Attempting the Impossible

After 22 months of decline, metal prices are nearing the point at which historical cycles have turned from downswing to uptrend.

Investors are celebrating lower inflation with big share market gains while families battle seemingly endless cost of living pressures.  

Overly exuberant share price action among mining stocks has become the norm in the days after Christmas, often giving a false signal about underlying equity market conditions.  

The poorest mining investment returns in 2023 came from companies embracing exactly the same macro narratives as those of the best performers.  Conforming to prevailing themes about future trends is clearly not enough.  

To the cheers of investors, the US Federal Reserve switched course this week. The world’s most significant central bank now foresees almost imminent interest rate reductions as it again rethinks its views about inflation.

The RIU Resurgence Conference, held in Perth on 22 and 23 November, showcased 37 investment pitches, with a heavy emphasis on those miners with uranium related development assets in Australia, Canada and the USA. 

The Noosa Mining Conference, held during 15-17 November, showcased 58 investment pitches from mining industry companies, generally at their earliest development stages. Here are my top conference "Hits" and "Misses".

At this point in the investment cycle, attention should increasingly shift to those companies with discovery opportunities which have taken the brunt of recent market weakness. 

The emphasis among junior miners on strong news flow as a share price driver has become a damaging myth foisted upon unsuspecting investors. Dreadnought Resources is another illustration. 

The vast bulk of the mining industry’s listed stocks remain in the midst of a prolonged cyclical decline without any meaningful signs of a turn in fortunes.

The prevalence of strategic unreliability is one of my top five takeaways from the MiningNews Select conference with Torque Metals offering another example of a company sullying the waters for everyone by blatantly abandoning seemingly firm strategic commitments. 

Gold related equities are losing their appeal despite the bullion price hovering near all-time record high levels. 

The Australian government’s critical minerals strategy is so egregiously flawed it should be expunged from the public record and started afresh.

Last week’s dramatic surge in European gas prices is a timely warning to global investors that the pressure for higher Australian wages is intensifying. 

IGO’s revaluation of former Western Areas nickel assets raises fundamental doubts about the credibility of independent expert reports. 

Data from MinEx Consulting show that the least financially capable mining companies are being asked to shoulder a historically heavy burden. 

Women activists undermine their own professional standing when they resort to analytical trickery to tout their superior economic worth.