, plus a record number of equity issuances.
In early June, BDO published a report on cash raised by explorers in the mining sector, showing positive signals for a continued strong recovery.
Exploration companies raised AU$2.37 billion in the March 2021 quarter, up 7 percent from the AU$2.21 billion raised in December. Of those companies, 48 raised funds of AU$10 million or more and made up 75 percent of the total funds raised.
"The first quarter of 2021 has proven to be a strong start to the year for Australian explorers, and is showing signs of a transition away from mere recovery to a new focus on ESG," the BDO report reads. "The global push for lower carbon emissions and clean energy has put a spotlight on EV-related commodities and greener energy alternatives, which we are already seeing in the March quarter."
Australia mining update: Expected trends in H2
As economies continue to open up, the fight against the coronavirus is still ongoing. The second half of the year kicked off with new lockdown measures in some countries and cities. However, many continue to be optimistic about the Australian mining sector's outlook for 2021.
Australia's resource and energy exports are estimated at a record AU$310 billion in 2020/2021, with almost half of those earnings coming from iron ore alone.
"The improved outlook reflects the ongoing rollout of vaccines, and the momentum this is providing for economic activity and trade amongst many of Australia's major trading partners," the most recent OCE quarterly report reads.
Australian iron ore earnings appear to have surged by almost 50 percent to an all-time high in 2020/2021. After topping the AU$100 billion mark ― the first time ever for any commodity ― in 2019/2020, iron ore export earnings are forecast to rise to AU$149 billion in 2020/2021, according to the OCE.
"Australia's copper export earnings are expected to increase in-line with higher prices. Export earnings are forecast to reach $13 billion in 2021/2022, up from $10 billion in 2019/2020," the OCE forecasts.
Meanwhile, metallurgical coal prices have recovered moderately, in line with improving global industrial production and economic activity. The Australian premium hard coking coal price is estimated by the OCE to increase from an average of US$143 a tonne in 2021 to around US$157 by 2023.
"Labour and skill shortages are affecting Australia's gold mine production, which is estimated to reach 332 tonnes in 2020-21," the latest OCE report reads. "Production from new mines and existing mine expansions is expected to boost gold mine production to 388 tonnes in 2022/2023."
According to the OCE, Australia's lithium export earnings are forecast to increase from AU$1.1 billion in 2019/2020 to AU$2.5 billion in 2022/2023.
Australia mining market: Commodities to watch
Commenting on his favourite commodities going forward, EMR Capital's Hegarty mentioned copper, gold and met coal.
"Copper is electrifying China and the rest of the developing world. It's the noblest of all metals, it's got a great diversity of uses and now you've got the green energy transition, which adds another leg to copper demand," he said. "It's on the supply side that the issue is ― the discoveries have been declining, exploration spins have been at a low point, so it's going to be tough to bring on new copper."
Hegarty has also liked gold for a long time, saying it's not only a commodity, but also a currency and a store of value.
"Exchange-traded funds are becoming more and more popular, and also the governments continue to buy gold," he said. "And it's the same thing as with copper — you've just got less exploration going into it, you've got less discoveries going into it and that's why gold continues to be under tension."
Looking over to met coal, Hegarty made the point that this commodity is part of the solution to decarbonisation and not part of the problem.
"It's so important to have that high-quality hard met coal going into steel production, so that we can actually continue to grow and the world can go through this whole decarbonising process," he said.
Don't forget to follow us @INN_Australia for real-time updates!
Securities Disclosure: I, Priscila Barrera, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.
The Board of Titan Minerals Limited (ASX: TTM) (Titan or the Company) is pleased to present the following update on surface exploration at its Linderos Project in Southern Ecuador. The focus of these programs has been the two main prospects currently known to exist at Linderos being the Mesta Gold Prospect and the Copper Ridge Prospect located <1km to its south. Some very exciting assay results from surface works are beginning to filter through with the key highlights so far being:
Meseta Gold Prospect
Assays received to date from the first 144 rock chips of 227 samples shipped for assay in the current mapping campaign, returned best results of:
- 64g/t gold with >1,500g/t silver (overlimit silver analysis pending) and 26.9g/t gold with 715g/t silver from exposed veins located 500m east of the closest previous drill hole.
- 61g/t gold with 103g/t silver and 42g/t gold with 9g/t silver located on current western margin of Meseta Gold Prospect
- 13g/t gold with 16g/t silver and 7.3g/t gold with 11g/t silver on veining discovered 2.3km southeast of Meseta Gold Prospect
Copper Ridge Prospect
A zone of outcropping quartz stockwork and altered porphyritic granodiorite averaging better than 0.2% copper over 360m wide has been identified in channel sampling. Assay results received for the first 28 of 47 channel samples have returned highly anomalous copper and gold results with the following highlights:
- 42m @ 0.31% copper and 0.12g/t gold including 12m @ 0.39% copper and 0.15g/t gold
- 42m @ 0.29% copper and 0.08g/t gold including 8m @ 0.53% copper and 0.11g/t gold
- 90m @ 0.26% copper and 0.13g/t gold
- 96m @ 0.21% copper.
GTI Resources Ltd (GTI or Company) is pleased to advise that the acquisition of Branka Minerals Pty Ltd and the vendor placement of $600,000, as advised to ASX on 18 August 2021, have now both been completed.
Settlement of the acquisition and completion of the vendor placement are the final milestones of a transformative period of corporate activity for the Company and positions GTI to commence exploration drilling in Wyoming prior to Christmas.
Executive Director Bruce Lane said:
"Preparation for our maiden drilling campaign in Wyoming has proceeded according to plan and settlement of the acquisition has put us in a great position to commence drill testing before the end of the year. The Company is now well funded after raising in excess of $5 million during the last 2 months and the market context for investing in ISR uranium exploration appear to be increasingly positive. We look forward to applying the funds we have raised in recent weeks to drive the creation of shareholder value in Wyoming's Great Divide Basin".
As previously advised, GTI is on track to commence ISR uranium drilling during December with the bonding process underway and drilling contractor bids received.
The Company will provide further updates in due course.
Read the full article here.
The mining and resources sector now sets its sights on Australia’s largest mining investment forum, Mines and Money @ IMARC, co-located with IMARC from January 31, 2022, to February 2, 2022, at the Melbourne Showgrounds.
It was gold price, lithium demand and China’s appetite for copper that dominated much of the discussion at Mines and Money Online Connect @ IMARC this week at the virtual event running from the 19th to the 21st October.
Mines and Money Online Connect saw 90 mining companies, 600+ investors and more than 2,000 participants log-on to hear mining executives and analysts discuss the next big thing for savvy investors in 2022.
Time to Strike Gold?
‘Frustrating’ sums up the 2021 gold price according to Commodity Discovery Fund Founder and Chief Investment Officer, Willem Middelkoop. Middelkoop spruiked gold’s glittering upside during the Mines and Money Gold Outlook Panel Discussion.
The panellists suggested that with the gold price soaring to record highs, a gold correction was inevitable. Historically, gold price is linked to market volatility and the much of new money printed in the United States.
In 2022, panellists expect plenty of market volatility and money printing, with an overinflated US dollar set to weaken in value, and subsequently drive up the price of gold. Through the Commodity Discovery Find, Middelkoop has studied the gold price in relation to increased money supply over the past decade.
“If you look at the current graph, the gold price needs to move back toward over US$2,000, and it should move toward US$8,000-$10,000 dollars to be in line with money growth. If you look at that statistic, there is so much upside,” said Middelkoop.
“A doubling of the gold price within 12 months is easily possible,” said Middelkoop.
The Need for Speed
The US has the need for speed with car manufacturing adopting electric vehicles (EVs) at an accelerating rate. The rising demand for EVs, which is expected to surge to 10% in global sales by 2025 according to Bloomberg New Energy Finance, will require startling quantities of lithium.
The price of lithium hydroxide continued to soar in 2021 and shows no sign of slowing down in 2022. Prices topped US$23,375 per tonne at the time of writing, which is up from a US$6,300 average per tonne in the September quarter 2020.
During the Mines and Money Battery Metals Session, Piedmont Lithium President and Chief Executive Officer, Keith Phillips, said the EVs market is fuelling the demand for lithium hydroxide. “I’ve always had the view that the market would speak, and the time would come, and it will,” said Phillips.
Phillips said Ford’s Blue Oval City required 125,000 tonnes per year of lithium hydroxide to service its three battery plants, which surpasses the production capacities of all lithium projects currently planned in the United States.
“Tesla has been a leader here, but LG and General Motors are making big commitments. “Everyone is talking about bringing more capacity to the US, which we desperately need, and even if we all succeed, we are still going to be short, and require lots of material from outside the US,” said Philips.
China’s Quiet Copper Rush
Copper was the metal of the hour during the China Commodities Supply and Demand Outlook 2022 Panel at Mines and Money. Companies from Australia’s biggest trading partner are digging for strategic commodities to enhance diversification and survival in an uncertain marketplace.
Gold Mountains General Manager, Maggie Huang said sourcing and developing copper mines was critical to not only Gold Mountains, but to the Chinese economy. “We see copper as a highly strategic metal for China, we are the largest consumer in the world. We consume half of all output of copper but produce only 20 to 25% of what we actually use,” said Huang.
Huang pointed out that whilst Australia and Canada represented stable and mature investment destinations in the past, “an investment is an investment,” and Chinese companies are now seeking new opportunities in other mining destinations.
As Africa and South America mature as mining destinations, Huang said emerging opportunities in Africa and South America could be more profitable and signify a more attractive investment than Australia or Canada.
As Mines and Money Online Connect @ IMARC concludes with positive outlooks on gold, lithium and copper, the mining and resources sector now sets its sights on Australia’s largest mining investment forum Mines and Money @ IMARC co-located with the International Mining and Resources Conference (IMARC) from the 31st January to 2nd February 2022 at the Melbourne Showgrounds.
The International Mining and Resources Conference (IMARC) is where global mining leaders connect with technology, finance, and the future. Now in its 8th year, it is Australia’s largest mining event, bringing together over 8,000 decision makers, mining leaders, policy makers, investors, commodity buyers, technical experts, innovators, and educators from over 130 countries for three days of learning, deal-making and unparalleled networking. IMARC is developed in collaboration with its founding partners the Victorian State Government of Australia, Austmine, the Australasian Institute of Mining and Metallurgy (AusIMM) and Mines and Money.
For more information, please visit https://imarcglobal.com/
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There are many big Australian gold stocks, but these are the five top companies in the sector by market cap.
Australia is the fourth largest producer of gold worldwide, and this past year has brought ups and downs for the commodity. The precious metal hit its 2021 high point early on and fell soon after.
Lately, gold has been resting at a strong price of around US$1,800 per ounce, and it seems like it will exit the year that way. It may even be in for a serious price hike if inflationary pressures continue on their current trajectory.
Read on to learn more about Australia’s five top gold companies by market cap. All market cap and share price information was obtained on November 25, 2021, using TradingView's stock screener.
1. Newcrest Mining
Market cap: AU$19.54 billion; current share price: AU$24.14
Newcrest Mining (ASX:NCM) operates a portfolio of gold mines across Australia, Canada and Papua New Guinea. These include its New South Wales-based Cadia mine and its Western Australia-based Telfer and Havieron mines.
2. Kirkland Lake Gold
Market cap: AU$14.57 billion; current share price: AU$54.99
Kirkland Lake Gold (ASX:KLA) has mining operations in Australia and Canada, both of which are low-risk, gold-rich countries. The company’s Fosterville mine is based in Victoria, Australia, and as of December 31, 2018, its mineral reserves stood at 2.7 million ounces. It produced 640,467 ounces in 2020.
In September 2021, Kirkland Lake Gold and Agnico Eagle Mines (TSX:AEM,NYSE:AEM), a Canadian gold miner, announced a “merger of equals." The new company will go by the name Agnico Eagle Mines, and the companies expect the transaction to close in late 2021 or early 2022.
3. AngloGold Ashanti
Market cap: AU$12.43 billion; current share price: AU$5.83
AngloGold Ashanti (ASX:AGG) is a global gold miner formed in 2004. It has two Australia-based operations, both of which are based in Western Australia’s northeastern goldfields: Sunrise Dam and Tropicana. Sunrise Dam is 100 percent owned, while Tropicana is 70 percent owned, with the remaining 30 percent owned by Regis Resources (ASX:RRL,OTC Pink:RGRNF). In 2020, these operations produced 554,000 ounces of gold.
In Q3 2021, AngloGold Ashanti reported total gold production of 613,000 ounces at a total cash cost of US$927 per ounce. This represents a 5 percent quarter-over-quarter increase in production, though a year-to-date decrease.
4. Northern Star Resources
Market cap: AU$11.39 billion; current share price: AU$9.66
Northern Star Resources (ASX:NST) is an Australian gold-mining company with projects throughout Western Australia and North America at its Kalgoorlie, Yandal and Pogo production centres. In the 2021 fiscal year, Northern Star experienced a 40 percent revenue increase and a 10 percent cash earnings hike.
In late November 2021, Northern Star announced an agreement to buy Newmont Australia’s power business for US$95 million. The company paid US$25 million for the option to purchase this business, an opportunity it was given through its recent 50 percent acquisition of Kalgoorlie Consolidated Gold Mines.
5. Evolution Mining
Market cap: AU$7.53 billion; current share price: AU$4.12
Australian gold miner Evolution Mining (ASX:EVN) has projects throughout New South Wales, Queensland and Western Australia, as well as in Ontario, Canada. Evolution Mining produced 680,788 ounces of gold in the 2021 fiscal year at an all-in sustaining cost of AU$1,215 per ounce.
In 2019, Evolution Mining became one of only two Australian gold companies to be included in the Dow Jones Sustainability Index (INDEXDJX:W1SGI). In 2020 and 2021, the company made several strategic acquisitions and divestments, including its high-value purchases of the Red Lake and the Kundana operations.
This is an updated version of an article originally published by the Investing News Network in 2018.
Don’t forget to follow us @INN_Australia for real-time updates!
Securities Disclosure: I, Isabel Armiento, hold no direct investment interest in any company mentioned in this article.
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What are the largest Australian copper companies? These five ASX copper stocks are the biggest on the exchange by market cap.
Last year, pandemic restrictions forced copper mines to shut down across the world, driving down global production and causing the 10 largest copper-mining companies to suffer dramatic losses.
But in 2021, copper hit an all-time high of US$10,700 per tonne, and stayed over US$9,000 for much of the year.
The three top copper-producing countries globally are Chile, Peru and China, with Australia coming in at number six. Still, there are plenty of untapped resources in the land down under, and Australia is making a name for itself as an up-and-coming producer of this important base metal.
Read on to learn more about the top five Australian copper companies on the ASX, ranked by market cap. All market cap and share price information was obtained on November 26, 2021, from TradingView.
Market cap: AU$192.56 billion; current share price: AU$38.03
The company, whose headquarters are in Melbourne, Australia, emphasises copper’s function in renewable energy systems and the metal’s critical role in reducing carbon dioxide emissions.
Recently, BHP has focused its attention on its energy assets. In late November, the company merged its oil and gas portfolio with Woodside Petroleum, a deal that was originally struck in August of the same year. On the mineral side of its operations, BHP was looking to acquire Noront Resources (TSXV:NOT,OTC Pink:NOSOF), a Canada-based nickel, copper, chrome and platinum company, but decided not to match a superior offer.
2. OZ Minerals
Market cap: AU$8.77 billion; current share price: AU$25.70
OZ Minerals (ASX:OZL) is a South Australia-based copper-mining company founded in 2008. Its operations include the Carrapateena project, where construction was completed in 2019, and the upcoming Malu underground mine, which was commissioned in 2015.
In a November press release, OZ Minerals reported a year-to-date 5 percent increase in group ore reserve copper metal tonnes. In its third quarter results, the company reported guidance of between 120,000 and 145,000 tonnes of copper for the year.
3. Sandfire Resources
Market cap: AU$2.59 billion; current share price: AU$6.11
Sandfire Resources (ASX:SFR) owns 7,189 square kilometres in the Bryah Basin region of Western Australia, including its DeGrussa and Monty operations. Both of these are 100 percent owned and produce copper and gold.
The company released its third quarter results in October, reporting total copper production of 15,946 tonnes. Sandfire expects output of between 64,000 and 68,000 tonnes of copper in 2022.
Market cap: AU$1.29 billion; current share price: AU$2.63
Australia-based mining company 29Metals (ASX:29M) has the Golden Grove mine in Western Australia and the Capricorn copper mine in Queensland, along with several promising new growth opportunities lined up. 29Metals focuses on copper production, though it also mines for zinc, gold and silver.
According to an October release from the company, production was weaker than expected at Golden Grove during the September quarter. However, the asset's quarter-on-quarter decline of about 10 percent was largely offset by a strong performance at Capricorn.
5. Copper Mountain Mining
Market cap: AU$804.96 million; current share price: AU$3.81
Copper Mountain Mining (ASX:C6C) is a Canadian and Australian copper miner, with its flagship Copper Mountain operation in British Columbia, Canada, and its Eva and Cameron copper projects in Queensland, Australia.
In the third quarter, Copper Mountain Mining reported total output of 22.4 million pounds of copper at its Copper Mountain mine, representing a 12.1 percent quarter-over-quarter decline in production. The company still reported positive cash flow, with strong construction and exploration gains made at its Eva and Cameron projects.
This is an updated version of an article first published by the Investing News Network in 2018.
Don’t forget to follow us @INN_Australia for real-time updates!
Securities Disclosure: I, Isabel Armiento, hold no direct investment interest in any company mentioned in this article.
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