Kitco NEWS Roundtable

Kitco News - Markets had a gut-wrenching Monday when the Nikkei plunged 12% which set off a global stock rout, noted mining audiences manager Michael McCrae. 

On Friday McCrae recorded Kitco Roundtable sponsored by Revival Gold. 

The Nikkei news fed the narrative that the Fed may not be able to engineer a soft landing, and a recession could be in the cards. The soft labor market report at the start of the month added to the narrative.

Copper had a tough go of it, reflecting general concerns about the economy. The metal dropped through $4 a pound this week and ended at $3.98.

Lithium woes continue. Reuters reported this week that spot prices for spodumene in top consumer China are hovering around $940 a metric ton, the lowest in almost three years, and Goldman Sachs expects spodumene prices to average $800 over the next year. Reuters reported that Arcadium is reassessing its Mount Cattlin operations in Western Australia given high costs and falling prices of raw material spodumene. 

Sprott, which filed a report on lithium this week, sees the current low price of lithium as unsustainable, as it has led to project curtailments and driven some miners to reduce capital expenditures and investment in future supply. Sprott believes that lithium prices have bottomed and that higher prices for the metal may be necessary to incentivize the required future production to meet demand forecasts.

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Digging Deep is brought to you by Revival Gold. Revival Gold is one of the largest, pure gold, mine developers in the United States. The Company is advancing engineering and economic studies on the Mercur Gold Project in Utah and mine permitting preparations and ongoing exploration at the Beartrack-Arnett Gold Project located in Idaho.

Revival Gold is listed on the TSX Venture Exchange under the ticker symbol “RVG” and trades on the OTCQX Market under the ticker symbol “RVLGF”. The Company is headquartered in Toronto, Canada, with its exploration and development office located in Salmon, Idaho.
 

Markets and metals were walloped by a late week sell-off, noted mining audiences manager Michael McCrae. 

On Saturday McCrae recorded Kitco Roundtable. 

Earlier in the week Federal Reserve Chair Jerome Powell said in a press conference that a case could be made for a cut "as soon as the next meeting.”  The central bank’s dovish stance helped to propel gold prices to a new all-time high of $2,500 an ounce mid week. 

But the market was spooked about concerns that the Fed had been keeping interest rates to high for too long. Concerns were punctuated by the jobs report on Friday.  According to the Bureau of Labor Statistics, the U.S. economy created only 114,000 jobs last month. The data missed expectations, as economists were looking for job gains of around 176,000. The S&P 500 dropped nearly 4%, with most of the selling coming on Thursday and Friday. 

In mining news there was a major mining deal announced at the start of the week. Filo (TSX: FIL) announced today that it agreed to be acquired by BHP and Lundin Mining for $3.2 billion. 

BHP and Lundin Mining will form a Canadian joint venture into which the Filo del Sol copper-gold-silver project and the Josemaria copper-gold project.

Copper futures dropped 3% during the week ending the week at $4.11. 

On Sunday mining audiences manager recorded Kitco Roundtable. 

Bloomberg noted that the metal was at its lowest level since April, adding that pessimism about China's prospects, and a heavy selloff in global technology stocks hurt the metal. A big AI buildout, which would require lots of copper for the data centers, became less certain. 

On Friday Seabridge Gold (TSX: SEA)  announced that it had received its "substantially started" designation from the BC Government for its 100% owned KSM Project. Seabridge says that the KSM project is the world's largest undeveloped gold project as measured by reserves and resources. An updated preliminary feasibility study estimates proven and probable reserves total 47.3 million ounces of gold and 7.3 billion pounds of copper

Seabridge was up 13% for the week to $22 a share. 

Kitco Roundtable is sponsored by Revival Gold. Revival Gold is one of the largest, pure gold, mine developers in the United States. The Company is advancing engineering and economic studies on the Mercur Gold Project in Utah and mine permitting preparations and ongoing exploration at the Beartrack-Arnett Gold Project located in Idaho.

Revival Gold is listed on the TSX Venture Exchange under the ticker symbol “RVG” and trades on the OTCQX Market under the ticker symbol “RVLGF”. The Company is headquartered in Toronto, Canada, with its exploration and development office located in Salmon, Idaho.

Copper futures slid 7% to $4.20, the metals worst drop since 2022, noted mining audiences manager Michael McCrae. 

On Saturday McCrae recorded Kitco Roundtable. 

Worries about China's economy hurt copper. However, gold hit an all-time mid-week on Federal Reserve's pivot, as well as U.S. political developments.  

In mining news, Panama’s government says it will engage with First Quantum Minerals Ltd. in the coming months to discuss the environmental impact of its shuttered copper mine, according to a report by Reuters. The mine was closed by the government last year. Cobre Panama is a top ten copper mine.

Serbia, the European Union and Germany inked on Friday a series of deals granting EU members and some of the continent’s most important carmakers exclusive access to Serbian lithium, also according to a report by Reuters. Jadar is one of the largest lithium deposits in the world. 

Victoria Gold said there is "no assurance" the mine its Eagle Mine will reopen.

On Saturday mining audiences manager Michael McCrae recorded Kitco Roundtable. 

In late June the Yukon mine suffered a heap leach failure at its Eagle Gold Mine. Eagle employs about 500 people. This week, the miner provided an update on its investigation. 

Gold prices ended their second week above $2,400 an ounce. Gold is seeing fresh bullish momentum following relatively dovish comments from Federal Reserve Chair Jerome Powell, coupled with weaker-than-expected inflation in the Consumer Price Index.

Large investments in copper projects show that miners are optomistic about the metals long term prospects, notes mining audience manager Michael McCrae. 

On Saturday McCrae recorded an episode of Roundtable. 

Copper had another down week, with its second consecutive drop. Copper futures were down 1% to end at $4.37. 

Big copper investments were announced this week, despite the metal's weakness. 

Reuters reports that copper miner Freeport Indonesia launched its $3.7 billion copper smelter in Gresik, East Java. The smelter’s total input capacity is 1.7 million metric tons of copper concentrate and output capacity will reach around 650,000 tons of copper cathode and 50 to 60 tons of gold. 

Reuters also reported that Uzbekistan’s Almalyk and Metals Combine (AGMK) plans a $15 billion expansion program to increase copper cathode output to 400,000 metric tons a year by 2030 from 148,000 tons currently.

Precious and industrial metals end the week on a down note, noted mining audiences manager Michael McCrae. 

On Saturday McCrae recorded Kitco Roundtable. 

Metals fell after the latest data showed the U.S. housing market underperformed expectations in May, and more investors become spooked about a broader market downturn. 

In mining news, both Pilbara Minerals and Vale announced big expansion plans. 

Gold, silver and copper were all flat this week after big economic news from the Fed, noted Michael McCrae, mining audiences manager. 

On Saturday McCrae recorded an episode of Kitco Roundtable. 

On Wednesday the Consumer Price Index was released. The CPI declined to 3.3% on a yearly basis in May from 3.4% in April The latest inflation data was weaker than expected. The number was reassurance for the Fed that it is making progress in taming inflation. 

Later on Wednesday the Federal Reserve announced that it sees one rate cut this year, down from three estimated in March. The Federal Reserve's interest rate estimate, also known as the dot plot, shows the Fed funds rate ending the year above 5.00%. Interest rates were unchanged within a range of 5.25% to 5.50%.

Gold was roughly back where it started, at the $2,330 level, ditto with silver at the $29 level. In industrial metals, copper was flat, too, at the $4.50 level. 

Commodities sold off this week on the personal consumption expenditures report released on Friday, noted mining audiences manager Michael McCrae. 

On Saturday McCrae recorded Kitco Roundtable sponsored by Snowline Gold. 

The report was mixed. Inflation tracked sideways and consumer spending weakened. Analysts say there is little clarity that U.S. central banks will be able to cut rates in the fall.

On Wednesday it was announced that  BHP (ASX: BHP) ended its attempt to buy Anglo American (LON: AAL). The deal topped at $49 billion. 

The Federal Reserve put the brake on the metals rally.

On Friday mining audiences manager Michael McCrae recorded Kitco Roundtable sponsored by Snowline Gold. 

At the start of the week, gold prices rallied to a record high above $2,450 an ounce as markets started to solidify expectations that the Federal Reserve was on track to cut rates two times this year, according to a report by Editor Neils Christensen. 

But at the May FOMC meeting, the minutes showed a general lack of confidence around the inflation outlook and much uncertainty around the timing of potential rate cuts. It also appeared that the Fed thought disinflation is further out. The news weighed on metals.

Gold ended the week down about $100 lower. Gold finished the week at the 2,330 an ounce level. Silver shed $2 and was down at $30 an ounce. 

Copper was down nearly 7%. After surging to an all-time high on Monday of $11,000 a ton, hawkish comments by the Fed and reluctance to spend on copper at such high prices by Chinese factories saw the metal fall.