• Mining and energy stocks head into long weekend on a high
  • Coal prices support strong buying for Yancoal and Coronado
  • Glencore inks deal to make Murrin Murrin mine in WA a key supplier of cobalt to auto giant General Motors


Mining and energy investors have received some early Easter eggs, and they haven’t had to hunt too hard to find them, with the big boys in good form heading into the long weekend.

Materials lifted 1.27% and Energy stocks were up 1.05% at 4pm AEST.

They were led by some of the bourse’s most prominent mining names with Northern Star Resources (ASX:NST) lifting 4.19% a day after inking a pretty tidy $44.5m deal for its unwanted Western Tanami and Paulsens gold mines in a trade with junior explorer Black Cat Syndicate (ASX:BC8).

Newcrest (ASX:NCM) lifted 1.93% as gold briefly touched US$1980/oz, while Fortescue Metals Group (ASX:FMG) gained 1.27% on some pretty confusing iron ore demand data.

Chinese iron ore imports tanked in March in the wake of its Olympics related pollution restrictions and more importantly a wave of Covid lockdowns in key cities across the Middle Kingdom.

But analysts remain bullish about Chinese economic growth amid warnings this week from Premier Li Keqiang that there were concerns over its economic outlook in the wake of a major shutdown of Shanghai, its financial capital.

Coal prices rose sharply again overnight as shortages related to the war in Ukraine continue to influence seaborne markets.

Yancoal (ASX:YAL) gained 7.5% on no news while Coronado (ASX:CRN) lifted 4%.


Glencore becomes GM’s cobalt supplier

One of the few cobalt producing operations outside less than desirable locations like the DRC is Murrin Murrin, a nickel laterite mine with a curious history.

Developed by Andrew Forrest’s Anaconda Nickel back in the 1990s, the operation in WA’s Northern Goldfields took over 15 years to hit nameplate capacity.

A pioneer of the High Pressure Acid Leach technology used to produce class 1 nickel at significant cost from low grade nickel laterite resources, Murrin Murrin is now ticking along at a steady pace.

One of its biggest advantages is its relatively high cobalt to nickel ratio, which stood Glencore in good stead when prices of the rare battery metal, which has a concentration of just 0.001% in the Earth’s crust, rose above US$100,000/t a few years ago.

It came back to earth as battery metals prices moderated from 2018-2020 before a big rebound last year.

Cobalt is now again in short supply and fetching over US$80,000/t on the LME. “Ethically-sourced cobalt” (i.e. not produced using child labour) is also relatively hard to come by.

That’s why Murrin Murrin is a prized source, with Glencore this week inking a deal to become the supplier of GM’s EV range and Ultium battery cathodes, including the Chevy Silverado EV, GMC Hummer EV and Cadillac LYRIQ.

“We are delighted to announce this collaboration and support General Motors in delivering its electric vehicle strategy,” Glencore US cobalt marketer and trader Ash Lazenby said.

“Future facing commodities like cobalt play a pivotal role in decarbonising energy consumption and the electric vehicle revolution.

“Glencore is already a leading producer, recycler and supplier of these commodities, which underpin our own ambition of achieving net zero total emissions by 2050.”

GM VP of global purchasing and supply chain Jeff Morrison said the “agreement is aligned with our approach to responsible sourcing and supply chain management.”