Excerpt from Rick Mills article...

Diversification is a way for mining firms to spread the risk, and is seen as a defensive strategy in the current challenging operating environment, where companies are seeking to maintain profit margins during what could be a prolonged downturn, brought on by lower metal prices and persistent mining cost inflation.

One game plan is for mining companies to diversify from gold, to copper and other green-economy metals that are expected to benefit from the energy transition. The copper price has fallen by nearly a third since its March record high, but according to Bloomberg, some of the largest miners  and metals traders are warning that in just a couple of years’ time, a massive shortfall will emerge for the world’s most critical metal — one that could itself hold back global growth, stoke inflation by raising manufacturing costs and throw global climate goals off course.

Commodities are the trade for riding out the Fed-caused recession

Companies that diversity into copper now, would be well-positioned to benefit from this shortfall, that should result in a much higher realized copper price. Barrick Gold and Agnico-Eagle are two recent examples. Agnico Eagle will pay USD$580 million for a 50% share in Teck’s San Nicolas copper-zinc mine in Zacatecas, Mexico. About 20% of Barrick Gold’s production now comes from copper.

 More on that here,

https://aheadoftheherd.com/diversification-is-the-new-mining-buzzword-richard-mills/

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