July Newsletter – 12.07.2021


  • Indonesia’s surge in COVID-19 cases spreads to coal mining areas
  • Robust China coal demand amid Australia import ban fuels price rally: Russell
  • Energy Fuels’ first shipment creates US-Europe rare earths supply chain
  • Almonty Industries: Bringing the largest tungsten mine outside of China to Australian investors
  • China’s first-half 2021 molybdenum output rises
  • Copper price rises as dollar retreats
  • Coal Shows Its Staying Power as Economies Bounce Back
  • Australia’s Sayona Mining raises $33.7 mln to fund deal, lithium project

Indonesia’s surge in COVID-19 cases spreads to coal mining areas

JAKARTA, July 8 (Reuters) – Indonesia’s biggest coal-producing province of East Kalimantan has recorded a spike in coronavirus cases, with miners among those infected, but so far there has been no disruption to coal operations, a local official said.

The Southeast Asian country is the world’s biggest thermal coal exporter and has been riding a boom in prices powered by strong demand from countries such as China, South Korea and Japan.

East Kalimantan on Borneo island reported 979 coronavirus infections on Thursday, the highest number outside the densely populated island of Java. The hospital bed occupancy ratio in the province had also reached 73% by Wednesday, health ministry data showed, among the highest levels in the country.

“The spread of COVID-19 in East Kalimatan has reached all areas and not just the urban areas,” Andi Muhammad Ishak, a spokesperson at the East Kalimantan COVID-19 task force told Reuters, adding infections had been reported in the mining sector.


Robust China coal demand amid Australia import ban fuels price rally: Russell

LAUNCESTON, Australia, July 8 (Reuters) – Seaborne coal has become a quiet winner among energy commodities, lacking the attention of higher-profile crude oil and liquefied natural gas (LNG), but enjoying strong gains amid rising demand.

Both thermal coal, used in power plants, and coking coal, used to make steel, have rallied strongly in recent months. And in both cases the driver has largely been China, the world’s biggest producer, importer and consumer of the fuel.

There are two elements to China’s influence on seaborne coal markets in Asia; robust demand as the Chinese economy rebounds from the coronavirus pandemic; and Beijing’s policy choice to ban imports from Australia.

Both elements are reflected in the prices, with lower-quality thermal coal from Indonesia being the biggest beneficiary.


Energy Fuels’ first shipment creates US-Europe rare earths supply chain

Energy Fuels (NYSE: UUUU) (TSX: EFR) and Neo Performance Materials (TSX: NEO) created a new United States-to-Europe rare earth supply chain this week when the first container – with 20 tonnes of product – of an expected 15 containers of mixed rare earth carbonate produced at Energy Fuels’ White Mesa Mill in Utah was shipped to Neo’s rare earth separations facility in Estonia.

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More shipments of RE Carbonate will be en route as Energy Fuels continues to process natural monazite sand ore mined in the US state of Georgia by Chemours (NYSE: CC) for both the rare earth elements (REEs) and naturally occurring uranium that it contains.

REEs are the building blocks of an array of clean energy and advanced technologies, including wind turbines, electric vehicles, cell phones, computers, advanced optics, catalysts, medicine, and national defense applications. Monazite also contains significant recoverable quantities of uranium, which fuels the production of carbon-free electricity using nuclear technology.

Both the US- China trade war and the pandemic induced shutdowns to manufacturing plants in China that could potentially cut off US rare earths imports last year shone a spotlight on the fact the nation is reliant on China for its rare earths needs.


Almonty Industries: Bringing the largest tungsten mine outside of China to Australian investors

  • Tungsten was once the powerhouse of the South Korean economy, but a shift in focus to manufacturing saw the massive Sandong mine close in the 1990s
  • Over a decade later, Woulfe Mining Corp recognised the potential that still lay within the South Korean mine and started working to rebuild it
  • In September 2015, Canada-based Almonty Industries acquired Woulfe and soon after completed an updated feasibility study for the Sandong project
  • Almonty has hit some crucial milestones ahead of the mine’s commissioning and secured a major portion of the funding needed to develop the project
  • With an upcoming ASX initial public offering (IPO), Almonty Industries is now bringing the historical tungsten asset to Australian investors

Throughout the 20th century, South Korea was one of the world’s major mining jurisdictions, with tungsten a key export commodity for the country.

For around four decades after the Korean war, South Korea produced massive amounts of tungsten from its Sandong Mine.

It got to the point where tungsten from Sandong accounted for over half of South Korea’s total exports — making the mine the powerhouse of the South Korean economy.

Nevertheless, falling commodity prices and a shift in focus to manufacturing saw operations at Sandong slowly scale down until the mine was eventually closed in 1994.

Yet, tungsten has since rebounded. Given its extremely high melting point, tungsten has important uses in modern tech — including lighting, mobile phones, military, cars, spacecraft and more.


China’s first-half 2021 molybdenum output rises

China’s molybdenum concentrate production increased in the first half of this year, supported by stable operations at major mining companies and a rise in buying interest from domestic ferro-molybdenum producers.

The country produced 50,800t metal equivalent of molybdenum concentrate over January-June, up by 11.04pc from a year earlier, according to data from the China Nonferrous Metals Industry Association.

Domestic January-June consumption reached 60,500t metal equivalent of molybdenum, up by 24.14pc from the same period last year.

Major producer Heilongjiang-based Luming Mining suspended production during April-September last year following a leakage accident in March. The firm was producing around 3,000 t/month of 50pc grade concentrate in the first half of this year and partly responsible for the rise in China’s total concentrate output during the period.


Copper price rises as dollar retreats

Copper prices ticked up on Friday as the US dollar pulled back from a three-month high.

Copper for delivery in September rose 2.45% from Thursday’s settlement price, touching $4.369 per pound ($9,611 per tonne) midday Friday on the Comex market in New York.

The most-traded August copper contract on the Shanghai Futures Exchange finished daytime trading 0.1% lower at 68,920 yuan ($10,622.20) a tonne but was still on course for a weekly gain.

The rapid spread of the highly contagious Delta variant of covid-19 in some emerging markets has raised concerns that the global economic rebound might be derailed, dampening expectations for metals demand.

A possible monetary policy easing in China did not help sentiment in Shanghai because it was viewed as a sign of weakness in the world’s top metals consumer.

“This created a risk-off tone across markets, with copper the lightning rod for these concerns,” said ANZ senior commodity strategist Daniel Hynes.


Coal Shows Its Staying Power as Economies Bounce Back

Surging electricity use and higher natural-gas prices are giving coal new life despite its environmental drawbacks

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An open-pit coal mine in China’s Liaoning province. Coal-fired power generation in the country has risen this year.

Coal use is surging in some of the world’s largest economies as electricity demand rebounds from the pandemic, illustrating the challenges to countries looking to wean themselves off the dirty but reliable fossil fuel.

Coal was in decline for years in many countries, but its use is now picking up in the U.S., China and Europe despite growing pressure from governments, investors and environmentalists to curb carbon emissions. The leading reason for the uptick—which has pushed coal prices to multiyear highs—is rising power demand as economies reopen rapidly from pandemic hibernation.

While analysts and executives say the resurgence of coal is likely to be short-lived, it shows the world’s continued dependence on fossil fuels until renewable-energy capacity grows further and storage technologies improve.

Countries have spent billions adding renewable-power capacity at record rates, but solar and wind projects generate electricity only when the sun is shining or the wind is blowing, and can’t be ramped up when demand rises. Those limitations mean the world is still reliant on fossil fuels, especially when there is a surge in electricity demand. Analysts say this will remain the case until more renewable capacity is added, along with storage such as batteries.


Australia’s Sayona Mining raises $33.7 mln to fund deal, lithium project

Sayona, which operates in Western Australia and Quebec, said it could raise another A$5 million through a share issue to retail shareholders next month.

Australian lithium producer Sayona Mining said on Monday it raised A$45 million ($33.68 million) through a share issue to fund an acquisition and build on its Abitibi lithium hub in Quebec, Canada.

The race by lithium miners to raise money and expand projects tracks the global demand for the electric-vehicle battery metal, which is poised to soar in the coming decade as more countries move to electrify transportation and cut carbon emissions.

Sayona, which operates in Western Australia and Quebec, said it could raise another A$5 million through a share issue to retail shareholders next month.

The total proceeds will be used to fund the company’s successful bid with its top shareholder Piedmont Lithium Inc for Canadian firm North American Lithium at C$94 million ($75.56 million).

The company plans to integrate the mine owned by North American Lithium with its Authier lithium project to create the Abitibi lithium hub.



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