en.Wedoany.com Reported - The global mining industry is shifting from a production-first to a value-first approach, as major producers and governments tighten policies to maintain profit margins. John Forwood, Chief Investment Officer of Lowell Resources Fund (ASX:LRT), believes this trend could support prices across multiple commodities, including copper, nickel, and uranium. He noted that key players in some commodities have decided to change their strategy, focusing more on profits rather than maximizing output.
The nickel market is the most evident case of this shift. Indonesia now controls over 60% of global nickel supply, and its policies have been frequently adjusted over the past two years. On Wednesday, LME nickel prices fell below $17,000 per ton, following a Bloomberg report that the country's nickel ore production quota for the second half of the year would be raised from 260 million tons to 360 million tons. However, Indonesia's Ministry of Energy and Mineral Resources later denied that a final decision had been made. Forwood mentioned that the 2025 quota, controlled by issuing "RKAB" licenses to miners, reached 379 million tons before being tightened to balance supply and demand and prevent prices from pushing producers further into loss-making territory.
Similar trends are emerging in other commodities. The Democratic Republic of Congo drove up cobalt prices last year by implementing a quota system aimed at curbing production growth from Chinese copper producer CMOC. In the copper sector, Chile's Codelco recorded its lowest monthly production in 23 years in April. Forwood noted that Codelco initially overstated its 2025 production expectations and fired an executive deemed responsible, before cutting its 2025 output by 27,000 tons, the lowest level since 1998. Codelco's new chairman, Bernardo Fontaine, also emphasized that he prioritizes value over volume. In uranium, the world's largest producer, Kazatomprom, may implement production limits to address sulfuric acid supply issues and reserve materials for the country's planned nuclear power projects. Additionally, Forwood pointed out that the oil and gas sector could see a contrary impulse, with the UAE's exit from OPEC earlier this year reflecting dissatisfaction with restrictive quotas due to its desire to expand capacity.
Lowell Resources Fund is increasing its copper exposure, with copper prices remaining above $13,000 per ton amid ongoing supply instability. The fund has raised its copper allocation from 15% to 20%. Forwood stated that the fund favors early-stage exploration companies with high upside potential and discovery prospects. Recently, Lowell established a position in Great Bear Exploration (ASX:GBL), which was renamed after acquiring the Great Bear project in Canada's Northwest Territories from White Cliff Minerals (ASX:WCN). Forwood believes northern Canada is opening up, with government northern development policies and new roads under construction. Historically, Great Bear was a significant producer of uranium, silver, and base metals with substantial output. White Cliff has achieved strong exploration results at its Danvers prospect but has not yet advanced the Great Bear project. He is also bullish on Enduro Metals (TSX Venture Exchange) and Alma Metals (ASX:ALM). The former holds a large copper porphyry target in British Columbia's Golden Triangle region, while the latter is the operator of the low-grade, high-tonnage Briggs copper porphyry joint venture project near Gladstone, Queensland.
This article is compiled by Wedoany. All AI citations must indicate the source as "Wedoany". If there is any infringement or other issues, please notify us promptly, and we will modify or delete it accordingly. Email: news@wedoany.com
