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Beijing : Three-month copper on the LME rose 0.8 percent to $6,676 a tonne and is on track for a 0.5 percent dip this quarter.

ShFE copper closed down 0.2 percent but still posted a 1.8 percent gain over the three months.

Zinc shrugged off early losses to trade higher for a third day on Friday on the prospect of Chinese smelters cutting output by 10 percent in response to low prices and treatment charges.

Helen Lau, an analyst at Argonaut Securities in Hong Kong, said a 10 percent cut implied that 400,000 tonnes of the metal would come out of the market in China, the world´s biggest zinc producer, on an annualise basis.

There is “a need for smelters to constrain their production because demand is weak, especially the demand from galvanising,” she added. Zinc is used to galvanise steel.

China’s Contemporary Amperex Technology (CATL) is said to be ready to start building a battery factory in Germany, planting a flag on the grounds of car giants BMW, Volkswagen and Daimler AG as part of a plan to settle close to most European automakers.

Plant expected to be at the German state of Thuringia.

According to anonymous sources quoted by Reuters, an official signing ceremony will take place at a summit in Berlin with China’s Premier Li Keqiang on July 9.

The factory’s location is said to be Thuringia, in east-central Germany, as the state’s Economy Ministry himself hinted to Reuters on Friday, when acknowledging he was negotiating with the Asian company about it.

CATL, China’s No.1 maker of battery cells for electric vehicles (EVs), sold 10% of its stock in an initial public offering to finance expansion beyond its homeland earlier this month.

The successful IPO, Bloomberg reported, gave the company a market value of about $13.5 billion, pushing the net worth of shareholder Pei Zhenhua past the $1bn mark, according to its Billionaires Index.

BMW, which plans to offer 25 electrified vehicles by 2025, has already awarded CATL a contract worth just over 1 billion euros ($1.16 billion) and other carmakers including Daimler, are said to be in talks with the company over a possible supply deal in Europe.

A battery plant in Germany could help ease an expected negative impact in the country’s automotive industry, highlighted by the IG Metall labour union in early June. The growing adoption of is likely to add 25,000 jobs by 2030, though another 75,000 positions in engine and transmission making are likely to disappear, the study shows.

Panasonic Corp. now sells a high-temperature long-life Nickel Metal Hydride battery. This Panasonic BK1100FHU NiMH battery has an ambient discharge range of -30° C to 85° C. The NiMH battery also has a minimum rated capacity of 11000 mAh.

This battery is suitable for applications needing high capacity and a wide range of temperatures. It will work in a variety of markets and applications — such as renewable energy applications (including solar street lights), tracking, underwater applications, and power sources, to give a few examples.

In fact, Panasonic will apply its technical expertise and superior technology to expand the lineup of high-temperature products in the future.

Panasonic rechargeable Nickel Metal Hydride batteries are designed to meet the requirement for increasingly higher levels of energy demanded by today’s products. The Nickel Metal Hydride batteries offer up to three times the capacity of same size standard Nickel Cadmium batteries.

Due to the batteries’ increased capacity and energy density, users can expect a longer run time between charges and long life.

Chile’s government is giving state-owned Codelco $1 billion in “extraordinary” capitalization to help it fund an ambitious plan aimed at upgrading its aging mines and dealing with dwindling ore grades.

The country’s mining minister, Baldo Prokurica, said the backing was essential for Codelco to keep up production numbers and so remain as the world’s No.1 copper miner, Diario Financiero reports (in Spanish).

The figure, though significant, is minor when taken in the context of Codelco’s 10-year investment strategy from 2020, originally pegged at $25 billion (now sitting at a whooping $39bn).

In March, the company received environmental approval to build a $1 billion desalination plant, which will be used to supply water to its operations in the country’s northern region.

The facility, the second-largest desalination plant in the South American country after the one that supplies BHP’s Escondida, will allow Codelco expand its Radomiro Tomic mine.

The miner, which hands over all of its profits to the state, holds vast copper deposits, accounting for 10% of the world’s known proven and probable reserves and about 11% of the global annual copper output with 1.8 million metric tonnes of production.

Last year, it contributed nearly $3 billion to Chile’s coffers.

Rio Tinto wants copper, and it’s ready to pay top-dollar.

The global miner would be willing to fork out a large premium over market value to secure a prime asset as it tries to reduce its reliance on iron ore, company and banking sources told Reuters.

If it can’t land a big copper project, it is weighing the cumulative power of a series of more modest acquisitions to increase its exposure to a metal expected to be in high demand from the electric vehicle and renewable energy industries, the sources said.

The approach under CEO Jean-Sebastien Jacques marks a shift for Rio Tinto, known for its cautious strategy since it was badly burned in the commodity price crash earlier this decade after a series of damaging acquisitions.

“Growth is back on the agenda,” Jacques told a mining dinner in London late on Thursday, but he said Rio would be selective.

Kevin Fox, managing director of Rio Tinto Ventures, a division set up to hunt for established mining projects to acquire, told Reuters it was tough to find quality assets.

“The exploration space is not full of wonderful opportunities,” he said. “What are we looking at? It’s trite to say the battery minerals sector is attracting a lot of interest and we are obviously looking at that. We include in that copper.”

He declined to say how much Rio would pay or to specify any projects.

More than a year after the division was set up, it has yet to make an acquisition.

Banking sources say pressure is mounting for a copper deal.

One banker with knowledge of the matter said for high-quality assets, where there are large deposits of high-grade copper, Rio Tinto would be ready to pay a premium of 30-40 percent over any target’s stock market value or, if unlisted, over the value of the project’s copper reserves.

The banker declined to be named as the matter is confidential. Companies that hold prime copper projects can be worth from $1 billion to $10 billion, depending on the size of their reserves, analysts say.

Iron ore, which accounts for most of Rio’s profit, has provided healthy margins for years but the outlook is uncertain as major buyer China is expected increasingly to rely on recycling rather than importing fresh ore.

Copper, by contrast, is regarded as a futureproof metal because of its widespread industrial use.

POTENTIAL TARGETS, RISKS

Among bigger options for Rio Tinto is Canada’s First Quantum Minerals, according to the banking sources. The $10 billion miner’s copper assets account for around 80 percent of its revenue.

Vancouver-based Nevsun Resources could also prove attractive, said bankers and analysts. Nevsun rejected a $1.16 billion joint offer from Lundin Mining and Euro Sun Mining Inc in May.

Quantum Minerals and Nevsun did not respond to requests for comment.

Rio Tinto could also look to increase its 51 percent stake in Mongolia’s giant Oyu Tolgoi mine, the bankers said. It would much prefer to increase its 30 percent stake in Chile’s Escondida, the world’s biggest copper mine which is operated by BHP, the sources added, though the chances of a deal are remote.

The risks are that Rio will repeat the mistakes of the past.

It was hit hard in the market crash because of acquisitions in the preceding years and has had to work hard to rebuild its balance sheet and regain shareholder confidence.

The most costly deal saw it entangled in a bidding war for Canada’s Alcan in 2007. It paid $38 billion – a third more than the closest rival bid – before writing down most of the asset’s value six years later.

CEO Jacques, appointed in 2016, said he would be careful with shareholders’ money. “We are not under pressure to grow for the sake of it,” he said on Thursday.

LAGGING IN COPPER

Compared with BHP – its closest rival and the world’s biggest listed miner – Rio Tinto has a heavier reliance on iron ore and lags on copper. BHP derives 44 percent of its core profit from iron ore, against Rio’s 60 percent, and has more than twice as much copper output.

Rio does not break out its copper profits separately, but its copper and diamonds division generated about 10 percent of its core profit. BHP’s copper accounted for around 17 percent.

Rio Tinto’s shares have outperformed BHP’s for more than a year, but bankers and analysts say the differences in their portfolios could cost Rio investors in coming years.

“While Rio’s shareholder returns have been significant, we believe that the best is behind it,” Goldman Sachs said in a note on why it prefers BHP to Rio.

Other major listed rivals like Anglo American and Glencore have more diverse portfolios than Rio; Glencore supplies more than 90 commodities, while Anglo American mines coal, platinum, iron ore, copper and diamonds.

Industry sources and analysts say the appointment of a new chief financial officer at Rio cements the authority of CEO Jacques.

“This change will now usher in the J-S Jacques era in full, coinciding with a time when questions on strategic direction … are beginning to grow,” said Tyler Broda, strategist at RBC Capital Markets.

However Frances Hudson, an investment director at Aberdeen Standard, which holds Rio Tinto shares, said the CEO faced a delicate balancing act.

“Investors are just as likely to criticize or punish companies for unfocused acquisitions where they have overpaid for unproven, non-earnings accretive benefits,” she said.

According to data compiled by Transparency Market Research, the global lithium-ion battery market was valued at USD 29.68 Billion in 2015 and is expected to reach USD 77.42 Billion by 2024, while growing at a CAGR of 11.6%. The market is primarily driven by the demand for consumer electronics, grid energy, as well as industrial, and automotive demand. Currently, the consumer electronic segment contributes to almost half of the global market revenue. The growing number of smartphones is currently the driver of the market, but that is expected to shift once electric vehicles become more widely available. The electric vehicle industry is expected to contribute heavily to the battery market as many countries begin to shift to a more environmentally efficient alternative. Vatic Ventures Corp, First Cobalt Corp., Katanga Mining Limited, Glencore Plc, eCobalt Solutions Inc.

Lithium-ion batteries are highly attractive to manufacturers because of their small compact size and ability to hold a large charge. The batteries are also rechargeable and recyclable, offering a cheaper and eco-friendlier solution. Due to their rechargeability, lithium-ion batteries are used in electric vehicles, allowing for zero-emission driving. Currently, government regulators are aggressively pushing out the deployment of electric vehicles due to rising environmental concerns, increasing the demand for their batteries. The surge in demand is outpacing the readily available supply, which has resulted in increasing prices for lithium-ion battery components. “The battery industry is expanding capacity to meet the forecast EV demand, which is being mirrored by converters’ capacity. The level of investment in the raw material part of the chain (hard rock mines and brines) is accelerating, but needs to accelerate faster,” said David Whitten, Head of Global Natural Resources and a Fund Manager at Janus Henderson Investors.

Vatic Ventures Corp also listed on the TSX Venture Exchange under the ticker. Just yesterday, the company announced breaking news that, “it has signed a memorandum of understanding (the “MOU”) with Falcon Gold Corp. (“Falcon”) for the Wabunk Bay cobalt claims (the “Property”) adjoining Uchi mine, northwestern Ontario, Canada. Vatic has the right to earn a 60% interest from Falcon (the “Option”) by meeting certain expenditure and consideration requirements on the Property. Falcon has an underlying agreement with the property owner whereby it has the right to acquire a 100% interest in 2 (cobalt, copper, nickel & PGE’s) mining claims in Earngey Township in the Kenora District of northwestern Ontario. The claims comprise 19 claim units and cover an area of approximately 304 hectares (see the Falcon press release of June 13, 2018). The Wabunk Bay property is highly prospective for cobalt, and the Company believes that it can explore and develop potential in a short timeframe there.

The Property is subject to a 2 kilometer area of interest and is subject to a 1% NSR in favour of the underlying owner which can be purchased for $1 million any time before commercial production. Upon exercise of the Option the Company and Falcon will form a 60/40 joint venture for further development of the Property subject to the right of the Company to acquire Falcon’s 40% interest by issuing shares of the Company to Falcon based on a valuation to be conducted by at least three valuators.

Wabunk Bay Sulphide Mineralization – In 1957, the Ontario Department of Mines reported in its Mineral Resource Circular No. 2 (“MRC 2”): “The showings occur entirely within a coarse-grained hornblende gabbro cutting greenstone, sediments, and various intrusive rocks. The gabbro is 200 feet wide and has a maximum width of 300 feet. The southern 1,000 feet of this body strike north then swing to the northwest for an additional length of 1,800 feet. Chalcopyrite, pyrrhotite, and pyrite occur where the gabbro is sheared and especially at the contacts of narrow diabase dikes, which strike north to northeast and are younger than the gabbro.”

The MRC 2 further reported on the Wabunk Bay mineralized zones: “The main showing lies in the north-south portion of the gabbro, strikes near north, and is about 300 feet long; although mineralization is not continuous, it is found along a length of 600 feet. The average width of mineralization cut in five drill holes is 21 feet. An 18-foot chip sample ran 1.08 percent copper and 0.40 percent nickel. A 22-foot chip sample ran 0.44 percent copper and 0.12 percent nickel. The best 25 feet of drill core assayed 0.62 percent copper and 0.04 percent nickel. Core assays gave as high as 0.03 percent cobalt.”

Wabunk Bay Exploration History – The history of exploration work in the area of the Wabunk Bay Cobalt Claims is summarized as follows:

• 1941 – Sulphide mineralization is discovered by Mike Colberg.
• 1955 – A prospector, Joe Kolak, restaked the showings and optioned the property to Campbell Island Mines and Exploration Ltd. Work completed included geophysical surveys, trenching and 6 diamond-drill holes, totaling 390 feet in 1956. Surface samples assayed 0.33% Co over 1.5m and 0.15% Co over 7.6m.
• 2003 – Jilbey Gold Exploration Ltd. carried out a large regional reconnaissance program in the greenstone belts south and east of Red Lake, Ontario. The Wabunk Bay area was covered by an airborne geophysical survey that identified two magnetic and conductive anomalies.