Let’s face it, 2024 was not the year for lithium and nickel, but the new year could be a different story, according to industry commentators.
The outperformers in 2024 were gold, silver, and antimony.
Gold surged more than 30% to over US$2,760 ($4,434) an ounce, silver advanced over 40% to US$34 an ounce, and antimony surged over 200% to above US$25,000 a tonne.
Niv Dagan, executive Director of Peak Asset Management, says gold producers have obviously benefited significantly from the high price.
“At the same time, silver and the gold-silver ratio are actually coming closer together. So silver has actually outperformed gold,” he tells Mining.com.au.
Dagan points to share price movements in junior explorers Investigator Resources (ASX:IVR), Mithril Silver and Gold (ASX:MTH), Unico Silver (ASX:USL), and Silver Mines (ASX:SVL), which have benefited throughout 2024 from the rising silver price.
By May, Investigator had reached a fresh 52-week high of $0.066, an 83% jump from the start of the year. However, it is now trading at nearly half what it was in January.
Mithril spent the first half of the year suspended from trade while it completed a merger with TSX Venture Exchange-listed Newrange Gold, but by late September the newly merged company had spiked over 180% to a high of $0.815.
Unico, meanwhile, rallied 177% to a 52-week high of $0.36 and is one of the few silver stocks that held onto some of its gains in the final days of 2024.
Silver Mines peaked at $0.22 in 2024, marking an advance of over 33%. However, legal hurdles with its planned development of its Bowdens Silver Project in New South Wales have seen its share price take a hit, and it rounded out 2024 lower than it started.
Ole Hansen, head of commodity strategy for Denmark’s Saxo Bank, says 2024 proved to be a significant year for precious metal investments, including silver.
“Silver’s rally this year has largely mirrored gold’s upward trajectory, driven by several shared macroeconomic factors,” Hansen says.
“The demand for investment metals has been fueled by an increasingly uncertain geopolitical landscape, where global tensions and economic shifts have led investors to seek safer assets.”
Hansen says central banks have been buying gold aggressively to diversify away from the US dollar and dollar-based assets such as bonds, which has indirectly supported silver prices.
“Additionally, concerns about mounting global debt, particularly in the United States, have prompted investors to hedge against economic instability by turning to precious metals,” Hansen says.
“The prospect of interest rate cuts, as inflation trends downward, has further bolstered non-yielding assets like silver.”
At the same time, increased industrial demand has helped create “physical tightness” in the silver market.
“Sectors such as electronics and renewable energy, particularly photovoltaic (solar) technologies, have significantly contributed to this surge,” Hansen says.
“The expectation of sustained industrial demand is likely to keep silver in a supply deficit into 2025.”
Peak Asset’s Dagan says another commodity that did really well in 2024 is antimony.
“Obviously, China is banning exports and essentially making it hard,” he explains.
China — which accounts for nearly half of global antimony production — placed restrictions on exports of the metal, a move that is expected to have significant implications for the global antimony supply chain.
Many antimony operations in Russia — which accounted for 24% of global supply in 2023 — were also disrupted by Western sanctions following Moscow’s invasion of Ukraine.
Dagan notes that some of the ASX-listed antimony explorers “have done very well” on the back of these supply concerns.
“Probably the standout has been Trigg Minerals (ASX:TMG), which picked up an antimony project in New South Wales and is up over 500% since that announcement,” he points out.
In September 2024, Trigg inked a binding agreement with Bullseye Gold to acquire the “ultra-high-grade” Taylors Arm and Spartan antimony projects in northern New South Wales.
In the North American market, Military Metals (CSE:MILI) has also witnessed a strong rally in its share price in 2024, gaining over 1,770% at one point to hit a 52-week high of C$1.03 ($1.15).
Although it has handed back a chunk of those gains, the Canadian antimony explorer was still up around 800% just prior to Christmas.
In early December, Military Metals struck a deal with Amador Mining to acquire the Last Chance Antimony-Gold Project in Nevada, US.
This was just one of several project buys in 2024 as the company expanded its antimony portfolio.
Military Metals said following news of China’s ban on exports of gallium, germanium, and antimony to the US that this underscored the urgent need for Western nations to secure reliable long-term sources of these essential materials.
“The West can no longer afford to rely on adversarial nations for resources essential to our security and economic stability,” CEO Scott Eldridge said at the time.
“We are taking proactive steps to meet this growing demand with future domestic and allied sources of antimony.”
Lithium finding ‘a bit of rhythm’
Meanwhile, lithium and nickel have had a rocky 2024, but with supply being stripped out of the market at a rapid rate, these commodities could be in for a better 2025.
“I think that lithium may be starting to find a bit of rhythm. The reason is that we feel that the supply-demand imbalance is starting to move the right way,” Dagan explains.
Over the past year, the market has seen several lithium and nickel operations halt production.
BHP (ASX:BHP) mothballed its Nickel West operations, while US lithium giant Albemarle (NYSE:ALB) dropped expansion plans for its Kemerton lithium hydroxide conversion site in Western Australia and laid off 40% of the operation’s workforce.
“We think the lithium market could have a strong rebound coming off what’s been a very, very tough 12 months,” Dagan says.
“Those producers with low operation costs should benefit significantly, and that will flow on.”
Winsome Resources (ASX:WR1) says that while 2024 has been particularly tough for the sector — marked by persistently low prices, a supply glut, and restricted capital access stalling several projects — there are signs of a promising turnaround and reason for optimism.
Demand is projected to climb in the near term, with a compound annual growth rate of 13% in global lithium carbonate equivalent (LCE) demand by 2030, leading to an anticipated supply deficit.
The Australian Office of the Chief Economist forecasts a rebound in lithium spodumene prices to US$1,156 per tonne in the new year from a 2024 low of US$750 per tonne.
Winsome says a decade ago, global LCE consumption for 2025 was forecast at just 200,000 tonnes. By 2020, that estimate had been revised upwards to 500,000 tonnes, and now demand is projected to reach 1.5 million tonnes by 2025.
“This classic case of supply versus demand will significantly influence market dynamics, affecting both short-term investor sentiment and long-term pricing trends,” Managing Director Chris Evans says.
Winsome is advancing its Adina Lithium Project in Québec, Canada.
“Adina is forecasted to supply over 20% of the global lithium carbonate equivalent shortfall at the end of this decade, with an expected annual output of around 40,000 tonnes LCE,” Evans says.
“Commissioning is indicatively scheduled for 2028, strategically aligning with the projected supply gap and underscoring its importance to the global lithium market.”
Meanwhile, Vancouver-based Patriot Battery Metals (ASX:PMT) just recently cemented a C$69 million investment, offtake, and partnership with one of Europe’s largest carmakers, Volkswagen.
That news sent the explorer’s share price up nearly 27%, however it has come off a one-year peak of about $1.15.
Peak Asset’s Dagan says Q2 Metals (TSX-V:QTWO) has also been a bit of a standout in 2024 following intercepts like 347.1m @ 1.35% lithium from its Cisco Lithium Property in Québec.
Just prior to Christmas, the company received the final results from the 2024 drilling campaign.
Vice President of Exploration Neil McCallum said 2024 had been a transformative year for Q2, noting that work at the property will resume in late January.
“Since its acquisition in February 2024, we have been focused on the Cisco property, which has far surpassed our lofty expectations,” he said.
Since May 2024, Q2 Metals has drilled 17 holes totalling 6,359.7m, all of which intersected pegmatite with visual indications of spodumene mineralisation.
Money set to flow
Dagan says the lithium market is witnessing greater consolidation as well as major car manufacturers ramping up activity.
“We’re seeing some global giants like GE and Toyota advising the market that they’re looking to invest in gigafactories in Canada and the US,” he tells this news service.
“We’re expecting some further money flow in lithium for those reasons.”
Nickel also looks like it could be in for a promising 2025 following a steep decline from its 2024 peak of around US$21,600 in May to around US$15,113 less than a week out from Christmas.
“A lot of the big producers like BHP and the likes of Rio Tinto have essentially stopped or put their nickel production on ice,” Dagan says.
“We feel now the demand supply and balance is probably heading in the right direction.
“Nickel looks to benefit from a pick-up in electrical vehicles and demand for steel and also demand for data centres and technology like AI.
“We feel that nickel has been heavily sold off, but the fact that a lot of the supply has been cut globally puts it in a strong position.”
Saxo’s Hansen sees commodities in general as a potential bright spot in 2025, driven by inflation fears and supply constraints.
“Tangible assets like gold are attractive when inflation and debt loom large,” he says.
Electrification will also continue to drive metals demand, especially for copper and aluminium.
“As AI and tech require more power, the need for these metals will grow,” Hansen says.
Hedley Widdup, CEO of specialist resources investor Lion Selection Group (ASX:LSX), favours gold companies with large resource positions, especially so if they are proximal to process facilities that are short of ore.
“this provides more pathways to cash flow than just building a new process plant,” he tells Mining.com.au.
“To my mind, it introduces either an ore sales/toll treatment pathway or M&A. We’ve bought three gold names with variations on this theme in mind.”
These three companies are Antipa Minerals (ASX:AZY), Brightstar Resources (ASX:BTR), and Saturn Metals (ASX:STN).
Write to Angela East at Mining.com.au
Images: Stock, Military Metals & Q2 Metals
