News - Market Insights

Top investment banks predict the rich form enjoyed by commodity markets will continue as prices remain elevated into the end of this year before what some are expecting to be a period of normalisation in 2022 (reports The Australian Financial Review).

Just last week, the Bloomberg Commodity Spot Index (a basket of 23 energy, metals and agricultural raw materials contracts) climbed to an all-time high, surpassing the peaks reached during the last commodity supercycle in 2011. It comes despite a plunge in iron ore prices, which is being offset by gains posted by a fresh crop of energy commodities such as natural gas and crude oil, while thermal coal prices have surged to record highs.

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Liontown Resources gold spin-out Minerals 260 has enjoyed a strong debut on the ASX, opening at close to a 50 per cent premium to its 50¢ issue price (reports The West Australian).

Minerals 260, which houses Liontown’s precious and base metals assets with a focus on the prospective Moora project and contiguous Koojan farm-in joint venture project with Lachlan Star, opened at 74.5¢, but pared its initial gains to be trading at 62.5¢ at 10.30am. The listing follows a $30 million initial public offering, in which Liontown shareholders were given priority on top of the shares they received as part of an in specie distribution.

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Highly profitable iron ore junior Fenix Resources has ended the quarter with net cash of A$93 million, though nearly $25 million subsequently flowed the way of shareholders earlier this month as dividend payments (reports MiningNews).

Fenix loaded six ships at Geraldton during the quarter with ore trucked in from its Iron Ridge mine 486kkm away by road. Six ships were loaded in the September period consisting 198,000 wet metric tonnes of lump and 143,422t of fines. The average price received was $176/t FOB, equivalent to US$163/t CFR. Cash costs on an FOB basis were A$87/t. Fenix has hedge contracts starting this month of 50,000t per month at a fixed price of $230 per dry metric tonne.

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Drilling at New World’s Antler copper project in Arizona continues to deliver high-grade results that highlight the robustness of mineralisation (reports Stockhead).

Results such as 7.3m grading 4.2% copper equivalent from a depth of 473m and 3.1m at 6.4% copper equivalent from 487.4m in ANT69 and 5.9m at 5.9% copper equivalent in ANT67 certainly bode well for a maiden resource estimate scheduled for completion later this month.

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Strandline Resources will proceed with full development of its Coburn mineral sands project in the Gascoyne after securing financial closure of a $150 million loan from the Northern Australia Infrastructure Facility (reports The West Australian).

The loan is expected to help create 300 jobs during construction and 150 ongoing jobs after completion. Strandline said Coburn, which is targeting first production in the December quarter of next year, would capitalise on a strengthening price outlook for mineral sands and the growing demand for critical minerals. Mineral sands are used in ceramic tiles, pharmaceuticals, electronics, paint, plastics, titanium metal and the use of welding rods.

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Climbing uranium prices have generated a windfall for aspiring producer Boss Energy (ASX: BOE), which aims to capitalise on its strengthened position in project funding and offtake negotiations (reports Small Caps).

The company has been forging ahead with restart plans at its Honeymoon uranium mine in South Australia in a bid to take advantage of the growing uranium market. In an announcement today, Boss noted the spot price of uranium has risen from US$32.40 per pound in July to more than US$50/lb. The current spot price on Tuesday was US$41.25/lb, which exceeds the all-in cost of US$31.90/lb that the company forecast in June.

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7th October 2021

E79 Gold Mines has rocketed onto the ASX. In its first day of trading, shares in the junior traded as high as A27.5c, 37.5% above the 20c issue price of the initial public offering (reports MiningNews).

The company raised $7 million in an oversubscribed IPO managed by Euroz Hartleys. After offer costs and combined with existing cash, E79 has $9 million to advance its projects. Chaired by Stavely Minerals boss Chris Cairns, E79 will focus on underexplored areas of Western Australia. The company's flagship project is the Laverton South project, comprising of tenure in the Laverton tectonic zone. The project comprises the 100%-owned Lake Yindana project and a farm-in over St Barbara's Pinjin ground.

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Garimpeiro mentioned back on July 25 that he had grown a bit bored with the local gold exploration scene and that he was off to the wilds of West Africa in search of action (reports Barry FitzGerald on Stockhead) .

He came up with a couple of West African gold specialists to keep an eye on – Tietto (ASX:TIE) and Predictive (ASX:PDI) which were trading at 33.5c and 16.5c respectively. Tietto has since moved to 38c ahead of going into a trading halt on Friday, while Predictive has risen to 22c. So that’s gains of 13.5% and 33% respectively. They are more than handy gains given the gold price has fallen to six week lows, with investors giving ASX gold equities in general a lashing in response.

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