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May 31st, 2024 | 07:00 CEST

Globex Mining, Samsung Electronics, BYD: Commodity rally and innovations from Asia

  • Mining
  • Commodities
  • Gold
  • Electromobility
  • Innovations
Photo credits: BYD CO., LTD

Increasing demand for generative AI, consumer electronics, and innovations in the automotive industry are significantly boosting demand for raw materials. These are golden times for explorers like Globex Mining. The Canadian company has such a broad-based commodities portfolio that it can be seen as a minerals land bank. For investors, this means reduced risk thanks to high diversification. Samsung Electronics is currently facing several challenges. Not only have they been overtaken by NVIDIA in chip production, but the workforce is also becoming restless. In South Korea, this would be the very first strike in the Company's history. Although the brand value is highly regarded globally, things seem to be quite off-kilter in Suwon. Innovations are produced in Asia. Car manufacturers such as BYD, Geely and Toyota are focusing on the next evolutionary stage in the development of electromobility. The EU, on the other hand, appears helpless and is trying to undermine competition with punitive tariffs. Will they succeed?

time to read: 6 minutes | Author: Juliane Zielonka
ISIN: GLOBEX MINING ENTPRS INC. | CA3799005093 , SAMSUNG EL./25 GDRS NV PF | US7960502018 , BYD CO. LTD H YC 1 | CNE100000296

Table of contents:


    Dr. Thomas Gutschlag, CEO, Deutsche Rohstoff AG
    "[...] China's dominance is one of the reasons why we are so heavily involved in the tungsten market. Here, around 85% of production is in Chinese hands. [...]" Dr. Thomas Gutschlag, CEO, Deutsche Rohstoff AG

    Full interview

     

    Gold rush in Quebec: Globex announces spectacular drill finds at Cartier Resources

    Some explorers specialize in a few commodities. Then, some do the exact opposite and are as broadly positioned as a mineral land bank. Canadian explorer Globex Mining has set itself the goal of increasing shareholder value by acquiring, exploring and developing mineral properties through its own exploration, option agreements or joint ventures, as well as through the sale of projects. Its business model is well positioned thanks to income from options, sales and royalties. Raw materials and precious metals are in demand like never before. Be it as a building material in the computer industry or as inflation protection for the FIAT currency.

    Unlike other exploration companies, Globex Mining owns its own properties. Currently, Globex has more than 200 land packages with various resources and reserves, mineralized drill intercepts, mineral occurrences and geophysical targets. These properties are located in Quebec, Ontario, Nova Scotia, New Brunswick, Tennessee, Nevada and Washington. Precious metals in its portfolio include gold, silver, platinum and palladium. Base metals and polymetallic deposits include copper, zinc, lead and nickel, often along with gold and silver. In addition, Globex owns a variety of specialty metals and minerals that are important for various industrial applications. In addition to acquiring and leasing properties, Globex invests approximately CAD 1.5 million annually in the exploration of its projects.

    There is now a promising update from one of the drill projects from licensee Cartier Resources on the 2024 drill program at the Chimo Mine Project. Part of the drilling took place on Globex's Nordeau West and Nordeau East license areas in Vauquelin Township, Quebec, east of Louvicourt.

    A total of 48 drill holes totalling 9,347 metres have been completed, and 2,307 samples have been collected for analysis, of which 66% have been assayed to date. An additional 115 drill holes totalling 16,000 metres are planned to test an additional 6.0 km of prospective ground, some of which will also be drilled on Globex license areas.

    Cartier's current drill results include:

    • West Nordeau Zone: 7.7 g/t gold over 2.0 meters, including 13.5 g/t gold over 1.0 meter
    • 13.2 g/t gold over 2.3 meters, including 46.1 g/t gold over 0.5 meters
    • 7.5 g/t gold over 2.0 meters, including 20.6 g/t gold over 0.5 meters
    • East Nordeau Zone: 11.0 g/t gold over 2.8 meters, including 17.9 g/t gold over 1.0 meter

    Globex will receive a 3% gross metal royalty on the Nordeau areas, securing additional revenue from future production.

    Labor dispute at Samsung: Union demands fair wages and transparent bonuses

    2023 was a challenging year for Samsung Electronics. The South Korean electronics giant struggled with high interest rates, rising inflation and political problems. Nevertheless, the Company achieved sales of KRW 258.9 trillion and an operating profit of KRW 6.6 trillion.

    Samsung Electronics has maintained and improved its market share in well-known areas such as displays and mobile devices. In addition, a large sum was invested in new equipment and research to meet future demand and maintain technology leadership. Although the business was challenging, Samsung Electronics maintained its position as one of the world's most valuable brands for the fourth consecutive year, with an estimated value of USD 91.4 billion.

    However, things are not looking good at Samsung. In contrast to other countries, employers like Samsung provide their employees with virtually lifelong job security. The connection between workers and the Company is deep.

    Now the Samsung Electronics union is planning a one-day strike on June 7 over failed negotiations over pay and bonus arrangements. It would be the first-ever strike in the Company's history, affecting 28,000 employees. The nationwide Samsung Electronics Union (NSEU) announced the strike, demanding transparent and fair performance bonuses and wage increases.

    The scale of this announcement initially seems unremarkable to Western investors who are used to the odd strike in their country. However, given the South Korean culture and the long-standing relationship of trust between employees and the Company, this is a sign of serious mismanagement.

    Samsung used to be known for suppressing organized labor activities. In 2018, CEO Lee Sang-hoon was accused of sabotaging legitimate labor activities. He threatened to lower wages for employees who joined the activities and intentionally delayed negotiations between management and workers.

    In addition, it was reported that he gathered incriminating material on key union members to dissuade them from their activities. Lee resigned as Executive Chairman in 2020. In the same year, Samsung's Executive Chairman, Jay Y. Lee, promised to end the Company's union suppression practices.

    The union criticizes that despite Lee's promise to eliminate non-union management practices, nothing has changed in the attitude of the Company's management. It emphasizes that it can no longer tolerate the Company's unwillingness to negotiate. What good is the best global brand value if a company exploits its employees?

    BYD: Improved batteries in Asia vs. punitive tariffs in the EU

    According to Reuters, the European Commission will not decide whether to impose tariffs on Chinese electric vehicles until after the European elections on June 9. The preliminary tariffs, expected by June 5, would come as a shock to Chinese electric vehicle makers and add billions of euros in new costs. According to the US-based Peterson Institute for International Economics, the number of electric vehicles imported into the EU from China rose significantly from around 57,000 in 2020 to around 437,000 in 2023.

    The aim of the delay is to keep the issue out of the election campaign phase, reports the German magazine Spiegel, which first published the news. The European elections will take place from June 6 to 9. The investigation, officially launched on October 4, may take up to 13 months. Nine months after the start of the investigation, the Commission may impose provisional anti-subsidy duties.

    Meanwhile, China will invest around USD 830 million in a state-led project to develop solid-state batteries. Solid-state batteries offer the potential for longer ranges, shorter charging times and improved safety compared to conventional lithium-ion batteries. They are, therefore, seen as the next big breakthrough. Toyota Motor from Japan is also planning to launch vehicles with solid-state batteries on the market in the coming years - with over 1,300 patents, the Japanese are leading the way in the development of this battery. China wants to strengthen its leading position in the global EV market. Among the selected participants are BYD, FAW, Geely and Saic, as well as CATL and WeLion New Energy Technology.

    Many industry representatives and analysts expect solid-state batteries to determine the competitiveness of the next generation of electric vehicles. This would once again put BYD and its Asian counterparts one step ahead of European carmakers.


    Globex Mining offers investors a solid investment opportunity thanks to the promising drill discoveries at Cartier Resources and the planned further drilling in the Nordeau areas. The broad portfolio of over 200 land packages, the large number of resources and the strategic diversification spread the risk. The additional income from the gross metal royalties ensures future financial stability and supports the Company's long-term growth. Samsung Electronics faces significant internal challenges due to the planned strike by the labor union, which indicates mismanagement and insufficient willingness to negotiate. Despite a strong market position in areas such as displays and mobile devices, the strike could cause lasting damage to the Company's image and relationships with employees. BYD's ability to leverage technological advances, such as the development of the solid-state battery, not only ensures the Chinese group a competitive advantage but also a prominent position in the future of electromobility. It remains to be seen whether the EU can reduce consumer demand through punitive tariffs or whether there will be a migration towards Switzerland and other non-EU countries. Innovation cannot be permanently hindered through regulation.


    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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