This is an annual phenomenon. While many metal fabricators take downtime over the holiday period, most smelters keep operating, leading to a jump in visible inventory.

Copper has experienced the sharpest seasonal stocks build this year, leaving exchange inventory at the highest levels since 2020.

The rise in ShFE zinc inventories has closely matched last year’s pattern, while aluminum has seen a highly muted rebuild by historical standards.

Nickel stocks were increasing before the holiday break and are now at four-year highs. Those of tin are the highest since ShFE launched its tin contract in 2015.

Copper surge

ShFE copper stocks have mushroomed from just 30,905 metric tons at the end of December to 285,090 tons.

The scale of this year’s seasonal surge has been the strongest since 2020, when registered inventory peaked at 380,085 tons. The New Year holiday period that year coincided with the first wave of COVID-19 lockdowns and the resulting slump in Chinese manufacturing activity.

This year the jump in exchange stocks likely reflects the combination of fast domestic production growth and higher imports.

The country’s output of refined copper rose by 9.0% year-on-year in January-February, equivalent to an extra 159,000 tons, according to local data provider Shanghai Metal Market. Imports rose by 2.6% over the same period.

Stocks registered with Shanghai’s International Energy Exchange have also jumped from 9,760 tons at the end of last year to a current 40,511 tons. However, this year’s mid-March peak of 45,298 tons fell short of last year’s peak of 82,575 tons.

Muted rise in aluminum stocks

ShFE stocks of aluminum fell to 199,757 tons this week from last week’s year-to-date high of 206,417 tons.

If that turns out to be this year’s seasonal peak, it means the rebuild has been extremely muted relative to the last four years.

Stocks are up by just 100,728 tons on the start of January. By this time last year they had risen by 229,000 tons. The seasonal effect was even stronger over the 2020-2022 period.

Visible inventory remains remarkably low after last year’s high imports of over 1.5 million tons and the bullish optics reinforce the narrative of a tight domestic market.

Seasonal norm for zinc and lead

Exchange stocks of zinc in Shanghai crept a little higher this week to 121,873 tons and are now up by 100,658 tons on the start of January.

This is very close to last year’s seasonal build of 103,441 tons and to that seen in 2021.

Shanghai lead stocks stand at 53,631 tons and are up by just 747 tons since the start of 2024, which is comparable to the 333-ton rise seen over the first three months of last year.

Lead is less exposed to the new year holiday effect, having its own seasonality in the form of car battery kill rates over the northern hemisphere winter months.

China is also exporting ever more refined lead. Shipments rose by 62% year-on-year to 188,000 tons in 2023, the highest annual volume since 2007.

The steady outbound flow has served to keep Shanghai inventory below the 100,000-ton level for the last two years.

Nickel stocks at four-year high

Shanghai nickel stocks dwindled to just 560 tons in May last year, reflecting a shift in domestic production from the refined nickel that trades on the ShFE to nickel sulphate used in electric vehicle batteries.

The dynamic has changed dramatically over the last year. A new generation of Chinese nickel refineries has started up to capitalise on the burgeoning import flow of Indonesian raw materials.

ShFE stocks have grown to 20,713 tons, the highest tally since December 2020. The build has been mirrored on the London market, where the London Metal Exchange (LME) has been fast-tracking Chinese companies wanting to list their brands. LME stocks have risen by 21% so far this year.

Tin stocks hit record high

Global exchange stocks of tin, by contrast, are showing divergent trends.

Those in London have fallen by a third this year to below 5,000 tons as supply is constrained by export delays in Indonesia.

Shanghai tin stocks have been rising steadily since the start of December and now total 12,021 tons, which is the highest inventory in the contract’s nine years of trading history.

The country has been stocking up on refined tin in recent months, imports hitting a record high of 33,470 tons last year.

(The opinions expressed here are those of the author, Andy Home, a columnist for Reuters.)

(Editing by David Evans)

Graphic: Congo overtakes Peru on copper output, still behind on exports

“Whatever report we have in front of us, we are not convinced by it,” said VL Kantha Rao, secretary at the Ministry of Mines, which administers Hindustan Zinc.

Last September, the company said it plans to create separate entities for its zinc, lead, silver and recycling businesses to unlock potential shareholder value.

But it did not consult the government, which has a 29.54% stake in the company, on the planned move, another government official told Reuters on the condition of anonymity.

The official also said the government was not convinced by Hindustan Zinc’s rationale for the split and that the Ministry of Mines has lodged its objection with the company.

Hindustan Zinc CEO Arun Misra told Reuters the company had received the ministry’s communication, which will be discussed with the board along with the management’s observations.

However, Misra said he believes demerging the company to create a separate silver and zinc entity will help improve its market capitalization, based on a report by a consultant.

A year back, the government had opposed Hindustan Zinc’s proposal to buy two entities of Vedanta — which has a 64.9% stake in Hindustan Zinc — and forced the company to drop the plan.

(By Neha Arora and Nikunj Ohri; Editing by Shounak Dasgupta and Savio D’Souza)

Of the 500 million crowns, 200 million is due to reduced production and 300 million to delayed deliveries to customers, Boliden said in a statement.

Finland’s industrial, logistics and electrical workers said on Wednesday they would extend their ongoing two-week strikes by one week until March 31 in protest against government labour reforms and welfare cuts.

Boliden now expects a negative cash flow impact in the first quarter of around 1 billion crowns, up from its previously communicated 500 million crowns.

It expects the impact of delayed deliveries to be temporary and to be regained in the second quarter, it added.

“Some impact on production is also expected during the second quarter, based on currently assumed circumstances,” the company said.

($1 = 10.5079 Swedish crowns)

(By Anna Ringstrom; Editing by Louise Rasmussen and Mark Potter)

Prices rose as much as 2.5% to $2,571.50 a metric ton on the London Metal Exchange after the mining site experienced heavy rain that made landfall on Monday.

Rainfall at the site this week exceeded a previous record set in 1974, according to a statement from Glencore. The company is monitoring flooding in the area and assessing impacts on its operations.

Copper pared gains late Thursday, after hitting an 11-month high earlier this week. The market has been supported by the Federal Reserve’s signals on future rate cuts, which bolstered risk appetite and weakened the US dollar.

The metal has gained more than 10% over the past six weeks, boosted by supply risks, along with a generally more positive global economic outlook. Open-interest, or the number of outstanding contracts, for copper on the Shanghai Futures Exchange has soared to a record of more than 500,000 since last week as investors increased bullish bets.

The US dollar steadied following a decline on Wednesday, as Fed policymakers kept their outlook for three cuts this year and moved toward slowing the pace of reducing their bond holdings, suggesting they aren’t alarmed by a recent uptick in inflation. A weaker greenback makes commodities from copper to iron ore cheaper to other currency holders.

The copper market remains very tight, Goldman Sachs Group Inc. said in a note. “The combination of record low copper stocks, our expectation of peak mine supply next year, rapid green demand growth, and low price elasticity of both demand and supply will, in our view lead to copper scarcity pricing in 2025,” analysts led by Lina Thomas said.

Copper climbed 0.3% to $8,955.50 a ton on the London Metal Exchange as of 4:42 p.m. local time, after gaining as much as 1.8% earlier.

The suspension could exacerbate a tightened supply of zinc concentrates, feedstock to make refined zinc, which is mainly used to galvanise steel to protect it from corrosion.

“MRM has temporarily ceased operations as we monitor flooding in the region and assess impacts onsite at our operations,” Glencore said in a statement.

McArthur River mine is one of the world’s biggest zinc and lead operations. It produced 262,200 tonnes of zinc in concentrates and 50,400 tonnes of lead in concentrates last year, according to Glencore’s production report.

The site experienced rainfall this week which exceeded the previous record dating back about 50 years to 1974.

Also backed by Glencore, Peruvian zinc, lead and silver miner Volcan suspended three of its mines in the country earlier this week as it works on updating an operating permit for its Rumichaca tailings dam.

Delay in the start of major Russian zinc mine Ozernoye, suspension of Europe’s biggest zinc mine Tara, also led to a lower supply of mined zinc.

(By Julian Luk; Editing by David Evans)

In a paper published in the journal Frontiers in Bioengineering and Biotechnology, the scientists explain that electronic waste is notoriously difficult to recycle because it’s hard to separate the different metals in the waste from each other.

“Getting the metals in solution is a first step, but the selective recovery of the metals remains a challenge. Compared to processes such as chemical precipitation, biosorption using spent brewer’s yeast presents a cheap and environmentally friendly approach,” Klemens Kremser of the University of Natural Resources and Life Sciences, Vienna, and corresponding author of the article, said in a media statement.

Several options already exist for separating the different component metals of electronic waste, including other biosorbents—biological materials that can be used to soak up pollution. However, they all have significant downsides. For instance, chemical precipitation produces contaminated slag, while biochar—a biosorbent that is similar to charcoal—is difficult to separate from wastewater.

So the scientists turned to brewer’s yeast.

They acquired 20 litres of spent brewer’s yeast, separated the biomass from leftover brewing residues, and dried out the biomass. Electrostatic interactions on the surface of the yeast allow metal ions to stick to that surface—a process called adsorption. Changing the pH of this solution alters the interactions, which can allow the yeast to adsorb more or different metal ions, depending on the contents of the solution and the specific pH.

The researchers then chose to test the yeast biomass against zinc, aluminum, copper, and nickel, economically important metals. They tested each metal solution at different pHs and temperatures, to gauge whether it was possible to increase the strength of the interactions and recover more metal. They also tested the yeast against a real polymetallic waste stream.

“Using waste biomass for metal recovery is not a completely new process, but the selectivity of biosorption processes is a key factor for efficient metal recovery from polymetallic waste streams,” Anna Sieber, Ph.D. fellow of K1-MET, an Austrian metallurgical research center, and first author of the article, said.

“We demonstrated high metal recovery rates from a complex metal solution using an environmentally friendly and cheap biomass. Yeast biomass is considered a safe organism, and the demonstrated reusability of the biomass makes it an economically feasible approach.”

High recovery rates

The group was able to recover more than 50% of aluminum, more than 40% of copper, and more than 70% of zinc from the test metal solutions. Over 50% of copper and over 90% of zinc were retrieved from the polymetallic waste stream they tested the yeast on.

Changing the temperature had little impact on efficiency, except for zinc, where it raised the recovery rate by 7.6%. Similarly, adjusting the pH had a limited effect on most of the metal solutions, except for aluminum, where it improved the recovery efficiency by 16%.

“The metals can be removed from the yeast surface by acid treatment and thus could be recycled,” Sieber said. “It would be interesting to investigate potential applications for these reclaimed metals.”

The yeast itself could also be recycled without heavily impacting its ability to recover metal: the scientists were able to use it five times to recover different metals.

The team, however, cautions that the new process needs testing with much larger studies in real-life conditions before it can be implemented on an industrial scale.

“The metal removal process in this study was optimized for the four metals in question,” Kremser said. “The concentration of potentially interfering metal ions was very low in our starting solutions, but this would be important to consider when applying this approach to different mixed metal solutions.”

The metal has gained more than 10% over the past six weeks, boosted by supply risks, along with a generally more positive global economic outlook. Open-interest, or the number of outstanding contracts, for copper on the Shanghai Futures Exchange has soared to a record of more than 500,000 since last week as investors increased bullish bets.

The US dollar steadied following a decline on Wednesday, as Fed policymakers kept their outlook for three cuts this year and moved toward slowing the pace of reducing their bond holdings, suggesting they aren’t alarmed by a recent uptick in inflation. A weaker greenback makes commodities from copper to iron ore cheaper to other currency holders.

The copper market remains very tight, Goldman Sachs Group Inc. said in a note. “The combination of record low copper stocks, our expectation of peak mine supply next year, rapid green demand growth, and low price elasticity of both demand and supply will, in our view lead to copper scarcity pricing in 2025,” analysts led by Lina Thomas said.

Copper climbed 0.8% to $8,998.50 a ton on the London Metal Exchange by 11:35 a.m. local time, after rising as much as 1.8% earlier. Zinc rose 1.3% after Glencore Plc said it temporarily ceased operations at its McArthur River zinc and lead mine in northern Australia due to a cyclone.

Rainfall at the site this week exceeded a previous record set in 1974, according to a statement from Glencore. The company is monitoring flooding in the area and assessing impacts on its operations.

The push echoes calls from the mining industry for clarity on how permits can be obtained for mines that produce copper, lithium and other energy transition minerals. Executives have long complained the US process can be complex, expensive and opaque due in part to a federal mining law enacted in 1872.

“Our message to the Biden administration is, ‘Do everything you can to do everything here in America. Get your permitting processes streamlined,'” Dunleavy told Reuters on the sidelines of the CERAWeek energy conference in Houston.

It is “somewhat nonsensical,” the governor said, that Biden has pushed for greater adoption of electric vehicles – which require far more critical minerals to build than internal combustion engines – but has blocked Northern Dynasty’s Pebble copper and gold mining project.

“If we don’t get our permitting processes together, if we don’t start to use data and science again instead of emotion, this chaos is going to continue,” he said.

Dunleavy sued Biden last week for the president’s 2023 decision to block Pebble. The suit seeks more than $700 billion, an amount that the governor says the state will lose in economic development without the mine. Dunleavy tried unsuccessfully last year to have the US Supreme Court overturn Biden.

Vancouver-based Northern Dynasty itself sued Biden on Monday.

The proposed Pebble mine would have “unacceptable and adverse effects on certain salmon fishery areas” in Alaska’s Bristol Bay, the US Environmental Protection Agency said last year.

Dunleavy said he believes the mine and the state’s salmon fishers can co-exist.

“The science is there to be able to develop the mine responsibly,” he said. “We can put the safeguards in, and that’s why I’m a supporter.”

Lisa Murkowski and Dan Sullivan, Alaska’s two Republican US Senators, oppose Pebble, which Dunleavy acknowledged is a hindrance.

“However, my job as the governor is to advocate for our state, advocate for the development of our state lands or minerals, and advocate for the prosperity of our people,” he said.

Ambler road

Dunleavy, who has endorsed his fellow Republican Donald Trump against Democrat Biden in the 2024 US presidential election, is also pushing Biden to approve the construction of an access road to the prospective Ambler mining district in northern Alaska.

The Ambler project seeks to open a remote area rich in copper, zinc and lead and could yield deposits of rare earths used in weapons manufacturing. Trilogy Metals is one of the region’s potential developers.

“I hope it’s approved this year. But if it’s a post-election decision and there’s a new administration, I hope it’s approved immediately,” Dunleavy said.

(By Ernest Scheyder; Editing by David Gregorio)

The Peruvian firm said in a statement, posted to the local regulator, that it would suspend its operations in the San Cristobal, Carahuacra and Ticlio mines in the center of the country for up to 30 days.

Peru is the world’s second largest producer of copper, silver and zinc, which are key to its economy. Sales of the metals are equivalent to 60% of all the country’s exports.

The mines are part of the Yauli mining unit, located in the department of Junin, 170 kilometers (105.63 miles) from capital Lima, which produces zinc, lead, silver and copper. The Rumichaca tailings dam is in the same area.

The company did not specify what impact the suspension of activities would have on production, but said that during the shutdown period “all the necessary care and maintenance work will be carried out to restart operations as soon as possible.”

(By Juana Casas; Editing by Deepa Babington)

The London Metal Exchange (LME) plans to list Jeddah, a Saudi Arabian Red Sea port city, as a new delivery point for copper and zinc subject to consultation on a technical change to the LME’s warehouse location framework, it said on Tuesday.

The warehouses, registered with the LME, the world’s largest and oldest metals trading venue, are usually located in areas of net metals consumption or top transit hubs such as Rotterdam.

“Saudi Arabia is an increasingly important global metals hub and Jeddah fully meets with the operational and logistical criteria for new warehouse locations – such as being an important area of net consumption and having an effective transport network,” Matthew Chamberlain, LME chief executive, said in a statement.

Saudi Arabia is planning an ambitious industrial development and logistics program, part of its wider Vision 2030 reform plan, which aims to make the kingdom a major global player in the energy, mining, logistics and industry sectors.

“We look forward to a long future of cooperation with LME and to further developing our relationships with the international metals community,” said Farooq Shaikh, chief executive at LogiPoint, which operates a network of logistics parks in Saudi Arabia.

The Saudi hub would service the Middle East, North and East Africa regions, he added.

The proposal is subject to a consultation among LME members, warehouse companies and their London agents, which will run until April 30, to amend a clause in the LME’s policy on the approval of locations as delivery points related to warehouse insolvency.

The proposed amendment would clarify that some jurisdictions may require a court order to allow the withdrawal of metal in an event of a warehouse operator insolvency.

Subject to the proposal passing the consultation, Jeddah will become active as a delivery point three months after the approval of the first warehouse company in this location.

(By Polina Devitt; Editing by David Goodman and Emelia Sithole-Matarise)

Nordenham in Germany halted production in 2022 along with some other smelters in Europe producing energy-intensive zinc and aluminum because of surging power prices after Russia invaded Ukraine.

The source did not say how much was currently being produced or when the smelter would be at full capacity.

The smelter produces about 165,000 tonnes of zinc and zinc alloys per year, its website says.

Glencore bought the Nordenham smelter after it filed for insolvency in May 2020, when the Covid-19 pandemic hit demand for the metal used to galvanize steel.

Prices of zinc on the London Metal Exchange (LME) at around $2,570 a metric ton are up more than 10% since hitting a seven-month low at $2,278 on February 12.

(By Pratima Desai; Editing by Jane Merriman)

The Vancouver-based BMC, owned by private, UK-based firm BMC Ltd., is developing the critical minerals project located 115 km southeast of Ross River. KZK was paused last year when the Kaska Nation said the federal and Yukon governments didn’t address their concerns over wildlife and the environment at the mine’s proposed site.

“The decision document reapproves the project to proceed through the regulatory phase of permitting,”Allan Nixon, vice president of external relations told The Northern Miner on Wednesday. “This is very positive news and we are pleased to have a new decision document. We are just in the process of reviewing it in detail as there have been some changes in a few of the terms and conditions.”

“We will continue to engage with Kaska to ensure we address any remaining concerns they may have and to ensure we are maximizing opportunities for their participation in and benefit from the project.”

The document, issued on Friday, represents a green light on BMC’s path towards developing KZK, one of the few pre-production critical minerals projects in the Far North to advance past the feasibility study stage and into permitting. BMC first submitted its proposal for mine in 2017.

Kudz Ze Kayah, or ‘caribou country’ in the Kaska language, will cost $376 million to develop, and the open pit operation would have a nine-year life. According to a 2020 feasibility study, KZK has an after-tax net present value (at a 7% discount rate) of $617 million, and an internal rate of return of 45.9%. The mine would produce 7.8 million oz. of silver, 56,500 oz. of gold, 235 million lb. of zinc, 32 million lb. of copper and 56 million lb. of lead in concentrate annually during steady-state operations.

The decision document presents the outcome of talks held in February between the Yukon and federal governments, the Ross River Dena Council (RRDC), Liard First Nation (LFN) and community members. Those consultations were ordered by Yukon Supreme Court chief Justice Suzanne Duncan, who found last January that the Crown failed in its duty to consult and accommodate Kaska’s environmental concerns.

New conditions on KZK

Government authorities concluded in the document that KZK should go ahead without review but under a new terms and conditions.

Regulators must consult with the Kaska on KZK’s technical details and its potential impacts on Indigenous rights; the Kaska will play a key role in the review of mine closure plans and land use; and Kaska will be consulted about reviewing environmental monitoring and financial security.

“(Governments) are committed to working closely with Kaska in the regulatory process to determine if the Kudz Ze Kayah project can proceed to licensing,” reads the document issued by the Yukon Environmental and Socio-economic Assessment Board.

The Yukon government will also set up an independent Finlayson caribou herd oversight committee composed of territorial officials, LFN and RRDC members. That body will monitor protection measures, such as temporary pauses of rock blasting and transportation routes to minimize disturbances to caribou.

Scott Donaldson, CEO of BMC, told The Northern Miner at PDAC last week that he looks forward to sitting down with the Kaska and working through the decision document.

“I’m confident we’ve worked very hard to adopt as many of the Kaska requests as we possibly could,” he said.

Donaldson said BMC’s next steps are its permitting issues and consultations, with a final investment decision on the project expected in the first half of next year.

The Kaska Nation chief did not immediately respond to a request for comment.

Kaska sought review

The dispute over KZK began in June 2022, when the federal and territorial governments approved it following an environmental and socio-economic assessment.

But weeks later, the Kaska, on behalf of the RRDC announced a civil lawsuit against the governments, alleging it wasn’t properly consulted over the mine’s potential environmental impacts, including on caribou herds.

The RRDC petitioned the court to review how regulatory authorities had approved KZK, which led to a judicial hearing in Whitehorse last April, where lawyers for the Kaska, BMC, the Attorney General of Canada and Yukon presented arguments for their respective positions.

Duncan reserved her position at the time until January, when she found that the federal and territorial governments partially fulfilled their duties to consult.

KZK mainly consists of the ABM open pit mine, with smaller resources in the Krakatoa open pit and underground mines. ABM hosts probable reserves of 15.7 million tonnes grading 5.8% zinc, 1.7% lead, 0.9% copper, 138 grams silver per tonne and 1.3 grams gold for contained metal of 135,800 tonnes copper, 265,700 tonnes lead, 915,000 tonnes zinc, 665,800 gold and 69.5 million oz. silver.

Cominco began exploring around the KZK deposit in 1977. Drilling in 1994 revealed copper, lead and zinc mineralization. BMC purchased the project from Teck Resources’ (TSX: TECK.A/TECK.B; NYSE: TECK) in 2015.

Decarbonization emerges as one of the industry’s foremost challenges, as the survey conducted last month with 75 mining company decision-makers revealed.

Survey respondents anticipate heightened scrutiny from investors this year regarding their decarbonization strategies.

Findings indicate that fewer than a quarter have made formal commitments to achieve all scope-related carbon emission reductions by 2050 or earlier. About a quarter have not yet made formal commitments but are actively developing emission reduction plans. Moreover, 10% lack both ESG and carbon reduction strategies, while 7% either do not intend to implement such strategies or face challenges in reducing emissions at present, according to KMPG data.

Scope 1 encompasses greenhouse gas (GHG) emissions directly owned or controlled by organizations, while scope 2 includes indirect emissions resulting from the production of purchased energy. Reducing scope 3 emissions, which traverse the company’s value chain, poses a considerable challenge.

“Many in the industry face substantial hurdles to reducing scope 3 emissions, particularly due to Canada’s limited smelting or refining capacity for critical minerals,” wrote Heather Cheeseman, national mining leader for KPMG in Canada.

Intermediary minerals produced in Canada are shipped to smelters worldwide.

“Until Canada develops smelting or refining capabilities for mined minerals, miners will encounter limitations,” Cheeseman said.

According to the survey, nine out of 10 Canadian mining leaders are optimistic about the country’s potential to emerge as a global leader in critical minerals.

However, an overwhelming majority (98%) said there is an urgent need for increased investment, government commitment, and favorable tax policies to bolster the sector’s growth.

Read More: Canada plans scrutiny of Chinese offtake deals, minister says at PDAC

If the strike goes through as announced, Boliden expects a 300 million crown ($29.35 million) hit to its first-quarter profit, where of 100 million would be due to reduced production and 200 million due to delayed deliveries to customers, it said in a statement.

Workers elsewhere in Finland started industrial action last month to protest against labour market reforms and proposed cuts to the social welfare system planned by the right-wing government.

($1 = 10.2199 Swedish crowns)

(By Anna Ringstrom; Editing by Terje Solsvik and Stine Jacobsen)

Perseus is offering A$0.55 cash per each share of OreCorp it does not already own, which values the target company at A$258 million ($172m). The bid represents a 4% premium over its rival Silvercorp Metals (TSX, NYSE: SVM). 

Silvercorp approached OreCorp in August last year, hoping to obtain the Nyanzaga gold project in Tanzania, located near Barrick Gold’s (TSX: ABX; NYSE: GOLD) Bulyanhulu mine and AngloGold Ashanti’s (JSE: ANG) (NYSE:AU) Geita mine.

Both bidders, who have been battling for OreCorp since, claim Tanzanian authorities are ready to approve their offers.

The Nyanzaga mine would cost $474 million to build and is slated to produce 242,000 ounces gold per year over its first decade, according to a feasibility study issued in August 2022.

Perseus has three operating mines in Ghana and Côte d’Ivoire, producing gold at a rate of more than 535,000 ounces per year.

Vancouver-based Silvercorp has two producing precious metals mines in China and has been looking to diversify its portfolio. Its bid for OreCorp closes on March 22 unless extended. 

Prices rose as much as 1.8% to $2,540 a ton, continuing a rebound that brokers say has been driven by investors closing short positions on the London Metal Exchange after they reached a record level in data going back to 2018. All base metals gained Thursday as Chinese data showed strong demand for raw materials like coal, crude oil and iron ore, while former central bank governor Yi Gang outlined a plan to revive the country’s ailing property sector.

Support has also come from a report this week that South Korea’s Young Poong Corp. cut refined zinc production at its Seokpo smelter, in a move that could rebalance spot market supply after a recent increase in exchange inventories.

“Short-covering has been the driver of recent gains,” Marex Group analyst Al Munro said by email. He added that the rally could run into resistance above $2,600, a level “above which exchange stock deliveries have emerged over the past year.”

Zinc smelters have faced a sharp reduction in the processing fees they charge to turn mined ore into finished metal, and analysts say there could be more cuts to come as miners struggle to boost output.

“Metal market participants have held perennially bearish views on zinc on expectations that mine supply increases would push the market into surplus,” Bank of America commodity strategist Michael Widmer said in a note this week. “But the anticipated glut has so far not materialized, because mined and refined production have consistently underperformed.”

Copper smelters have also faced a rapid decline in spot processing fees. Bloomberg reported on Thursday that at least 15 smelters have been invited to meet in Beijing next week to discuss measures to counter the decline, including a potential joint production cut.

Still, the president of Tongling Nonferrous Metals Group Holdings Co., one of the top producers, said this week that his company isn’t planning output cuts, as it prepares for strong demand growth in electric vehicles and other new-energy sectors.

Zinc was up 1.6% at $2,534.50 by 4 p.m. local time on the LME. Copper gained 0.8% to $8,648 a ton. Nickel and aluminum advanced more than 1%.

(By Mark Burton)

The deal comprises an upfront payment of $1.05 billion at completion, and a deferred cash consideration of $250 million payable in 2030, among others.

The buying entity will assume economic and operating control of Illawarra on completion of the deal, including all current and future liabilities.

The Illawarra project generated $1.64 billion underlying revenue in fiscal 2023 for South32, about 18.2% of its total underlying revenue of $9.05 billion.

The deal is expected to complete in the first half of fiscal 2025, subject to certain conditions including an approval from the Foreign Investment Review Board.

South32 CEO Graham Kerr said the deal will streamline the company’s portfolio and unlock capital to invest in development projects in copper and zinc.

“The transaction will also simplify our business and reduce our capital intensity,” Kerr added.

GEAR would hold 70% of the project, while M Resources would hold rest of the stake, post completion of the deal.

(By Echha Jain; Editing by Maju Samuel and Shailesh Kuber)

Adriatic Metals, which had planned to start production at the Vares mine in January, produced the first concentrate on Tuesday but the plant’s official opening will be in March after six years of exploration and a $200 million investment.

The project will continue to ramp up processing capacity to about 65,000 metric tons a month by the fourth quarter of this year, the company said.

Production will be increased by blending high-grade stockpiled ore with lower grade stockpiles, it added.

Adriatic Metals expects to dig about 800,000 tons of polymetallic ore per year from the mine, producing about 65,000 tons of lead-silver concentrate and 90,000 tons of zinc concentrate, with annual ore export revenue of about 800 million Bosnian marka ($444 million).

(By Daria Sito-Sucic; Editing by Jason Neely and David Goodman)

The paper, published in Transactions of Nonferrous Metals Society of China, details the new technique which employs a sulfurization-reduction approach.

Using pyrite as a sulfurizing agent, the novel sulfurization-reduction method facilitates the efficient extraction of metals from slag by combining thermodynamic analysis with practical laboratory experiments.

According to the scientists, the technique has allowed them to recover nearly 98% of the copper and zinc content and about 90% of the lead content in slag.

The article points out that only in 2022, China produced over 11,000 kilotons of refined copper, leading to 2.2 to 3 tonnes of slag per tonne of copper produced. This slag contains valuable metals like additional copper (0.5%–6%), lead (0.2%–0.6%), and zinc (1%–5.5%), which are often not recovered, resulting in resource waste and environmental hazards from leaked toxic ions.

“By significantly reducing the harmful residues in the leftover slag, this method contributes to a more sustainable approach to waste management in the metallurgical industry. It suggests a shift towards more eco-friendly practices, emphasizing the importance of both economic viability and environmental responsibility in resource recovery processes,” the researchers said in a media statement.

Coeur acquired the Silvertip mine and mill in 2017 but ceased mining and processing in 2020. During that time, the company spent over C$100 million at the site. The highest-grade drill intercept returned 4.9 metres at 1,261 g/t silver, 22.4% zinc, 22.0% lead, 0.13 g/t gold, 0.2% copper, 70 ppm indium, 60 ppm gallium and 0.08% tin.

At the end of 2022, the property had measured and indicated resources of 6.4 million tonnes grading 265 g/t silver, 9.68% zinc and 5.12% lead. In terms of contained metal, those numbers represent over 60 million oz. of silver, almost 1.4 billion lb. of zinc and 722.2 million lb. of lead.

The inferred resource is 1.7 million tonnes grading 239 g/t silver (14.4 million contained oz.), 10.09% zinc (378 million lb.) and 4.43% lead (166 million lb.).

The Silvertip exploration project is located within the traditional territories of the Kaska and Tahltan Nations, and Coeur has signed participation agreements with both of them.

Investment fund positioning is now the most bearish it’s been since the London Metal Exchange (LME) first launched its Commitments of Traders Report in 2018.

LME three-month zinc , currently trading around $2,400 per metric ton, is already down by 8% on the start of the year.

Zinc’s use in galvanized steel means it is heavily exposed to the fortunes of the ailing global construction sector, particularly that in China.

The global zinc market is generating a lot of surplus metal, some of which has just turned up in LME warehouses, lifting stocks to the highest level since June 2021.

More may be on the way judging by LME time-spreads but with the price now eating into the cost curve, just how much further can zinc fall?

Bear attack

Fund managers lifted short positions on the LME zinc contract to 60,492 contracts, or just over 1.5 million tons, as of the close of business last Friday. The previous record short positioning of 54,935 contracts occurred in August last year.

There are still plenty of investment funds keeping the faith with zinc after the LME price bounced off a six-month low of $2,278 on Feb. 12.

But even on a net basis the collective short of 18,012 contracts is still the largest since 2018, exceeding the previous point of maximum bearish positioning seen in February 2020, when China was leading the world into Covid-19 lockdown.

It’s worth noting that “other financial institutions”, covering index providers and insurance players, are still net long of zinc but at much reduced levels relative to the 2018-2021 period.

Zinc flood

The accumulation of speculative bear bets on the London zinc contract has played out in tandem with fast-rising LME warehouse stocks.

A total 72,750 tons of zinc were delivered onto LME warrant in Singapore between Feb. 6 and 16, lifting headline inventory to 228,500 tons. The last time LME stocks were so high was in the first half of 2021, when they peaked at 294,025 tons.

Global commodities trader Trafigura is reported to be delivering metal from off-exchange shadow storage into an on-exchange rent-sharing warehouse deal.

When LME stock movements become defined by warehousing dynamics, it’s a sure sign there’s a lot of surplus metal floating around, even if it’s not always visible.

The International Lead and Zinc Study Group estimates the global refined zinc market notched up a 204,000-ton supply-usage surplus last year and its most recent forecast in October was for an even bigger 367,000-ton glut this year.

More large-volume deliveries into the LME system are quite possible, if LME time-spreads are anything to go by.

The benchmark cash-to-three-month spread has moved into super-contango this week. It was valued at $42.50 per ton at Wednesday’s close, the widest it’s been in at least two decades.

Higher interest rates are of course a factor in the cost of carry but this week’s sudden widening in the spread structure looks ominous.

Into the cost curve

With market optics deteriorating, it’s not hard to see why investment funds are piling on the bear pressure.

But just how much more price downside is there?

The zinc price is already trading deep into the production cost curve. Analysts at Citi calculate that 90th percentile mine costs averaged $2,600 per ton last year.

Several mines have already gone into care and maintenance, most notably Boliden’s Tara mine in Ireland and Nyrstar’s Middle Tennessee complex.

Price-induced cutbacks and unexpected outages such as the fire at the new Ozerny mine in Russia have pushed the mined concentrates segment of the market into deficit.

Treatment charges, the fees levied by a smelter for converting concentrate into metal and a good indicator of raw materials availability, are currently assessed by price reporting agency Fastmarkets at $70-100 per ton over LME cash.

That’s a long way off last year’s benchmark of $274 per ton, which tells you how much concentrates availability has tightened over the last year.

Lower treatment charges squeeze smelter margins and there have already been casualties.

Nyrstar, which is owned by Trafigura, has placed its Budel plant in the Netherlands on care and maintenance. Low treatment charges have combined with low physical metal premiums and high power costs to undermine the smelter’s profitability.

This is all part and parcel of the building supply response to market oversupply and low prices.

It does, however, create a tension with all the new short positions being established by the fund community.

How this tension is resolved will in part depend on just how much more zinc makes its way from the storage shadows to the LME warehouse system.

(The opinions expressed here are those of the author, Andy Home, a columnist for Reuters.)

(Editing by David Evans)

This represents the largest private investment in southern Arizona’s history, and the largest investment in the local Santa Cruz county economy to date by nearly nine times, the Australian miner said.

Last year, the Hermosa project became the first to be added to the United States’ FAST-41 permitting process, and the company said it has the potential to become one of the world’s largest zinc producers.

“Today’s investment decision represents a major milestone for our business and aligns with our strategy to reshape our portfolio toward commodities critical to a low-carbon future,” South32 CEO Graham Kerr said in a news release.

“[The] project will strengthen the domestic supply of critical minerals needed for clean energy technologies and national defense, reducing America’s reliance on foreign countries and transforming the local economy,” Hermosa project president Pat Risner added.

With a surface footprint of just over 600 acres and projected to use approximately 75% less water than other mines in the region, the operation has been designed to minimize its environmental impact, the company said.

The new investment will fund construction of key infrastructure projects, including water management systems, power, site facilities, underground shaft sinking, initial underground development and other work required to begin operations, it added.

Once completed, this infrastructure would support future potential development of other deposits at the site, including the battery-grade manganese deposit, South32 said.

Construction and mine development at Hermosa, made up of the Taylor (zinc-lead-silver) and Clark (zinc-manganese-silver) deposits, started last year with approvals from the State of Arizona.

“Development of the zinc deposit is the first phase of a regional-scale opportunity at Hermosa, with ongoing activities to unlock additional value from the manganese deposit,” Kerr said.

In January, South32 released a mine plan of operations as a roadmap of operational activities at the Hermosa project from start to finish located on lands managed by the Coronado National Forest.

“With Red Dog being awarded the Zinc Mark, all of Teck’s managed base metals operations are now verified and recognized for strong environmental and social performance, illustrating our focus on responsible production for the benefit of our customers, and for the environment and people where we operate,” said Teck president and CEO Jonathan Price.

Red Dog is also the first mine to win the stand-alone Zinc Mark.

Zinc Mark is awarded by Copper Mark, which also awards the Molybdenum Mark and Nickel Mark. Each winner meets the Copper Mark assurance framework that aims to promote responsible production practices along the value chains of the covered minerals.

Operations are independently verified against 32 criteria, including greenhouse gas emissions, community health and safety, respect for Indigenous rights and business integrity. (More information about the Copper Mark verification can be found here.)

Red Dog is one of the world’s largest zinc mines, located about 170 km north of the Arctic Circle in northwest Alaska, near Kotzebue. It is a conventional truck-and-loader open pit with drilling and blasting. In 2022 it produced 553,000 tonnes of zinc contained in concentrate.

The current mine life, based on existing developed deposits, will extend through to 2031.

The company said operations at the mainly copper and zinc producing mine have been temporarily suspended.

Lundin said that it is working with Portugal’s authorities in their investigation.

(By Vallari Srivastava; Editing by Tasim Zahid)

Two of the sources said London-listed miner Glencore was also delivering zinc to LME registered warehouses, but that the quantities are small. Reuters was not able to establish the exact amounts of zinc being delivered into the LME system by Trafigura and Glencore.

Trafigura and Glencore declined to comment in response to a request for comment.

“Trafigura is delivering (in Singapore) for rent deals,” one of the sources said, adding that Glencore too had been sending zinc to LME warehouses in Singapore. “There’s a lot more zinc waiting outside (the LME system).”

So-called “rent deals” are agreements under which LME warehouses share their fees or rental income with companies that deliver metal to them.

Weak demand for zinc – used to galvanize steel, particularly in top consumer China where the property slowdown has hit buying – makes rent deals possible, as less material is feeding through to consumers and more is in need of storage.

The firm that delivers the metal to a warehouse does not retain ownership under the rent deals, but still gets a share of the rent as long as the metal stays in the warehouse, and the fees are paid by the new owners of the metal.

After steady drawdowns in January, 41,150 tons of zinc have been delivered LME warehouses in Singapore since Feb. 1, taking the total to 198,275 tons on Friday. In November they reached their highest since 2003 at just over 200,000 tons.

Maximum rent LME warehouses can charge for zinc in Singapore is 53 US cents a ton per day, which on 41,150 tons would yield around $21,800 a day in rental income.

Total zinc stocks in all LME locations on Friday amounted to 238,275 tons.

Visibility of surpluses is behind the climbing discount for the cash over the three-month contract at around $17 a ton compared with a $10 discount on Feb. 1.

Benchmark zinc prices on the LME fell to $2,278 a ton on Monday, the lowest since August last year.

(By Pratima Desai; Editing by Jan Harvey)

In detail, his proposal calls for banning the granting of open-pit mining concessions and activities related to the exploration, exploitation, benefit or use of minerals, metals or metalloids using the open-pit method.

To argue his case, López Obrador said that open-pit mining causes severe environmental damage and uses excessive water that could be supplied to water-scarce communities. 

“It is clear that open-pit mining transgresses human rights by affecting the right to a healthy environment and good health,” his proposal states. “The most significant effects are evident in the communities and towns near project areas, placing them in a situation of vulnerability and inequality.”

The proposal, however, does not mention underground mining. 

The motion is expected to revive hostilities between the Mexican government and big industry players, as the country’s oldest and largest mines are open-pit operations. In total, Mexico hosts 264 mines that extract surface minerals, most of them located in Chihuahua, Zacatecas, Sonora and San Luis Potosí. 

Top producers such as Grupo Mexico’s Buenavista del Cobre, Newmont Goldcorp’s Peñasquito, two of Fresnillo’s gold-silver units, and several other mines owned by Industrias Peñoles are open-pit operations.

Since taking over in 2018, the AMLO administration has not granted any new concessions through de facto mechanisms – but without the backing of any specific law. 

The recent move adds to the uncertain investment atmosphere in the country, whose miners were shaken back in May 2023, when Mexican Senators approved a new mining law in an accelerated process without opposition legislators present. 

The mining law reforms involve companies having to deal with an increased burden of pre-consultation, impact studies and water concessions, among other things. The new law also requires financial commitments (bonding) and shortens the tenure of mining concessions from 50 years to 30 years, with a one-time 15-year renewal possible.

The zinc producer, controlled by Brazilian holding company Votorantim SA, said the obstruction of the road to access the mine has not had a material impact on Atacocha’s production to date.

Mine production has been suspended, and activities are limited to critical operations with a minimum workforce to ensure proper maintenance, Nexa said.

On a weekly basis, the Atacocha mine produces about 200 tonnes of zinc, which is less than 3% of the company’s total zinc production, it said.

Mining conflicts in Peru have risen over the past two years as empowered local communities increased demands under the administration of leftist ex-President Pedro Castillo, who was impeached in December 2022 and replaced by vice president Dina Boluarte.

Nexa itself has faced three recent road blockades at Atacocha. The first one, in March 2022, cost the miner 300 tonnes of lost zinc production. It was also affected by another blockage in August the same year, and in January 2023.

Nexa has nine operations distributed between Brazil and Peru – three of which are refineries and six mines. including the largest underground zinc mine in Peru, Cerro Lindo, and the largest zinc refinery in the Americas, Cajamarquilla.

Peru is the world’s no. 2 copper producer after Chile and an important producer of zinc.

The mine, which was originally due to start production by the end of 2023, was expected to be one of the main drivers of global mine production growth this year, industry association ILZSG said in October.

However, a fire damaged the imported equipment in a part of Ozernoye’s plant in November, while US sanctions imposed on the company in December have made it hard to find a replacement abroad, two sources familiar with the matter told Reuters.

“The flotation part of the plant with imported equipment was damaged in the fire. As a result, the technological scheme will be based on flotation equipment that the company has developed by its own design bureau,” the company told Reuters.

“The quality of concentrate will not be affected by these changes,” it added.

The project, which would be Russia’s largest zinc mine, is designed to produce up to 350,000 metric tons of zinc in zinc concentrate. It is already mining ore and stockpiling it until the plant is ready to process it.

Washington’s sanctions cemented Ozernoye’s dependence on future demand in top consumer China, where the construction sector, a major consumer of steel galvanised with zinc, has had patchy post-pandemic recovery.

Weak demand and the global market surplus, which the ILZSG estimated at 211,000 metric tons in January-November, have pushed zinc prices down 25% over the last 12 months.

Delayed Ozernoye’s production will not be able to materially change this picture. Macquarie said that its analysts had updated their estimates to reflect Ozernoye’s delay but still expect the global refined zinc market to remain in oversupply this year.

(By Polina Devitt and Julian Luk; Editing by Christina Fincher and by Sandra Maler)

Revenue for the major global copper producer, which also operates sprawling freight railroads in Mexico, slid nearly 10% to $3.42 billion, the company said in a statement.

Earnings before interest, tax, depreciation and amortization (EBITDA) fell 27% to $1.52 billion.

Grupo Mexico, controlled by billionaire German Larrea, operates major copper and other base metal mines across its home country, as well as in the United States, Peru and Spain.

The firm produced 264,251 metric tons of copper over the quarter, down 2% from a year earlier as its sales slipped 8%. Grupo Mexico also pointed to declining zinc and molybdenum prices, while exploration costs increased.

Grupo Mexico expects to produce 1.058 million tons of copper in 2024, up from 1.03 million tons last year. Full-year 2023 copper production was up 2% year on year, falling short of its prior target of 1.05 million tons.

The firm also confirmed that its Buenavista zinc project in Mexico’s Sonora state should start operations in the first quarter of 2024, adding that the mine should produce some 54,000 tons of zinc and 11,000 tons of copper this year.

“Once we finish the full ramp-up, this will double our production capacity and we will generate over 2,000 jobs on the operating front at year-end,” Leonardo Contreras, the mining division’s finance chief, told analysts in a call.

Contreras added that the start-up had been delayed last year partly due to scant rainfall over northern Mexico.

Meanwhile, the group’s transport arm, which late last year bought majority stakes in two maritime-rail transport freight firms serving US-Mexico trade, saw quarterly sales rise 15%, helped by higher volumes, notably in the automotive sector.

The company said it expects to spend some $490.5 million this year on the division, which last month submitted a proposal at the request of Mexico’s government to adapt some of its freight rail routes for passenger travel.

Analysts at Banorte noted the “negative profitability surprise” weighing on the group’s share price, which was down over 2% in afternoon trading.

(By Sarah Morland, Valentine Hilaire, Noe Torres and Aida Pelaez-Fernandez; Editing by Deepa Babington and Mark Porter)

The US central bank held interest rates steady for a fourth straight meeting on Wednesday. While Fed Chair Jerome Powell did signal an openness to monetary easing, he said he didn’t think it’s likely that the Open Market Committee will be confident inflation is moving sustainably toward 2% by next month’s meeting.

“The macro fundamentals have returned to neutral with tempered expectations for US rate cuts combining with frequent roll-outs of domestic measures for China’s economy,” Holly Futures Co. wrote in a note. “Still, overseas copper demand is weak and China is entering an off-peak season. Price volatility could continue before the Lunar New Year holiday.”

The world’s second-largest economy has been struggling to regain momentum even after the government introduced some stimulus measures. Manufacturing activity usually slows ahead of the week-long holiday, while the metals-intensive property sector is still mired in a prolonged slump.

Industrial metals have had a soft start to the year, with aluminum on the London Metal Exchange dropping 4.4% in January, the biggest monthly loss in eight months. Zinc also tumbled 4.9% last month, while copper gained just 0.6%.

On Thursday, copper slipped 0.9% to settle at $8,534.50 a ton on the London Metal Exchange, while aluminum dropped more than 1%. Zinc fell 2%.

(By Annie Lee)

At the end of 2023, the MINING.COM TOP 50* ranking of the world’s most valuable miners reached a combined $1.42 trillion, up a healthy, if far from spectacular $48.7 billion over the course of 2023. Mining’s top tier is also worth $330 billion less than in March 2022.

Metal and mineral markets are volatile at the best of times – the nickel, cobalt and lithium price collapse in 2023 was extreme but not entirely unprecedented. Rare earth producers, platinum group metal watchers, iron ore followers, and gold and silver bugs for that matter, have been through worse.

Mining companies have become better at navigating choppy waters and as a whole the majors performed fairly consistently last year despite geopolitical and market turmoil, but within the ranking, 2023 fortunes were made and lost over what seemed like days.

The forced closure of one of the world’s biggest copper mines – and the subsequent collapse of owner First Quantum Minerals stock – served as a stark reminder of the outsized risks miners face over and above market swings.

Panama root canal

After months of protests and political pressure, at the end of November the Panama government ordered the closure of First Quantum Minerals’ Cobre Panama mine following a ruling by the Supreme Court that declared the mining contract for the operation unconstitutional.

Public figures, including climate activist Greta Thunberg and Hollywood actor Leonardo Di Caprio backed the protests and shared a video calling for the “mega mine” to cease operations, which quickly went viral. 

That mining cobre is at the nexus of the green energy transition is clearly an irony lost on those trying to save the world.  FQM is seeking arbitration and completely winding down operations will take time, but a reopening of Cobre Panama is not on the cards. 

From 25th position in the ranking at the end of March 2022 and a valuation well above $20 billion, the November-December sell off saw FQM drop out of the top tier altogether, ending 2023 at number 58 with a market cap below $6 billion. 

Cobre Panama supplied more than 40% of the company’s revenue, and with nickel prices plummeting FQM has also been forced to suspend operations at its Raventhorpe mine in Australia. 

Amid the inevitable takeover rumours now in circulation, shares in the Vancouver-based company have rallied in 2024, but still not enough to reenter the top 50.

No. 12 with a bullet 

If 2023 was an annus horribilis for FQM it was mirabilis for Amman Mineral Internasional. Stock in the Indonesian firm surged by 269% from its July debut in Jakarta to reach a market capitalisation of more than $30 billion at the end of last year – and number 12 in the ranking. 

That valuation is quite an achievement on annual revenue of $2 billion no matter how fat margins are at the company’s Batu Hijau copper and gold mine.  Batu Hijau is the third largest mine worldwide in terms of copper equivalent output (but no match for Cobre Panama when it comes to the orange metal alone)  and has been in production since the turn of the millennium. Amman is also developing the adjacent Elang project on the island of Sumbawa. 

Amman Minerals’ ascent has minted at least six new billionaires and the stock appears to be building on its success in 2024, rising by double digits in January already.

Indonesia’s other major mining IPO, Harita Nickel, was on a different trajectory altogether. After listing in April and raising $672m, the company has had a tough go of it and the stock has shed more than 38% since then as nickel prices continue to decline.

Shiny gold, dull silver, tarnished PGMs

The price of gold hit an all-time record on December 1, 2023.  But bullion’s best ever level passed without the usual fanfare and despite bullish indications for 2024, gold mining stocks did not exactly storm the rankings of the most valuable miners.

Over the course of 2023 gold and royalty companies on the MINING.COM TOP 50* ranking of the world’s most valuable miners added a collective $20.8 billion in market cap. 

And judging by gold miners’ performance so far this year, gold above $2,000 is not providing enough support. Newmont is already down 17%, Barrick has shed 13% and Agnico Eagle shareholders are 9% poorer. 

The number of precious metals companies in the top 50 has also been relatively stable over the years. With Newmont’s absorption of Newcrest now complete, the open slot was taken up by Kinross, which spent a few years in the wilderness. 

Anglogold Ashanti was just edged out by Jiangxi Copper for position number 50 on the last trading days of 2023, but based on its performance so far in 2024 the London-listed company is already back among the top tier. Indeed Anglogold is the only major gold player in the black year to date.

Silver has not been able to ride gold’s coattails and the top 50 has not had a silver specialist for a few years after Fresnillo dropped out (now at #61) and while Pan American Silver has come close in recent years at the end of last year it made it to #58 only. 

The exit of platinum and palladium majors like Sibanye Stillwater and Impala Platinum, now both valued at less than $4 billion, made space for Royal Gold to reenter at 47 at the end of last year, up from 57th in 2022. 

After a dismal 2023, the sole remaining PGM specialist Anglo American Platinum looks likely to lose more ground this quarter as palladium and platinum prices continue to slide into the new year.

Not too tough at the top 

London-listed Anglo American has had a rough year in part due to its exposure to platinum group metals and control of AngloPlat, and is now valued at $30 billion after peaking at $70 billion in March 2021.  

Were it not for the London-listed company’s iron ore operations, the 40%-plus slump in share value may have been deeper. Rumours that Glencore may be sniffing around now that the Swiss behemoth’s bid for all of Teck Resources has soured is also keeping Anglo from falling further down the rankings .  

Investors in Anglo, with a history going back more than a hundred years on the South African gold and diamond fields, have had a particularly wild ride over the last few years. In January 2016, Anglo’s market cap fell below $5 billion after it came close to suffocating under a pile of debt.  

Against expectations, iron ore seems to be holding above $120 a tonne, Chinese property bankruptcies and Beijing’s tepid stimulus response notwithstanding. 

Iron ore’s resilience despite Chinese troubles has also kept the share prices of the other diversified majors, which make their fattest profits from the steelmaking ingredient, from skidding. 

The top 10 mining companies have been able to keep their share of the total above 50% for a few years now. Not quite the magnificent seven, but size does matter in mining, particularly when access to capital is no longer a headache but a migraine. 

Expectations of another active year of M&A in the sector is likely to make the Top 50 top-heavier, especially now that it’s painfully obvious just how one-commodity companies like the lithium stocks can so easily be derailed. Coal miners’ strong 2023 suggests there are still exceptional minerals that prove the rule.   

Lithium losers 

After defying gravity early on, the combined losses for lithium miners in the top 50 climbed to nearly $30 billion in market cap over the 12 month period. Four counters occupy the worst performance table for 2023. 

The M&A drama surrounding Liontown, Albermarle and Hancock Prospecting turned out to be a soap opera and Chile’s move to take control of its lithium industry now appears far less consequential than feared.

Despite the precipitous decline in lithium prices in 2023, after hitting all time highs above $80,000 a tonne in November 2022, none of the battery metal miners’ stock performance was dire enough to drop out of the Top 50.

The merger of Livent and Allkem to form Arcadium Lithium could in fact up lithium mining’s representation in the ranking to seven should Pilbara Minerals’ January bleeding be stanched. But with lithium prices far from stabilizing, the battery metal’s presence in the top 50 may fade further. 

Pilbara Minerals, which unlike its peers was still able to show share price gains last year,  joined the Top 50 last year, bringing the number of companies based in the Western Australia capital to five, surpassing the tally of Vancouver, BC as the top home base in the ranking. 

With the exit of First Quantum, three mining companies in the top 50 call Vancouver home while the return of Kinross saw the ranks of Toronto-headquartered miners move back up to four.  

Nuclear options

Uranium prices more than doubled during 2023 and recently hit triple digits for the first time in 16 years. The breakthrough for the nuclear fuel comes after a decade in the doldrums following the Fukushima disaster in Japan.

Canada’s Cameco made the best quarterly performer list once again in Q4 and after doubling in market worth in 2023.  The Saskatoon-based company now sits at no 23 in the ranking after jumping 22 places since end-2022.    

The value of shares in Kazatomprom, the world number one uranium producer, topped $10 billion at the end of 2023, placing it at position 38.  Until last year the state-owned Kazakh company was outside earshot of the Top 50 since its dual-listing in London and Astana in 2018.  

None of the smaller uranium companies are likely to pierce the top 50 by themselves, but combinations among the rank and file may edge in when countries aiming to ditch fossil fuels stop thinking they can have their yellowcake and eat it too.

*NOTES:

Source: MINING.COM, Morningstar, GoogleFinance, company reports. Trading data from primary-listed exchange at December 28 2023 to January 2, 2024 where applicable, currency cross-rates January 2, 2024. 

Percentage change based on US$ market cap difference, not share price change in local currency.

As with any ranking, criteria for inclusion are contentious. We decided to exclude unlisted and state-owned enterprises at the outset due to a lack of information. That, of course, excludes giants like Chile’s Codelco, Uzbekistan’s Navoi Mining, which owns the world’s largest gold mine, Eurochem, a major potash firm, and a number of entities in China and developing countries around the world.

Another central criterion was the depth of involvement in the industry before an enterprise can rightfully be called a mining company.

For instance, should smelter companies or commodity traders that own minority stakes in mining assets be included, especially if these investments have no operational component or warrant a seat on the board?

This is a common structure in Asia and excluding these types of companies removed well-known names like Japan’s Marubeni and Mitsui, Korea Zinc and Chile’s Copec. 

Levels of operational or strategic involvement and size of shareholding were other central considerations. Do streaming and royalty companies that receive metals from mining operations without shareholding qualify or are they just specialised financing vehicles? We included Franco Nevada, Royal Gold and Wheaton Precious Metals on the basis of their deep involvement in the industry.

Vertically integrated concerns like Alcoa and energy companies such as Shenhua Energy or Bayan Resources where power, ports and railways make up a large portion of revenues pose a problem. The revenue mix also tends to change alongside volatile coal prices. Same goes for battery makers like CATL which is increasingly moving upstream, but where mining still makes up a small portion of its valuation.  

Another consideration is diversified companies such as Anglo American with separately listed majority-owned subsidiaries. We’ve included Angloplat in the ranking but excluded Kumba Iron Ore in which Anglo has a 70% stake to avoid double counting. Similarly we excluded Hindustan Zinc which is listed separately but majority owned by Vedanta.

Many steelmakers own and often operate iron ore and other metal mines, but in the interest of balance and diversity we excluded the steel industry, and with that many companies that have substantial mining assets including giants like ArcelorMittal, Magnitogorsk, Ternium, Baosteel and many others.

Head office refers to operational headquarters wherever applicable, for example BHP and Rio Tinto are shown as Melbourne, Australia, but Antofagasta is the exception that proves the rule. We consider the company’s HQ to be in London, where it has been listed since the late 1800s.

Please let us know of any errors, omissions, deletions or additions to the ranking or suggest a different methodology.

The mine was put on care and maintenance in June after prices of the galvanizing metal hit a three-year low and Boliden has begun talks with staff over a planned resumption in the second quarter of this year.

Tara is Europe’s largest zinc mine and among the biggest globally, producing more than 300,000 metric tons of zinc concentrate a year at its peak, Boliden’s website says.

The restart plan, however, proposes a one-week closure for the mill every three weeks, 150 job losses and a production target of 180,000 tons of zinc concentrates a year, down from 198,000 tons last year, the source said.

Talks are continuing and the mine could restart in the second quarter at the earliest if agreement is reached, Boliden spokesman Klas Nilsson said, adding that external market conditions have not changed significantly since the mine entered care and maintenance.

Zinc prices are about 25% lower than a year ago and the concensus forecast in a Reuters poll of analysts this week projected a zinc market surplus of 300,000 tonnes in 2024.

Trafigura-owned Nyrstar halted two US zinc mines late last year because of weak prices and inflation and this month closed the Budel zinc smelter in the Netherlands.

(By Julian Luk; Editing by David Goodman)

Registering warehouses in China, the world’s largest consumer of industrial metals, to store metal traded on the LME has been a strategic aim since Hong Kong Exchanges and Clearing (HKEx), opens new tab bought the LME in 2012 for $2.2 billion.

In a presentation made to the LME’s warehousing committee in December, seen by Reuters, the exchange said companies in the region had indicated interest in Hong Kong as a place to store industrial metals as an alternative to mainland China.

“Around ten domestic and regional LME market participants … have recently expressed interest in this initiative directly to the LME or through the HKEMCA (Hong Kong Energy, Mining and Commodities Association),” the LME’s presentation said.

“An LME warehouse in Hong Kong could be seen as a showcase for in-depth cooperation between Mainland China and Hong Kong,” the presentation said. It also said Hong Kong as a good delivery location (GDL) “closes gaps in the LME’s delivery network that have frustrated some Chinese customers”.

HKEMCA did not respond to a request for comment.

“The LME actively engages with industry participants worldwide to ensure the LME warehouse network continues to provide maximum global connectivity for the metals community,” the LME said in response to a request for comment.

“When assessing potential new delivery points, we consider a number of important criteria … we also discuss these with the relevant LME advisory committees before communicating with the market.”

No timeline for the proposal was given by any of the sources, but several hurdles stand in the way of listing Hong Kong as a (GDL), the sources said.

Two sources said they were wary of the idea of investing in Hong Kong because of the risks associated with China’s growing influence over foreign firms and individuals in the territory.

Concern about China’s power in Hong Kong could be reinforced or eased by whether China respects a decision by a Hong Kong court to order the liquidation of property giant China Evergrande Group, opens new tab.

Three of the sources said the idea was flawed due to the prohibitive costs of storage space in Hong Kong and the fact that its imports of industrial metals such as copper and aluminum traded on the 147-year-old LME are insignificant.

“The LME sees this as a potential gateway into China, but the political situation isn’t healthy, people don’t want to invest in Hong Kong. It is de facto China,” one of the sources said.

“Hong Kong authorities would need a green light from China, where they will come up against the same issue they have had all these years; local resistance and regulatory hurdles.”

Chinese rules and regulations alongside resistance from local competitor Shanghai Futures Exchange (ShFE), have frustrated the LME’s attempts to expand its network of warehouses to China.

However, things have changed due to pressure on Chinese exchanges to innovate and expand throughout Asia. ShFE is looking at expanding its metals warehousing network outside China, while the LME is planning to launch new metals contracts using prices from the Shanghai Exchange.

ShFE and the China Securities Regulatory Commission, which would approve LME warehouses in China, did not respond to requests for comment.

Typically the LME would only approve locations in countries which consume and import large amounts of industrial metal.

Hong Kong’s imports of industrial metals such as copper and aluminum are a small fraction of global supplies.

“Hong Kong is not a traditional centre for base metals storage and does not currently attract significant inflows of metal due to cheaper nearby ports,” the LME said.

Good delivery locations in the LME’s Asian network include ports in Taiwan, South Korea and Malaysia which are all cheaper places to store metal, the sources said.

Singapore is also included in the LME’s network, but it is more expensive and though it doesn’t consume large amounts of metal, it is used as a transit location.

Two of the sources said rent in Hong Kong could potentially amount to four times the maximum rent warehouses in the LME’s system can charge, which for aluminum, copper, zinc and nickel is around 50 US cents a metric ton.

This the LME acknowledged by saying in the presentation that warehouse rents would have to be subsidized by the Hong Kong government “to be a commercially viable option”.

Other support for LME warehousing from the Hong Kong government could include “recently warranted LME metal given “fast tracked” customs status across the mainland border”.

The Hong Kong government referred Reuters to HKEx in response to a request for comment. HKEx said “this is an LME matter”.

(By Pratima Desai, Siyi Liu, Farah Master and Mai Nguyen; Editing by Veronica Brown and David Evans)

Consolidated profit after tax dropped 18% to 20.13 billion rupees (nearly $242 million), ahead of analysts’ average estimate of a 23.5% fall, as per LSEG data.

Domestic sales and production for zinc rose 9.8% and 7% respectively, while that of aluminum rose 1.4% and 6%, respectively.

As a result, revenue from operations rose 4% to 349.68 rupees during the quarter, beating analysts’ expectations of an 8% fall.

Grappling with falling metal prices, the metals and mining company has reported profit falls since the first quarter of 2022 and a loss in the July-September quarter last year.

Prices of key base metals – zinc and lead – were down on the London Metal Exchange during the quarter, lower than in the year ago quarter despite sequential improvement.

While aluminum prices improved year-on-year, they are down from their record high levels in March 2022.

In September last year, billionaire Anil Agarwal launched a sweeping overhaul that would carve up the metals-to-oil conglomerate into six separate businesses, a move aimed at shoring up parent Vedanta Group’s financial performance.

Last week, the Vedanta Group-owned Hindustan Zinc reported its fifth consecutive decline in quarterly profit as the company was also hit by lower zinc prices and sales.

($1 = 83.0810 Indian rupees)

(By Kashish Tandon; Editing by Janane Venkatraman)

The agreement includes the creation of a technical committee consisting of two nominees from Glencore and two from Falco to ensure that operations of Glencore’s Horne copper smelter are not adversely affected. A similar strategic committee will also be created. Glencore will appoint one nominee to Falco’s board of directors.

Glencore will retain priority over the operations of the Horne 5 project. Falco must make financial assurances, guarantees, and indemnification to Glencore to cover risks and losses to the smelter. Glencore retains the right to require remediation, suspension, or other risk mitigation to protect the Horne smelter.

The successful completion of the OLIA combined with life-of-mine copper-zinc concentrate offtake agreements with Glencore allows Falco to advance its Horne 5 project, said Falco president and CEO Luc Lessard. The company is moving forward with permitting and financing for the project.

The Horne 5 mine is to be developed below the historic Horne mine, which was operational from 1927 to 1976 and produced 11.6 million oz. of gold and 2.5 billion lb. of copper. The environmental impact assessment is currently under review.

As per the 2021 feasibility study, the Horne 5 project has proven and probable reserves of 80.9 million tonnes grading 0.17% copper, 0.77% zinc, 1.44 g/t gold, and 14.14 g/t silver.

The measured and indicated resource is 105.6 million tonnes of almost identical grades and containing 389.8 million lb. of copper and 1.85 billion lb. of zinc. There is also an inferred resource of 24.3 million tonnes grading 0.19% copper, 0.67% zinc, 1.35 g/t gold, and 21.40 g/t silver.

After taxes, the project has a net present value with a 5% discount of $1.25 billion and an internal rate of return of 27.3%. Payback should occur in 3.5 years.

The miner on Monday posted a near 50% drop in second-quarter metallurgical coal output as it completed major work at an underground mine at its Illawarra operation, while its quarterly manganese production also missed estimates.

Its shares fell as much as 5.3% after the production report was released then recouped some losses to trade down 2.3%, underperforming the broader market, which was up 0.5%.

The Perth-headquartered miner said production of metallurgical coal, used to make steel, fell to 744,000 metric tons in the three months to December, from 1.5 million tons a year earlier. This is below the estimates of around 1.0 million tons by Macquarie and Morgan Stanley.

South32, the world’s biggest producer of manganese, which is used to strengthen steel and increasingly in batteries, reported a nearly 14% drop in quarterly manganese ore output at 1,272 thousand wet metric tons (kwmt), below Macquarie’s estimate of 1,312 kwmt.

Output fell due to lower yields at its Australia Manganese unit, while its South Africa Manganese operation completed planned maintenance.

South32 said it still expects to achieve annual total coal production at the Illawarra operations of 5.0 million tons.

However, it cut the production forecast for Brazil Alumina by 7% due to third-party power outages and maintenance and also lowered annual production guidance for Mozal Aluminium by 12%, where it is cutting output as part of a recovery plan.

South32 said it had also commenced a strategic review of its nickel operation Cerro Matoso in Columbia to evaluate options to improve its competitive position amid a sharp downturn in the nickel market.

Nickel prices have slumped 40% over the past year following a surge in supply from Indonesia, which has led to a string of restructures and writedowns at nickel mines across Australia.

“With some of our commodities facing headwinds in the half, we continued to focus on delivering cost efficiencies and expect first half operating unit costs to be below or in line with guidance for the majority of our operations,” South32 CEO Graham Kerr said.

South32 said it remains on track to make a final investment decision for the Taylor zinc-lead-silver deposit in Arizona in the March quarter.

(By Ayushman Ojha and Aaditya Govind Rao; Editing by Leslie Adler, Richard Chang and Sonali Paul)