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PDAC: Junior miners optimistic for year ahead

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The mood among delegates was overwhelmingly positive at this year’s PDAC convention, held 3-6 March in Toronto, Canada, with many project developers telling Roskill that the commodity market cycle was on the upturn.

Developers are seeing strong interest in projects from consumers, with many reporting to Roskill that they had secured offtakes and were pushing ahead with financing and permitting.

The latter topic was a sticking point for some companies, however, with several European projects noting that permitting was causing delays. In addition, the retail investor market, which usually comes out in force for PDAC, has been diverted away from commodities in recent years towards new markets such as medical marijuana.

Of the companies that Roskill met with, market optimism was particularly strong for battery material projects, notably cobalt, lithium, and graphite, while copper and vanadium developers were likewise bullish for the year ahead.

In the copper market, with China’s new ban on Category 7 scrap and further restrictions on Category 6 scrap and “zero” waste imports scheduled for 2020, a number of smelters and fabricators are worried about the increasing likelihood of shortages in their secondary metal supplies over the next two years, which could prove to be a boon for mine developers.

Vanadium projects were also benefitting from greater interest following the sharp increase in prices last year, which were underpinned by tight supply and a bullish outlook for demand, underpinned by China’s new high-strength rebar standard, designed to limit the use of inferior steels in construction.

Chinese regulatory changes also contributed to a tighter tungsten market in 2018, with the enforcement of new environmental policies resulting in widespread inspections that led to supply disruptions. The outlook for the sector indicates supply from existing tungsten mine producers will fall over the next decade, meaning either recycled tungsten sources or new mine projects will need to make up the shortfall.

Roskill’s NEW Tungsten: Global Industry, Markets & Outlook report was published in March 2019. To discuss the tungsten market with Roskill, contact Jessica Roberts: jessica@roskill.com

Roskill will be publishing its Copper Demand to 2035 report in Q2 2019. To discuss the copper market with Roskill, contact Jonathan Barnes: jonathan@roskill.com

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