08. April 2021 | 09:49 CET
Infineon, Airbus, Lufthansa, Almonty Industries - High-tech is the bottleneck!
In order to limit global warming, the world must become climate-neutral. For this, it will require removing billions of tons of CO2 from the atmosphere and storing it. Meanwhile, the Corona pandemic raises entirely different problems. Planned investments in research and development cannot be carried out as planned due to a lack of raw materials and the supply of certain necessary resources. Primarily, this affects high-tech manufacturers, but even basic technologies can only be developed with difficulty. We shed light on the facets of an economy trying to move a great deal, but with a giant brake block in front of it.
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ISIN: DE0006231004 , NL0000235190 , DE0008232125 , CA0203981034
"[...] 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
Born in Munich, he first studied economics and graduated in business administration at the Ludwig-Maximilians-University in 1995. As he was involved with the stock market at a very early stage, he now has more than 30 years of experience in the capital markets.
Infineon - The shortage of chips is becoming noticeable
The never-ending Corona pandemic is having a drastic impact on the global chip market. Most recently, even Samsung reported significant restrictions on the manufacture of new devices in 2021. Only Apple seems to be virtually unaffected, although that could change soon. Smart chips are arguably the most important components of any technical device today. Manufacturing them requires silicon, copper, silver, nickel and many other minor and rare metals.
There are several pandemic-related reasons for the shortage of chips: Due to the spread of home offices as a new work situation, the demand for notebooks and tablets has increased enormously. Many chips are needed for their production. On the other hand, the manufacturing processes and the supply chains of manufacturers and customers have been severely restricted by the pandemic.
Infineon is currently overwhelmed by demand. The Company is benefiting from an unprecedented flood of orders for its semiconductor products. It is already thinking about expanding its plant in Dresden. Other manufacturers are also stepping on the gas: The US chip manufacturer GlobalFoundries wants to invest around EUR 400 million to expand its clean rooms. The Company currently produces around 400,000 wafers per year and plans to double this figure in the future.
The combination of the Corona Crisis and the pressure of digitalization is the current explosive for technological innovations; what typically takes ten years to develop now must be ready within a year. Infineon shares made a 140% jump upwards since March 2020 and is currently consolidating at EUR 36. If the NASDAQ continues to accelerate, the Infineon share remains the first choice.
Airbus - Together with Lufthansa into climate research
Some want to say, "Airplanes are only bad for the climate!" True, but not all of them. Because an Airbus A350 from Lufthansa will be sent into the air as a climate research jet in the future, this will be used to research the effects of air traffic on the greenhouse effect. For this purpose, Lufthansa regularly provides aircraft that can transport a 1.6-ton measuring container. Around 100 different trace gases, aerosol and cloud parameters will be recorded on selected passenger flights from the end of the year.
Due to the low capacity utilization during the pandemic, Lufthansa certainly has some aircraft left over that can be put into service for environmental research. As Lufthansa announced yesterday, conversion work has already begun in Malta to install an air intake system on the "Erfurt" aircraft's fuselage. The tropopause region readings between 9,000 and 12,000 meters above sea level are to contribute to better research into the greenhouse effect. Lufthansa has been equipping individual aircraft with scientific climate measurement instruments since 1994, and nowadays, it naturally makes sense to report on such projects.
The cooperation between Airbus and Lufthansa shows a gratifying coming together in the service of research and the pandemic situation. After all, both companies' businesses are mutually dependent: If there is no flying, there is no need for new aircraft. But if new approaches to the future are found through research, this will also deliver more climate-friendly mobility concepts for aviation over time. Both Airbus and Lufthansa have performed well since March 2020, perhaps a little too quickly given the hoped-for normalization by 2023/24, but the stock market is not a bed of roses.
Almonty Industries - What is scarce remains scarce and expensive
Scarce raw materials are currently a huge topic on the capital markets. Global dependence on China is a regular concern for commodity strategists in the Western industrialized nations. The idea of everything that could happen as a result of political crises makes us feel globally uneasy. And the dependencies do not only affect the chip industry; pretty much all high-tech industries have to live with this uncertainty factor.
Real scarcity goods are tungsten and molybdenum, the key resources of Toronto-based Canadian producer Almonty. Its main business is mining, processing and shipping tungsten concentrate from the Los Santos mines in western Spain and Panasqueira in Portugal. Both produce tungsten concentrate and, along with Austria, are considered to be among the few producers of this rare metal, at least in Europe.
With the assistance of Deutsche Rohstoff AG (DRAG), the Sangdong mine, historically one of the largest and highest-grade tungsten mines in the world outside of China, was acquired in September 2015 through the purchase of a 100% stake in Woulfe Mining Corp. The deal secures Almonty's long-term market share in the world tungsten market for years to come. DRAG owns a 12% stake in Almonty Industries and continues to invest heavily in the subsidiary.
Credit facilities of CAD 54 million have just been successfully extended, so nothing stands in the way of further development of the site in Korea. The Company has appointed JH Kim as Chief Financial Officer of Almonty Korea Tungsten, the Company's wholly-owned subsidiary in South Korea. Mr. Kim has more than 16 years of experience as a finance manager for global manufacturing Company Honeywell Korea and Honeywell Analytics Asia Pacific. As a result, the management base has been significantly strengthened in this very important investment property.
The Almonty share has quickly passed the CAD 1 mark and continues to rise with positive news. The market capitalization has increased to around CAD 200 million in recent weeks. Scarcity causes rising prices - and from today's point of view, this could still be the beginning for Almonty Industries.