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Commodities


Our Commodities Portfolio

Stocks Date of Initial Coverage Initial Entry Price Highest Point Performance from Initial Entry
HVY 1688911200 10-Jul-2023 $0.113 244% -31%
REZ 1685887200 05-Jun-2023 $0.022 70% -55%
GUE 1676811600 20-Feb-2023 $0.150 37% -27%
MEG 1676552400 17-Feb-2023 $0.039 151% -72%
LYN 1668949200 21-Nov-2022 $0.256 127% -34%
TYX 1662386400 06-Sep-2022 $0.017 294% -29%
SGA 1658412000 22-Jul-2022 $0.163 249% 16%
CAY 1644757200 14-Feb-2022 $0.100 5% -20%
LNR 1644411600 10-Feb-2022 $0.029 134% -90%
AKN 1643893200 04-Feb-2022 $0.165 33% -85%
EV1 1637067600 17-Nov-2021 $0.200 183% -50%
KNI 1629813600 25-Aug-2021 $0.200 723% 5%
PFE 1628085600 05-Aug-2021 $0.200 -8% -78%
RAS 1625407200 05-Jul-2021 $0.065 585% -46%
BPM 1621346400 19-May-2021 $0.200 25% -55%
TG1 1617717600 07-Apr-2021 $0.200 28% -80%
IRD 1616850000 28-Mar-2021 $0.215 -7% -72%
MAN 1614776400 04-Mar-2021 $0.080 -8% -50%
EMH 1614690000 03-Mar-2021 $1.100 40% -67%
FYI 1610974800 19-Jan-2021 $0.200 123% -68%
PUR 1606827600 02-Dec-2020 $0.014 204% -63%
LRS 1606309200 26-Nov-2020 $0.018 2332% 1150%
EMN 1599141600 04-Sep-2020 $0.065 615% 18%
MNB 1598364000 26-Aug-2020 $0.030 550% %
TTM 1594130400 08-Jul-2020 $0.067 80% -67%
LCL 1588168800 30-Apr-2020 $0.036 258% -72%
GTR 1588082400 29-Apr-2020 $0.018 89% -56%
GAL 1582981200 01-Mar-2020 $0.247 691% 14%
TMR 1581944400 18-Feb-2020 $0.200 -48% -98%
VUL 1566223200 20-Aug-2019 $0.200 5420% 1185%
Stocks Date of Initial Coverage Initial Entry Price Highest Point Performance from Initial Entry
HVY 1688911200 10-Jul-2023 $0.113 244% -31%
REZ 1685887200 05-Jun-2023 $0.022 70% -55%
GUE 1676811600 20-Feb-2023 $0.150 37% -27%
MEG 1676552400 17-Feb-2023 $0.039 151% -72%
LYN 1668949200 21-Nov-2022 $0.256 127% -34%
TYX 1662386400 06-Sep-2022 $0.017 294% -29%
SGA 1658412000 22-Jul-2022 $0.163 249% 16%
CAY 1644757200 14-Feb-2022 $0.100 5% -20%
LNR 1644411600 10-Feb-2022 $0.029 134% -90%
AKN 1643893200 04-Feb-2022 $0.165 33% -85%
EV1 1637067600 17-Nov-2021 $0.200 183% -50%
KNI 1629813600 25-Aug-2021 $0.200 723% 5%
PFE 1628085600 05-Aug-2021 $0.200 -8% -78%
RAS 1625407200 05-Jul-2021 $0.065 585% -46%
BPM 1621346400 19-May-2021 $0.200 25% -55%
TG1 1617717600 07-Apr-2021 $0.200 28% -80%
IRD 1616850000 28-Mar-2021 $0.215 -7% -72%
MAN 1614776400 04-Mar-2021 $0.080 -8% -50%
EMH 1614690000 03-Mar-2021 $1.100 40% -67%
FYI 1610974800 19-Jan-2021 $0.200 123% -68%
PUR 1606827600 02-Dec-2020 $0.014 204% -63%
LRS 1606309200 26-Nov-2020 $0.018 2332% 1150%
EMN 1599141600 04-Sep-2020 $0.065 615% 18%
MNB 1598364000 26-Aug-2020 $0.030 550% %
TTM 1594130400 08-Jul-2020 $0.067 80% -67%
LCL 1588168800 30-Apr-2020 $0.036 258% -72%
GTR 1588082400 29-Apr-2020 $0.018 89% -56%
GAL 1582981200 01-Mar-2020 $0.247 691% 14%
TMR 1581944400 18-Feb-2020 $0.200 -48% -98%
VUL 1566223200 20-Aug-2019 $0.200 5420% 1185%

Macro Outlook Commodities - 2023

The fallout from the Global Financial Crisis (GFC) in 2008 and the years immediately after saw a short term boom bust cycle in the commodities sector.

The subsequent bust in ~2011 led to a period of over 10+ years of depressed commodities prices and broad based underinvestment in new supply.

Then in 2020 the 2 year covid hand brake and the freezing up of supply chains globally made the problem even worse.

Covid made the world realise that relying on other countries for supply of critical commodities is a risk, encouraging many governments to try and discover and develop local supply.

This “security of local supply” theme was turbo-charged after the Ukraine war took all sorts of commodity supply off the market, especially food (Ukraine wheat) and energy (Russian gas).

Supply side problems coupled with increasing demand from the push towards decarbonisation has brought about the idea of a “commodities supercycle” - where demand outweighs supply significantly and commodity prices stay higher for longer.

The commodities supercycle has now entered the lexicon of investors - with big pools of capital now turning to mines, organisations investing upstream to secure battery metals and governments providing funding to secure critical mineral supply.

The history of commodities supercycles is as follows:

  1. US industrialisation: Late 1890s through to a peak in 1917 - the US was rapidly industrialising and the supercycle peak coincided with the entry of the US into World War 1 and continued until the early 1930s.
  2. World War and the rebuild: The next supercycle began in the lead up to the Second World War. The war itself and rebuilding in the aftermath required lots of materials - it peaked in 1951, and this demand continued through to the early 60s
  3. Cold war and nationalisation: The early 1970s marked the start of the third cycle as commodity supply was disrupted as the Cold War saw countries nationalise industries and foreign investors pulled out. In the mid 1980s producers managed to shore up supply and the cycle faded.
  4. China Industrialisation: The most recent supercycle started in 2000 when China joined the World Trade Organisation (WTO) and started to modernise. The raw materials China needed to do this sparked a long bull run for commodities. The 2008 GFC put a spanner in the works but Chinese stimulus made the cycle continue through to 2014 when oil cratered on oversupply.

Our view is that we are now entering the next iteration of a commodities supercycle for the following reason:

Clean energy revolution & localisation of supply chains - We think the fundamentals for the next supercycle have been set with the world looking to transform the way energy is produced and consumed (through cleaner, renewable energy technologies) AND the push to localise the supply chains for these critical raw materials (Fallout from the Ukraine/Russia conflict).

We think that 2023 will be a year where the tailwinds for the commodities supercycle get stronger and capital starts to flow into the commodities where the biggest supply/demand imbalances are being forecast.

What the analysts say

Goldman Sachs believes that commodities will be the best-performing asset class once again in 2023, handing investors returns of more than 40% (source).

The investment bank has been strong on commodities since calling the start of a commodities supercycle in 2020 and think that 2023 will be another strong year for the sector.

On the supply side Goldman Sachs believes that with the cost of capital high there will be a continued undersupply of commodities in 2023 - as new mines and new production remain underinvested.

On the demand side, the re-opening of China will continue to push commodity demand up as the country looks to re-build from tumultuous years of lock down.

Read the full Goldman Sachs 2023 commodity outlook.

JP Morgan strategist Marko Kolanovic is also calling for the start of the worlds fifth “commodity supercycle” of the last 100 years and thinks that pools of capital flowing into the commodities sector will lead to prices that are a lot higher than most expect.

What about the bear case?

The bear case for commodities is a looming recession.

If a recession materialises and consumption craters, then this would be bad for commodities.

The irony is that the inflationary environment has been caused, in part, due to increases in prices for commodities.

For example, if the price of lithium doubles in the next 12 months, it could make electric vehicles unaffordable for consumers - thus destroying demand.

And if the demand side of the equation changes, due to the inflationary pressures, then commodity prices will fall.

Our Commentary on Commodities

Our Commodities Investments

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Heavy Minerals Ltd (ASX:HVY)

Heavy Minerals (ASX:HVY) is a “mineral sands” developer with three projects. The most advanced project is a garnet-rich deposit located in WA, very close proximity to two other garnet producers

Read Investment Memo →


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Resources & Energy Group Ltd (ASX:REZ)

Resources & Energy Group (ASX: REZ) is a junior explorer focused on making a metals discovery in Western Australia.

Read Investment Memo →


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Global Uraniuum and Enrichment (ASX:GUE)

Global Uranium and Enrichment Limited (ASX:GUE) (formerly Okapi Resources (ASX:OKR)) is a uranium explorer and developer with projects across four uranium districts in the USA & Canada.

Read Investment Memo →


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Megado Minerals (ASX:MEG)

Megado Minerals (ASX: MEG) is a junior exploration company aiming to make a critical minerals discovery in North America.

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Lycaon Resources (ASX:LYN)

Lycaon Resources (ASX: LYN) is a junior explorer focused on making a valuable metals discovery in Western Australia.

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Tyranna Resources Ltd (ASX:TYX)

Tyranna Resources (ASX: TYX) is a junior exploration company defining a hard rock lithium discovery in Angola, West Africa.

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Sarytogan Graphite (ASX:SGA)

Sarytogan Graphite (ASX:SGA) holds 100% of a huge graphite project in Kazakhstan, strategically located between Europe and China.

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Canyon Resources (ASX:CAY)

Canyon Resources (ASX:CAY) is developing one of the largest undeveloped, high grade direct shipping bauxite deposits globally in Cameroon, Africa.

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Lanthanein Resources Limited (ASX:LNR)

Lanthanein Resources Limited (ASX:LNR) is exploring for rare earths in the Gascoyne region, WA located in close proximity to Hasting Technology Metals’ advanced Yangibana Rare Earths project

Read Investment Memo →


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Auking Minerals (ASX:AKN)

AuKing Mining (ASX: AKN) owns 75% of a JORC copper/zinc resource near Halls Creek in WA. AKN is focused on exploring and developing this resource

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Evolution Energy Minerals (ASX:EV1)

EV1 is a sustainable, ESG friendly, advanced stage graphite project in Tanzania

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Kuniko Limited (ASX:KNI)

KNI holds a portfolio of battery metals exploration assets (copper, nickel, and cobalt) in Norway

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Pantera Minerals Ltd (ASX:PFE)

Pantera Minerals (ASX:PFE) is an early stage minerals exploration company based in Western Australia. PFE has a diverse suite of commodities within its tenements, including Iron-Ore, Lead, Zinc, Silver, Copper and Manganese

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Ragusa Minerals Ltd (ASX:RAS)

Ragusa Minerals (ASX: RAS) is a junior exploration company focused on its hard rock lithium project in the Northern Territory.

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BPM Minerals (ASX:BPM)

BPM Minerals (ASX:BPM) is an exploration company aiming to make lead-zinc discoveries in the Earaheedy Basin in WA, Australia. BPM also holds other early stage gold-nickel projects across WA

Read Investment Memo →


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TechGen Metals Ltd (ASX:TG1)

Techgen Metals (ASX: TG1) is a junior exploration company focused on gold and nickel-copper-PGE projects across Western Australia and New South Wales.

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Iron Road Limited (ASX:IRD)

Iron Road Ltd (ASX: IRD) is advancing one of the world’s largest, development ready, high- product grade (>66% Fe) iron ore projects.

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Mandrake Resources Limited (ASX:MAN)

Mandrake Resources (ASX: MAN) is a junior exploration company aiming to make a lithium discovery in North America.

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European Metals Holdings (ASX:EMH)

European Metals Holding (ASX: EMH) is developing the largest hard rock lithium resource inside the European Union.

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FYI Resources (ASX:FYI)

FYI Resources Ltd (ASX: FYI) is an critical minerals technology and development company, focusing on a key battery metal input High Purity Alumina (HPA) and rare earths

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Pursuit Minerals Ltd (ASX:PUR)

Pursuit Minerals (ASX: PUR) is developing an advanced lithium brine project in Argentina.

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Latin Resources Limited (ASX:LRS)

Latin Resources (ASX: LRS) is a multi-commodity exploration and development company focussed primarily on lithium in Brazil and halloysite and kaolin in WA

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Euro Manganese (ASX:EMN)

Euro Manganese (ASX:EMN) is developing a High Purity Manganese project in the European Union (Czech Republic) through the recycling of a tailings resource from a historical mine site

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Minbos Resources (ASX:MNB)

Minbos Resources (ASX: MNB) is seeking to build high-margin phosphate fertiliser supply business with the potential to dramatically transform Angola’s food security and crop yields.

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Titan Minerals (ASX:TTM)

Titan Minerals Ltd (ASX:TTM) is an exploration and development company on the hunt for world class gold and copper assets in the emerging global minerals hotspot, Ecuador

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Los Cerros (ASX:LCL)

LCL Resources Limited (ASX: LCL) acquired multiple high-grade copper, gold and nickel targets across five project areas in PNG in late-2022. This adds to its 2.6Moz Quinchia Gold Project in Colombia.

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GTi Resources (ASX:GTR)

GTi Energy (ASX: GTR) is an exploration company targeting Uranium discoveries in Wyoming, USA & Utah, USA

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Galileo Mining (ASX:GAL)

Galileo Mining (ASX: GAL | OTC:GALMF) is focused on expanding its PGE discovery in the Norseman region, WA whilst also chasing a large scale nickel discovery in the Fraser Range

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Tempus Resources (ASX:TMR)

Tempus Resources (ASX:TMR) is an exploration company focussed on gold in Canada and Ecuador

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Vulcan Energy Resources (ASX:VUL)

Vulcan Energy Resources (ASX:VUL, FWB:6KO) is aiming to become the world’s first Zero Carbon LithiumTM producer.

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