It has been an exciting year for investors in base metals. In May, copper hit record highs, while nickel, zinc, and tin prices have all seen double-digit gains this year. One thing all these base metals have in common is that we need them for the energy transition. Another is that they have all recently suffered from serious supply disruption. Lithium, meanwhile, also crucial to the energy transition, has seen its price plummet as supply has ramped up. Latin America is the key global store of most of the energy-transition metals. As countries and investors compete to secure supplies of critical minerals, the region’s mining sector will see an inflow of capital.
An influx of cash
One of the reasons for the recent uptick in base-metals prices that is less understood is the influx of energy traders and funds. Energy-trading houses (such as Gunvor, Vitol and Mercuria) that made huge profits buying and selling oil have moved, or moved back, into metals. At present, the value of the metals market is far smaller than that of oil and gas, but as one of the traders told me:
