Close menu

February 16th, 2022 | 11:14 CET

BYD, Phoenix Copper, Freeport-McMoRan - The supercycle is on

  • Electromobility
Photo credits:

Inflation has risen again in the US, posting its highest level since February 1982 at 7.5%. Experts do not yet see any easing in the face of high energy and commodity prices. On the contrary, the inflationary spiral continues to spin and is being further fueled by policymakers' increasingly ambitious climate neutrality targets. Here, especially the required materials such as copper, lithium and cobalt could multiply. Due to high demand and low supply, further bottlenecks, delays in supply chains and thus rising prices are only a matter of time. Profit from it.

time to read: 4 minutes | Author: Stefan Feulner

Table of contents:

    Explosion in the market leader

    The share of the second-largest copper producer Freeport McMoRan is a fundamental investment in every commodity portfolio. Only the Chilean market leader Codelco is ahead of the US producer from Phoenix. Last year's figures were once again impressive and show the extreme demand for copper. The giant produced 3.843 billion pounds of copper, 20% more than in the same period last year. That was partly due to the ramp-up of underground production at the Grasberg mine and higher milling rates in North and South America.

    In addition to copper, gold production also flourished with 1.381 million ounces, a substantial 61% increase, partly due to the expansion of the Grasberg mine, the world's largest gold mine in Western New Guinea. As a result, net profit exploded by 619% and amounted to USD 4.306 billion. The booming business development can be seen impressively on the share chart. After the low of USD 4.82 at the time of the Corona breakout, Freeport increased almost ninefold. Nevertheless, the Company has further growth potential. A breakout above the USD 45.62 mark would push the door wide open to new ten-year highs at USD 61.35.

    Low supply, high demand

    Rising demand is overrunning the existing copper supply. In the past decade, investment in exploration and the development of new copper deposits largely failed to materialize due to the weak copper price. Currently, copper demand is being met by around 10 large and 20 smaller mines. The demand is enormous. An interesting investment target is the share of Phoenix Copper. The up-and-coming producer of base and precious metals, whose main activities are located in the Alder Creek mining district in Idaho in the USA, currently has a market capitalization of EUR 70.30 million and is listed on the AIM in London and the OTCQX Market in the USA as well as in Frankfurt. At the same time, the Company stands on several feet.

    The main project is the Empire mine, to which Phoenix Copper secured the lease rights back in 2013. Since then, the land size of the open pit project has been expanded from the original 2.05 sq km to the current 17.20 sq km. Production is scheduled for the first half of 2023. It is estimated that less than 1% of the potential ore system at Empire has been explored to date, promising enormous potential for the future.

    Broadly diversified portfolio

    In addition to the prospective Empire open pit mine, Phoenix owns the historic Horseshoe, White Knob and Blue Bird underground mines, all of which have historically produced copper, gold, silver, zinc, lead and tungsten. The discovery at Red Star, 330 m northwest of the Empire mine, has shown high-grade silver/lead sulfide ore in three shallow exploration holes. In addition, the Navarre Creek district includes a Carlin-type volcanic gold discovery that has a 6.1 km strike length within a 14.48 sq km area.

    In addition, Phoenix Copper owns Redcastle and Bighorn, two cobalt claims located in Lemhi County. They run along the most prolific cobalt mineralization trend in the US and adjacent to the mine of Electra Battery Metals, formerly known as First Cobalt, with whom it already has a joint venture. The Company is well-financed with cash on hand of about USD 15 million. Debt capital in the form of a bond is also to be raised for the transition to production at the Empire mine in order to achieve the set goals of starting production by 2023.

    Phoenix Copper CFO Richard Wilkins will present the Company tomorrow, February 17, 2022, at the virtual International Investment Forum IIF. Registration is free at

    Renewable energy growth driver

    There is an enormous demand for copper in renewable energies. For example, 30t of copper is used to produce just one wind turbine. For a new type of electric car, around four times the amount is needed than for the production of a car with an internal combustion engine. In 2019, there was already a shortage of 383,000t on the market. In 2020, the supply deficit rose to 559,000t, the highest value in more than a decade.

    If we look at the growth rates of the electric carmakers in New Energy Vehicles alone, we see that demand will increase significantly in the coming years. BYD alone plans to more than double its unit sales from around 600,000 units to 1.5 million in the current year.

    Especially in China, competition is fierce and growing strongly. Tesla sold 59,845 electric cars in January, according to the latest data from the China Passenger Car Association (CPCA). However, the market leader in the Middle Kingdom is BYD, which delivered 93,101 units in the first month of the year. It is followed by Great Wall Motor (GWM) with 13,781 units and XPeng and Li Auto with 12,922 and 12,268 cars, respectively.

    The demand for copper will continue to increase in the coming years due to its importance in relation to the energy transition. In addition to copper producers such as Freeport-McMoRan, investors should take a closer look at second-tier Phoenix Copper. BYD remains the undisputed market leader in China in the electric car sector.

    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.

    Risk notice

    Apaton Finance GmbH offers editors, agencies and companies the opportunity to publish commentaries, interviews, summaries, news and the like on These contents are exclusively for the information of the readers and do not represent any call to action or recommendations, neither explicitly nor implicitly they are to be understood as an assurance of possible price developments. The contents do not replace individual expert investment advice and do not constitute an offer to sell the discussed share(s) or other financial instruments, nor an invitation to buy or sell such.

    The content is expressly not a financial analysis, but a journalistic or advertising text. Readers or users who make investment decisions or carry out transactions on the basis of the information provided here do so entirely at their own risk. No contractual relationship is established between Apaton Finance GmbH and its readers or the users of its offers, as our information only refers to the company and not to the investment decision of the reader or user.

    The acquisition of financial instruments involves high risks, which can lead to the total loss of the invested capital. The information published by Apaton Finance GmbH and its authors is based on careful research. Nevertheless, no liability is assumed for financial losses or a content-related guarantee for the topicality, correctness, appropriateness and completeness of the content provided here. Please also note our Terms of use.

    Der Autor

    Stefan Feulner

    The native Franconian has more than 20 years of stock exchange experience and a broadly diversified network.
    He is passionate about analyzing a wide variety of business models and investigating new trends.

    About the author

    Related comments:

    Commented by Juliane Zielonka on November 30th, 2023 | 07:00 CET

    Growth Industries in Focus: Investors see potential in Defense Metals, BASF and Volkswagen shares

    • Mining
    • Tungsten
    • RareEarths
    • Electromobility

    Investors are looking for opportunities in growing markets. Looking at industries currently requiring rare earths - such as energy, defense, electromobility, and many more - leads to the mining sector. Someone has to supply the valuable raw materials so these industries can continue growing. Defense Metals' Wicheeda project in Canada shows promising results, particularly the increase to 6.4 million tons with a TREO content of 2.86%. BASF secures EUR 124.3 million in government funding for a green hydrogen plant in Ludwigshafen, planned in collaboration with Siemens Energy. Volkswagen is facing challenges, emphasized by VW board member Thomas Schäfer, who announced tough cuts to maintain competitiveness without closing plants. Volkswagen will have to respond to change with a more agile approach, especially as China advances in electromobility.


    Commented by Fabian Lorenz on November 22nd, 2023 | 07:20 CET

    BYD with "Tesla killer", JinkoSolar with sales record, and Klimat X Developments with milestone payment

    • Sustainability
    • climatechange
    • Electromobility
    • renewableenergies

    BYD is currently bursting with energy. The Chinese company is rushing from one sales record to the next. To ensure this continues in the coming year, BYD has unveiled two new "Tesla killers". The mid-range SUVs are designed to make life difficult for the Model Y. For those without a climate-neutral business model, CO2 certificates can be purchased from Klimat X Developments. The Company has just received a milestone payment. When will the shares of the innovative company benefit? JinkoSolar shareholders also need to be patient at the moment. The share is not taking off despite the solar group doing well operationally. While the Chinese have reason to celebrate, another competitor disappoints once again.


    Commented by André Will-Laudien on November 21st, 2023 | 07:15 CET

    Attention: New battery technology in demand! Freyr Battery, Manuka Resources, Varta and IBU-tec in focus

    • Mining
    • BatteryMetals
    • Electromobility
    • climatechange

    Despite all ecological reservations, the electrified future is advancing. In an effort to combat climate change, politicians have decided on the complete electrification of the future. The plan to entirely displace fossil fuels will lead many countries into a new economic dimension that will outperform conventional economies for a long time. However, a beautiful, new world must be economically affordable. This requires significant technological advancement and a tremendous amount of money for the transformation; ideological thinking helps little in this regard. Central Europe, in particular, is an importer of raw materials and energy and is a long way from setting world-changing parameters. However, since everything has already been decided in Berlin, millions of batteries and stationary energy storage systems are now needed for the green transformation. The key here is access to the critical metals of the future. These strategic decisions are being evaluated in the stock market. It is worth doing the math.