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September 29th, 2022 | 10:57 CEST

Barsele Minerals, K+S, BYD - Sweden as a crisis winner?

  • Mining
  • Gold
  • fertilizer
  • Electromobility
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Due to the explosions in the Baltic Sea pipelines Nord Stream 1 and 2, a switch to other energy sources is inevitable, especially for German industry. Fertilizer producer K+S, based in Kassel, is affected by this. The situation is different with Barsele Minerals. The Canadian company is exploring large gold areas in sunny Sweden and plans to mine up to 3.5 million ounces of the precious metal in the future. Electric car and battery manufacturer BYD, on the other hand, has sufficient resources in its home country of China and is preparing to make the leap into the European market. Find out here which shares are now defying the crisis.

time to read: 5 minutes | Author: Juliane Zielonka
ISIN: BARSELE MINERALS | CA0688921083 , K+S AG NA O.N. | DE000KSAG888 , BYD CO. LTD H YC 1 | CNE100000296

Table of contents:

    Humphrey Hale, CEO, Managing Geologist, Carnavale Resources Ltd.
    "[...] Our projects are at the initial, high reward exploration stage. [...]" Humphrey Hale, CEO, Managing Geologist, Carnavale Resources Ltd.

    Full interview


    Barsele Minerals - Establishing Sweden as a gold hotspot

    Precious metals such as gold, silver and platinum are essential for sustainable technological progress in the automotive industry. Thanks to its high corrosion resistance, good conductivity and ease of processing, gold is a very valuable material here. Especially because it helps in the manufacture of electronic components to ensure that they are durable and protected from environmental influences. Gold and other precious metals support the development of alternative drive models such as electric and hydrogen cars and autonomous driving. Gold is primarily used for car controls, such as engine and transmission controls and automatic start-stop systems.

    The Canadian Company Barsele Minerals is currently exploring an area with gold deposits in Sweden. Its Barsele project is located in the mining region of Västerbottens Län in northern Sweden, 600 km north of Stockholm. It covers 33,500 hectares in the Fennoscandian Shield. The structurally connected gold mineralized ore veins occur mainly in a granodiorite bedrock and, to a lesser extent, in volcanic and sedimentary rocks. Several parallel ore veins, varying in width from 10 to 100 meters, cover a mineralized area of 425 meters. The area thus comprises a productive belt of gold and massive sulphide deposits that cut across the "gold line" in northern Sweden. Researchers believe there are gold deposits in Sweden similar to those in Alaska or California.

    Barsele Minerals' goal is to extract such a large gold deposit. The Company estimates production at 3.5 million ounces of gold. Sweden offers itself as a production location outstandingly. After all, Sweden is the leading producer of metals in Europe. There is the security of tenure. Fiscal incentives also offer advantages to investors - for example, there is no mineral tax, and corporate income tax is only 22%. Sweden also provides low political risk in the wake of geopolitical tensions. It also has well-defined environmental and permitting procedures in a mining-friendly country.

    K+S AG - Energy crisis threatens German agriculture

    The energy crisis in Europe has the fertilizer producer K+S fully in its grip. That is because the fertilizer industry is being held back by the rise in the price of natural gas due to a sharp increase in producer prices. The Kassel-based company is Europe's largest supplier of potash for use in fertilizers and, following its acquisition of Morton Salt, the world's largest salt producer. The Company also produces and sells other mineral fertilizers, such as those made from magnesium and sulfur. But the production process of most fertilizers is very energy intensive.

    Prices for fertilizers and nitrogen compounds have risen sharply in recent months. In August, they doubled compared to the same month last year (+108.8%). Already in 2022, shortly after the start of the war in Ukraine, prices were 87.2% higher than in 2021. Sales of potash fertilizer fell 52.3% in the last quarter to 55,900 tons of potash. Nitrogen fertilizer also recorded a decline of 18.5%. Only lime fertilizer (592,600 tons of calcium oxide) was virtually unchanged, down 0.1%.

    In a joint appeal, the agricultural and farmers' associations address the incumbent German Minister of Economics, Robert Habeck. "A collapse in production cannot be ruled out because the farms do not fall within the scope of the German government's aid programs due to their small and medium-sized structure."

    In the letter, the umbrella organizations point out that the production of fruit, vegetables and potatoes is very energy-intensive due to the high-quality standards. However, companies cannot pass on the rising costs to the market, as food retailers are increasingly turning to cheaper imported goods due to declining consumer purchasing power. As a result, jobs and value creation in structurally weak rural areas are threatened with collapse. The halt in production would lead to supply bottlenecks and mean the end of regional and sustainable production. Thus, the situation remains tense for K+S as well.

    BYD - Emission-free transport solutions on the leap to Europe

    BYD is currently conquering the European market. The Chinese electric vehicle manufacturer is launching three models for small and larger budgets in the passenger car sector. At the IAA in Hanover, the Company also impressed in the commercial sector with electric buses and Elketro trucks for commercial transport. BYD is presenting two zero-emission, all-electric trucks at the trade show. One model for urban delivery traffic and one truck for logistics and waste collection. The eBus will also be exhibited for the first time in Europe and features innovative technology.

    Mr Javier Contijoch, eBus Sales Vice President at BYD Europe Commercial Vehicles, says: "We are pleased to present BYD's latest technological innovations to European customers, which include both eTrucks and eBuses. We see the future in electric mobility, and through partnerships, we want to help European customers run as smoothly as possible as they electrify their fleets."

    The advantage of BYD, in addition to building electric vehicles, is the continuous optimization of the battery drives. Expertise in battery and electronics technologies is essential to BYD's expertise with new energy solutions. The Company thus pools research and development resources that other electric vehicle manufacturers have to buy in. But VW and Tesla are also upgrading with affiliated battery production facilities. Daimler continues to rely on cooperation with China in the production of motive power.

    BYD sells its e-mobility solutions in over 70 countries. Today, over 2.5 million BYD new energy vehicles are on the road, including 90,000 commercial vehicles. The strategy of the Chinese is very simple: through local joint ventures, they are building a global partner network, including a new cooperation for e-buses in Spain. In China, BYD is sitting at the source with its mineral deposits to manufacture batteries and other components for its products.

    Every investor should think carefully about the mix of commodities, future-oriented industries and countries in which they invest. China's economy is still being shaken by the Zero-COVID strategy, including lockdowns, and an investor never owns a company share but always only a certificate (ADR = American Depositary Receipt). German companies such as K+S AG have to factor in the horrendous energy prices, which can never be fully transferred to customers. The German Farmers' Association is issuing an urgent warning about possible production stops in the agricultural sector. By contrast, Barsele Minerals' gold project in Sweden is much more relaxed. The Scandinavian country has gold deposits roughly as large as Alaska or California and offers excellent infrastructure and tax advantages for Barsele Minerals.

    Conflict of interest

    Pursuant to §85 of the German Securities Trading Act (WpHG), we point out that Apaton Finance GmbH as well as partners, authors or employees of Apaton Finance GmbH (hereinafter referred to as "Relevant Persons") may hold shares or other financial instruments of the aforementioned companies in the future or may bet on rising or falling prices and thus a conflict of interest may arise in the future. The Relevant Persons reserve the right to buy or sell shares or other financial instruments of the Company at any time (hereinafter each a "Transaction"). Transactions may, under certain circumstances, influence the respective price of the shares or other financial instruments of the Company.

    In addition, Apaton Finance GmbH is active in the context of the preparation and publication of the reporting in paid contractual relationships.

    For this reason, there is a concrete conflict of interest.

    The above information on existing conflicts of interest applies to all types and forms of publication used by Apaton Finance GmbH for publications on companies.

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    Der Autor

    Juliane Zielonka

    Born in Bielefeld, she studied German, English and psychology. The emergence of the Internet in the early '90s led her from university to training in graphic design and marketing communications. After years of agency work in corporate branding, she switched to publishing and learned her editorial craft at Hubert Burda Media.

    About the author

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