ALMONTY: 2022 WILL BE EXCITING ALMONTY: 2022 WILL BE EXCITING
Lithium dominates the headlines when it comes to critical raw materials for batteries. But as is so often the case, it is worth looking at the second tier. There, you quickly come across tungsten. The lustrous white heavy metal is characterized by its heat resistance. Due to its high density, the metal is found in classic sectors such as oil and gas, mining and chemicals, but also new applications such as charging stations for e-cars, 5G networks and semiconductors. In the e-mobility sector, tungsten is on track to outpace environmentally harmful cobalt, increasing demand and prices. The price of tungsten APT (ammonium paratungstate) has exceeded USD 300 per metric ton unit (mtu) for the first time in three years. In addition, there is a political tailwind: the EU lists tungsten high on its list of critical raw materials. Availability is also a critical issue, then there is a quasi-monopoly by China, which commands about 85% of global production.
Canadian explorer and producer Almonty Industries - incidentally, the major shareholder with around 12.2% is Deutsche Rohstoff AG - is on its way to help break up this quasi-monopoly. The Canadians are already producing at two mines in Portugal and Spain. There, Almonty expects increasing margins. However, the project in South Korea makes the stock really interesting. In Sangdong - close to Samsung, Kia and Hyundai - Almonty is currently building a new mine that is fully financed. Among other things, it has secured a KfW loan.
Once the final permits have been obtained, production is scheduled to start in the fourth quarter of 2022. When full capacity is reached, Almonty will account for around 30% of non-Chinese tungsten production and reduce dependence on the West. At that point, the stock should also begin to break even. In recent weeks, it has shown stability in the challenging environment and continues to trade in its corridor between CAD 0.80 and CAD 1.05. For further details, interested parties can refer to a study on researchanalyst.com
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