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January 18th, 2024 | 08:00 CET

Opportunities in times of Crisis: Defense Metals, Rheinmetall and Thyssenkrupp shares as promising investments in Energy and Defense

  • RareEarths
  • Defense
  • Energy
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Geopolitical unrest is shaking the global economy - those who bet on companies such as Defense Metals, Rheinmetall or Thyssenkrupp in good time have the chance to make substantial profits! Defense Metals, as a supplier of rare earth metals, under the leadership of President Dr. Luisa Morena and CEO Craig Taylor, is not only advancing the promising Wicheeda rare earth project but is also revolutionizing the entire supply chain for rare earth metals in North America with Ucore Rare Metals Inc. Rheinmetall is strengthening the German armed forces and also expands its expertise in renewable energies. Thyssenkrupp is feeling the effects of the global unrest elsewhere, is exploring ahead and can look forward to the green light for a special project.

time to read: 6 minutes | Author: Juliane Zielonka

Table of contents:

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    Rare Earths, Strong Alliance: Defense Metals and Ucore Rare Metals focus on independence in North America's supply chains

    Pandemics and wars of aggression have significantly impacted the global economy over the past two years. Anyone who already had Rheinmetall shares in their portfolio on February 24, 2022, at the latest, could count themselves lucky. Their price continues to rise unabated. Companies worldwide have drastically felt the effects of their supply chain dependencies on countries, some of which have imposed rigorous lockdowns. Smart leaders are drawing the consequences. President Dr. Luisa Morena and CEO Craig Taylor of the Canadian mineral exploration and development company Defense Metals (ISIN CA2446331035) are among them.

    The Company specializes in rare earths. Rare earth metals are used in a variety of high-tech applications, including defense, aerospace, electronics, and energy technologies such as renewables. The management team at Defense Metals is continuing to expand its logistics chains, given the promising sales markets. They are currently exploring a potential partnership with Ucore Rare Metals Inc. to further leverage their expertise in materials processing.

    The 100%-owned Wicheeda Rare Earth Element (REE) project covers 8,301 hectares and is located approximately 80 km northeast of Prince George in British Columbia, Canada, with a population of 77,000. Wicheeda is easily accessible by year-round gravel roads and is close to infrastructure, including power transmission lines and gas pipelines. The nearby Canadian National Railway and major highways provide easy access to port facilities in Prince Rupert, the closest major North American port to Asia. These are all plus points for smooth operations in the area.

    Ucore Rare Metals is committed to breaking China's dominant position in the rare earth metals supply chain by establishing a secure, independent, and domestic supply chain for rare earth metals in North America. A sample of Defense Metals' mixed rare earth carbonate is already on its way to be processed in Ucore's specialized machinery.

    Defense Metals CEO Craig Taylor explains: "The Wicheeda project is being developed as a viable source of rare earth metals from North America, and as additional processing and separation facilities become operational in the future, the demand for rare earth precursors will become increasingly important." Together with Ucore, Defense Metals is moving purposefully in this direction to become part of the supply chain for rare earth metals in the Western world.

    Dr. Moreno is the President of Defense Metals. She is a physics engineer and holds a PhD in materials science and mechanics from the prestigious Imperial College London, UK. She will be a guest at the 10th International Investment Forum and will answer questions from interested investors about the Company's strategy and other topics during the live event. You can register for the event here.

    Rheinmetall: Success in times of crisis thanks to boom in defense and energy sector

    The order volume of Rheinmetall (ISIN DE0007030009) shows just how valuable rare earths and steel are in today's crisis-ridden times. Whether in the defense or renewable energy sector, the Company is pleased to have full order books.

    The German armed forces have commissioned Rheinmetall to produce medium-calibre ammunition for the Puma infantry fighting vehicle. The framework agreement provides for the delivery of several hundred thousand cartridges, with a gross order value of over EUR 350 million. Delivery will begin this year and will extend until 2027, provided that perfect functioning is proven. The coding of the airburst ammunition is intended to enable the Puma infantry fighting vehicle to engage larger soft and semi-hard surface targets. This includes shelters, light transport vehicles and enemy ground forces.

    Furthermore, Rheinmetall has successfully expanded its business in the field of thermal management. For the first time, a new heat pump is being used as an innovative plug-and-play solution in hydrogen-powered trucks for a new customer.

    The thermal module has already been used in battery-powered vehicles such as commercial vehicles, construction machinery and boats. Rheinmetall is now reaching another milestone by successfully integrating the innovative plug-and-play system in a promising sector: Modern trucks with fuel cell drives. The share price stands at EUR 321.10.

    Two companies already equipping trucks and vans with hydrogen technology will be represented at the 10th International Investment Forum on February 21: dynaCERT and First Hydrogen. Investors can register for free to get an overview of the companies.

    Thyssenkrupp navigates logistics challenges, kickstarting a new pig iron plant

    The impact of unrest and wars on supply chains and logistics is currently being felt by Thyssenkrupp (ISIN DE0007500001). Due to the unsafe sea route in the Red Sea, the Company is exploring alternative transportation routes. At the beginning of the week, the Company informed the news agency Reuters that the logistics departments are in close coordination with the transport and logistics partners in order to be able to react flexibly to the situation.

    *Alternative routes and modes of transportation are constantly being examined. The shipping route around the southern tip of Africa requires more time, which can lead to delays and higher charges. "This primarily affects the businesses of thyssenkrupp and its suppliers that rely on global supply chains, such as the automotive and plant engineering industries. So far, however, no supply bottlenecks have occurred*," said a spokesperson for the Group. Due to this development, demand for air freight has risen, according to logistics companies.

    There is at least good news for Germany as a business location: The Düsseldorf Government District approves the first construction phase of thyssenkrupp Steel Europe AG's direct reduction plant ahead of schedule. This is a type of shaft furnace for converting iron ore. The plant, which produces pig iron, will initially be operated with natural gas and later with hydrogen, leading to a 10% or 20% reduction in CO₂ emissions on site. The share is currently trading at EUR 5.59.

    Independent supply chains and strong partnerships are the order of the day. Defense Metals and Ucore Rare Metals are focusing on this independence for North America's supply chains, with a focus on rare earth metals. The promising Wicheeda project of Defense Metals is being developed as a viable source of rare earth metals. Ucore offers potential downstream processing, all located in North America. Dr. Luisa Moreno will reveal details on the seamless supply chain project live on February 21 at the 10th International Investment Forum. Register here. If China attacks Taiwan in 2024, this war will also impact the geopolitical situation. It is critical for investors to carefully analyze which future alliances cushion risks for their portfolio. Rheinmetall is experiencing growing demand in the defense and energy sectors. The German armed forces awarded the Company a contract to manufacture medium-calibre ammunition for the Puma infantry fighting vehicle. At the same time, the Company successfully expands its activities in the field of thermal management by integrating an innovative heat pump into a hydrogen-powered truck. Meanwhile, Thyssenkrupp is navigating through turbulent times of global logistics challenges. Uncertainties in the Red Sea shipping route have prompted the Company to explore alternative transportation routes. The early approval of the first construction phase of thyssenkrupp Steel Europe AG's direct reduction plant by the Düsseldorf Government District marks a decisive milestone. It opens up the possibility of starting work on the foundations of the plant without delay. Good luck!

    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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