$10 Trillion to Catch Up to China

Things are heating up in the critical metals space.

Lithium prices continue to rise in China with both technical and battery grade carbonate prices having now doubled year-to-date.

Cobalt prices are up more than 50% this year.

In Japan, the government is considering lifting a 50% ceiling on government funding for resource exploration projects by the end of this year.

The move would allow Japan Oil, Gas and Metals National Corp. (JOGMEC) to pay for more than half the costs of exploring and developing natural resources.

That move is seen to be motivated by China’s continued dominance in the rare earth space, as evidenced by the fact that the metals allowed to qualify for JOGMEC’s assistance are limited to lithium, cobalt, cerium, neodymium and dysprosium.

All metals necessary if government mandates to transition towards electric vehicles are to be met.

The inability of countries to establish independent critical metals supply chains threatens the predictability of the pivot towards a greener world.

It won’t be easy, it won’t be cheap, and it will take time.

Especially because China continues to play resource monopoly.

Earlier this month, Chinese battery maker Contemporary Amperex Technology Co Ltd (CATL) took a stake in China Molybdenum Co’s Kisanfu copper-cobalt mine in the Democratic Republic of Congo (DRC) for $137.5 million.

That money gives CATL access to one of the world’s largest undeveloped sources of cobalt — cobalt that’s necessary in, you guessed it, electric vehicles.

China Molybdenum will retain 75% of the mine and future production will also be split 75:25.

Robert Friedland was recently quoted as saying that copper is so critical in the electrification of everything that finding and developing sources of it should be a national security issue.

He went on to say that the underinvestment in mining and a power grid in the U.S. that “is a joke” compared to China’s requires a $10 trillion investment just to catch up.

This will require a lot more than neat slogans.

It will also require a whole new way of looking at energy and how it’s transacted.

Nick Hodge just shared his newest idea.  A company that is perfectly positioned to profit from this massive shift.

A company that he’s calling the “Amazon of Energy.”

Let's get it!

Gerardo Del Real

Gerardo Del Real
Editor, Daily Profit Cycle

For the past decade, Gerardo Del Real has worked behind-the-scenes providing research, due diligence and advice to large institutional players, fund managers, newsletter writers and some of the most active high net worth investors in the resource space. Now, he is bringing his extensive experience to the public through Daily Profit Cycle, Junior Resource Monthly, and Junior Resource Trader. For more about Gerardo, check out his editor page.

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