SP Angel Morning View -Today’s Market View, Tuesday 19th September 2023

Base metals slide as higher oil prices weigh on Fed interest rate decision

MiFID II exempt information – see disclaimer below

Cobra Resources (COBR LN) – Agreement signed to explore REE extraction opportunities

Eurasia Mining* (EUA LN) – Interims

Goldstone Resources* (GRL LN) – Corporate and operational update

Ionic Rare Earths (IXR AU) – Appointment of DRA Global to review Makuutu’s DFS for development progression

Savannah Resources* (SAV LN) – Media speculation commentary

CAA Mining* (Private) – Preparing to drill Spodumene (lithium) discoveries close to Ewoyaa in Ghana

(Agreement to earn into 85% on six lithium licenses through expenditure of $8m on licenses)

(CAA holds 70% in Lithium Resources Ghana Limited (LRGL) in return for spending US$4 m and US$2 million already spent to date)

  • Spodumene identified in surface and petrographic studies on licenses to the north and east of Atlantic Lithium’s, Ewoyaa resource.
  • Petrographic analysis shows spodumene as large euhedral and idiomorph crystals also large and small subhedral grains in samples.
  • Work done:
    • Petrographic studies on auger chip samples and surface outcrop both show spodumene,
    • >8k metres of follow up auger drilling,
    • >1,500 auger samples analysed,
    • >5k soil samples collected,
    • Abasaa corridor,  15-20km east of Ewoyaa deposit generating geochemical footprint interpreted to be analogous with lithium mineralisation at depth,
    • $2 million already spent by CAA on exploration.
  • Assays: Full field laboratory equipped with PXRF and LIBS, for quick lithium assays recently installed
  • Livista Energy:  Cross-shareholding and JV with Livista, a lithium refiner with plans to process lithium in Ghana.
  • Target: to prove an initial exploration target offering >10mt @ >1% lithium oxide
  • Funding: CAA is looking to raise £0.5-1m in pre-IPO funds for drilling and expenses at a Valuation of £5.85m at 30p/s pre-new money

*SP Angel’s role is limited to making introductions and interested parties should be aware that investment in a private company can present certain risks not present in listed companies (e.g. limited or no liquidity and no rules compelling disclosure of information to investors).This offer is open to professional investors only and is not offered to retail investors.

VinFast deliveries increased fivefold in Q2

  • Vietnamese EV startup, VinFast has announced it sold 9500 vehicles in Q2 ’23, up from 1780 in Q1.
  • Following its recent IPO, VinFast shares rocketed, giving the startup a US$160m market cap. – more than GM, Ford and VW combined.
  • The EV maker plans to expand in seven more markets in Asia, including Indonesia, where it aims to start deliveries from next year and establish a plant by 2026.
  • The Indonesian facility will be VinFast’s third after its one in the northern Vietnamese city of Haiphong and a new plant in North Carolina in the United States.

Copper prices slide as China spot demand weakens as smelter fee discussions loom

  • Copper prices have moved below $8,300/t for the first time in 10 days.
  • Treatment charges are reportedly staying high between $85-95/t as China smelters negotiate with miners for concentrate.
  • The higher the treatment charge, the more abundant concentrate is, with higher fees often associated with a weaker market.
  • Smelters are expected to start stockpiling inventories to gain an upper hand in negotiations, with China port inventories sitting at high levels of 937kt.
  • A downstream Chinese user who makes copper piping for air conditioners etc stated to Bloomberg that ‘consumption is lagging the previous few years,’ on the back of the construction slump, stating that ‘the whole industry is finding it very difficult.’
  • 25% of China’s copper demand stems from construction, 16% from consumer goods and 20% from the power sector.
  • Clean energy is currently providing the only supportive tailwind to copper demand, which is reported to have risen 6.3% in H1 of this year. (Bloomberg)
  • Fabricator demand is expected to be weak going into peak season this autumn and premiums are on the slide, all pointing to demand weakness in the short term.

Gold pushes higher as traders eye Fed dot plot for rate path guide

  • Gold prices pressed higher to $1,933/oz, climbing to a two-week high.
  • The FOMC meeting starts today, with a rate decision expected tomorrow – consensus suggests no hike.
  • The dollar has paused its rally, having climbed to six-month highs, providing some respite to gold prices.
  • However, US Treasuries remain depressed, with the 10-year yield climbing to 4.35%, weighing on gold’s upward momentum.
  • Bond markets have become concerned over an uptick in inflation, with rising oil and gasoline prices causing an uptick in CPI readings for August.
  • China has been slashing US Treasury holdings, whilst total US Treasury holdings rose 2.2% between June and July.
  • Beijing has been reducing holdings to prop up the yuan.
Dow Jones Industrials +0.02% at 34,624
Nikkei 225 -0.87% at 33,243
HK Hang Seng +0.26% at 17,977
Shanghai Composite -0.03% at 3,125


US – Federal Reserve to release interest rate statement on Wednesday evening

  • NAHB housing market index falls to 45.0 in September vs 50.0 in August

China – When it comes to major consumer trends, China may prove to be more adept than most other nations

  • Much of China’s economy is moving to Electric Vehicles, electric busses, e-bikes and other electric means of transport we haven’t even thought of as yet.
  • Their rapid adoption of Li-ion and EV technology is part of their ongoing drive for self-sufficiency and greater efficiency reducing China’s oil imports and creating a more energy efficient economy.
  • China’s speed of adoption and near-total domination of supply chains has beaten the West with no other nation capable of preparing supply chains and dominating a sector as China.
  • This makes us wonder, what next?
  • China had built a massive 893 GWh of battery call manufacturing capacity last year representing some 77% of installed global manufacture capability.
  • Benchmark expect China’s Li-ion capacity to rise to 6,197 GWh in 2027 maintaining their share of global Li-ion battery capacity at 69%.
  • According to Bloomberg NEF it will cost the US and Europe $87bn and $102bn to meet domestic demand for new EVs.
  • China’s manufacturers are also innovating and making claims on new types of battery cells which may give it an ongoing leading edge as Europe struggles to get going.
  • We suspect China could even lead on new Li-ion innovation and adoption by virtue of having so many expert engineers and technicians to trial and test new ideas and chemistries.
  • Chinese manufacturers are about to debut a huge range of new EVs across Europe potentially crushing local manufacturing before it has even begun.
  • The EU is already preparing a case against China over unfair subsidies with China already alleging ‘consequences’ if they are denied access to the EU market.
  • This will likely involve restrictions on the critical raw materials and components on which our industries depend for their survival.
  • We expect allot of sabre rattling, much soft lobbying and a series of increasingly harsh restrictions on critical raw materials till the EU agrees to allow full access to EU markets.
  • Once China has gained global domination of the EV market, we wonder what sector it will go after next – electric flight maybe?

Evergrande shares resume trading in HK following arrest of several staff in Southern China

  • Evergrande shares fell 25% in trading yesterday to HK$0.47 following the arrest of several staff in its wealth unit (Asia Financial).
  • A WeChat account of the Shenzhen’s government press office said the wealth unit has suspected of ‘illegal fundraising’ according to CNN.
  • Country Garden, which has >3,100 projects in China and liabilities of ~US$192bn has been struggling to meet debt payments.
  • Evergrande has around 800 unfinished projects and around US$300bn of liabilities.

Low birth rate on ‘Three-Child’ policy likely to persuade government to subsidise property

  • Many housing projects were designed around the former ‘one child’ policy so it may still be possible to redesign unfinished apartments to accommodate the new three-child policy (2021) which followed the failed two-child policy in 2015. Sichuan Province has even abolished the three-child policy and now allows as many children as desired.
  • Problem is, many couples feel they can not afford the housing, schooling and other costs related to bearing more children.
  • Solution: Government housing and educational support for new families to encourage the birthrate to rise.

Germany – Annalena Baerbock, Foreign Minister comments the EU must reduce its reliance on China

  • We will resist commenting on this enlightening statement.

Iran – US unfreezes $6bn in Iranian oil revenues as part of a deal to free five prisoners

  • Let’s hope they don’t unfreeze the money too quickly, $6bn could be used to manufacture a lot of drones for Russia.

Emissions – People who work from home cut emissions by 54% vs people who travel into offices

  • Just one day a week of remote working cuts emissions by just 2% according to a study by researchers from Cornell University and Microsoft (Guardian).
  • Two-four days cuts emissions by 29%.
  • They also found that IT and communications technology had a negligible impact on individuals’ work carbon footprints..


US$1.0681/eur vs 1.0663/eur previous. Yen 147.78/$ vs 147.67/$. SAr 18.991/$ vs 18.974/$. $1.238/gbp vs $1.239/gbp. 0.644/aud vs 0.645/aud. CNY 7.298/$ vs 7.291/$.

Dollar Index 105.16 vs 105.27 previous.

Commodity News

Precious metals:

Gold US$1,933/oz vs US$1,928/oz previous

Gold ETFs 88.9moz vs 89moz previous

Platinum US$937/oz vs US$936/oz previous

Palladium US$1,245/oz vs US$1,252/oz previous

Silver US$23.27/oz vs US$23/oz previous

Rhodium US$4,100/oz vs US$4,100/oz previous

Base metals:

Copper US$ 8,285/t vs US$8,447/t previous

Aluminium US$ 2,206/t vs US$2,204/t previous

Nickel US$ 19,655/t vs US$20,100/t previous

Zinc US$ 2,518/t vs US$2,538/t previous

Lead US$ 2,231/t vs US$2,268/t previous

Tin US$ 25,500/t vs US$26,205/t previous


Oil US$94.9/bbl vs US$94.6/bbl previous

  • Crude oil prices have consolidated their recent strength in the last week buoyed by continued inventory drawdowns in response to OPEC+ output cuts.
  • European energy prices have fallen back fell as the supply risk from strikes at Australian facilities have eased and Norwegian outages have started to come back online.
  • Societe Generale announced on Monday an updated strategy that will halt lending to some new greenfield oil and gas projects, as well as phasing out its exposure to “private pure players” in the E&P sector.
  • TGS has agreed to buy loss-making seismic rival PGS in an all-share deal valued at NOK9.3bn (c.$860m), from which the Company expects to realise annual cost savings of $50m per annum.

Natural Gas €34.450/mmbtu vs €34.300/mmbtu previous

Uranium UXC US$62.10/lb vs US$60.75/lb previous


Iron ore 62% Fe spot (cfr Tianjin) US$121.8/t vs US$120.7/t

Chinese steel rebar 25mm US$536.7/t vs US$536.8/t

Thermal coal (1st year forward cif ARA) US$128.0/t vs US$129.4/t

Thermal coal swap Australia FOB US$167.5/t vs US$166.0/t

Coking coal swap Australia FOB US$313.0/t vs US$313.0/t


Cobalt LME 3m US$33,420/t vs US$33,420/t

NdPr Rare Earth Oxide (China) US$71,935/t vs US$72,009/t

Lithium carbonate 99% (China) US$22,128/t vs US$22,288/t

China Spodumene Li2O 6%min CIF US$2,490/t vs US$2,510/t

Ferro-Manganese European Mn78% min US$1,036/t vs US$1,034/t

China Tungsten APT 88.5% FOB US$305/mtu vs US$305/mtu

China Graphite Flake -194 FOB US$645/t vs US$645/t

Europe Vanadium Pentoxide 98% 6.4/lb vs US$6.4/lb

Europe Ferro-Vanadium 80% 28.75/kg vs US$29.25/kg

China Ilmenite Concentrate TiO2 US$316/t vs US$316/t

Spot CO2 Emissions EUA Price US$87.5/t vs US$87.3/t

Brazil Potash CFR Granular Spot US$355.0/t vs US$355.0/t

Battery News

Tesla in talks with Saudi Arabia for EV Gigafactory

  • Saudi Arabia is in early talks with Tesla to set up a manufacturing facility in the kingdom to help diversify its economy away from oil. (WSJ)
  • The gulf nation has offered Tesla the right to purchase certain quantities of metals and minerals the company needs for its EVs.
  • The Saudis reportedly approached the government in the Democratic Republic of Congo about securing assets in the country, according to the report.
  • Saudi officials said the talks with Tesla, made by the Saudi Public Investment Fund, began this summer, and are at very early stage.

Company News

Cobra Resources (COBR LN) 1.1p, Mkt Cap £6.3m – Agreement signed to explore REE extraction opportunities

  • Cobra announces an update on its Wudinna Project in South Australia, where it recently identified positive metallurgical results for its ionic REE mineralisation.
  • The Company has subsequently signed an MoU with Watercycle Technologies LTD from the UK.
  • Watercycle is focused on extraction technologies and has previously worked on portable extraction plants for geothermal lithium brines.
  • Cobra’s Boland prospect recently showed recoveries of magnet REEs up to 58% and 65% for heavy REEs.
  • The Company believes its REE mineralisation is recoverable through low disturbance, In Situ recovery mining.
  • The MoU will look to develop a flowsheet to begin commercialisation discussions.
  • Watercycle is currently using its technology at the Weardale Lithium project in Eastgate, County Durham.
  • We note that in situ leaching has been used in Australia for Uranium at the Four Mile project in South Australia, where remote ion exchange is used.

Eurasia Mining* (EUA LN) 2.9p, Mkt Cap £84m – Interims

  • With the team focused on the sale of its portfolio of assets, no production of PGM concentrate was recorded at West Kytlim since the end of 2022.
  • No sales of PGM concentrate were booked during the period with the Company considering a number of tender offers for its stockpiled concentrate produced in 2022.
  • Net loss during the period amounted to £7.4m (H1/22: £3.9m profit) largely reflecting adverse affects of the rouble depreciation during the period.
  • Net FX loss totalled £6.3m during the period (H1/22: -).
  • Admin costs were £1.3m (H1/22: £1.3m), in line with the same period last year.
  • Cash burn significantly reduced to £2.3m (H1/22: -£11.2m) with no production at West Kytlim and work at other assets reduced to a minimum.
  • Closing cash position stood at £0.4m with a further £1.5m held in US Treasury notes.
  • The Company also estimates the value for unsold concentrate at £3.5m and expects to receive £1.5m in VAT refunds against capital expenditures recorded in previous years.
  • Updating on the status of a potential sale process, the team reports it remains in discussions with several parties from BRICS non-sanctioned counterparties with due diligence ongoing.

*SP Angel act as Nomad and Broker to Eurasia Mining

Goldstone Resources* (GRL LN) SUSPENDED – Corporate and operational update

  • Operationally, the Company mining operations recommenced at the Pit 2 of the Homase Mine in May 2023.
  • The team expanded its equipment fleet having purchased two second hand 30 tonne excavators, two new front end loaders, a truck crane, TLB, tractor and supporting associated accessories.
  • ~65kt at 1.1g/t and 3x waste stripping ratio was mined and delivered to the plant to date.
  • Heaps stacking restarted in June 2023 running at an average of 1,000tpd.
  • 652oz of gold has been shipped in Q3/23 to date.
  • The Company is currently in the process of reviewing its production estimates following recorded issues with the heap leach process and the impact of a six months’ pause in stacking operations this year.
  • Financially, the Company is expecting new auditor to complete its review shortly allowing it to publish its 2022 annual accounts with the next 2-3 weeks.
  • Interim accounts to June 2023 that are required to be published by 30 September 2023 are expected to be released shortly after.
  • Until such time, trading in Company’s shares will remain suspended.
  • Separately, the team is in ongoing discussions with Asia Investment Management Services Limited seeking an extension to the outstanding secured gold loan facility that is currently due for repayment 30 September.
  • Outstanding gold amount due under the facility stood at ~2.0koz (including accrued interest) as of June 2022.

*SP Angel acts as broker to Goldstone Resources

Ionic Rare Earths (IXR AU) A$.028p, Mkt Cap A$106m – Appointment of DRA Global to review Makuutu’s DFS for development progression

  • Ionic has appointed DRA Global to complete a review of Makuutu’s current feasibility study.
  • DRA will analyse opportunities for cost efficiencies, expansion, time savings.
  • The group will also advise on a Demonstration Plant, which will support the progression towards an FID.
  • Ionic owns 60% of the Makuutu Heavy Rare Earths Project, which holds a basket of 71% heave rare earths content.
  • Makuutu holds a total resource in clay of 532mt @ 640ppm TREO.
  • The current DFS points to a 35-year mine life for a pre-tax NPV8 of $406m and an IRR of 32.7%.
  • Alongside developing Makuutu, Ionic is currently developing the Belfast recycling facility, where they recently signed an agreement with the UK government and Ford to develop the UK’s internal permanent magnet recycling facility.

Savannah Resources* (SAV LN) 3.7p, Mkt Cap £66m – Media speculation commentary

BUY – 21.1p

  • The Company released a commentary regarding the recent press speculation in Portugal over a potential sale of the Barroso Lithium Project.
  • A Portuguese business journal reported on a potential acquisition of the asset by Aethel Mining, a private company co-founded by Portuguese businessman Ricardo Santos Silva and an owner of the Torre de Moncorvo iron ore operations.
  • The Company reported it is not currently in a sale process and press comments that it is close to a sale are unfounded and misleading.
  • As highlighted previously, the team acknowledges that there has been a strong increase in corporate interest from multiple parties across the lithium value chain following a positive DIA decision and the release of the updated scoping study.
  • The Company is currently working on identifying best options and strategic partners to help fund and develop the project.
  • The team reiterated its timeline to provide an update on commercial agreements regarding Project development towards the year end.

*SP Angel acts as Nomad and Broker to Savannah Resources

No.1 in Copper:  “The winner of the 2020 Fastmarkets Apex contest for copper was the team at SP Angel comprising John Meyer, Sergey Raevskiy and Simon Beardsmore, with an accuracy score of 93.8%”

No1. In Gold:  “SP Angel’s trio took the top spot for the gold price prediction throughout the year, with an accuracy score of 97.59%”

The SP Angel team also ranked 1st in Palladium, 3rd in Tin and 5th in Silver in the fourth quarter of 2020


John Meyer – [email protected] – 0203 470 0490

Simon Beardsmore – [email protected] – 0203 470 0484

Sergey Raevskiy –[email protected] – 0203 470 0474


Richard Parlons –[email protected] – 0203 470 0472

Abigail Wayne – [email protected] – 0203 470 0534

Rob Rees – [email protected] – 0203 470 0535

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

SP Angel                                                            

Prince Frederick House

35-39 Maddox Street London


*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.

Sources of commodity prices
Gold, Platinum, Palladium, Silver BGNL (Bloomberg Generic Composite rate, London)
Gold ETFs, Steel Bloomberg
Copper, Aluminium, Nickel, Zinc, Lead, Tin, Cobalt LME
Oil Brent ICE
Natural Gas, Uranium, Iron Ore NYMEX
Thermal Coal Bloomberg OTC Composite
Coking Coal SSY
RRE Steelhome
Lithium Carbonate, Ferro Vanadium, Tungsten, Spodumene, Ferro-Manganese, Graphite Asian Metal


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