1 October we become SureStone CapitalSame team, same ABN. Our website and email addresses move to surestone.com.au.
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Key Points:
Government support for critical minerals seen as beneficial but must align with miners Speculative buy ratings on Brazilian Rare Earths and Meteoric Resources Major iron ore miners’ exports outperform forecasts, with positive outlooks on BHP, Rio, and Fortescue Core Lithium and Ioneer preferred among lithium stocks, others considered fully valued
David Lane from Ord Minnett provides a comprehensive overview of the rare earths and lithium sectors, highlighting significant government activity and market movements. Lane notes increased governmental focus on critical minerals supply chain resiliency, with both Australian and US authorities supporting new projects outside China’s dominance. Lane points to government investment as a potential positive, yet cautions against direct competition with mining companies, referencing comments from Lynas (ASX:LYC) regarding this delicate balance.
Lane expresses a more favourable outlook on smaller rare earth players, specifically Brazilian Rare Earths (ASX: BRE) and Meteoric Resources (ASX:MEI), citing recent environmental approvals and strong resource prospects. He highlights an unexpected bauxite discovery at Brazilian Rare Earths, which may add significant value if spun out as a standalone operation. Lane maintains a speculative buy on both companies, recently increasing his price target on Brazilian Rare Earths to $7 per share.
In the major mining sector, Lane remarks on robust exports from BHP (ASX:BHP), Rio Tinto (ASX:RIO), and Fortescue Metals (ASX:FMG), exceeding consensus expectations. He praises Rio’s acquisition of Arcadian Lithium as opportunistic. Within lithium, Lane favours Core Lithium (ASX:CXO) and Ioneer (ASX:INR) as undervalued, with other names like Delta Lithium (ASX:DLI) and Global Lithium (ASX:GL1) considered fully priced.
