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April 13th, 2022 | 17:45 CEST

Nevada Copper, Aurubis, Nordex - Fueling the energy transition!

  • Copper
  • Electromobility
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A study commissioned by the International Copper Association (ICA) concludes that copper demand will be strongly driven by the massive expansion of cabling for solar, wind power and electric vehicle infrastructure. Experts estimate that the volumes demanded from the solar and wind sectors will multiply by 2040. A projected increase in the number of charging ports for electric vehicles from 3.2 million in 2021 to 152.3 million in 2040 will exponentially increase copper demand in this sector. As a result, an increasing supply shortage is emerging, which in turn will lead to further price increases for the industrial metal. Copper producers such as Nevada Copper or recycling companies such as Aurubis will benefit from these general conditions.

time to read: 3 minutes | Author: Carsten Mainitz
ISIN: NEVADA COPPER CORP. | CA64128F7039 , AURUBIS AG | DE0006766504 , NORDEX SE O.N. | DE000A0D6554

Table of contents:

    Nevada Copper - When will the revaluation start?

    Nevada Copper is predestined to profit from increases in the copper price. The Company owns one of the few production-ready copper mines in the US. Positive operating progress was reported at the Pumpkin Hollow project earlier this month. According to the report, monthly production increased to a new record high. In addition, the Canadians confirmed the previously formulated plans to achieve processing of up to 5,000t per day from Q3 of the current year.

    With this confirmation to be fully on track, the Company could slowly regain lost confidence. Several project delays had unsettled the market. On the management and capital side, however, there have also been positive changes with the arrival of CEO Randy Buffington and the acquisition of new major shareholders.

    Currently, the Company is valued at just under CAD 300 million, with share prices around CAD 0.60. Three years ago, the shares still cost CAD 4. Given the favorable general conditions, the opportunities currently clearly outweigh the risks. It seems only a matter of time before the stock's re-rating begins.

    In total, the Pumpkin Hollow property has a size of 60 sq km. In addition to the ramp-up of the Pumpkin Hollow underground mine, the fully-permitted open pit mine will also contribute to future success.

    Aurubis - Entry into the growth field of battery recycling

    In order to satisfy the increasing copper demand, more must undoubtedly be produced. But recycling will also become more important. Here Aurubis, as a leading global supplier of non-ferrous metals and one of the world's largest copper recyclers, is in an excellent position. The Company processes complex metal concentrates, scrap metals, organic and inorganic metal-bearing recycling materials and industrial residues into metals of the highest quality. Aurubis produces more than 1 million t of copper cathodes annually and uses them to manufacture various copper or copper alloy products.

    Recently, the Group announced its entry into the growth field of battery recycling. The first step will be the construction of a pilot plant at the Hamburg site. Industrial production is to start in five years at the latest. Aurubis expects a capital expenditure of about EUR 200 million. Metals such as lithium, nickel, cobalt, manganese and graphite are extracted from the black mass, a powdery residue produced during the dismantling and shredding of lithium-ion batteries, through a hydrometallurgical process.

    "Battery recycling is becoming much more important due to the expansion of e-mobility and the rapidly increasing demand for lithium-ion batteries and raw materials for their production," emphasized Roland Harings, CEO of the Group. The Company leader continued: "The responsible use of resources and the goal of closing the cycle of valuable metals for electromobility are important factors in our investment decision. Furthermore, recycling is a central, strategic growth driver for Aurubis. We want to play a leading role in battery recycling."

    Nordex - Everything is okay in the medium term

    Most recently, industry associations in the energy sector have welcomed the plans of German Economics and Climate Protection Minister Robert Habeck for a massive expansion of green energies. However, many experts say the targets do not go far enough. They also say that statutory approval procedures and subsidies and regulations on feed-in tariffs are counterproductive in some cases.

    Wind energy plays the biggest role in Germany today. In the long term, Nordex, as one of the leading integrated, globally positioned manufacturers of onshore wind turbines, should also benefit from the expansion of renewable energies. At present, however, increased raw material prices and supply chain problems are weighing on the bottom line, which will lead to red figures in the current year and the previous year. Most recently, the North Germans confirmed their medium-term targets with an EBITDA margin of 8%, to which the share reacted positively.

    Copper is a key raw material for a successful energy transition. The beneficiaries are undeniably copper producers. Nevada Copper is additionally tempting with an attractive company valuation. Recycling is also a promising field of activity, and Aurubis is a good choice here. The Group will benefit from its entry into battery recycling in the future. Once the current challenges have been overcome, Nordex will soon be back in the black as demand increases.

    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

    Carsten Mainitz

    The native Rhineland-Palatinate has been a passionate market participant for more than 25 years. After studying business administration in Mannheim, he worked as a journalist, in equity sales and many years in equity research.

    About the author

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