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Today’s Market View – Base Resources, GoldStone Resources, Horizonte Minerals and more…

SP Angel . Morning View . Friday 19 02 21

Copper, iron ore and nickel prices continue to rise on stimulus projects


Base Resources* (LON:BSE) – Kwale North Dune mineral resource increase

GoldStone Resources* (LON:GRL) – Homase fully permitted. SP Angel appointed broker to Goldstone

Horizonte Minerals (LON:HZM) – £18m raised to progress the Araguaia ferronickel project

Trans-Siberian Gold (LON:TSG) – Rodnikova Scoping Study


Industrial metals continue to rally on infrastructure spending and ‘green tinted recovery’

Copper and nickel prices continued to rally on Friday, powering to multi-year highs along with tin as the world looks to build its way out of a Covid-fueled recession.

Investors are starting to appreciate that there is insufficient mine capacity to enable rapid transition to a more environmentally-conscious global economy.

As the US, China, EU, UK and beyond all look to roll out their own packages of environmental initiatives, the post-crisis demand for industrial metals are widely expected to outstrip near-term and medium-term supply.

Copper – Three-month prices have rallied over 12% year-to-date to levels not seen since 2011, with copper wiring and cabling vital to economies building electric infrastructure.

Nickel – Three-month prices have risen 17.3% year-to-date to 7-year highs as automakers ramp up EV production in response to changing consumer demands while battery composition continues to change favoring nickel-dense chemistries. While EV demand for nickel is set to surge, the metal’s current dominant use, stainless steel production, is set to grow 2.2% per year to 2030.

Tin – Three-month prices have risen 24% year-to-date to 10-year highs amid a boom in personal electronic sales which has had disastrous knock-on effects for the autos industry, while mine supply from Indonesia and Myanmar is under threat due to coronavirus restrictions and geo-political instability.

Recommendations: Phoenix Copper*, Arc Minerals*, Cornish metals*, Strategic Minerals*, Rambler*, SolGold*.


Tin – prices rose through $25,000/t this week on strong demand for electronics in electric vehicles and other devices

Raised demand for laptops, computer gaming, electric vehicles is driving demand for tin higher.

The Internet of Things is also adding many more electronic devices in the home all of which use tin in soldering their connections.

Manufacturers have got better at thrifting on tin use but the side effect is that when these devices are recycled, there may be insufficient tin for recovery.

Even so, strong demand combined with forecast 2,700t deficit in the tin market this year is raising prices particularly with new sanctions likely on Myanmar.


Vanadium prices jump 9.5% higher in the US as steel makers prepare for stimulus projects

Ferro-vanadium prices leapt 9.5% to $15.6-16/lb ($34.4-35.2/kg) this week in the US to a near 2-year high (FastmarketsMB).

The sudden acceleration in prices is due to consumers and traders stocking up ahead of demand for structural steel from new housing and infrastructure projects.

An estimated 20 million Americans live in mobile homes. These homes are not good from a welfare perspective not to mention their energy efficiency.

US stimulus cheques and funds should help in the development of substantial new infrastructure and policymakers move to kick start the economy.

‘Availability is tight, and it is in very few hands,” a trader said. “Prices are moving very fast and it is difficult to find material – people are holding off.’ ‘Contracts for 2021 included increased flexibility on volumes, reflecting sellers’ struggles to lock in volumes while sentiment and demand were weak throughout most of last year.’ According to a FastmarketsMB sources.

Bushveld Minerals* is one of the world’s leading producers of ferro-vanadium with around 5% of global supply. The company is also developing a new vanadium electrolyte production facility to support VRFB instillations for grid battery backup power. *SP Angel act as nomad and broker to Bushveld Minerals


Ford F-150 hybrid pickup trucks powering  homes in Texas as ice storms hit power

The Ford F-150 hybrid pickup carries an onboard power generator which turns the truck into a mobile generator with up to 7.2kW of power.

This is a very significant development in our view.

Increasing reliance on wind and solar power is likely to make power cuts and rolling blackouts more common in our view unless grids install substantially greater battery backup. Li-ion batteries are favored by utilities due to their fast reaction times but catch fire and are potentially less reliable.

While utilities debate the merits of Vanadium Redox Flow Batteries and other storage devices consumers are likely to be left out in the cold.

This is a good reason to buy a Ford F-150 hybrid if only to keep the lights, heating and mobile phones running when the utilities fail.

Alternatively, a Tesla Powerwall or equivalent will do.


Recent Interviews:

IGTV:   Is this a new Supercycle for commodities:

Metals expected to continue the last-year gains into 2021

Is 2021 the start of the new COVID-Supercycle or will Lockdowns delay the recovery?

VOX Markets:  11/02/20


121 Conference panel:  Investment Leader’s Discussion: Van Eck, Qora Capital, Nedbank, SP Angel

Africa set to gain from Covid stimulus as East and West compete for metals in the new COVID-Supercycle:

iiTV:     Mining stock to own 2021: Mining share tips for 2021 –

*SP Angel almost invariably acts as nomad or broker or nomad and broker to companies mentioned in the above videos and podcasts.

We speak more about these companies as we have a good understanding of their business and can talk with a greater degree of confidence. As ever, however, it should be noted that our views do not take into account the circumstances and needs of any particular investor or investor type. So enjoy the talks, but please do your own research, including other companies not mentioned by us but operating in the same areas, and get professional advice where appropriate.


Metals price forecasting through 2020 – 2020 was probably the most difficult year for forecasting anything

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


Dow Jones Industrials -0.38% at 31,493

Nikkei 225 -0.72% at 30,018

HK Hang Seng +0.20% at 30,655

Shanghai Composite +0.57% at 3,696



Eurozone – Business activity remains in the contraction territory this month on the latest PMI numbers as countrywide lockdowns weigh on the services sector.

Although the current pull back is not as severe as spring last year.

““Vaccine developments have meanwhile helped business confidence to revive, with firms across the eurozone becoming increasingly upbeat about recovery prospects… assuming vaccine roll-outs can boost service sector growth alongside a sustained strong manufacturing sector, the second half of the year should see a robust recovery take hold,” Markit reports.

“One concern is the further intensification of supply shortages, which have pushed raw material prices higher… supply delays have risen to near-record levels, leading to near-decade high producer input cost inflation… at the moment, weak consumer demand – notably for services – is limiting overall price pressures, but it seems likely that inflation will pick up in coming months.“

Manufacturing PMI: 57.7 v 54.8 in January and 54.3 est.

Services PMI: 44.7 v 45.4 in January and 45.9 est.

Composite PMI: 48.1 v 47.8 in January and 48.0 est.


US – Housing starts fell 6% in January to 1.58m units vs a rise of +5.8% at 1.669m units in December

Building permits rose 10.4% in January to 1.881m units vs 4.2% at 1.70m units in December

Philadelphia Fed manufacturing index in February was 23.1 vs 26.5 in January.


Germany – Manufacturing PMI:60.6 v 57.1 in January and 56.5 est.

Services PMI: 45.9 v 46.7 in January and 46.5 est.

Composite PMI: 51.3 v 50.8 in January and 50.5 est.


France – Manufacturing PMI: 55.0 v 51.6 in January and 51.5 est.

Services PMI: 43.6 v 47.3 in January and 47.0 est.

Composite PMI: 45.2 v 47.7 in January and 47.5 est.


UK – Manufacturing PMI: 54.9 v 54.1 in January and 53.1 est.

Services PMI: 49.7 v 39.5 in January and 42.0 est.

Composite PMI: 49.8 v 41.2 in January and 42.6 est.


Uber drivers in court action to be classed as workers could win compensation for all ‘independent contractors’

A win for the 25 Uber drivers in the Supreme court today could entitle all ‘independent contractors’ to the minimum wage and holiday pay.

A ruling in their favor will be another element in driving inflation higher


Currencies US$1.2112/eur vs 1.2052eur yesterday.  Yen 105.55/$ vs 105.77/$.  SAr 14.570/$ vs 14.657/$.  $1.398/gbp vs $1.388/gbp.  0.780/aud vs 0.776/aud.  CNY 6.461/$ vs 6.471/$.


Commodity News

Precious metals:  

Gold US$1,772/oz vs US$1,782/oz yesterday

Gold ETFs 105.7moz vs US$105.8moz yesterday

Platinum US$1,259/oz vs US$1,259/oz yesterday

Palladium US$2,355/oz vs US$2,377/oz yesterday

Silver US$26.86/oz vs US$27.19/oz yesterday


Base metals:  

Copper US$ 8,716/t vs US$8,592/t yesterday – Goldman analysts see a ‘high risk of scarcity for copper over the coming months’

They also suggest the ‘global market for the key metal facing the largest deficit in a decade’ forecasting a deficit of 327,000t this year followed by an open-ended phase of deficits and a record 10-year supply gap on the horizon.

Goldman reckon the fundamental outlook ‘remains extremely bullish, with no evidence that current price levels are yet stimulating softening effects to reverse both spot and forward fundamental tightening trends’

We see good potential for copper prices to rise over $10,000/t over the next 24 months as demand rises for copper cabling for offshore wind farms, electric vehicle charging points and new housing and infrastructure projects.

Aluminium US$ 2,153/t vs US$2,142/t yesterday

Nickel US$ 19,480/t vs US$18,865/t yesterday

Zinc US$ 2,876/t vs US$2,857/t yesterday

Lead US$ 2,128/t vs US$2,123/t yesterday

Tin US$ 24,970/t vs US$25,345/t yesterday



Oil US$63.0/bbl vs US$65.0/bbl yesterday

Natural Gas US$3.065/mmbtu vs US$3.256/mmbtu yesterday



Iron ore 62% Fe spot (cfr Tianjin) US$169.3/t vs US$167.8/t – London high course dismisses Sierra Leone’s legal challenge over Marampa iron ore project

The London high court has conclusively dismissed the Republic of Sierra Leone’s challenge and uphold claims by SL Mining against Sierra Leone over the cancellation of the miner’s license to operate the Marampa iron ore project.

SL Mining restarted operations at the project after several failed attempts from other companies, with the mine achieving a 2mtpa output producing iron ore with 65% Fe content.

The company placed the mine under care and maintenance in after facing an export ban from the country’s government, which saw the company’s mining license cancelled.

Yesterday’s ruling has resulted in Sierra Leone agreeing to pay SL Mining’s costs and will not appeal the judgement (Fastmarkets MB).

Chinese steel rebar 25mm US$667.7/t vs US$666.6/t

Thermal coal (1st year forward cif ARA) US$65.1/t vs US$64.1/t

Coking coal swap Australia FOB US$154.5/t vs US$154.5/t



Cobalt LME 3m US$49,000/t vs US$48,000/t

NdPr Rare Earth Oxide (China) US$72,514/t vs US$72,395/t – Inner Mongolia to more than double REE production over next five years

The autonomous region of northern China is set to raise its REE capacity to 100,000tpa by 2025, from around 45,000tpa currently, Argus Media reports.

The region is China’s largest production hub for light rare earths including praseodymium, neodymium, lanthanum and cerium.

Inner Mongolia plans to also accelerate development of high-end rare earth functional materials, high-purity rare earth alloy materials and rare earth magnetic materials used in high-end computer numerical control.

Lithium carbonate 99% (China) US$10,602/t vs US$10,585/t

Spodumene 6% Li2O min, cif (China) US$455/t vs US$395/t

Ferro Vanadium 80% FOB (China) US$30.5/kg vs US$30.5/kg

Ferro-Manganese high carbon 78% Mn US$1,610/t vs US$1,575/t

Tungsten APT European US$250-255/mtu vs US$250-255/mtu

Graphite flake 94% C, -100 mesh, fob China US$560/t vs US$560/t                

Graphite spherical 99.95% C, 15 microns, fob China US$2,625/t vs US$2,625/t


Battery News

All Ford cars sold in Europe to be electric by 2030 

Ford has pledged that all of its cars on sale in Europe will be electric by 2030. 

It said it would invest $1bn converting a vehicle assembly plant in Cologne, Germany, to become its first electric vehicle facility in Europe. It’s first all-electric cars would start rolling off the production line there in 2023.  

Ford promised that all of its passenger cars in Europe would be “zero-emissions capable all-electric or plug-in hybrid” by mid 2026, before ramping up its ambitions to be completely all-electric by 2030. 


US makes official return to Paris climate pact 

The US is back in the Paris climate accord, just 107 days after it left. 

World leaders expect an announcement from Washington in the coming months on the US’s goal for cutting emissions of heat-trapping gases by 2030. Biden says this will happen by April. 

A longtime international target, included in the Paris accord with an even more stringent goal, is to keep warming below 2C above pre-industrial levels. The world has already warmed about 1.2C since that time. 


China likely to back down on Australian export ban as power shortages bite

Chinese power producers are scrambling to fill the gap in coal supplies created by China’s ban on Australian coal exports (

Worse China’s use of lesser quality coals presents a growing and serious health issue for residents living near coal-fired power plants

China continues to build coal-fired power stations despite promises to go green and to move to renewables.

And has consumed more coal than all other nations combined since 2011 (

China accounts for around 24% of global energy consumption (BP). 

The CPC has committed to raise the proportion of its renewable and non-fossil-fuel energy consumption to 20% by 2030.

South Africa and Chile still rank higher than China in terms of the proportion of GDP spent on renewable energy through China’s total figure spent is substantially larger.

Problem is that only 23% of Chinese energy comes from clean sources including natural gas with the rest mainly from oil and nuclear


Company News

Base Resources* (LON:BSE) 16.5p, Mkt Cap £194m – Kwale North Dune mineral resource increase

Base Resources reports that, in conjunction with its feasibility study work and the completion of additional drilling and mineralogical work, the mineral resources estimate for its wholly owned Kwale North Dune project in Kenya has been increased by 13% to 194mt at an average heavy minerals grade of 1.5%.

The company confirms that 99% of the estimated resources at Kwale North are now classified as measured and indicated.

Base Resources comments on the background to the Kwale North Dune deposit saying that “The North Dune deposit was initially excluded from the …[original Kwale] … project’s Mineral Resources on the basis of HM grade and the then prevailing economic conditions.  However, in 2018, it was decided to re-evaluate the potential of the North Due in light of improved economic conditions, refined resource definition methodology and with insights gained from five years of operations on the Central Dune”.

In addition, the company has confirmed an initial mineral resources estimate for the Bumamani deposit, which was discovered in 2017 and is located 1.5km south of the North Dune deposit, of 115mt at an average heavy minerals grade of 1.9% of which 111mt is within the measured and indicated classifications.

The heavy mineral assemblage in both deposits is dominated by ilmenite which comprises 45% of the heavy mineral content of Kwale North Dune and 47% of Bumamani.

The mineral resources work forms part of continuing studies to extend the mine life at Kwale with a pre-feasibility study on the viability of the extension project expected early in Q2 2021.

The company’s 2020 mineral resources report (available on its’ website) shows the majority of the resource base at the company’s larger and higher grade Ranobe (Toliara) deposit in Madagascar with some 1.3bn tonnes at an average grade of 5.1% heavy minerals content.

Conclusion: Increased resources at Kwale North Dune plus an initial estimate of the resources at Bumamani will underpin the forthcoming prefeasibility study aimed at extending the mine life at Kwale. We await the study with interest.

*An SP Angel analyst has visited Base’s operations in Madagascar


GoldStone Resources* (LON:GRL) 12.25p, Mkt Cap £34.7m – Homase fully permitted. SP Angel appointed broker to Goldstone

GoldStone reports that both the Mining Operating Permit and the Water Use Permit for the Company’s Homase South Pit have been awarded, meaning that the Company now has all of the key permits required to progress with development of the pit.

This update follows last week’s announcement from GoldStone which detail the granting of the environmental permit for the project- a key milestone required for the development of the Akrokeri-Homase Gold Project.

CEO Emma Priestley commented: ” We thank the Minerals Commission, Water Resources Commission of Ghana and all involved for the approval of our Permits, with these approvals in place, there is clear demonstration of continued support for the project development from the Ghana Government. We are delighted with the granting of these permits which allows the Homase South Project, to advance with  its development phase.”

GoldStone also announce they have appointed SP Angel as the Company’s broker with immediate effect.

*SP Angel acts as broker to GoldStone Resources


Horizonte Minerals (LON:HZM) 8.5p, Mkt Cap £123m – £18m raised to progress the Araguaia ferronickel project

Horizonte Minerals reports that it has raised £18m (approximately US$25m) through placing an additional 162.7m shares at 7.5p/share in order to advance the wholly-owned Araguaia ferronickel project in Brazil towards the start of construction.

CEO, Jeremy Martin, explained that the “funding allows us to fast track critical path workstreams, advance long lead items and continue to build our team”.

Mr. Martin highlighted “the increasing appetite of investors for nickel” and suggested that both Araguaia and the wholly owned Vermelho nickel cobalt project which are “both high-grade, low-cost, long mine life assets, which allow us to be highly competitive globally” could be beneficiaries of this interest.

The company has previously disclosed expected capital investment of US$443m for the initial phase of the Araguaia ferronickel project producing approximately 14,500tpa of nickel contained in 52,000tpa of ferronickel with cash costs equivalent to US$3.08/lb of contained nickel

A subsequent, second phase of the project includes the flexibility to double production to 29,000tpa of contained nickel by the addition of a second rotary kiln electric furnace in the third year of the project.


Trans-Siberian Gold (LON:TSG) 95p, Mkt Cap £82m – Rodnikova Scoping Study

The Company announced results of the Scoping Study for the 100% owned Rodnikova gold/silver deposit in Kamchatka, Russia.

The Scoping Study envisages an underground operation and a 500ktpa CIL plant delivering LOM 517koz gold (4.03g/t) and 3,062koz silver (28.9g/t) over 14 years.

The study is based on current MRE of 6.3mt at 5.0g/t for 1,010koz (~50%/50% Measured&Indicated/Inferred).

Development and sustaining capex is estimated at $82m and $51m, respectively.

Rodnikova post-tax NPV and IRR estimates include ($1,600/oz gold price):

Including application of TOR:

Post Tax NPV10% of $177.6m

Post Tax Internal Rate of Return of 59.2%

Excluding application of TOR:

Post Tax NPV10% of $117.6m

Post Tax Internal Rate of Return of 40%

TOR refers to a “Territory of Advanced Development”, a special fiscal regime for foreign investors that invest in Russia’s Far East and involve certain incentives and benefits like lower corporate profits tax, VAT, land tax, mineral extraction tax and social insurance payments. The Company secured the status of the Advanced Special Economic Zone (ASEZ) resident and is planning to apply for project to be treated under TOP regime in due course.

Further drilling is expected to upgrade and expand the MRE as the team continues to de-risk the project on course for a PFS.

Conclusion: The Rodnikova Scoping Study marks another step in the de-risking process with the project representing an organic growth opportunity. The study delivers attractive returns at $1,600/oz gold price with further drilling required to firm up the resource with the team highlighting upside potential to the current MRE estimate.




John Meyer – – 0203 470 0490

Simon Beardsmore – – 0203 470 0484

Sergey Raevskiy – – 0203 470 0474

Joe Rowbottom – – 0203 470 0486



Richard Parlons – – 0203 470 0472

Abigail Wayne – – 0203 470 0534

Rob Rees – – 0203 470 0535

Grant Barker – – 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


Copper, Aluminium, Nickel, Zinc, Lead, Tin, Cobalt


Oil Brent


Natural Gas, Uranium, Iron Ore


Thermal Coal

Bloomberg OTC Composite

Coking Coal




Lithium Carbonate, Ferro Vanadium, Antimony

Asian Metal


Metal Bulletin


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