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Australia in box seat for rare earths

Australia has well positioned to benefit from the rise of critical minerals, according to the federal government’s Outlook for Selected Critical Minerals Australia 2021 report.

Released by the Office of the Chief Economist in the Department of Industry, Science, Energy and Resources, the report detailed the prospect for market growth in metals such as lithium, cobalt, graphite, vanadium, and rare earth elements like neodymium, praseodymium and dysprosium.

Minister for Resources, Water and Northern Australia Keith Pitt said Australia must take advantage of its privileged position in the market.

“Australia is blessed with abundant resources and a highly-skilled workforce which is ready to transform these minerals and elements into the kinds of products the world needs,” Pitt said.

The report credited Lynas Rare Earths – an Australian mid-tier mining company – for being the largest non-Chinese supplier of rare earth products.

“Australia’s mined production of rare earths is forecast to grow by 9.1 per cent per annum over the outlook period (2020-2030), largely as a result of investment by Lynas at their Mount Weld operation,” the report stated.

Highly considered by the report was the market conditions surrounding electric vehicles and associated battery storage technology.

The global fleet size of electric vehicles is expected to grow by 30 per cent by 2050, leaving the battery storage market to lag behind.

This has occurred due to heightened investment by auto manufacturers, according to the report.

“Auto manufacturers have invested heavily in the transition from internal combustion engines (ICE) to electric vehicles (EV), and therefore it is in their interests to recoup their investment as quickly as possible,” the report stated.

“Currently, auto manufacturer’s planned capacity increases to 2025 exceed the requirements of announced government policies.”

Pitt said the Australian Government is supporting the development of the necessary minerals for electrification.

“Australia is already the world’s top producer of lithium, and the Government’s Critical Minerals Facilitation Office is supporting the development of other resources, downstream processing, and helping to diversify global supply chains,” Pitt said.

“Australia also has a stable investment environment and stable governance arrangements that make Australia an attractive location for critical minerals investment and development.”

Tesla targets $1bn investment in Australian EV minerals

Tesla chair Robyn Denholm has declared the company plans to spend more than $1 billion on Australia’s minerals supply to cater for growing electric vehicle (EV) demand.

Denholm, who spoke at the Minerals Council of Australia’s minerals week, said each electric vehicle has around $5000 worth of minerals with Australia capable of supplying almost all of it.

“Australia is the only country in the world with resources in all three of the critical battery metals, as well as other minerals required for the clean energy transition,” she said.

“By 2030, the value of the global lithium-ion battery market is forecast to be $400 billion. That’s eight-times the revenue generated by Australia’s coal exports in 2020.”

Tesla has also valued Australia’s environmental social governance (ESG) practice and investor confidence in mining.

“In short, a values-led mining industry has greater value to Tesla and to an increasing portion of the global marketplace,” Denholm said.

“…Australia has the potential for some of the lowest emissions resources in the world.

“This is critically important over the next 30 years, because manufacturing as a whole has to decarbonise very quickly and this means that low-carbon minerals will be at a strong advantage in the new supply chains being created for renewable energy.”

According to Denholm, Australia has a competitive opportunity to enhance its environmental, social and governance (ESG) practices for the future.

“Tesla is the world’s largest manufacturer of electric vehicles and battery storage systems,” Denholm said.

“At the heart of everything we do in our quest to accelerate the transition to sustainable energy is the lithium-ion battery – one of the most important technologies of the century.

“There is a global transition to sustainable energy underway and this presents a huge opportunity for Australia.”

Denholm said Australia should also prioritise onshore refining of its lithium to save costs and reduce emissions.

“There’s another reason for Australia to prioritise onshore refining; it’s a huge economic opportunity,” Denholm said.

“Tesla estimates that last year, Australia supplied approximately 49 per cent of the world’s lithium ore – spodumene – but zero per cent of the refined product suitable for battery cells. That lithium sold for about $100 million US Dollars – but if it was processed on shore in Australia the value would have been more like $1.7 billion dollars.

“So that’s a $1.6 billion annual opportunity and growing.”

Australian gold down but not out in 2021

Australian gold production fell by nine tonnes for a total of 74 for the March quarter, down 11 per cent on the previous period, according to gold consultants Surbiton Associates.

The output was worth $5.5 billion at the quarter’s average gold price and Surbiton director Sandra Close said the drop was nothing to worry about.

“While gold output for the quarter was down considerably, this is no cause for concern,” Close said.

“Production was about three tonnes or four per cent less than the corresponding March 2020 quarter and such variations are not uncommon.”

Surbiton said while the period was usually victim to cyclonic weather in northern Australia, this had less of an impact than other years.

Close said China’s gold production was more noteworthy, as the world leader produced 74.44 tonnes of gold for the March quarter.

“Chinese production figures need to be treated with caution,” Close said.

“Australia may even be on the way to overtaking China as the world’s largest gold producer, but it is far too early to draw any real conclusions.”

In Australia, Kirkland Gold’s Fosterville mine in Victoria fell from third to fifth on the country’s list of largest gold producers, with a decline of 55,000 ounces on the last quarter.

Retaining top spot was Newcrest Mining’s Cadia East mine with 179,546 ounces of gold for the quarter.

Close said while some larger mines fell, other up-and-coming operations will look to challenge them over the next few years.

“Fosterville, Tropicana and Boddington together accounted for a reduction in output of 116,000 ounces, or 3.6 tonnes of gold, which was more than one third of the total reduction for the March 2021 quarter,” Close said.

“Novo and Ora Banda will increase output as they ramp up to full capacity over the next few months.

“Also, Capricorn Metals’ Karlawinda is due to start up mid-year and Wiluna Mines’ expansion project is underway.”

Close had no worries for the future of Australian gold, as prices and expenditure in exploration have uplifted the sector significantly.

“Thanks to higher gold prices in the last couple of years, the gold sector has continued to raise considerable capital and there is a tremendous amount of exploration going on, with excellent results being reported,” Close said.

“The chances of Australia’s gold output declining sharply in the next few years is unlikely.”

Australia’s largest gold producers for the March 2021 quarter were:

Cadia East 179,546 Newcrest Mining Ltd

Boddington 152,000 Newmont Inc.

Tanami 117,000 Newmont Inc.

Super Pit 111,278 Northern Star Resources Ltd

Fosterville 108,679 Kirkland Lake Gold Inc.

Copper explorers back record price run

Two Australian companies are confident that copper prices will continue to set records, with the red metal reaching a new high of $US10,724.50 ($13,682) on the London Metal Exchange (LME) overnight.

The red metal’s previous all-time high was recorded on May 7, where it reached $US10,361.

Junior explorers Kincora Copper and QMines started trading on the ASX in March and May, respectively, with both companies aiming to develop their copper assets.

QMines executive chairman Andrew Sparke said 11 straight months of decreased copper supply in Chile and COVID-19-related labour issues in South America have raised demand.

“The amount of copper we need to green the world is enormous,” he told Australian Mining.

“Where all this copper supply is going to come from is certainly yet to be determined. That backdrop is causing declining investors on the LME.

“It’s a really nice environment to be a copper explorer or company transition into copper development.”

Copper has been in high demand due to increases in economic stimulus from COVID-19.

Strained supply of the commodity has driven the copper price upwards, off the back of economic stimulus spending and copper’s importance in clean energy technology.

Sparke said ageing mines in South America, a country that has historically been a major supplier of the red metal, caused resources to be harder to extract as mines were forced to go deeper underground.“My view is demand will increase when supply is quite challenged. That is supported by many groups – Goldman Sachs is expecting a 600-900 per cent increase in copper demand until 2030,” he said.

QMines is developing its copper projects in Queensland, with its ASX listing aiming to fund a large exploration program at its Mt Chalmers copper-gold mine, a historic site that was operated between 1898 and 1982.

Its existing inferred resource is 3.9 million tonnes at 1.15 per cent copper and 0.81 grams per tonne of gold.

“In terms of unlocking value, we’re going to use those proceeds from the capital raised to roll out an exploration program that has an aim of increasing the resource,” Sparke said.

Kincora Copper president and chief executive officer Sam Spring said the push for decarbonisation and stimulus packages has increased copper demand.

“It’s a tailwind for the junior sector,” he told Australian Mining. “The improving copper price increases investor sentiment and that filters down to the junior miners who increase exploration with brownfield and greenfield projects.”

Kincora Copper has assets both in Australia and Mongolia, with the company listed on the ASX and the Toronto Stock Exchange (TSX).

Spring said copper was vital to a clean energy future due to its conductive properties.

“One thing about copper is that it’s the most cost-effective means to conduct electricity, both powering the vehicle, and getting power to the charging point. The shift from carbon cars to electric vehicles will see an increase in copper demand,” he said.

“It’s the same narrative for energy use at home from traditional power to solar and the likes. The foundation for this move in copper price has been in place for quite some time.”

彩涂钢材产品供应商 BlueScope 提高业绩预期，股价早盘高开

金属电镀和彩涂钢材产品供应商 BlueScope （ASX：BSL）周二发布公告称，BlueScope目前预计，2021财年下半年的息税前利润将在10亿至10.8亿澳元之间。高于之前7.5亿至8.3亿澳元的指导范围，但仍需取决于期间的外汇汇率和市场条件的变化。

BlueScope的董事总经理兼首席执行官Mark Vassella 说：”公司业务发展得越来越好，受益于强劲的产品利差、价格和需求的增长。BlueScope的所有团队在努力满足客户的特殊需求方面做得非常出色。”

“公司业绩也继续证明了我们业务模式的独特优势和价值。BlueScope是一家非常与众不同的钢铁公司，在利用新兴趋势方面处于令人信服的地位，例如对低密度和区域性住房以及电子商务和物流基础设施的需求。”

公司称，提高业绩预期的主要驱动力来自美国的North Star业务。自2月份提供业绩展望以来，中西部基准热轧卷钢价格强劲上涨–每公吨上涨约250美元。澳大利亚钢铁产品公司也受益于国内和出口钢材利差的改善。

此外，公司的扩建项目仍在进行中，新工厂将在2022财政年度的下半年投入使用。国内发货量目前超过了我们的预期–特别是在建筑和施工领域的高附加值产品。建筑产品部门目前预计将比2021财政年度上半年的收益有所改善，主要是由于北美涂层业务的利润率在钢价快速上涨的推动下有所加强。东盟业务的盈利也好于先前的预期，因为高于预期的钢材价格对利润率产生了有利的影响。

BlueScope钢铁有限公司是油漆和涂层钢材产品的制造商和分销商。其产品包括增值的金属涂层和油漆产品，热轧卷，冷轧卷，钢板以及管材。它在中国，印度，印度尼西亚，泰国，越南，马来西亚和北美拥有覆盖广泛的金属涂料，油漆和钢铁建筑产品业务。它为建筑，建筑，制造，汽车和运输，农业和采矿业的客户提供服务。该公司为整个亚洲的住宅和非住宅建筑业以及北美的非住宅建筑业提供服务。BlueScope 钢铁公司总部位于澳大利亚维多利亚。

公司截至2020年6月的2020财政年度的收入为113.242亿澳元，比2019财政年度减少9.9%。在2020财年，该公司的营业利润率为2.3%，而2019财年的营业利润率为10.2%。在2020财年，该公司的净利润率为0.9%，而2019财年的净利润率为8.1%。

公司股价早盘高开，截止发稿前，股价上涨1.93% 至22.475澳元。

text 【更多BSL股价走势和公告请点击BSL个股页面】

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公司公告 BlueScope increases earnings guidance to $1.0Bn to $1.08Bn for 2H FY2021

Records rain on South32 in 2021

By Henry Ballard

*Illawarra Metallurgical Coal. Image: South32*

South32 has met or exceeded production expectations across its Australian operations, not allowing inclement weather to diminish a strong March quarter.

Worsley Alumina, in which South32 owns 86 per cent, is on track to achieve nameplate capacity of 4.7 million tonnes at its bauxite mine in Western Australia.

One of the world’s largest sources of alumina, the mine has undergone planned maintenance to its calciner which allowed nameplate to be achieved.

South32 has set a year-to-date production record for its Australian manganese operations at the Groote Eylandt Mining Company operation (GEMCO) in the Northern Territory.

The 4.329 million wet metric tonnes of high-grade manganese produced were a 5 per cent increase on last year’s prior corresponding results.

Despite this, production guidance of 3500 wet metric tonnes for the manganese operation will remain unchanged in consideration of the effects of the wet season.

“We set year to date production records at Brazil alumina and Australia Manganese,” South32 chief executive Graham Kerr said.

“We increased our production guidance for South Africa manganese as we continue to respond to market conditions and at Cannington off the back of continued strong underground performance.”

At the Cannington silver and lead mine in north west Queensland, South32 increased its production guidance by 10 per cent for the 2021 fiscal year, despite also being hit with torrential rain through the March quarter.

Silver production was almost 3.5 million ounces for the March quarter, an 11 per cent increase on the previous period, while lead jumped by 6 per cent on the last quarter to 33,000 tonnes.

South32 expects weather-related disruptions to Cannington’s rail logistics to be resolved over the coming quarter, making March’s strong results all the more impressive.

On the company’s length of positive results, Kerr said they only strengthened confidence in the future for South32.

“Looking ahead, we expect the global economic recovery combined with fiscal stimulus to continue, driving a rebound in metal demand and sustaining higher prices for many of our key commodities,” Kerr said.

“We continue to reshape our portfolio, moving closer to the divestment of South Africa Energy Coal while progressing studies for our base metals development options.”

At South32’s Illawarra metallurgical coal operation in New South Wales, the company reported a 17 per cent increase in year-to-date production.

It produced 1.57 million tonnes of metallurgical coal during the March quarter, which was a 12 per cent increase on the previous quarter.

This increase was thanks in part to the Appin project’s longwall reconfiguration in late-2019, allowing for improved efficiencies.

The coal operation will now look to the June quarter of 2021 for the next stage in its longwall reconfiguration, in hopes that further efficiencies can allow for greater production and less resource waste.

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Infrastructure priority list promises record investment

More than 40 new proposals have been added to the national project pipeline, now worth $59 billion.

Infrastructure Australia has released its priority list for 2021, with a record number of new investments included across the country.

Forty-four new proposals have been added to the project pipeline, now worth $59 billion, while 10 projects have been moved off the list and into the construction phase.

Infrastructure Australia chief executive Romilly Madew said regional investment became a focus for the list this year.

“More than half of the investment opportunities on the 2021 Priority List benefit our regional communities, as we continue to draw focus on equitable service delivery and investments that will deliver affordable and quality infrastructure services for all Australians, regardless of where they live,” she said.

Among the 44 new projects to make the List were the Parkes Bypass to connect Melbourne and Brisbane, Parramatta’s outer ring road capacity, and Melbourne to Adelaide freight rail improvements.

With 180 projects on the list, chief executive officer for Cement Concrete & Aggregates Australia (CCAA) Ken Slattery said there’s a bottleneck between the government’s words and its capacity to act on them.

“There is a concern that the list is fine, but how such a record level of investment actually gets translated into constructed projects is unclear,” Slattery said.

Chief executive officer of the Australian Constructors Association (ACA) Jon Davies said the list plays a key role in supporting the nation up from its knees, post-COVID-19.

“With this record number of new investment opportunities, all levels of government need to work with industry to ensure that projects are delivered in a timely and efficient manner that maximises the social and economic benefits of the government’s investment,” Davies said.

“This will be vital in a post COVID-19 world with high levels of government debt but no less of a requirement to construct productivity enhancing infrastructure.”

Slattery agreed, if the industry could survive COVID, it’s exactly what the nation needs to renew itself in the coming years.

“One of the things we’ve seen is a strong and viable construction sector represents the backbone of the economy and the fact the construction industry has been able to operate throughout [COVID-19] has meant there has been a strong level of support for businesses and employees,” Slattery said.

“We’re talking something like 1.1 million people employed by the building and construction sector who stayed in work and continue to pay taxes and continue to support the economy more broadly, which is vitally important.”

Slattery said the CCAA was pleased its direct consultation with Infrastructure Australia was seen in the list’s considerations.

“We are encouraged by Infrastructure Australia recognising the role of the supply chain in all of this, which is a relatively recent development,” Slattery said.

“In the past we’ve simply seen that big projects were identified, supported and pursued without any real thought on where the materials were going to come from.

“We’re of the view that Infrastructure Australia really are paying due consideration to that. What we need is that to translate in approval processes and approval times.”

Included in the 10 items to leave the list for the construction phases were Nowra Bridge (NSW), the M1 and Bruce Highway works (Queensland), and METRONET works (WA).

Metso Outotec wins Lynas rare earths contract

Lynas Corporation has signalled the start of development of its Kalgoorlie rare earths processing plant in Western Australia by awarding a contract to Metso Outotec.

The newly-merged company will supply the processing plant’s kiln – the largest and longest lead time piece of equipment required for Lynas’ operation.

The contract for the kiln, which measures 110 metres and weighs 1500 tonnes, will fetch around $US15 million ($21.6 million) for Metso Outotec. It will involve discharge housing, combustion chamber and burner, motor control stations and delivery to Kalgoorlie.

Metso Outotec will manufacture the kiln according to Lynas’ design. It will be an improvement to the four 60-metre kilns currently in operation at the Lynas Malaysia plant.

“The kiln is the longest lead time item for our Kalgoorlie project and placing this order is an important milestone in the development of our new processing plant in Kalgoorlie,” Lynas chief executive and managing director Amanda Lacaze said.

“We are making good progress on the project, and we look forward to working with Metso Outotec on the engineering and supply of the kiln.”

Metso Outotec plans to commence work on the kiln immediately, with components to be manufactured in Australia and Europe.

“We are excited having been selected by Lynas as a key supplier for the development of its significant greenfield project in Western Australia,” Metso president – mining equipment, Stephan Kirsch said.

“The Metso rotary kiln system forms an integral part for the processing of rare earths.”

The Kalgoorlie rare earths processing plant earned major project status from the Australian Government earlier this year.

It will undertake cracking and leaching of rare earth concentrate from Lynas’ Mt Weld mine in Western Australia’s Goldfields region.

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Commonwealth, Victorian Governments commit more funds to infrastructure projects

Amid growing concerns over Victoria’s COVID-19 situation, the Federal and State Governments have announced a $525 million joint investment for further infrastructure.

The package will deliver “shovel-ready” infrastructure projects and road safety upgrades across Victoria. A total $320 million investment has been provided by the Federal Government under the package, and the Victorian Government will spend $205.5 million.

The Federal Government recently announced infrastructure joint investments with other states across the country.

“Partnering with State and Territory Governments to invest in more infrastructure projects across Australia is a key part of our JobMaker plan to rebuild our economy and create more jobs,” the Prime Minister Scott Morrison said. “This funding injection means we have brought forward or provided additional funding in excess of $830 million to Victoria in the past eight months.

“This package builds on the fast tracking of $514 million for infrastructure in Victoria which we announced last November, locking in priority upgrades that will bust congestion, increase productivity, improve safety, and boost jobs at a time we need it most.”

Premier Daniel Andrews said the projects will help fortify the state’s construction industry.

“This partnership with the Commonwealth will build the projects regional communities need and help keep our construction industry strong – which is more important than ever right now as we rebuild from the pandemic,” he said.

“This package is on top of our $2.7 billion we’re investing in new projects across the state to get shovels in the ground – and boots in the mud – to kickstart our economy.”

Projects to lift Australia’s economy

The Federal Government has also announced it will fast-track 15 critical infrastructure projects across the country in response to the economic turmoil wreaked by COVID-19.

Projects such as Inland Rail from Melbourne to Brisbane, the Marinus Link between Tasmania and Victoria, the Olympic Dam extension in South Australia, numerous road, rail and iron ore projects in Western Australia, and emergency town water projects in New South Wales and Snowy 2.0 have all been included on the Federal Government’s “priority list”.

The priority projects will form a five-year package worth $1.5 billion.

“Joint assessment teams will work on accelerating these projects worth more than $72 billion in public and private investment,” Morrison said last month. “These are projects that will support over 66,000 direct and indirect jobs.”

Australian lime market to reach more than $500 billion this decade

Three types of lime products are produced in Australia, including aglime, quick lime and hydrated lime.

There are good signs for Australia’s limestone segment, with the lime market expected to exceed $USD339.5 billion ($AUD510.8 billion) by 2027, according to a report by Coherent Market Insights.

An increase to lime’s demand in the agriculture and the steel industries is expected to drive profits up in the coming years.

“The Australia lime market was estimated to account for $USD290 billion ($436 billion) in terms of value in 2018 and is predicted to grow at a CAGR (compound annual growth rate) of 1.7 per cent during the forecast period (2019 to 2027),” the report stated.

Lime – or calcium hydroxide – is produced by heating limestone, and has widespread use across construction, industrial, chemical, environmental and metallurgical sectors.

Australia produces three types of lime products, including aglime (agricultural lime), quick lime and hydrated lime.

The steel industry, which contributes upwards of $16 billion to Australia’s GDP, requires lime for its activities.

While the nation faces a drop in construction activity, the use of lime in agriculture is expected to keep the market growing.

On basis of product type, in 2018, aglime accounted for the largest market share of 52.4 percent, with 778.5 kilotonnes, in terms of volume, the report stated.

“This is mainly due to increase in demand for aglime in farms as it is used to counter the high acidic content in soil and neutralise its pH factor to avoid any toxic contamination in plants.”

Major players in the Australian lime market include ADBRI (Adelaide Brighton), Boral, Sibelco, Omya Australia, Wagners and Lime Group Australia. New South Wales has the nation’s largest market share of lime at 31.3 per cent in 2018, with volumes predicted to reach 410.5 kilotonnes by the end of 2027.