USA Rare Earth, Desert Gold Ventures, Alcoa: Commodities Are Becoming the Key to the Future

Alcoa: Structural Advantage in the Crisis

The global aluminum market is undergoing a phase of profound change. Triggered by the military escalation in the Middle East, the global supply of the light metal has plummeted, as key mining and processing facilities in the crisis region have had to sharply reduce or temporarily halt production entirely. Since these shortfalls can hardly be offset by other regions in the short term, a deficit of nearly 3 million tons looms for 2026. The depletion of global inventories is rapidly driving prices on commodity exchanges skyward. Experts expect prices to break through previous historical records in the coming months.

The US corporation Alcoa occupies a unique position in this regard. The company benefits from a crisis-resistant structure. Its own bauxite mines are located in secure regions far from geopolitical unrest. An even greater advantage lies in its energy supply, as Alcoa powers approximately 86% of its aluminum production with sustainable, renewable energy sources. While many competitors are struggling with surging fossil fuel prices, Alcoa remains largely unaffected by these cost shocks. The combination of low operating costs and high selling prices is providing Alcoa with a massive increase in cash reserves. This enables management to rapidly reduce debt and return capital directly to investors through planned share buybacks.

These strong prospects are also drawing the attention of various financial experts. UBS has therefore recently raised its price target from USD 75 to USD 80 and rated the stock "Buy." Analysts unanimously emphasize that the aluminum producer's actual earnings power remains significantly undervalued by the broader market.

Desert Gold Ventures: Taking Big Steps Toward Becoming a Producer

Despite the current correction, many factors suggest that gold will continue its long-term upward trend and could reach new highs. Demand from central banks remains high, geopolitical risks are rising, and increasing global government debt is boosting demand for safe-haven assets.

As a result, attractive long-term entry opportunities are emerging in promising stocks that could benefit disproportionately from rising precious metal prices. Through the SMSZ Project, Desert Gold Ventures controls an area of approximately 440 km² along the Senegal-Mali Shear Zone, one of Africa's most productive gold regions. The resource already comprises approximately 1.1 to 1.3 million ounces of gold at grades of around 1.1 to 1.2 g/t. Particularly attractive is the near-surface, oxidized mineralization, which enables cost-effective mining methods and thus improves profitability.

The Canadian company is on the verge of becoming a producer. Since late April, a 4,250 m drilling program has been underway at five prioritized target areas to further expand the resources near the planned Barani East Mine. At the same time, infrastructure development is progressing rapidly. Already, 52,000 sqm have been cleared for the future gravity plant, foundation work is underway, and the water supply is secured, meaning gold production could begin as early as July of this year.

The current PEA indicates a post-tax net present value of USD 61 million and an internal rate of return of 57% at a gold price of USD 2,850 per ounce. At a gold price in the range of USD 4,100, this rises to USD 124 million, while the IRR could climb to 101%.

The Tiegba Gold project in Côte d'Ivoire offers additional upside potential. Promising gold anomalies have already been identified across 297 km², while less than 20% of the area has been explored in detail to date. This gives Desert Gold a second exploration pillar with significant discovery potential.

With a market capitalization of around EUR 28 million, an advanced development project, imminent production start and significant exploration potential, Desert Gold could be poised for a revaluation. The price target set by GBC analysts is EUR 0.59. The share is currently trading at around EUR 0.08.

USA Rare Earth on an Expansion Course

The American commodities group USA Rare Earth is continuing to advance its efforts to secure an independent supply of raw materials with government backing. The company has agreed with US trade authorities on a far-reaching financing package intended to free up to USD 1.6 billion. This sum will flow directly into the development of a completely domestic supply chain, ranging from mining to the production of essential magnets.

The backdrop to this strategic initiative is Washington's political determination to no longer rely on Asian exports for key resources urgently needed by the modern technology, aerospace, and defence industries. With this government support, the company is thus playing a central role in American economic security.

The company is focusing on growth not only in North America but also across the Atlantic. By 2030, the raw materials specialist plans to make extensive investments of over EUR 175 million across Europe, with a clear focus on France.

State-of-the-art production facilities for specialty alloys, metals, and magnet manufacturing are to be built in Lacq, in southern France. This project is being supported by the government in Paris through targeted subsidy programs and extensive loan guarantees, with the aim of making Europe less vulnerable to global supply chain disruptions.
Incidentally, the local economy stands to benefit, as the construction and operation of the new facilities will create more than 300 jobs in the region.

Despite these positive strategic prospects, the company's shares recently experienced a sharp setback, losing more than 20% in value. The sell-off was driven primarily by investor concerns over potential dilution. Recently published regulatory filings have paved the way for existing shareholders to sell up to nearly 94 million shares—equivalent to roughly one-third of all shares—which triggered significant selling pressure in the market.

The macroeconomic conditions for commodity stocks remain attractive. Alcoa could benefit from a structural aluminum deficit and rising prices. Desert Gold is on the verge of becoming a producer and, with its resource and exploration potential, has significant leverage from a rising gold price. USA Rare Earth, meanwhile, is positioning itself—with billions in government support—as a key component in building independent supply chains for critical raw materials in the US and Europe.