Close menu

June 8th, 2021 | 07:47 CEST

NIO, Almonty Industries, Daimler - The power struggle escalates

  • Tungsten
Photo credits:

The US government bans American investments for 59 companies from China. They are accused of cooperating with the Chinese state apparatus and military. The response from Beijing is not likely to take long. The Middle Kingdom is pulling the strings concerning the globally planned energy revolution. Whether solar plants, wind turbines or electric cars. The switch from fossil fuels to a sustainable energy supply based on renewable energy requires many metals. At the moment, more than 80% of the production of rare metals takes place in China. The currently prevailing chip shortage could be just a precursor.

time to read: 3 minutes | Author: Stefan Feulner
ISIN: US62914V1061 , CA0203981034 , DE0007100000

Table of contents:

    Extremely increasing demand

    Decarbonization, or the shift to a low-carbon economy, is exploding global demand for nickel, lithium and rare earth metals. By 2020, excess demand was already evident for most metals. Yet the energy transition is only at the beginning of its cycle, considering that the share of electrified vehicles in Germany is just 10%. The problem of increased demand is now being joined by another problem in the form of the escalating trade war. The Chinese government's plan includes establishing export controls on 17 rare earth metals. The goal is to develop and preserve these resources to meet rising domestic demand and protect the strategic resource amid intensifying global competition.

    Tungsten shortage problem

    Western nations face a mammoth task. Thus, projects are being built outside of China, subsidized by politicians, to continue to guarantee the supply chain, but this cannot be accomplished under a time frame of 10 years. The same problem exists with the strategic metal tungsten, which is irreplaceable in many modern technologies due to its unique properties.

    The global tungsten market is mainly driven by China, which will continue to dominate both the supply and consumption of tungsten. Global demand for tungsten is forecast to increase by up to 7% annually, outstripping available supply, which will drive prices up permanently in the near future. Tungsten prices continue to move higher, having increased by 25% in 2021. Traditionally, tungsten prices lag copper prices by six months.

    Mitigation through megaproject

    Almonty Industries, which specializes in mining and processing tungsten, is working to solve this bottleneck. In addition to mines at Los Santos in western Spain and Panasqueira in Portugal, the Company is developing another tin and tungsten project at Valtreixal in northwestern Spain. However, the financial closing expected in June for the world's largest tungsten mine, the Sangdong Mine, should provide a push into higher valuation territory. The Almonty Korea Tungsten deposit has the potential to produce 50% of the world's tungsten supply outside China.

    In addition, a customer for the next 15 years with a guaranteed price floor has already been found in the Austrian Plansee Group. Alongside the German Rohstoff AG, Plansee is one of the Company's major shareholders. The Groundbreaking Ceremony was held at the end of May. On the capital market, Almonty Industries is aiming for a listing on the ASX in Sydney. As part of this, Andrew Frazer, who has experience in the capital markets, was appointed to the board. The Almonty share, which is also traded in Germany, is currently on the verge of a breakout at EUR 0.85. The expected financial closing is likely to result in a significant increase in the share price. The expected financial closing should push the Company further north. The share still offers considerable potential in the long term due to its unique selling proposition (ex-China).

    Scarcity puts the brakes on

    Even Chinese companies are already suffering from scarcity. This was the case with electric car maker NIO, which announced its sales figures for May. With the delivery of 6,711 units, it was possible to top the previous year's result by 95.8%. However, looking at the previous month of April, this represents a 6% decline. The Company cited the global semiconductor shortage as the reason for the May decline. Due to the lack of supply of semiconductors, there were delays in the production and delivery schedule. However, the Company expressed confidence in making up for last month's dip in June. Despite the relatively weak figures, Citigroup analysts were optimistic and raised the stock from "neutral" to "buy." The price target is USD 58.30.

    Daimler puts the brakes on costs
    The Stuttgart-based company is willing to shed its own sales houses and workshops in the UK, Spain, and Belgium in order to continue cutting costs. "In this context, our markets are continuously reviewing their existing and future local sales setups as well as networks," a spokesman for the automaker said on Monday. He added that this had already been communicated at the local level in the three countries affected. First, the "Handelsblatt" had reported. It involves 25 branches with about 2800 employees. The possible savings effects pushed the Daimler share to a new 52-week high of EUR 80.34.

    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 in the future hold shares or other financial instruments of the mentioned companies or will bet on rising or falling on rising or falling prices and therefore a conflict of interest may arise in the future. conflict of interest may arise in the future. The Relevant Persons reserve the shares or other financial instruments of the company at any time (hereinafter referred to as the company at any time (hereinafter referred to as a "Transaction"). "Transaction"). Transactions may under certain circumstances influence the respective price of the shares or other financial instruments of the of the Company.

    Furthermore, Apaton Finance GmbH reserves the right to enter into future relationships with the company or with third parties in relation to reports on the company. with regard to reports on the company, which are published within the scope of the Apaton Finance GmbH as well as in the social media, on partner sites or in e-mails, on partner sites or in e-mails. The above references to existing conflicts of interest apply apply to all types and forms of publication used by Apaton Finance GmbH uses for publications on companies.

    Risk notice

    Apaton Finance GmbH offers editors, agencies and companies the opportunity to publish commentaries, interviews, summaries, news and etc. on These contents serve information for readers and does not constitute a call to action or recommendations, neither explicitly nor implicitly. implicitly, they are to be understood as an assurance of possible price be understood. The contents do not replace individual professional investment advice and do not constitute an offer to sell the share(s) offer to sell the share(s) or other financial instrument(s) in question, nor is it an nor an invitation to buy or sell such.

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

    The acquisition of financial instruments entails high risks that can lead to the total loss of the capital invested. The information published by Apaton Finance GmbH and its authors are based on careful research on careful research, nevertheless no liability for financial losses financial losses or a content guarantee for topicality, correctness, adequacy and completeness of the contents offered here. contents offered 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 André Will-Laudien on November 28th, 2023 | 07:00 CET

    GreenTech 2024 - The turnaround analysis: Siemens Energy, Almonty Industries, JinkoSolar and Nordex. Is the turnaround near?

    • Mining
    • Tungsten
    • renewableenergies
    • GreenTech

    The Western hemisphere is experiencing unprecedented inflation due to the impact of Corona and subsequent geopolitical conflicts. This time, it is not a boom causing prices to explode but the scarcity of raw materials, manpower and capital. The rise in interest rates is making infrastructure projects worldwide more expensive and jeopardizing the implementation of climate projects. In such an environment, GreenTech companies try to plan carefully, but they are still dependent on the support of public budgets. After sharp price corrections this year, investors can now enter the market a good 50% below the highs, but has the bottom already been reached?


    Commented by Armin Schulz on November 22nd, 2023 | 07:10 CET

    Siemens Energy, Almonty Industries, BASF - Rebound underway, where is it worth getting in?

    • Mining
    • Tungsten
    • RareEarths
    • renewableenergies
    • rebound

    At the end of October, the mood among investors was gloomy. Many indices were under pressure and had lost more than 10% of their value. Since October 28, the mood has changed, and the markets have rallied significantly. One of the reasons is undoubtedly the Fed's interest rate pause. After three weeks on the upswing, the indices are approaching new highs. Nevertheless, there are still stocks that have not yet been able to benefit from the upward trend. We have picked out three interesting stocks that offer plenty of long-term potential.