Q&A with YJ Lee, Director, Fund Manager, Arcane Capital
The energy transition is driving deep structural deficits in copper and silver, even as investor attention remains fixated on lithium and battery metals.
YJ Lee, Director and Fund Manager of Arcane Capital — which runs Singapore’s first green metal fund — explains why copper and silver are entering sustained supply shortfalls, how geopolitical shocks have accelerated the shift away from fossil fuels, and where the next wave of demand for critical minerals will come from.
He also discusses the fund’s 165% return in 2025, the outlook for lithium, and why mining investment remains a small fraction of tech valuations despite being essential to the global electrification build‑out.
Click here to listen to the full interview:
Can you start with an introduction to your fund?
I run the Arcane Green Metal Fund space out of Singapore. The Green Metal Fund is the first of its kind in Singapore. We focus on investing in the miners that produce the metals for the energy transition — metals like silver, nickel, cobalt, etc.
The fund has done pretty well since we launched in May 2024. In 2025, we delivered a net 165% return to investors, which is incredible.
Copper and silver, in particular, have emerged lately as key metals of focus at the moment. What prompted your focus within the critical mineral space and across these specific metals?
The critical mineral space is where I see massive, massive growth in the next five years, all the way to 2030 and beyond.
If you look at what’s happening around the world, you can see electric vehicles all over. If you’ve not had a chance to go to China lately, go to any of the tier-one cities, and there will be a few things you notice.
One, the roads are quiet — 100% of all taxis are electric, and almost every bus is electric. About 40% to 50% of the cars on the road in the cities are electric, so the roads are quiet, and this is just the start of it.
The rest of the world is a bit further behind — we are seeing penetrations of 20%–30% EV adoption throughout the world. Australia and the US are slowly but surely moving in the right direction. But that’s just one factor.
The next big things that we are seeing a lot more are the big trends in grid storage pairing solar, wind, and batteries. All this combines within the same picture of electrification that is driving this huge new trend towards new minerals that need to be mined.
The good thing is that these are reusable minerals. They replace the oil, gas, and fossil fuel paradigm, where you mine it, you take it out of the ground, you refine it, and you burn it once.
But where electricity and batteries are concerned, you mine that metal once, it goes into a battery, you charge it 10,000 times, and you use it every day for the next four years.
It’s quite topical right now, given the current state of the world, and with the Strait of Hormuz being blockaded, and the lack of access to oil in particular. This is a long-term trend where we do need to move away from fossil fuels. That’s an obvious one.
How much has this current geopolitical situation highlighted the need to move into renewables?
If it weren’t for the human suffering that this war has brought, I would be cheering Trump on the sidelines thanking him for moving the agenda of the green energy transition five to 10 years ahead.
In the past, people were anxious about electric vehicles, whether they could access charging, whether they had range, whether the batteries were going to last as long as 10 years, etc.
These have all been addressed today. And with the war having driven petrol prices up — you know, almost doubling in some places — it has actually caused even secondhand electric vehicles to go up in price. This has all accelerated the move towards lithium batteries.
You are quite bullish on lithium. What are the key dynamics that you see for the market?
The biggest dynamic that you need to know is that this market is growing massively. Every year, we are putting around 500 kilotons of supply into the market, and the market is growing at 33% every year.
You were the first in Singapore to launch a Green Fund. Do you see others following suit?
Singapore is a financial capital. We are one of the smallest financial capitals in the world, but we do not have a single operating mine in the country. We are too small to have a mine.
The average investor invests in property and in consumer goods, not in mining. So, there’s a lack of investor understanding on investing in mining. Therefore, there are not that many new funds that are actually specialised in the industry.
What’s your outlook for the coming year in the market? Are there key commodities or key trends that you think will be standouts?
I think we are in the early stages of a new commodity cycle. The broad markets are expensive. S&P 500 and NASDAQ have been driven to sky-high valuations, especially by tech.
I think eventually people will start looking for real hard assets that are needed to build all these new data centers. To a large extent, investment in mining is a small, small fraction of the valuations that the tech guys are having right now, but this does not make sense.
The capital has to come back to mining, and with potential higher inflation for the next few years — given that the war has disrupted energy supplies — the knock-on effects on the other industries like agriculture is here to stay.
This means that interest rates can’t really go down and also that governments will need to print more money in the future.
I don’t want to give a foolish picture that everything’s going to go up forever. I think we need to be aware that speculation could lead to a real recession in major economies, and that means, at least for the short term, we could be at risk of metal prices falling as well.
I’m still very bullish many metals are entering structural deficits. Lithium is probably entering one this year or the next, while silver has been in a structural deficit for five years already. Copper is entering a structural deficit in the next two years as well.
So, all these are great opportunities for investment.
Write to Amy Rotman at Mining.com.au
Images: Mining.com.au
