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1) Theo Yameogo from Ernst & Young breaks down this year's forecast for 5 different metals.
With gold, he sees three possible outcomes depending on how the economy goes. If there is a recession, people will turn to gold and says that the price may be anywhere from $2,000 to $4,000. Yameogo believes that it is important to remember that when the US dollar decreases, the price of gold will increase. A second scenario is a stable price if we were to see a milder recession, and a third scenario would see the price of gold fall if we do not reach a recession.
Looking at silver, the impact of the energy crisis, higher geopolitical uncertainty in countries of silver producers and higher costs of operations will likely be offset by high cash at disposal, driving capital allocation strategies, according to Alfredo Alvarez Laparte, the energy lead partner at EY Latin America North.
When it comes to copper, the price is largely dependent on China's economy as it is the major consumer of global copper. Once China gets into full swing, it will require a lot of copper, and iron ore, for growth. According to Yameogo, there are no new mining projects dedicated to producing copper beginning in 2023, that would increase the supply in the market.
With nickel, Yameogo says that the metal "...is expected to remain hot in 2023." Nickel biggest use comes from the production of stainless steel and more recently in NFC batteries.
Finally, iron will be the one of the most sought -out metals by China as it opens its borders from Covid and restarts its economy, according to Theo Yameogo. “Iron is already up anyway, but it is expected to continue to increase because there is now a large consumer of it that is coming into the market,” said Yameogo. And just like copper, there is no major new mining project that will be producing iron in 2023 to bring more supply to the market.
2) Magnis Energy Technologies, a battery technology company based in Australia, announced that it signed an anode active materials (AAM) offtake agreement with Tesla. Magnis is developing a graphite mine in Tanzania where it plans to get "ultra-high purity natural flake graphite" from its operation. Tesla plans to purchase “a minimum of 17,500 tpy starting from February 2025,” and the automaker has an option for “a maximum of 35,000 tpy for a minimum 3-year term at a fixed price.” The agreement also allows for Tesla to not only purchase graphite from Magnis, but also to buy processed anode material (AAM) and involved Magnis to building a US facility to produce the AAM. "The agreement is conditional on Magnis securing a final location for its commercial AAM facility by 30 June 2023, producing AAM from a pilot plant by 31 March 2024, commencing production from the commercial AAM facility by 1 February 2025, and customer qualification," according to Magnis.