Winning the race for critical raw materials: Standard Lithium, Power Metallic Mines, and Lynas Rare Earths under scrutiny

Standard Lithium – The rally and what matters now

The recent sharp rise in lithium prices is giving investors some hope again. After a steep decline, current prices signal a possible trend reversal. This is mainly driven by strong demand from the electric vehicle sector, mega-batteries for energy storage, and data centers. At the same time, some large producers are showing lower production, which is tightening supply and already having a significant impact on the price of lithium. Tighter markets are on the horizon for 2026, even if the structural oversupply will not disappear overnight.

In this environment, companies that are pushing ahead with concrete projects are gaining attention. One example is Standard Lithium, which is active in the lithium-rich Smackover Formation in the US. The Company is about to make a final investment decision on its flagship project in South West Arkansas. The planned plant appears to be robust in terms of economic viability, with projected operating costs well below the industry average. Progress in securing billions in project financing with partner Equinor is an important sign of confidence.

The appeal is obvious: local production for a strategically critical supply chain. Nevertheless, the investment remains speculative. Success depends on timely commissioning and lithium prices remaining at the expected level. In addition, further capital raising through share issues could weigh on the share price. For risk-conscious investors who believe in the future of domestic battery raw materials, this offers an interesting, albeit provisionally uncertain, bet on the coming years. The share is currently trading at USD 5.27.

Power Metallic Mines – Important for North American supply chains

For investors looking for substance in the commodities sector, Canadian explorer Power Metallic Mines is worth a closer look. The Company is advancing its flagship NISK project in the mining-friendly region of Québec. What makes the story unique is its strategic relevance. NISK targets polymetallic mineralization that can deliver high-grade copper, nickel, platinum, palladium, gold, silver, and cobalt. At a time when secure supply chains for critical metals in North America are at the top of the geopolitical agenda, such a project in a stable jurisdiction is becoming increasingly important. This is also in line with efforts to list the stock on the New York Stock Exchange.

Current drilling results provide solid reasons for the growing interest. The highlight published in December comes from the Lion Zone. A drill hole there intersected an average of nearly 3% copper over a length of more than 20 m. This included a particularly high-grade section of 4.4 m with over 12% copper. Equally impressive is another drill hole that returned a copper-equivalent grade of nearly 28% (CuEq) over just under 1.6 m. Such exceptional grades are a strong indicator of potential economic viability and support the geological model of robust, high-grade mineralization. They serve as a solid basis for the upcoming initial resource estimate.

The outlook for the Company is characterized by several near-term value drivers. In addition to the steady stream of further drill results, the publication of an initial metallurgy study is imminent, which will provide information on metal recovery. Strategically, Power Metallic has also significantly expanded its land package to roughly 313 sq km, securing the potential for further discoveries in the emerging district. The fundamental strength of the project is also reflected in analyst estimates. Hannam & Partners, for example, sees a price target of CAD 2.28 and emphasizes the transformative potential of the exploration.

Lynas Rare Earths – The invisible backbone of modernity

For investors, rare earths are more than just exotic metals. They could be described as the secret stars of the energy transition, especially neodymium and praseodymium. These metals hold the key to highly efficient electric vehicle motors and powerful generators in wind turbines. Without them, green technology would quickly come to a halt. Demand is primarily driven by two megatrends: the global energy transition and advancing digitalization. The problem, however, is that supply is currently in very few hands, creating a delicate dependency for the future. This dependence on a small number of sources makes them a strategic and political asset, creating both volatility and opportunities.

Lynas Rare Earths is positioned precisely in this tension. The Australian company has evolved from a difficult start-up to the leading producer outside China. Its trump card is a fully integrated supply chain in the West. With the completion of its billion-dollar capital program, it is now ready for the next phase. NdPr capacities have been expanded, and a new heavy rare earths plant in Malaysia will further increase the value of the portfolio. Its strategic importance for Western industries cannot be overstated.

The potential for 2026 is impressive. Analysts expect sales to double, driven by higher production volumes and strong NdPr prices. Its inclusion in the ASX 50 underscores its growing market significance. However, the share price remains at the mercy of commodity prices and geopolitical news. Operational setbacks, such as recent power issues in Kalgoorlie, demonstrate its vulnerability. The valuation already reflects a great deal of optimism, so the stock remains prone to volatility. The share price is currently trading at AUD 15.43.

The race for critical raw materials will define the next decade of the global economy. In this strategic environment, three companies offer exposed opportunities. Standard Lithium is promoting a domestic lithium supply with its Arkansas project, but remains a bet on prices and timely commissioning. Power Metallic Mines is developing a potentially strategic asset for North American supply chains with its polymetallic NISK deposit in Québec. Lynas Rare Earths is cementing its role as an indispensable, non-Chinese producer for the magnets of the energy transition. For risk-conscious investors, they mark key positions in the geopolitical commodity game.