Leading the pack in a strong day for Materials was exploration wunderkind Chalice Mining (ASX:CHN) and rare earths miner Lynas (ASX:LYC).

Chalice announced what it declared the largest nickel sulphide discovery globally in 20 years, and the largest PGE discovery in Australian history.

Gonneville’s maiden resource, 45% of it in the indicated category, came in at 330Mt of ore at 0.94g/t platinum, palladium and gold, 0.16% nickel, 0.1% copper and 0.016% cobalt (0.58% nickel equivalent or 1.6g/t palladium equivalent).

In total that makes 10Moz of Pd-Pt-Au, 530,000t of nickel, 330,000t of copper and 53,000t of cobalt, the equivalent of 1.9Mt of nickel or 17Moz of palladium.

Shares in Chalice were up by around 29% to ~$8.75, giving the explorer a market cap of +$3 billion. Talk about a company maker.

Lynas bounced back from a less-than-impressive quarterly report, which saw revenue slid from a record $185.9m in the June Quarter to $121.6m in the September Quarter.

It is surely benefitting from a spike in rare earth prices in China, with the grades used to make permanent magnets surging to their highest level in over a decade amid supply tightness.

CHN, LYC share price charts


Lithium outlook strong, nickel to find ‘balance’ in 2022

Nickel-lithium major IGO (ASX:IGO) today  announced plans to throw its weight behind Impact Minerals’ (ASX:IPT) Broken Hill nickel-copper-platinum group metals project in New South Wales as part of a farm-in deal worth up to $18 million.

IGO is direct beneficiary of strong lithium and nickel pricing.

While lithium tightness is expect to continue through 2022 (and beyond), the nickel market may find balance, according to Argus.

“The world’s nickel supply and demand growth are very likely to be in sync in 2022, given the development of new projects on both the nickel production and consumption sides,” it says.

“That will correct this year’s forecasted 60,000-100,000t of supply deficit.”

The growth next year on both the supply and demand sides is expected to be about 300,000-350,000t, according to Yang Bo, a nickel expert at the Xiangyu Group Research Institute, who spoke at the Nickel and Cobalt Annual Conference 2021.

The supply increase mainly comes from Tsingshan’s nickel matte project in Indonesia, Huayou Cobalt’s nickel-cobalt mixed hydroxide precipitate (MHP) projects in Indonesia and Ningbo Lygend’s Indonesia MHP plant.

As for demand, much of the growth will be generated from the new energy battery materials and stainless-steel sectors.

“An estimated stainless steel production growth of 5pc in China in 2022 will bring in around 100,000t of demand for products with high nickel content, while the nickel-containing power battery sectory is expected to create 150,000-200,000t of nickel demand next year,” Yang says.

IGO share price chart


Gold is moving above $US1,820/oz

Northern Star (ASX:NST) and Evolution (ASX:EVN) edged higher after the price pushed through $US1,824/oz overnight.

The precious metal is now at crossroads, according to OANDA senior analyst Jeffrey Halley.

“If gold can break and hold above its well-defined resistance zone between $1832.00 and $1835.00 an ounce, it will trigger an inverse head-and-shoulders pattern that would target a return to $2000.00 an ounce,” he says.

“Support is at $1800.00 and $1785.00 an ounce, although I suspect that a fall through $1810.00 will be enough to trigger a mad fast-money dash for the exit door.”

The ASX’s largest gold miner Newcrest was not amongst the gainers after its US$2.8 billion acquisition of Canada’s Pretium Resources drew a tepid response from investors.

Conducted at a 22.5% premium to the company’s last closing price, it is a move that will see Newcrest immediately extend its gap on the chasing pack of Northern Star and Evolution to maintain its status as Australia’s biggest gold miner.

The 2Mozpa major will immediately add more than 300,000ozpa with the acquisition of Pretium’s Brucejack mine in British Columbia.

NST, EVN, NCM share price charts