Lithium hot, gold still warm for explorers

by Ross Louthean Queensland explorers should be looking for opportunities for lithium which is being driven by the global electric vehicles batteries market. They should also retain a focus on gold which, despite the erratic but growing crypto-currency market, has slipped back recently. However, there are positive issues ahead such as global and American debt and the growing concern for a Russian invasion in the Ukraine. These were key points raised in the annual keynote address on the mining scene at the annual RIU Explorers Conference in the Western Australian port city of Fremantle by Vertical Events. The speaker was Canacord Genuity’s well-known market analyst Paul Howard (pictured above) who pointed out that in the previous year the prediction was for a gold bull market to continue supported by weak inflation and for copper and lithium to outperform with the green revolution and for nickel to follow. In the year since one of the great changes on the Australian market was that it became the year for IPOs with a record number of floats being listed on the ASX – 107 resources and mining service floats among 188 for 2021 which also took in health and technology companies. The Explorers Conference over three days is Australia’s second largest conference after Diggers & Dealers in Kalgoorlie and is a strong platform for junior explorers from throughout the country. Several with Queensland tenements are to present though the audience of 1,400 was restricted by Western Australia’s tough Covid border stance. However, several hundred interstate and overseas people were streaming the conference. Paul Howard said interest in gold had become “flat” as there was strong investor interest elsewhere but his view was that for this precious metal there scenario was for “near-term cautious, and longer-term bullish.” He believes for lithium pricing demand will remain strong until additional supply comes online, which could be in the second half of 2022 but more likely between 2023-2025. For copper and nickel there were low stockpiles and the aggressive movement in the electric vehicle (EV) related metals could shore up supply. For the Australian market there are now skills shortages amplified by Covid and because of the issues with opening up State borders. Canacord Genuity sees more mergers and acquisitions coming in the gold sector with a focus on small caps companies. There was, he said, a lack of new discoveries, leaving exploration to the explorers. One of the juniors that will draw a crowd is Carnaby Resources which has produced spectacular results from its tenements in the southern Mount Isa field. Howard pointed out copper retained a strong and structural longer-term demand trajectory. The nickel market will see new Indonesian operations come on stream, though there have been hiccups with some project commissionings.

Lithium hot, gold still warm for explorers

Industry Queensland

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