Longing For China’s Short (Copper)

‘Always Be Long,’ Africa Miner Says

Copper’s spot price and active futures contracts are rising 2.2% at last look.

So-called volatility is accelerating in producer-copper equities such as Vale, Glencore, Freeport McMoRan FCX (up 5% right now), BHP, Rio Tinto, Teck Resources — and our preferred copper producer, Ivanhoe Mines IVN IVPAF and sister-co Ivanhoe Electric (IE). *

I remember many years ago, Ivanhoe’s Robert Friedland telling me and anyone who would listen, back in the Ivanhoe Mines  Mongolia-Oyu Tolgoi incarnation, “Always be long what China is short of.”

Here is a fresh video interview of the Ivanhoe Mines (Africa copper, zinc, nickel, etc.) founder — Bloomberg news.  It’s less than 4 minutes. Video here please.

Copper is “very, very tight and now in deficit,” he says. That is a continuing theme for the global industrial metal, along with China demand/economy, electric vehicles, carbon-lowering initiatives and falling interest rates that tend to boost the dollar prices of most commodities.

Copper’s price in 2023 (and 2022) has been a tug of war, TCRs.

I put it like this on our LinkedIn feed: “Copper’s price is like a scale of justice that moves in both directions: one side weighted (or propelled) by China and the other by the EV/battery/green dynamics.”

This week is a pro-China week for copper’s price, at last look $3.88 USD a pound.

* I own IVN and IE. Ivanhoe shares are within reach of an all-time high. Another video from Saudi Arabia’s Future Minerals Forum here please.

TCRs, our other copper-cos in the home portfolio are Western Copper & Gold WRN; EMX Royalties EMX and Elemental Altus Royalties ELE; and C3 Metals CCCM.

Is there ahead of us a copper tumult, a span of frantic buying for the metal, like the rush this year and last that pushed uranium’s price to a 12-year high spot price?

In the Robert McEwen interview this week, I asked the creator of McEwen Mining MUX and McEwen Copper that question. See The Calandra Report/TCR please here.

I have a positive view on copper because of urbanisation in Asia, in China. — Rob McEwen

“Will we see another Panama (nationalization — First Quantum Minerals) in the copper business? Well, I think we could see some kind of run on copper given the supply-demand (metrics). Copper is something that manufacturers (vehicles, construction, telecom) need, and they need to secure supply.” 

 

 

Contango Ore: Shares continue to lose ground in Contango, the Alaska partner with Kinross Gold for Manh Choh gold project Peak Gold. Road safety concerns for transporting ore, and petitions, prompted a request for a court injunction. 

The injunction would have stopped the use of 95-foot ore hauling trucks. The Alaska Department of Transportation and Peak Gold, the partnership, are contesting the lawsuit.

“They (opposing group) requested an injunction but it was denied. We expect a ruling  soon,” CEO Rick van Nieuwenhuyse says. “We have asked that the case be dismissed. Today we are hauling ore, 16 trucks a day delivering ore from the Manh Choh mine site and building the stockpile at the Fort Knox mill, just as planned!  We are fully permitted and fully financed.

I own Contango CTGO shares.

I made money in trades if the NYSE-listed stock in 2022 and 2023; I am under water by 40% right now on a total remaining investment of approx. $16,000 USD.

“Development-stage companies are trading at a huge discount, and we’re no exception — half the value of what we were six months ago,” Contango’s Rick van Nieuwenhuyse said in a shared webcast this week with First Mining Gold FF’s Dan Wilton and Hycroft Mining‘s Diane Garrett. See video here please.

“It is a great buying opportunity for a company that will be generating $50 million of cash flow starting next quarter.”

— Thom Calandra

— Thom Calandra