The broad advance in commodity prices is naturally enough proving to be a powerful tailwind for the junior exploration sector.
If it is not record gold, silver and copper prices, it has been a case of strong price recovery in lithium and PGMs, and so on.
It’s fair enough to say that the exploration space is buzzing. But while the drive coming from commodity prices is broad all right, it is not absolute.
The steel additive manganese is an example. It has been plodding along since the highs of 2024 when global supplies took a hit after storm damage knocked out South32’s Groote Eylandt operation.
The arrival of peak steel production in China and that country’s property development woes have also been keeping a lid on manganese prices. But growth in ex-China steel production and historically low manganese stockpiles in the country has led to some recent improvement in prices.
There is also a growing recognition that manganese is set to benefit from looming changes to the preferred chemistry mixes in battery cathodes for electric vehicles and energy storage systems.
Currently there are two types of battery cathode chemistries – a phosphate-based battery or LFP (lithium-iron-phosphate), or the more expensive nickel-based battery NCM chemistry (nickel-cobalt-manganese).
LFP has come to dominate the market in China because it is much lower cost, and it has a much higher safety rating than the NCM alternative on which the Europeans, in particular, placed early bets.
The limitation to the LFP chemistry is it doesn’t have the performance (mileage) of the more expensive NMC chemistry. But increase the manganese content to make a so-called lithium manganese-rich or LMR cathode and the performance difference narrows, and the safety (thermal runaway) properties are maintained.
Industry experts reckon a switch to the more manganese-intensive batteries is close at hand.
Ford and General Motors have recently declared they plan to switch to lithium manganese-rich (LMR) batteries while the Chinese are starting to incorporate manganese into LFP batteries to arrive at a lithium-manganese-iron-phosphate cathode chemistry.
It means much greater use of manganese in batteries is coming. Think of it as thematic for manganese, with high-growth battery consumption likely to more than offset sluggish demand growth from the steel sector.
Trek Metals:
Given the inclusion of more manganese in batteries is work in progress, and the global steel outlook is pretty much flat, it is clear that the manganese juniors are currently missing out on the investor support that the non-manganese juniors are enjoying in the new year because of the broad advance in commodity prices.
Still, that’s nothing that a potentially exciting high-grade manganese discovery can’t fix.
It is a situation that seems to be unfolding for Trek Metals (ASX:TKM), which has stumbled on to high-grade manganese outcrops while looking for gold at its Christmas Creek project in the Kimberley region of WA.
It is early days but high-grade results to date from rock chip sampling have got the market’s interest up, with Trek trekking from 6.5c at the start of the year to 9.4c in Thursday’s market for a 44% gain.
Trek is calling the discovery Kuro.
According to the company, results to date demonstrate the presence of consistent, laterally extensive high-grade manganese mineralisation at surface over a strike extent of more than 750 metres along the main outcropping trend.
The surface mineralisation occurs within a broader corridor up to 400m wide, defined by multiple sub-parallel discrete outcrops with intervening areas of untested shallow cover.
“Importantly, the surface mineralisation occurs within a much larger gravity-defined anomaly that extends well beyond the mapped outcrop limits,” Trek reported.
It wasn’t joking about the high-grade nature of the rock chips. The samples returned an average grade of 50.7% and up to 60.1%.
“Grades of this tenor, approaching theoretical manganese oxide purity, are extremely rare and highlight the strength of the mineralising system,” Trek said.
“Importantly, these high grades are not isolated – they are laterally extensive, consistently returned, and closely associated with strong gravity anomalies, providing compelling evidence that the surface mineralisation may be underpinned by a much larger mineralised body at depth.”
The truth of all that will of course be determined by the drill bit, with a drilling program likely after the wet season comes to an end.
Gateway Mining:
It was a tough day out on Thursday for the gold stocks as the yellow metal took a TACO hit on the Greenland issue.
But juniors with discovery news were able to shine through.
That was the case for Gateway Mining (GML) which reckons it is on to a significant discovery at its Haflinger prospect, part of its broader Yandal gold project in WA.
The stock traded up to 8.2c in the early response to the discovery but got pulled back to 7.3c by the close of trade for a 2.8% daily gain as gold prices continued to weaken.
Drilling on the Celia shear structure returned as impressive 52m hit grading 1.4g/t from 64m, including 12m at 3.1g/t.
The result followed on from the two bottom-of-hole results reported earlier in the week (2m at 3.4g/t from 148m and 4m at 2.9g/t, again from 148m) which were interpreted to have “clipped” the targeted contact structure.
Gateway is well cashed up to chase down Haflinger’s potential, with the prospective structure now intersected over a strike length spanning 500m and remaining open to the south.
The company’s executive chairman Andrew Bray made the call that Haflinger is “clearly shaping up as a very promising high-grade gold structure”.
It’s just what a junior wants to be finding in a $A7000-plus an oz gold market.
