Weekly Watchlist

Vol-2: What I'm watching

A few things I’m watching….

1. Metals prices versus miners divergence

I’m glad I’m not the only one to notice how weak some of the miners are trading relative to underlying commodity prices. Copper is approaching all time highs, zinc is close to 3 year highs, lithium is up large YTD, but miners are all somewhat subdued (albeit the majors are holding well).

Yellow Lab Life Capital@YellowLabLife

If you had told the Koala that lithium carbonate would be $21,500/t up +26% YTD at the end of July And spodumene was up +35% YTD to $2,100/t Definitely would have thought Albemarle $ALB would be up 40-50% YTD, not down 20% This move down from mid-May ($ALB is -48% in ~10

Lithium Price Bot @LithiumPriceBot

Dec 31, 2025 #Lithium Carbonate 99.5% Min China Spot Price: $16,905.39 1 day: $+71.33 (0.42%) 📈 YTD: +64.81% #Spodumene Concentrate (6%, CIF China) Price: $1,548.00 1 day: $+3.00 (0.19%) 📈 YTD: +89.71% Sponsored by @LibraEnergyMats

4:40 PM · Jul 28, 2026 · 28.3K Views

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13 Replies · 9 Reposts · 132 Likes

I get it - the world has gotten a lot more uncertain and miners margins are being eaten up by energy prices, reagents and the like. Perhaps they got ahead of themselves earlier in the year…

The chart below is of the energy producers ETF (XLE) versus crude price.. notice the large divergence that occurred during the backend of last year where the energy producers ran hard while energy prices were stagnant or even declined. The energy stocks were telling us something…

Perhaps the metals miners are telling us something about where metals prices are going? I can’t help shaking the thought of a 2H22 repeat where in the aftermath of the Russia/Ukraine war kicking off we saw energy prices and rates rip and supply chains choke up - all things that are repeating today and are major headwinds for miners. In April 22’ through October 22’ the GDX fell from $41 to $21 whilst COPX fell from $46 to $26.

2. Long end rate rises

As I said last week I am no macro guy… but it was interesting to see the Fed, BOJ & Bank of England all hold interest rates through the week… while yields on the long end of the bond market just screamed higher🚨🚨

Geiger Capital@Geiger_Capital

30yr yield breaking out above 5.25% Highest since 2007 and not stopping. Got hard assets?

5:25 PM · Jul 31, 2026 · 134K Views

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107 Replies · 144 Reposts · 1.71K Likes

3. Restarts: this time isn’t different?

A lot of commodity markets have shown strength in the past couple of years - be it precious metals, copper, uranium, you name it. As is typical in a commodity cycle once price runs you get a bunch of folks looking to restart mines that had failed in prior pricing cycles. A new set of eyes look at the old problematic Asset and think they can fix it - kind of reminds me of this meme.

Boss Energy (Honeymoon) and now Lotus (Kayelekera) have struggled in the uranium space with the latter doing a balance sheet reset last week following a near 90% collapse in its share price the last couple of months.

In the base and precious metals space - Kingston (KSN.AX; Mineral Hill) fell over before it got going, Meeka (MEK.AX; Andy Well) has struggled and what happens with underground grades and throughput next quarter could be make or break for that mine and company.. while Polymetals (POL.AX; Endeavour), Broken Hill Mines (BHM.AX; Rasp) and Develop (DVP.AX; Woodlawn) are all in similar situations where they now need to illustrate they can overcome the problems that have plagued these Assets in the past and generate cash flow. None have done anything (yet) to convince me they won’t suffer the same fate as prior cycles.

While I don’t follow the company closely it was interesting to see A$2bn company Develop (DVP.AX) drop 20% in a matter of hours on Wednesday morning - the day after reporting their quarterly. DVP’s response to a ASX speeding ticket was they didn’t know what caused the big drop only that there was a broker downgrade. After being prodded to look into the quarterly to see if I could see why the drop I couldn’t help but notice the difference in headline recoveries versus what recoveries were for each metal into their respective concentrate. This is an important differentiation - there’s no point recovering zinc into a copper concentrate.. as it’s likely the copper smelter receiving the concentrate not only doesn’t pay the miner for this element but penalises the miner for having it in there. This is also the case for valuable by-products like precious metals.. what concentrate they report to will determine payability (how easy it is for the smelter to separate out).

Woodlawn’s complex metallurgy was the big reason it has struggled historically. My guess is that currently around half of the ~2.8% CuEq feed grade is getting recovered AND paid by the smelter/s.. at A$20k/t copper price that’s A$280/t rock. I think even Bill would struggle to make that work for a small underground mine in Australia. But I’m too much of a coward to short him.

Here’s what ChatGPT has to say: And Bill’s recent comment for calm…

4. Coal-dilocks

I mentioned in my first note We’re back (for now) that I was eager to compare notes three years later for the met coal miners (2Q23 versus 2Q26). In 2Q23 we had benchmark PLV prices of ~US$243/t and margins for the miners were around ~$60-$70/t (see below extract).

Well some results are in…. and at an average PLV price of US$238/t for 2Q26, the miners who have reported thus far have made ZERO. In addition to the below highlighting Peabody having a $17m loss, Alpha a $25m gain and Coronado breaking even… Whitehaven, Yancoal and Stanmore all reported and their net debt/cash balances didn’t move (ie made no money). Anglo reported losses of US$190m for 1H26.

What’s the reason you had $60/t margins on $243/t price 3 years ago and now are struggling to break even at a $238/t price? One reason is rampant inflation with mines getting older and no one putting new capital into opening up fresh coal deposits with more favourable geology. Another reason is coal quality where the difference in price between benchmark PLV (premium low-volatile) coal and lower ranking coals have blown out. A part of this is due to numerous issues with PLV producing mines in Australia (Grosvenor, Moranbah North, BMA) and another part is any volume uplift in the met coal supply has been in the lower quality coals (ie those from Mongolia and Russia).

It’s hard to see what is going to move this market (absent some increased thermal demand into the northern hemisphere winter). It’s in a kind of goldilocks zone where prices are that low that no one makes any meaningful money but not low enough that forces supply curtailments. Id rather it be well into the cost curve or well into profit town personally. Not much to do here.. but I will be watching further results in the week/s ahead. This market can turn on a dime given the (lack of) volume that goes through the spot market (as opposed to contract market)..

5. Diggers & Dealers

The biggest mining conference in Australia kicks off this week. Will we see any deals announced?

All the best out there

Respeculator

**Disclaimer - this is NOT intended as financial advice - before acting on any information, you should consider the appropriateness of the information provided to your financial situation and seek advice. Whilst every effort is made to ensure the accuracy of data provided there’s a good chance inaccuracies exist. This is opinion only.**