Two iron ore deals refreshed interest in a sector largely overlooked in the rush to embrace technology metals.

At the top end of iron ore it was a US$5.3 billion acquisition by Japan’s Mitsui of a 40% stake in the undeveloped Rhodes Ridge project in WA which was a reminder that iron ore will be a major Australian export for decades.

At the bottom end of iron ore it was a deal to merge Fenix with CZR which reinforced the point that solid profits are still on offer for companies with the right assets especially as iron ore continues to trade at around US$107 a tonne.

CZR, a company controlled by billionaire prospector Mark Creasy, had its best week in two years, rising by 9c (51%) to 27c. Fenix was steady at 30c, but Bell Potter reckons Fenix is heading up to 41c.

The corporate migration deals involved three technology metal hopefuls which have joined the gold rush.

  • High-Tech Metals, a cobalt and nickel explorer, was rewarded with an 11c (67%) price rise to 28c after announcing that it had acquired gold assets from Rox Resources.
  • Battery Age Minerals enjoyed a 1c (9%) boost yesterday after announcing plans to accelerate work on the El Aguila gold and silver project in Argentina, and
  • Delta Lithium chief executive James Croser told a mining conference in WA that Delta today was more about gold than lithium but slipped 1c lower to 17c.

Hastings Technology Metals ignored the gold migration trend, striking a joint venture deal with Andrew Forrest’s Wyloo Metals aimed at speeding the development of the Yangibana project in WA.

Hastings got a small share price bump on Tuesday but soon settled back to 37c, down 1c.

Gold, the investment star of the past two years, continued to exert a magnetic pull on investors (despite being a non-magnetic metal) but the reality is that the metal actually hasn’t gone far since a warning in this column two weeks ago that peak gold is approaching.

Back then (February 14) gold was trading at US$2918 an ounce. Yesterday it was hovering around US$2900/oz.

Gold could still push through the magic US$3000/oz mark especially if unease in the U.S. with the antics of its wildman President Donald Trump sparks a shift out of the equity and bond markets to the safety of gold, an event which cannot be ruled out.

Swiss gold bug Egon von Greyerz returned to the gold debate this week with a few gems in a client newsletter including an observation that all the gold held by the world’s central banks is valued at US$3 trillion – which is the same stock market value of one technology company, Microsoft.

“That tells us how overvalued stocks are, and that the gold price is ridiculously low,” von Greyerz wrote.

Overall, the Australian market was burdened by an excess of politics as Federal election campaigning heats up and Trump actively destabilises the U.S. with mass sackings of government employees, and Europe where he is aligning the U.S. with Russia.

Those factors were layered over a generally unimpressive profit reporting season to see the Australian market, as measured by the all ordinaries, lose 1.3% over the week. The metals index (which includes the majors such as BHP and Rio Tinto) was down 3%, while the gold index slipped 1%.

Gold sector leaders had a mixed week with Bellevue the strongest performer with a rise of 6c to $1.20 after delivering a well-received presentation at the BMO conference in the U.S.

Other gold moves and news included:

  • Matsa, up 1.4c (25%) to 6.9c after striking deal with international goldminer AngloGold Ashanti for the sale of the Lake Carey project for a cash payment of $101 million.
  • Lefroy Exploration, up 1c to 9c after announcing the start of drilling at its highly-rate Lucky Strike project in WA,
  • Pantoro, steady at 14c (but up 4c over the past month) after reporting wide and high-grade gold zones at the Scotia prospect which is part of its Norseman project in WA.
  • Horizon Minerals, down 0.5c to 6.1c despite reporting its first gold pour at its Phillips Find project in WA, and
  • Great Boulder, up 0.5c to 6.7c after reporting the intersection of multiple shallow zones in drilling at its Side Well project near Meekatharra in WA.

Rare earths stocks, as seen in the modest reaction to the Hastings/Wyloo deal, remained out of favour despite publicity associated with Trump’s coercion of Ukraine to grant the U.S. access to its mineral resources, especially the country’s rare earths.

Lynas, the rare earth leader, fell by 22c to $6.84 after reporting a disappointing half year profit of just $5.9 million from revenue of $254.3 million, a classic case of producing more to earn less.

Citi reckons the worst isn’t over for Lynas, recommending it as a stock to sell with a price target of $5.50.

Viridis, which released a promising scoping study into its Colossus rare earths project in Brazil, slipped 2c lower to 31c but did score a strong buy tip from Bell Potter which said the stock’s price was a “head scratcher” because it said the shares will rise to a target price of $1.45.

Lithium stocks continued to struggle, burdened by an oversupply of the battery metal and continued negative publicity associated with electric vehicles.

Pilbara Minerals lost 8c to $2.01 after being hit by a sell tip from UBS which noted the company’s growth options but added the telling comment that “they’re not free”.

Independence fell further, burdened by its troubled combination of lithium and nickel to be down another 39c at $4.18 but did touch a 12-month low of $4.05, while ioneer fall by 3c to 14c after losing a partner in its Rhyolite Ridge project in the U.S.

Sandfire was a rare winner among copper stocks, rising by 34c late in the week to $10.77 as concern grows about Trump’s plan for a 25% tariff on imported metal, a plan which could work in favour of its Black Butte project in Montana.

Other news and market moves this week included:

  • Chalice Mining, up 7.5c to $1.52, as interest grows in its updated and lower cost ore treatment plan for the Gonneville project near Perth. Morgans described the shift as a “facelift” for the proposed developed, increasing its advice from hold to buy with a price target of $2.80.
  • Western Yilgarn added 1c to 3.8c after reporting a maiden resource of 168 million tonnes of bauxite at its Julimar West project 75km north of Perth in WA.
  • Perenti lost 14c to $1.25 after reporting a relatively weak first half profit from its drilling activities, though Citi is sticking with a buy tip and a price target of $1.60.
  • Vulcan fell by 18c to $4.12 after announcing the start of a seismic survey in Germany with big German chemicals company BASF for geothermal heat suitable for renewable power generation, and
  • Lode Resources slipped 1.8c lower to 9.7c despite reporting what it called spectacular antimony and silver assays from surface samples at its Montezuma project on the west coast of Tasmania including one small sample grading 31.9% antimony and 5460 grams per tonne of silver.