SP Angel Morning View -Today’s Market View, Monday 28th July 2025

China focus on cutting over production and excessive competition leading to closure of mines

MiFID II exempt information – see disclaimer below

Crafted by humans, with minor assistance from Google AI

IGTV – The Future of Mining: Gold, Copper, Rare Earths & M&A:  https://youtu.be/-G59iOq6x2c?si=z4fVkyHNP9isbOTB

Adriatic Metals (ADT LN) – Tailings capacity hits production guidance

Boss Energy (BOE AU) – Shares hit on Honeymoon mine revised guidance

Guardian Metal Resources (GMET LN) – Expanding its land position at the Tempiute tungsten project, Nevada

Kavango Resources* (KAV LN) – Insights into the structural geology of the Hillside gold project, Zimbabwe

Kenmare Resources (KMR LN) – Second dredge arrives at Moma

Pensana (PRE LN) – Longonjo and Coola update

Perseus Mining (PRU AU) – Quarterly shows higher costs from Yaouré

Premier African Minerals (PREM LN) – Progress reports from the Zulu lithium project

SolGold (SOLG LN) – Core of high grade mineralisation identified in recent drilling at Tandayama America

Sovereign Metals* (SVML LN) – Test work shows Kasiya is the only non-Chinese graphite project that can compete on cost with China today.

Valterra (formerly Anglo American Platinum (VALT LN) – Flooding at Amandelbult hits H1 performance

China – new focus on cutting over production and excessive competition leading to closure of mines

• A crackdown across a number of commodities appears to be part of a new directive to limit oversupply and lift underlying prices
• The CCP may also be looking to control more commodities following their successful use of the Rare Earth market in tariff negotiations with Trump

• Chinese officials are cracking down on lithium miners starting with polluting, inefficient and overproducing mines, citing permit issues on mines in Yichun, Jiangxi province.
• The mines are required to produce resource and reserve reports/permits to confirm they are mining in licensed areas.
• The move may also be a part of the closing phase of China’s 14^th 5-year plan with officials tidying up according to the plan’s objectives.
• New SSIR, structural reform, appears to be on cutting excessive competition in EVs, solar panel manufacturing and raw materials while improving productivity.
• Part of this policy may also result in reduced exports to the west, particularly when these exports are effectively at the expense of subsidised energy and China Inc. in general

China also focussing on boosting domestic demand through increasing the share of household income vs national income

• This is what the US has been asking China to do for over the past 15-20 years
• Domestic consumption in 2023 was only 39% of GDP in China and 68% in the US
• Demographics – affecting demand and focus on higher-tech and higher-margin industries

Lithium futures hit following sharp rally amid wider commodity sell-off

• Lithium futures in China fell 8% overnight, having posted sharp gains over the past week to $11,250/t for carbonate (GFEX)
• The move followed several unverified reports from Chinese sources that domestic carbonate producers were cutting output.
• Bloomberg reported last week that Jiangxi was halting lithium brine production in Yichun for 26 days.
• We note that the major winners from last week’s commodity rally in China, including coking coal, iron ore, silicon and lithium, are all limit down this morning.
• This may reflect the sell-off is more reflective of profit taking and rationalisation in the market, rather than a change in sentiment for lithium pricing.
• Beijing has initiated a wider programme of reducing overcapacity in upstream operations, which supported steelmaking and battery metal feedstock prices.
• Mysteel reports June 2025 China spodumene imports fell by 4.8%mom to 605kt, whilst the average import price fell by 18%.
• China’s average import price for African spodumene has pushed average import prices down to $513/t in June.
• Mysteel notes expansion from the South African DMCC mine, active trading in Nigeria’s local ore market and stable ramp ups from the Zimbabwean operations, Arcadia, Bikita, Sabi Star and Kamativi.

Official inspection and crackdown on lithium mines in China

• China’s NEA ‘National Energy Administration’ initiated a series of inspections earlier this month following a high-level meeting at the start of the month.
• The checking of permits vs permitted resources along with pollution and other issues are being used to crack down on overproduction.

Copper – Section 232 tariffs on copper imports due on Saturday

• The devil will be in the detail, eg which products and imports from which nations will be subject to higher 50% tariffs
• CME arbritrage remains at $3,000/t on the LME for Sept with the market indicating smaller tariffs and another TACO climbdown by Trump on the big figure.

Currencies

US$1.1719/eur vs 1.1759/eur previous. Yen 147.85/$ vs 147.24/$. SAr 17.763/$ vs 17.713/$. $1.343/gbp vs $1.348/gbp. 0.655/aud vs 0.658/aud. CNY 7.169/$ vs 7.168/$.

Dollar Index 97.84 vs 97.53 previous.

• US dollar regains a smidgeon of ground as market expects Fed to hold interest rates despite pressure from Trump

US/China – Chinese press reports that two nations are expected to extend their tariff truce by another three months. (Bloomberg)

• US Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng are planned to meet in Stockhold on Monday.

US government froze restrictions on tech exports to China in an effort to avoid hurting trade talks with Beijing. (FT)

• President Trump is hoping to hold a meeting with President Xi Jinping this year.
• The administration lifted bans on H20 Nvidia chips exports earlier this year months after blocking those shipments and following direct lobbying from Nvidia CEO Jensen Huang.
• There is also a risk of retaliation in sectors heavily dependent on Chinese imports like rare earth containing permanent magnets.

Calendar is quite full with a number of key announcements including BOJ (Thursday) and FOMC (Wednesday) rate decisions.

• US NFPs for July are due this Friday.
• Additionally, Apple, Amazon, Microsoft and Meta are all due to reports their numbers this week.
• More than 80% of S&P 500 companies have exceeded profit estimates, on Bloomberg data.

EU/US – The US agreed a trade deal with the EU, its largest trading partner, involving a 15% base line US imports tariffs.

• European cars will be subject to a 15% tariff while steel will face quota system.
• Additionally, the EU agreed to spend an additional US$700bn on US energy products as well as invest US$600bn in the US and place significant orders for its military equipment.
• The deal was announced by President Trump and EC President Ursula von der Leyen on Sunday at is golf club in Turnberry.
• The US administration threatened 30% tariffs if no deal was reached by 01 August.
• European Stoxx 600 equity index is trading 0.7% higher this morning with US futures also climbing (S&P500 +0.3%, Nasdaq +0.5%).

Thailand/Cambodia – Two nations’ leaders are set for talks on Monday to stop the deadliest clashes in more than a decade.

• Earlier President Trump said that he would not negotiate a trade deal with either of countries unless hostilities stop.

Nigeria – Viral video reported to show Nigerian miners allegedly trafficked and abandoned by a China-owned mining company in the Central African Republic (CAR)..

• A video showcasing the plight of Nigerian miners allegedly trafficked by a Chinese mining company in the Central African Republic has sparked outrage according to:
• https://africa.businessinsider.com/local/lifestyle/china-nigeria-in-diplomatic-talks-over-abandoned-miners-in-chinese-owned-mines/wkjedzz
• The video is reported to show distressed Nigerian miners stranded in Bambari, a remote town in the Central African Republic (CAR).
• The stranded Nigerian miners alleged they had worked for nearly a year without pay, were denied food and shelter, and had their passports seized

Precious metals:

Gold US$3,340/oz vs US$3,366/oz previous

   Gold ETFs 91.8moz vs 91.6moz previous

Platinum US$1,410/oz vs US$1,406/oz previous

Palladium US$1,247/oz vs US$1,269/oz previous

Silver US$38.3/oz vs US$39.1/oz previous

Rhodium US$6,350/oz vs US$6,000/oz previous

Base metals:

Copper US$9,799/t vs US$9,940/t previous

Aluminium US$2,628/t vs US$2,645/t previous

Nickel US$15,215/t vs US$15,580/t previous

Zinc US$2,817/t vs US$2,865/t previous

Lead US$2,021/t vs US$2,035/t previous

Tin US$33,905/t vs US$34,945/t previous

Energy:

Oil US$69.0/bbl vs US$69.0/bbl previous

• The US Baker Hughes rig count was down 2 to 542 units last week (-47 or 8% y/y), with oil rigs down 7 to 415 units (-67 y/y) and gas rigs up 5 to 122 units (+21 y/y), as the Texas lost 4 rigs to 249 units (-27 or -10% y/y).
• Chevron has sold Hess’ 50% participating interest in Block A-18 of the Malaysia–Thailand Joint Development Area for $450m to PTTEP, which acquires 300mmcf/d net gas production and several discovered gas fields awaiting development. We expect Chevron to divest more non-core assets from the portfolio, providing more M&A opportunities for the sector.

Natural Gas €32.7/MWh vs €33.0/MWh previous

Uranium Futures $71.1/lb vs $72.4/lb previous

Bulk:

Iron Ore 62% Fe Spot (cfr Dalian) US$110.6/t vs US$113.4/t

Chinese steel rebar 25mm US$468.6/t vs US$464.2/t

HCC FOB Australia US$178.0/t vs US$178.0/t

Thermal coal swap Australia FOB US$114.3/t vs US$112.8/t

Other:  

Cobalt LME 3m US$33,335/t vs US$33,335/t

NdPr Rare Earth Oxide (China) US$71,628/t vs US$69,342/t

Lithium carbonate 99% (China) US$9,973/t vs US$9,842/t

China Spodumene Li2O 6%min CIF US$840/t vs US$790/t

Ferro-Manganese European Mn78% min US$995/t vs US$995/t

China Tungsten APT 88.5% FOB US$443/mtu vs US$443/mtu

China Graphite Flake -194 FOB US$410/t vs US$410/t

Europe Vanadium Pentoxide 98% US$4.9/lb vs US$5.0/lb

Europe Ferro-Vanadium 80% US$23.7/kg vs US$23.7/kg

China Ilmenite Concentrate TiO2 US$282/t vs US$283/t

China Rutile Concentrate 95% TiO2 US$1,095/t vs US$1,097/t

Spot CO2 Emissions EUA Price US$65.1/t vs US$65.1/t

Brazil Potash CFR Granular Spot US$362.5/t vs US$362.5/t

Germanium China 99.99% US$3,025.0/kg vs US$2,975.0/kg

China Gallium 99.99% US$395.0/kg vs US$395.0/kg

EV and battery news

GM to build lithium manganese-rich batteries for cost saving

• General Motors (GM) plans to start producing lithium manganese-rich (LMR) prismatic battery cells with LG Energy Solution in 2027 and fit them to full-size trucks and SUVs from 2028.
• CEO Mary Barra said lower nickel and cobalt content should deliver even greater cost savings than LFP cells at today’s metal prices.
• LMR chemistry uses abundant, cheaper manganese and allows further supply chain independence from China.
• GM expects the LMR packs to offer 400+ mile range, mirroring current NMCA batteries, at a cheaper price.

Chinese automakers extend gains in Europe

• European vehicle sales fell 4.4% yoy to 1.25 m units in June, yet registrations of Chinese brands leapt 47.5% to 65,110, lifting their share to a record 5.5%.
• YTD Chinese registrations have surged 91%, pushing their share of the market to 5.1%, just below Mercedes-Benz’s 5.2 % and ahead of Ford’s 3.8%.
• BYD registered 70,500 vehicles in H1 2025, up 311 % yoy; its Seal U and VW Tiguan topped the PHEV chart in June, and BYD’s EV tally overtook Tesla’s in April.
• Executive vice-president Stella Li said BYD intends to invest up to $20bn in Europe over the coming years to sustain its momentum.
• Other Chinese automakers have also seen significant growth in Europe:
  • Leapmotor sold about 8,300 units in June, buoyed by the T03 and C10, and now counts more than 450 European outlets through its Stellantis partnership.
  • XPeng chalked up 8,338 registrations in H1 2025, including 5,615 G6 SUVs, and has continued strong growth since it became the first Chinese NEV start-up to exceed 10,000 cumulative European deliveries in December 2024.
  • SAIC Motor’s MG brand saw sales volume up 22% to 162,153 units in H1, outselling Tesla for the first time.
• Analysts at UBS believe Chinese makers’ cost edge will keep expansion on track despite EU tariffs being imposed.

Company news

Adriatic Metals (ADT LN) 285p, Mkt Cap £988m – Tailings capacity hits production guidance

• Adriatic, who is currently being taken over by Dundee Precious Metals, reports quarterly results.
• The Company reported production of 1.7moz AgEq from Vares over the quarter, up 23%qoq.
• Commercial production achieved on 1^st July 2025.
• Ore milled increased 50% to 99kt over the quarter, whilst mine development increased 24%qoq to 904m.
• The Company’s new TSF has been operational since June.
• Company revised guidance:
  • 475kt-525kt milled for 9.5moz-10.5moz AgEq for FY25 (vs 625-675kt for 12-13moz AgEq)
  • Guidance impacted by TSF limitations and mechanical problems with the crusher.
  • Both issues now reportedly resolved.
• Expansion study to boost processing to 1mtpa on schedule, with scheduling due for completion in 4Q25.
• Cash balance reduced to $59m from $76m.

Boss Energy (BOE AU) A$1.9, Mkt Cap A$790bn – Shares hit on Honeymoon mine revised guidance

• Uranium producer Boss provided an update on its Honeymoon project.
• Company guides FY26:
  • 1.6mlb U3O8 at C1 costs of A$41-45/lb and AISC of A$64-70/lb.
  • CAPEX of A$56-62m.
• For FY27, Boss notes that they have ‘identified potential challenges that may arise in achieving nameplate capacity… due to the potential for less continuity of mineralisation and leachability,;
• Boss is reassessing their previous assumptions of the continuity of the mineralisation at Honeymoon.
• Boss held cash of A$37m at quarter end, down from A$64m in the previous quarter.

Guardian Metal Resources (GMET LN) 61.5p, Mkt Cap £85m – Expanding its land position at the Tempiute tungsten project, Nevada

Power Metals Resources* (POW LN) 15p, Mkt cap £17m – (Power Metals* holds a 19.5% stake in Guardian Metal Resources)

• Guardian Metal Resources reports that it has acquired a further 18 unpatented mineral claims plus a placer mining claim and 3 millsite claims covering the old Schofield open-pit mine adjacent to its existing claims at the Tempiute tungsten project in Nevada.
• The company says that “There is potential to define near-surface resources at the historical Schofield Mine, where only small-scale mining occurred in the past. Further mineralisation beneath the mine was confirmed by Union Carbide Corporation in the late 1970s”.
• The newly acquired ground “covers additional mineralised exposure around the North Stock … where recent exploration discoveries indicate that the eastern edge of the North Stock contains high grade tungsten-bearing skarn mineralisation”.
• The company confirms that it has already started mapping and sampling on the ground and that “multiple geophysical programmes will commence shortly … [including] … a high-resolution drone magnetics survey, as well as a high-resolution induced polarisation (“IP”) survey that will contain multiple cross-sections over fertile intrusive and projected tungsten skarn-zones”.
• Guardian Metal Resources also says that a “drill rig has been secured and preparations for the upcoming drilling campaign are well underway”.
• CEO, Oliver Friesen, explained that acquisition of the additional ground was “another very positive step towards unlocking the full potential of the Tempiute district … [and that] … we are now well-positioned to rapidly expand operations at Tempiute”.
• Today’s announcement explains that with the recent equity funds and the US£6.2m Dept of Defence award, the company is well resourced for continuing exploration of its Nevada tungsten exploration at Tempiute and Pilot Mountain.

Conclusion: Guardian Metal Resources has expanded its Nevada tungsten project at Tempiute with the acquisition of claims covering the former Schofield open-pit mine.

*SP Angel acts as Nomad and Broker for Power Metals

Kavango Resources* (KAV LN) 1.18p, Mkt Cap £36m – Insights into the structural geology of the Hillside gold project, Zimbabwe

(Kavango hold 100% of the Hillside license area in Zimbabwe)

• Kavango Resources reports interim findings of a continuing investigation into the structural geology of its Hillside gold project in Zimbabwe.
• Work so far has confirmed that gold bearing quartz veins at the Nightshift, Bill’s Luck and Steenbok prospects “occur within well-developed shear zones …that have acted as fluid conduits and controlled the alteration, vein density and gold mineralisation”.
• Among the information from the structural geological studies Kavango Resources says that the “Bill’s Luck and Night Shift shear zones are interpreted as segments of the regionally extensive WNW-trending Redwing shear zone, which, along with the regional NE-trending Irisvale-Lancaster shear zone (hosting the Steenbok prospect), truncates the Filabusi and Fort Rixon greenstone belts”.
• “These findings confirm the structural control on gold mineralisation in the Filabusi Greenstone Belt and provide predictive vectors for targeting mineralised shoots”.
• CEO, Bill Turney, said that the understanding of “the oblique-dominated shear zones … [at Hillside will help] … us accelerate development of our Steenbok, Nightshift and Bill’s Luck mining targets”.

Conclusion: Improved understanding of the structural geology controlling the mineralisation at Hillside should aid target definition and improve the effectiveness of future exploration.

*Two SP Angel Analysts recently visited Kavango’s Hillside mines and licenses in Zimbabwe. An SP Angel analyst holds shares in Kavango

Kenmare Resources (KMR LN) 324p, Mkt Cap £292m – Second dredge arrives at Moma

• Mineral sands producer Kenmare reports its second new high-capacity dredge has landed at Moma.
• The new dredges are part of Kenmare’s major CAPEX programme to upgrade the Wet Concentrator Plant A.
• Connection of the new dredges and feed preparation to WCP A is due to begin this quarter.
• The upgrade plan will enable mining to transition to the Nataka ore zone, expected to take 18 months.
• Nataka represents 70% of Moma’s MRE, with WCP A expected to be in operation for >20 years.

Pensana (PRE LN) 79p, Mkt Cap £243m – Longonjo and Coola update

• The Company released an operating update regarding development activities at the Longonjo Project as well as Coola Rare Earth Exploration Project in Angola.
• Construction at Longonjo is progressing on schedule and within the capital cost budget of US$217 million.
• Engineering delivery partners (Pro-Process Engineering, Lycopodium ADP Group, SRK Consulting) are now fully mobilised and conducting detailed engineering work.
• Specialist drilling company engaged to define the excavation profile for the TSF with mined material to be used for site infrastructure.
• Drilling to start at the Coola carbonatite (40 km north of Longonjo) to test for a high-grade resource similar to Longonjo.

Perseus Mining (PRU AU) A$3.5, Mkt Cap A$4.7bn – Quarterly shows higher costs from Yaouré

• African gold producer Perseus reports quarterly results.
• The Company sold 131.2koz over the quarter at an average price of $2,977/oz.
• The Company produced 121.2koz over the quarter vs 121.6koz prior quarter.
• AISC reported at $1,417/oz, vs $1,209/oz prior quarter.
• Higher costs from Yaoure reflect higher royalties and sustaining CAPEX for the TSF expansion.
• Cash position of $827m, listed securities of $118m and undrawn debt capacity of $300m.
• A$100m buyback currently 73% complete.
• Nyanzaga MRE and Reserve upgrade due 3QFY26.
• First gold from Nyanzaga due January 2027.
• Five-year guidance:
  • 515-535kozpa at AISC of US$1,460-1,620/oz.

Premier African Minerals (PREM LN) 0.03p, Mkt Cap £19m – Progress reports from the Zulu lithium project

• Late on Friday afternoon, Premier African Minerals provided a further progress report on its of modifications to the flotation plant at its Zulu lithium plant in Zimbabwe.
• The company explains that the spodumene flotation section of the plant has, under test conditions, run for an extended period of five days “without interruptions related to the plant and … [delivered] … consistent production at saleable grades in excess of 5% spodumene during those periods”.
• The OEM has also tested to “identify other areas not yet fully optimised and to demonstrate the quality of the ore body at Zulu and the amenability to spodumene concentrate recovery through floatation”.
• The announcement confirms that “The plant OEM and the reagent supplier have been able to identify specific reasons for Zulu’s previous experienced poor recoveries and grade. At this time, we believe that certain operational changes, particularly related to improved management of particle size in the comminution circuit, could effectively address this and some contamination issues”.
• “It has therefore been decided that the OEM should continue with this test programme for a further five-day test run to implement the identified operational changes and to further examine options to optimise reagents”.
• CEO, George Roach, said that “Our knowledge of the plant and our understanding of the complexities of the process and the solutions will support the long-term success of this project”.

Conclusion: Continuing test work at the Zulu lithium plant is resolving some of the operational issues but additional investigation is still required to implement the necessary operational changes and establish the optimum reagent use.

SolGold (SOLG LN) 9.16p, Mkt Cap £263m – Core of high grade mineralisation identified in recent drilling at Tandayama America

1. Solgold reports that its recent drilling at the near-surface Tandayama America deposit in the Cascabel project area has confirmed a “high-grade resource core at Tandayama-América … adjacent to Cascabel Project’s Alpala Deposit”.
2. The 18-hole drilling programme is part of continuing efforts to bring the project to production in 2028 with the production of ore from open-pit mining at Tandayama America early in that year expected to be followed by underground ore from Alpala towards the end of the year.
3. Results from Holes TAD25-52,53 & 54 highlighted in today’s announcement include:
   • An intersection of 164.4m at an average grade of 0.35% copper and 0.42g/t gold from a depth of 21.6m in hole TAD 25-052 including a 58m wide section averaging 0.47% copper and 0.57g/t gold from 56m depth and a second 14m wide interval from 130m depth which averaged 0.35% copper and 0.57g/t gold; and
   • An intersection of 216m at an average grade of 0.33% copper and 0.31g/t gold from a depth of 82m in hole TAD 25-053 including a 28m wide section averaging 0.60% copper and 0.71g/t gold from 176m depth and a 54m wide interval from which averaged 0.4% copper and 0.46g/t gold from a depth of 224m; and
   • An intersection of 226m at an average grade of 0.34% copper and 0.25g/t gold from a depth of 50m in hole TAD 25-054 including a 60m wide section averaging 0.46% copper and 0.31g/t gold from 94m depth.
4. The drilling campaign, totalling >5,000m, aims to upgrade the “existing resources in the near-surface zone to measured and indicated status in order to define an early-stage, low-capex, open-pit development plan for Cascabel”.
5. The current open-pit mineral resource (November 2023) at Tandayama America hosts an ‘Indicated’ resource of 492mt at an average grade of 0.22% copper and 0.20g/t gold plus an additional ‘Inferred’ resource of 45mt at an average grade of 0.18% copper and 0.18g/t gold.
6. Tandayama America also contains an underground resource of a further 230mt of ‘Indicated’ mineralisation at a grade of 0.26% copper and 0.18g/t gold and ‘Inferred’ resources of 201mt at an average grade of 0.21% copper and 0.21g/t gold.
7. Currently three drilling rigs are deployed and the company confirms that a fourth rig is to be added to accelerate “our understanding of the near-surface potential and building the data required to advance engineering and execution”.
8. The company confirms that “Pit 1 drilling is expected to be completed in early August”.
9. Describing the early results from the drilling as “highly encouraging”, CEO, Dan Vujcic, said that “The grades we are seeing at shallow depths and continuity of mineralisation reinforce our staged development plan, with Tandayama playing a central role in the Cascabel open-pit to underground strategy”.
10. Today’s announcement also describes progress with Solgold’s corporate reorganisation with 100% ownership of the Cascabel project now residing in Solgold Finance AG and plans, described by Mr. Vujcic as “long overdue”  to close “dormant entities and … [update] … the ownership structure of the regional Ecuadorian assets as part of the previously announced establishment of ExploreCo”.

Conclusion: The identification of a higher-grade core to the Tandayama America mineralisation within the envelope of the planned open-pit reinforces the plan announced earlier this month to develop an open pit mine ahead of completion of the underground mine development at Alpala as a route to early production at Cascabel.

Sovereign Metals* (SVML LN) 36.6p, Mkt Cap £230m – Test work shows Kasiya is the only non-Chinese graphite project that can compete on cost with China today.

(Sovereign currently holds 100% of the Kasiya project. Malawi has 10% free carry right. Rio Tinto holds 18.5% of Sovereign Metals)

• Sovereign Metals report on test work for CSPG ‘Coated Spherical Purified Graphite’ from the Kasiya rutile and graphite mine in Malawi shows low-cost potential.
• Test work using carbon-rich pitch coating shows positive results for enhanced battery performance and longevity and will help further advance discussions with blue-chip graphite offtakers looking for non-Chinese supply.

Cost curve highlighting Kasiya as the world’s lowest cost major graphite mine

• • 1. China weighted average C1 cash cost source: Benchmark Mineral Intelligence
  • 2. Cumulative Demand & China graphite production source: S&P Global Market Intelligence
  • 3. Company specific disclosure sources as follows in RNS:
• Strategic Market Opportunity
• The US Commerce Department recently raised tariffs to 160% from 66.5% through the addition of 93.5% preliminary anti-dumping duties on Chinese graphite imports.
• The move is designed to encourage local production of graphite and AAM ‘Active Anode Material’ in North America. China currently controls ~97% of anode material processing.

Conclusion: Kasiya is the only non-Chinese graphite project that can compete on cost with China today.

• The industrial nature of graphite makes it extremely difficult for Western graphite miners to break into the market with processors reluctant to buy from new mines unless they can see consistent production and long-term resource life.

• This has held back the commissioning and development of new graphite mines and AAM processing in the West increasing China’s dominance in the supply chain and prolonging the use of polluting, but consistent, synthetic graphite.

• Sovereign’s Kasiya mine has the potential to become the world’s largest and lowest-cost natural flake graphite producer enabling substantial AAM production in the West.
• The latest successful coating test work is a further demonstration of Kasiya’s increasing strategic importance.

*SP Angel act as Nomad and broker to Sovereign Metals. An SP Angel analyst has visited the Kasiya mine site. We highly recommend the Malawi coffee beans sold in Lilongwe airport

Valterra (formerly Anglo American Platinum (VALT LN) 3,600p, Mkt cap £9.6bn – Flooding at Amandelbult hits H1 performance

• Valterra, the former Anglo American Platinum, reports an H1 2025 decline in revenue to R42.3bn (H1 2024 R52.2bn) and a 46% fall in EBITDA to R6.6bn (H1 2024 – R12.3bn.
• Headline earnings are 81% lower at R1.2bn (H1 2024 – 6.5bn).
• The financial results reflect declines in production of 22% to 1.39moz of refined PGMs (H1 2024 – 1.78moz) and 25% lower sales volumes of 1.48moz (H1 2024 -1.97moz) despite a 5% rise in the US$ denominated basket price to US$1,517/oz (H1 2024 – US$1,442/oz).
• All-in sustaining costs (AISC) of US$962/oz are in line with the US$957/oz achieved in H1 2024.
• The company says that “Operational performance in the first half of 2025 was characterised by inclement weather-related impacts across the portfolio, the most severe being the flooding event at Amandelbult in February. This materially impacted operational performance at Amandelbult, resulting in M&C … [metal & concentrate] … production at this operation declining by 45% or 128,700 ounces”.
• Despite the flooding at Amandelbult, the company is maintaining its full year production guidance range of 3.0-3.4m PGM oz although expectations are for “the lower end” of the range.
• “Cash operating unit cost guidance has been revised to R19,000 – R19,500 per PGM ounce to take into account the flooding impact … [with ] … AISC expected to be within the guidance range of $970 – $1,000 per 3E ounce”.
• Expressing regret for a fatality at the Unki mine on 30th April, CEO, Craig Miller reaffirmed safety as “our foremost priority”.
• Mr. Miller described 2025 as “a pivotal milestone in our corporate journey, with the successful completion of our demerger from Anglo American plc, the launch of our new identity as Valterra Platinum and our secondary listing on the London Stock Exchange”.
• He described the compnay’s response to the flooding at Amanfelbult as a demonstration of the company’s “ability to rapidly respond to major setbacks” and he also confirmed the completion of “the pre-feasibility study for the Sandsloot underground project, which has affirmed that the technical and economic parameters used in the study are consistent with what we presented at our Capital Markets Day” held in March.
• He also explained that Valterra remains “on track to deliver R4 billion in full-year operating cost savings … ensuring that over the medium term, our assets operate sustainably in the lower half of the industry cost curve”.

Conclusion: Major flooding at Amandelbult affected H1 performance but the company is currently maintaining its full tear production guidance.

LSE Group Starmine awards for 2025 / 2024 commodity forecasting:

No.1 in Precious Metals: SP Angel mining team awarded No 1. ranking for Precious Metals forecasting in LSEG Annual Starmine Award for Reuters Polls for Q1 2025

No.1 in Precious Metals: SP Angel mining team awarded No 1. ranking for Precious Metals forecasting in LSEG Annual Starmine Award for Reuters Polls 2024

No.2 in Base Metals: SP Angel mining team awarded No 2. ranking for Base Metals forecasting in LSEG Annual Starmine Award for Reuters Polls 2024

Analysts

John Meyer –John.Meyer@spangel.co.uk – 0203 470 0490

Simon Beardsmore – Simon.Beardsmore@spangel.co.uk – 0203 470 0484

Sergey Raevskiy –Sergey.Raevskiy@spangel.co.uk – 0203 470 0474

Arthur Parish – Arthur.Parish@spangel.co.uk – 0203 470 0476

Sales

Richard Parlons –Richard.Parlons@spangel.co.uk – 0203 470 0472

Abigail Wayne –Abigail.Wayne@spangel.co.uk – 0203 470 0534

Rob Rees –Rob.Rees@spangel.co.uk – 0203 470 0535

Grant Barker – Grant.Barker@spangel.co.uk – 0203 470 0471

George Krokos – george.krokos@spangel.co.uk – 0203 470 0486

Prince Frederick House

35-39 Maddox Street

London, W1S 2PP

*SP Angel are the No1 integrated nomad and broker by number of mining brokerage clients on AIM according to the AIM Advisers Ranking Guide (joint brokerships excluded)

+SP Angel employees may have previously held, or currently hold, shares in the companies mentioned in this note.

DISCLAIMER

This note is a marketing communication and comprises non-independent research. This means it has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of its dissemination.

This note is intended only for distribution to Professional Clients and Eligible Counterparties as defined under the rules of the Financial Conduct Authority and is not directed at Retail Clients.

This note is confidential and is being supplied to you solely for your information and may not be reproduced, redistributed or passed on, directly or indirectly, to any other person or published in whole or in part, for any purpose.

This note has been issued by SP Angel Corporate Finance LLP (‘SPA’) to promote its investment services. Neither the information nor the opinions expressed herein constitutes, or is to be construed as, an offer or invitation or other solicitation or recommendation to buy or sell investments. The information contained herein is based on sources which we believe to be reliable, but we do not represent that it is wholly accurate or complete. All opinions and estimates included in this report are subject to change without notice. It is not investment advice and does not take into account the investment objectives and policies, financial position or portfolio composition of any recipient. SPA is not responsible for any errors or omissions or for the results obtained from the use of such information. Where the subject of the research is a client company of SPA we may have shown a draft of the research (or parts of it) to the company prior to publication to check factual accuracy, soundness of assumptions etc.

Distribution of this note does not imply distribution of future notes covering the same issuers, companies or subject matter.

Where the investment is traded on AIM it should be noted that liquidity may be lower and price movements more volatile.

SPA, its partners, officers and/or employees may own or have positions in any investment(s) mentioned herein or related thereto and may, from time to time add to, or dispose of, any such investment(s).

SPA is registered in England and Wales with company number OC317049.  The registered office address is Prince Frederick House, 35-39 Maddox Street, London W1S 2PP.  SPA is authorised and regulated by the UK Financial Conduct Authority and is a Member of the London Stock Exchange plc.

MiFID II – Based on our analysis we have concluded that this note may be received free of charge by any person subject to the new MiFID II rules on research unbundling pursuant to the exemptions within Article 12(3) of the MiFID II Delegated Directive and FCA COBS Rule 2.3A.19.

A full analysis is available on our website here http://www.spangel.co.uk/legal-and-regulatory-notices.html. If you have any queries, feel free to contact our Compliance Officer, Tim Jenkins (tim.jenkins@spangel.co.uk).

SPA research ratings – Based on a time horizon of 12 months: Buy = Expected return of more than 15%, Hold = Expected return between -15% and +15%, Sell = Expected return

SP Angel Corporate Finance LLP is authorised and regulated by the Financial Conduct Authority and is a Member of the London Stock Exchange.

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