Energy transition needs raw materials
There are raw materials that are particularly needed such as copper, nickel, silver or platinum to make the future greener.
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Accelerated demand for certain metals is expected in the coming years. This demand is global and not caused by just a few countries. This is actually a megatrend that is being driven by the weakness of the US dollar. This is where commodity investors should take heed. Whether it becomes a super cycle or not, the time is in any case exciting as far as certain commodities are concerned. One of the particularly interesting commodities is zinc. Last year, there was a deficit in the zinc market. Mining disruptions were to blame.
Demand, on the other hand, recovered very quickly in the pandemic year 2020, especially in China. This is because steel was and is in strong demand, and zinc is part of this as a corrosion protection. The demand outlook for the current year is also extremely robust. And the refined zinc market in 2021 shows only a modest surplus, inventories are still low, and demand is high. A prolonged oversupply is not expected.
While there are many new mining projects in China, there are not outside China. And in China, there are severe environmental constraints that can push smelter capacity down. Higher mine supply is expected to be used to replenish low concentrate stocks. As there has also been little investment in new mines, the outlook for the zinc price should be very good, as well as for the companies that own zinc in their projects, such as Osisko Metals or Griffin Mining.
Griffin Mining - https://www.youtube.com/watch?v=kRi8d4ew1pA - is China's largest zinc producer. Zinc, gold, silver and lead come from its Caijianying mine. Operating profit increased by 6.5 percent in 2020 compared with the previous year.
Osisko Metals - https://www.youtube.com/watch?v=vzBAY7IIx6c - focuses on base metals and has extremely high-grade zinc projects in the Northern Territories and New Brunswick.
Current corporate information and press releases from Osisko Metals (https://www.resource-capital.ch/en/companies/osisko-metals-inc/) and Griffin Mining (https://www.resource-capital.ch/en/companies/griffin-mining-ltd/).
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