Trump was right…America has a China problem.
And it’s hitting us from all sides.
World War III feels closer than ever, the AI revolution is accelerating beyond our control, and the green energy transition is grinding to a halt.
Because China holds the keys to the kingdom of critical minerals.
They’ve cornered the market, and they’re not afraid to use it as leverage.
Just look at antimony, a crucial component in everything from long-range missiles to advanced electronics. Forbes describes it as “most important metal you’ve never heard of”, and as the war in Ukraine demonstrates, our dependence on China for this critical mineral leaves us vulnerable.
Antimony prices exploded this year, rising well over 200% after Beijing slapped export restrictions on antimony, with the explicit intention of restricting global shipments to shore up China’s own natural security. This move has sent shockwaves through the tech and defense industries. Antimony is currently trading at over $35,000 a ton.
Here are two companies that are looking to help the West escape from the stranglehold China currently has us in and should be on your watchlist for 2025.
Canadian junior miner Military Metals Corp. wasted no time jumping into this game with a series of major antimony acquisitions on two continents–Europe and North America.
They’re hoping to help turn the tables on Chinese domination, and they’re moving quickly to do so.
Military Metals Corp. recently announced that it has purchased one of Europe’s largest antimony deposits in Slovakia with a historical resource.
One of the properties acquired is Trojarova. This is a Soviet-era resource with an initial discovery from the 1950s and prior development in the ‘80s and ‘90s. It’s already seen two phases of exploration. According to Military Metals Corp. CEO Scott Eldridge, the Slovakian government’s earlier exploration was halted before they reached the richest part of the deposit.
Back then, the Cold War was winding down, and what would follow next was a destocking and the Strategic Arms Reduction Treaty (START) between the Soviets and the United States. Antimony was no longer critical.
That’s all changed now. The world is at war.
And Trojarova, with a historical resource of over 60,998.4 tons of antimony of in situ value worth around $2 billion at today’s spot prices—could become a military kingmaker. Perpetua Resources has 90,000 tons of Antimony. These 2 companies are the largest Antimony companies in N.America.
Figure 1 Military Metals Corp. (CSE: MILI, OTCQB: MILIF):
For Slovakia, it could mean new status as a European supplier of a key national defense critical metal at a time when Germany is certain it will go to war with Russia in the next few years.
The company anticipates that the robust mining infrastructure in Slovakia aligns perfectly with the European Union’s Critical Raw Materials Act, opening avenues for potential EU funding as it advances these projects toward production.
In March 2024, the European Union allocated 500,000,000 euro under the Act in Support of Ammunition Production (ASAP) to boost output capacity to 2 million shells annually by the end of 2025. But the Western militaries have a major problem.
With the European Union cornered, Military Metals Corp. moved to grab antimony resource shares in North America, too–in Canada’s Nova Scotia, where it acquired the West Gore Antimony Project–one of Canada’s largest antimony mines and a hero of WWI supplies.
With historical drilling results indicating over 7 meters of 10.6 gpt gold and 3.4% antimony, Military Metals Corp. is planning to score a huge antimony victory for the home front. Just a month after securing West Gore, it moved to further consolidate the territory around it in an October 24th, 2024 LOI to acquire more claims in a strategic flanking move.
Eldridge is expecting the supply crunch to snowball, with antimony prices already doubling this year, and poised to keep going into next year. Military Metals Corp. is now strategically positioned as a leading developer of the metal that will make or break the Western world in global warfare.
#2 Perpetua Resources (NASDAQ:PPTA)
Perpetua Resources’ (NASDAQ: PPTA) flagship Stibnite Gold Project in Idaho is not only one of the largest open-pit gold mines in the United States–it is also set to be the country’s only domestic source of antimony.
According to the company, the mine–a key player for Allied Forces in WWII–could end up supplying some 35% of U.S. antimony demand in the first six years of production.
Federal support for Stibnite has been significant, with the Department of Defense awarding Perpetua Resources up to $34.6 million in additional funding in February of this year under the existing Technology Investment Agreement (TIA) through Title III of the Defence Production Act (DPA), then receiving a letter of interest for a $1.8 billion loan from the U.S. Export-Import Bank (EXIM) earlier this year to help develop the mine.
This potential financing, which offers a 15-year term at competitive rates, is a rare backing that underscores the project’s importance to national security, particularly as the U.S aims to reduce its reliance on Chinese mineral imports. In fact, the loan would be one of the largest investments ever in a mine by the U.S. government.
In a further show of government support, the Pentagon has already committed nearly $60 million under the Defense Production Act to advance Stibnite’s permitting process, emphasizing the mine’s role in securing a domestic antimony supply chain. Perpetua Resources said in September this year that it expected to be issued the final permit for the mine this December.
Source: Perpetua Resources Investor Presentation, October 2024
With bipartisan support and no expected regulatory hurdles due to federal interest, Perpetua Resources presents a unique opportunity and analysts are taking note.
Just a month ago, Roth MKM increased the stock’s target price to $15, signaling a projected 45% return as Perpetua Resources advances toward production.
High institutional interest and the project’s potential for environmental remediation and restoration of fish spawning areas reinforce Perpetua Resource’s long-term value and align the company with broader U.S. strategic and environmental objectives.
Bonus stocks to keep an eye on: NioCorp Developments Ltd. (NASDAQ: NB)
NioCorp Developments is focused on developing the Elk Creek Superalloy Materials Project in Nebraska, which is expected to be a significant source of niobium, scandium, and titanium. Niobium is a critical material used in the production of high-strength steel alloys, which are essential for the construction of military vehicles, aircraft, and infrastructure. Scandium is used in advanced aluminum alloys for aerospace applications, and titanium is a crucial material for aerospace and defense applications due to its strength, lightness, and corrosion resistance.
NioCorp’s Elk Creek project has the potential to establish a domestic supply of these critical minerals, reducing reliance on foreign sources and strengthening the U.S. defense industrial base. By securing access to these materials, the U.S. can ensure the production of advanced military equipment and maintain its technological edge in the defense sector.
Furthermore, NioCorp’s commitment to responsible mining practices and community engagement is important for ensuring the long-term sustainability of its operations and the responsible sourcing of critical minerals. By prioritizing environmental protection and working closely with local communities, NioCorp contributes to a more secure and socially responsible domestic supply chain for critical minerals used in defense applications.
Barrick Gold Corporation (NYSE:GOLD)
While Barrick Gold Corporation is primarily known for its dominance in gold production, it’s also a significant player in the copper mining industry. This is a crucial aspect of their operations, as copper is essential for a wide range of defense applications. It’s used extensively in electrical wiring for military vehicles and equipment, in the manufacturing of ammunition, and in the production of advanced electronics for communication, guidance, and sensor systems. Copper’s high conductivity and durability make it indispensable for these applications.
Barrick’s copper mining operations contribute to a diversified and reliable supply of this critical metal, which is essential for maintaining the technological edge of the US military. As a Western-based company, Barrick’s operations are subject to stricter environmental and labor regulations than those in many other copper-producing regions. This promotes responsible sourcing and minimizes the geopolitical risks associated with relying on copper from less stable regions, where production might be disrupted by conflict, political instability, or human rights concerns.
Barrick’s commitment to sustainable mining practices further enhances its value as a supplier to the defense industry. The company has implemented initiatives to reduce its environmental impact, including reducing water consumption, minimizing greenhouse gas emissions, and promoting biodiversity. This focus on sustainability aligns with the growing emphasis on environmental responsibility within the defense sector and ensures that Barrick’s copper is sourced ethically and with consideration for long-term environmental impacts.
Newmont Corporation (NYSE:NEM)
While widely recognized for its leading position in gold production, Newmont Corporation also holds a significant and strategically important role in the copper mining sector. Copper is absolutely crucial for a wide range of defense applications, from the wiring that connects vital systems within military vehicles and aircraft to the advanced electronics used in communication and weapons guidance systems. Copper’s high conductivity and resistance to corrosion make it indispensable for these applications.
Newmont’s copper production contributes to a stable and reliable supply of this critical metal for the US defense industry. This domestic production is particularly important because it reduces reliance on copper sourced from potentially unstable or adversarial nations. By sourcing copper from a Western-based company like Newmont, the US can ensure a more secure and ethical supply chain. Newmont adheres to high environmental and social responsibility standards, ensuring that its copper is mined and processed in a way that minimizes environmental impact and respects the rights of workers and communities. This commitment to responsible sourcing aligns with the growing emphasis on sustainability within the defense sector.
Newmont’s global presence and diversified operations provide a level of resilience against potential supply chain disruptions. The company’s mines are located in various regions, reducing the risk of production being significantly impacted by geopolitical instability or natural disasters in a single location. This geographical diversification strengthens the overall security of the copper supply for the US defense industry. Newmont’s commitment to operational excellence and continuous improvement ensures that it can consistently deliver high-quality copper to meet the demanding requirements of defense applications.
Arch Resources, Inc. (NYSE:ARCH)
Arch Resources is a major producer of metallurgical coal, a crucial component in the steelmaking process. While the world is transitioning towards cleaner energy sources, metallurgical coal remains a vital ingredient for producing the high-quality steel needed for various defense applications. It’s used in the production of everything from armored vehicles and naval vessels to critical infrastructure and the machinery used to manufacture weapons systems.
Arch Resources plays a crucial role in ensuring a stable supply of metallurgical coal for the US steel industry, which in turn supports the production of critical defense equipment. The company operates mines in regions with access to abundant coal reserves, ensuring a reliable supply of this essential raw material. This domestic production reduces reliance on foreign coal sources and strengthens the resilience of the US steel industry, which is vital for national security.
While Arch Resources acknowledges the environmental challenges associated with coal mining, the company is committed to responsible mining practices that minimize its impact. This includes investing in technologies to reduce emissions, reclaim mined land, and protect water resources. Arch Resources also prioritizes the safety and well-being of its workforce and the communities where it operates. As the world transitions to cleaner energy sources, Arch Resources is actively exploring opportunities to diversify its business and contribute to a more sustainable energy future.
Constellium SE (NYSE:CSTM)
Constellium SE is a global leader in the development and manufacturing of advanced aluminum products. Aluminum alloys are essential for aerospace and defense applications due to their high strength-to-weight ratio, corrosion resistance, and formability. These qualities make aluminum ideal for use in aircraft structures, missile components, and armored vehicles, where lightweighting and durability are crucial. Constellium’s expertise in aluminum processing, including extrusion, rolling, and precision casting, allows them to produce high-performance aluminum products tailored to the specific needs of the defense industry. Their focus on innovation makes them a crucial supplier to Western defense contractors seeking to maintain a technological edge.
Constellium’s advanced aluminum products are used in the construction of military aircraft, missiles, and other defense systems, contributing to the technological superiority and operational readiness of Western militaries. For example, Constellium supplies aluminum structural components for the F-35 Joint Strike Fighter program, one of the most advanced fighter jets in the world. The company’s commitment to research and development ensures that it remains at the forefront of aluminum technology, providing cutting-edge materials for critical defense applications. This dedication to innovation is vital for meeting the evolving demands of the defense industry, which constantly seeks lighter, stronger, and more resilient materials to enhance the performance and survivability of military equipment.
Constellium’s strategic partnerships with key players in the aerospace and defense sectors further solidify its position as a vital supplier to Western militaries. By collaborating with leading aircraft manufacturers and defense contractors, Constellium ensures that its aluminum solutions are integrated effectively into critical defense platforms. This collaborative approach fosters innovation and accelerates the development of advanced aluminum technologies that meet the evolving needs of modern warfare. Constellium’s commitment to supporting Western defense capabilities reinforces its role as a crucial partner in maintaining security and stability on a global scale.
Trilogy Metals Inc. (NYSE:TMQ)
Trilogy Metals Inc. is focused on developing the Ambler Mining District in Alaska, a region with the potential to be a significant source of copper and other critical minerals like cobalt, zinc, lead, gold, and silver. The Ambler project is particularly important due to its location within the United States.
By developing this domestic source of copper, Trilogy Metals contributes to reducing reliance on foreign suppliers and strengthening the resilience of the US defense industrial base. This is crucial for ensuring a stable and secure supply of copper for critical defense needs, especially considering the metal’s extensive use in ammunition, electrical wiring, and electronics for various military applications. Relying on domestic sources minimizes geopolitical risks associated with sourcing essential materials from potentially unstable or adversarial nations.
The Ambler Mining District holds the promise of becoming a significant source of other minerals critical to the US defense industry. Cobalt, for example, is a key component in high-performance alloys used in jet engines and other military equipment. Zinc is vital for corrosion protection and is used in galvanized steel for military vehicles and infrastructure.
Securing a domestic supply of these critical minerals not only enhances national security but also supports the development of advanced technologies and strengthens the overall competitiveness of the US defense industry. Trilogy Metals’ commitment to responsible mining practices and environmental stewardship will be crucial in ensuring the long-term viability and sustainability of the Ambler project.
Arcadium Lithium plc (NYSE:ALTM)
Arcadium Lithium plc is a newly formed lithium giant resulting from the merger of Allkem and Livent. This merger brings together two industry leaders with complementary strengths, creating a company with a diverse portfolio of lithium assets and a global footprint. Arcadium Lithium is poised to be a major force in the lithium market, contributing significantly to the supply of this critical mineral for electric vehicles, renewable energy storage, and other applications.
The significance of Arcadium Lithium lies in its potential to strengthen the security and resilience of the lithium supply chain for the Western world. By combining the resources and expertise of Allkem and Livent, Arcadium Lithium can leverage its diversified operations to mitigate geopolitical risks and ensure a more stable supply of lithium for Western industries. This is particularly crucial as the demand for lithium is expected to soar in the coming years due to the rapid growth of the electric vehicle market and the increasing adoption of renewable energy technologies.
Arcadium Lithium’s commitment to sustainable and responsible lithium production aligns with the growing emphasis on environmental stewardship and ethical sourcing. By prioritizing sustainable practices throughout its operations, Arcadium Lithium contributes to a more responsible and environmentally friendly lithium supply chain, which is essential for the long-term viability of the electric vehicle and renewable energy sectors.
By. Michael Kern
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Forward-Looking Statements
This publication contains forward-looking information which is subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ from those projected in the forward-looking statements. The forward-looking statements in this publication are based on current expectations and assumptions about future events, geopolitical developments, trade policies, market conditions, the company’s strategic initiatives to address the critical shortage of antimony, and current expectations, estimates, and projections about the industry and markets in which the company operates. Factors that could change or prevent these statements from coming to fruition include, but are not limited to, the potential impact of the upcoming U.S. elections on various industries and specific companies, changes in government policies, market conditions, regulatory developments, geopolitical events and the company’s ability to successfully acquire and develop new antimony resources and fluctuations in antimony prices. The forward-looking information contained herein is given as of the date hereof and we assume no responsibility to update or revise such information to reflect new events or circumstances, except as required by law.
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