February 5th, 2025 - The Mine Wire

METALS MARKET

🇺🇸 The U.S. Federal Reserve held its rates last week despite President Trump pushing for a cut. With low unemployment (4.1%) and steady growth (3%), Powell said, “With ... the economy remaining strong, we do not need to be in a hurry to adjust our policy stance.” North of the border, the Bank of Canada cut rates by a quarter basis point to 3% which was largely expected.

The markets had a wild week as President Trump threatened tariffs against Canada & Mexico and implemented them against China. Companies that were perceived to be impacted by tariffs saw their stocks drop while precious metals were up as investors flocked to safe haven assets. Expect the roller coaster ride to continue for some time.

^{**For our chart above we are taking prices from Tuesday 4pm EST to Tuesday 4pm EST, so not the typical week of Monday through Friday.}

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KEEPING AN EYE ON GOVERNMENT DECISIONS

Here are some of the notable government policy moves this week:

• 🇺🇸 🇨🇦 🇲🇽 Without a doubt, President Trump’s tariff threats were big news across the globe this week as he singled out Canada, Mexico & China and mentioned that the EU & the UK were on deck. The blanket 25% tariff on Canada included a carve out for oil, natural gas, electricity, coal, uranium, and critical minerals which would have been taxed at 10%. Not surprisingly, Canada came out with their own tariffs on $30bn worth of goods that would have escalated to $155bn 21 days later. Luckily, cooler heads prevailed with Mexico and then Canada, coming to an agreement with President Trump to take action on their borders, leading to a 30 day pause in tariffs. However, Trump has indicated that further economic negotiations need to take place, so there is still a lot of uncertainty on what may or may not happen next. (S&P Global)

• 🇨🇳 🇺🇸 China wasted no time responding to the U.S. tariffs on Tuesday as it put a 15% tariff on coal and LNG as well as 10% on oil, farm equipment and some types of vehicles. China said it was also opening an anti-monopoly investigation into Alphabet’s google. Despite these moves, the tariffs will only impact about $20bn worth of American goods while the U.S. tariffs impact roughly $450bn worth of Chinese goods. In a non-tariff move, China will require licenses to export 20 tungsten, tellurium, bismuth, indium and molybdenum-related products to "safeguard national security interests" and has an outright ban on sending them to the United States given their application in many defense industries. The White House confirmed that China’s President Xi has reached out but President Trump doesn’t seem to be in a rush to make that call happen. The art of negotiating? (AP News)

• 🇺🇸 🇺🇦 President Trump indicated that the United States would continue to back Ukraine’s war effort in exchange for “equalization” for America’s close to $300bn in spending. He said, "We're telling Ukraine they have very valuable rare earths" and "We're looking to do a deal with Ukraine where they're going to secure what we're giving them with their rare earths and other things." (Reuters)

• 🇺🇸 🇿🇦 Yes, President Trump again. He also took a shot at South Africa and said the United States might withhold funding due to the country’s land expropriation policy. South Africa’s Mining Minister, Gwede Mantashe, said African countries should "withhold minerals" from the United States in response to any aid cut. At the Mining Indaba conference there were greater calls for more local beneficiation instead of exporting raw materials out of the continent. (Reuters)

• 🇺🇸 Chris Wright, the CEO of Liberty Energy, has been confirmed by the Senate to serve as President Trump’s Energy Secretary. We will keep an eye on Trump’s promise to fill the Strategic Petroleum Reserve which is at it’s lowest level in 40 years as it would likely increase oil prices. Wright also supports expanding nuclear power and served on the board of a small modular reactor startup, Oklo, who’s stock is up 40% in the past 5 days. EMX Royalty put out a statement that Wright would be stepping down from their board due to his new role. (Reuters)

• 🇦🇺 The government of Western Australia announced the start of a trial to assess a new authorization process for low impact mining activities in state’s mining sector. The Government's intent is to streamline the approval of eligible mining activities that pose a low risk to the environment and do not occur in sensitive areas. We’d love to hear from people on the ground how this trial goes! (Government of Western Australia)

• 🇳🇿 The New Zealand government came out with it’s critical minerals list which includes 37 minerals. Included in the list are gold and coal which make up roughly 80% of the country’s mineral exports. The island nation is hoping to grow it’s mining industry from NZ$1.2bn a year to roughly NZ$3bn per year. (Mining Technology)

• 🇵🇹 Portugal looks poised to become the first European nation to ban seabed mining. Parliament approved in first reading several texts from various political parties which outline their thoughts on how to legislate a ban. With broad agreement from major political parties, including the ruling party, it seems to be only a matter of time. (Barrons)

• 🇵🇭 In the Philippines, the Senate has approved at second reading a bill to increase the government’s share of mining profits. Further, the Senate approved at third reading, a ban on the export of raw materials in order to pave the way for the development of local industries, production of higher-value exports and the creation of more jobs for Filipinos. (The Manila Standard)

• 🇮🇳 India has approved 163bn rupees ($1.88bn) to develop its critical minerals sector and will launch the National Critical Mineral Mission (NCMM). "The mission will intensify the exploration of critical minerals within the country and in its offshore areas. It aims to create a fast track regulatory approval process for critical mineral mining projects. Additionally, the mission will offer financial incentives for critical mineral exploration and promote the recovery of these minerals from overburden and tailings." India is looking to secure key inputs as it grows its own manufacturing and technology sectors. (India Ministry of Mines)

• 🇹🇿 🇧🇮 Tanzania & Burundi have signed an agreement with two Chinese firms to build a railway between the two African countries for transporting metals to the port city of Dar es Salaam. The $2.15bn joint venture will be financed by the African Development Bank. (Reuters)

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MINING MATTERS FROM AROUND THE WORLD 🌎

• 🇦🇪 Big congratulations to Orion Resource Partners who announced a 50/50 joint venture with Abu Dhabi’s sovereign wealth fund, ADQ. The joint venture partners will initially invest US$1.2bn over the course of the first four years and focus on emerging markets in Africa, Asia & Latin America. Philip Clegg will head up the new Orion Abu Dahbi office as Managing Partner. (ADQ)

• 🇨🇱 Lundin Mining (TSX: LUN) has been ordered to permanently close its Alcaparrosa copper mine in Chile. The mine has been closed since 2022 when a significant sinkhole developed at the site. Chile’s environmental regulator head Marie Claude Plumer said, “"The company caused irreparable environmental damage.” Lundin has also been fined 3.36 billion pesos ($3.41m). Lundin put out its own statement saying it has cooperated fully with the regulator and “will review the notification and determine the next steps relating to the charges that it allegedly breached its environmental permit at its Minera Ojos del Salado operation.” (Reuters) & (Lundin Mining)

• 🇺🇦 Ferrexpo (LON: FXPO) announced yesterday that a civil claim worth 157bn hryvnias (USD $3.77bn) was filed against its Ukrainian unit, Ferrexpo Poltava Mining, in relation to alleged illegal mining and the sale of waste products. The miner has responded that the claims are “without merit”, but the stock still dropped almost half by market close. The company’s headquarters are in Switzerland, but it’s operations are in central Ukraine where it has three iron ore mines and an iron ore pellet production facility. It is the 3rd largest exporter of iron ore pellets in the world. (Reuters)

• 🇦🇺 Sadly, Resolute Mining’s (ASX: RSG) Terry Holohan is resigning from his President & Managing Director role. He had been on a leave of absence following his detainment by Mali’s military junta in November of last year. We certainly wish the best for Terry as he spends time with his family.

• 🇧🇼 The Government of the Republic of Botswana and De Beers Group announced the successful conclusion of negotiations focused on establishing a new sales agreement for Debswana’s rough diamond production, as well as extending Debswana’s mining licenses beyond 2029. (De Beers)

• 🇹🇷 ACG Metals (LON: ACG) with a mining project in Turkey, announced that former U.S. Secretary of State, Mike Pompeo, is joining its board of directors. Probably not a terrible move given that Mr. Pompeo worked in the first President Trump administration. The market seems to agree as the stock is up 12% on the news.

MINING BITS

• 🇺🇸 🇨🇦 We know we are preaching to the converted here, but a great read from Gracelin Baskaran, director of the Critical Minerals Security Program at the Center for Strategic and International Studies in Washington, D.C. - basically “any tariffs with Canada on minerals would have heavy consequences on defense, nuclear energy, and heavy manufacturing. Canada is a critical ally in the United States’ efforts to reduce reliance on China for critical minerals—both for feedstock and midstream processing.” She covers uranium, nickel and aluminum - worth a read. (CSIS)

• 🇺🇸 🇨🇦 The Alaska Beacon takes a look at Teck’s Red Dog Mine, the world’s largest zinc mine, which also produces germanium. The issue? The minerals are processed across the border in Trail, BC, Canada. The article points out that the United States only has two mines that produce germanium, the other being in Tennessee. With China putting an export ban on germanium in 2024, it is important for the United States to have access to Canada’s germanium. Used in fiber optics, computer chips, and night-vision equipment, 89% of Canada’s germanium exports currently go to the United States. (Alaska Beacon)

• 🇿🇦 South African petrochemicals company Sasol has entered into an agreement with De Beers to pilot the production of renewable diesel from vegetable oil. The deal was signed at the Mining Indaba conference in Cape Town this week and will see De Beers provide 20 acres of land to grow Solaris and Moringa plants. Certainly an interesting pilot and we wish both groups luck! (Reuters)

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