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London – November 20, 2024 – The single biggest threat to the U.S. military is war with China. A war that could start with Beijing blocking exports of one metal that is critical to the entire American military arsenal. That metal is antimony (Sb), and it’s one of the top-performing commodities this year.  Companies mentioned in this release include:  United States Steel (NYSE: X), SQM (NYSE: SQM), Vale S.A. (NYSE: VALE), Piedmont Lithium (NASDAQ: PLL), Uranium Energy Corp (NYSE American: UEC).

Which makes antimony miners in any Western-friendly country some of the hottest runners in the  markets right now. And one company in particular has positioned itself to take advantage of supply shortages with a number of strategic acquisitions that could help reduce Noth America’s reliance on China and other non-friendly suppliers.

Antimony has already seen a 200% price increase this year, with publicly listed companies in the space seeing increases of more than 800%. And as more analysts wake up to the opportunity, there could be even larger gains in the near future.

China which currently controls nearly half of the total global output of this metal, and the lion’s share of its refined end-product has recently upset Washington by restricting antimony exports to the United States. But one little-known miner could be set to tip the tides back in the West’s favor.

Military Metals Corp. (MILI.CN; MILIF.QB) is a breakout player in the antimony space, that has a plan to bring new supply onstream with a string of antimony assets from central Europe all the way to North America. The company has been on a major acquisition binge, scooping up past-producing mines, initial discoveries and future opportunities from North America to Europe.

MILI’s recent acquisitions are exactly what’s needed to help keep Western defenses locked and loaded as Putin’s nuclear saber rattling intensifies.

In Slovakia, Military Metals boasts two antimony projects, including one historically producing mine and one brownfield project with a large historical resource. In Canada, they are sitting on a historical antimony/gold play that serviced the needs of the Allies in WWI, the West Gore past-producing antimony project in Nova Scotia.

The Right Place at the Right Time

One of the companies that has already seen a large move is Perpetua Resources, who is finalizing a $1.86-billion government loan to develop their strategic resource including participation from the U.S. Department of Defense.

Perpetua is valued at around $700 million, with 90,000 tons of antimony. By comparison, Military Metals recently announced that it has purchased one of Europe’s largest antimony deposits in Slovakia. The Slovakian Trojarovadeposit has 60,998 tons of antimony in a Historical Resource and is currently valued at $23 million, creating the opportunity for a potential run.

The company’s next plan is to make Military Metals Historical Resource 43-101 compliant to westernized Standards. The table demonstrates this is a primary antimony project with a gold by-product, whereas most antimony production globally is a by-product of some gold mines.

But the acquisition spree has not stopped there …

On October 24, 2024, Military Metals (MILI.CN; MILIF.QB) signed a binding letter of intent to acquire further claims surrounding its West Gore Antimony Project in Nova Scotia. This was a strategic consolidation move. This past-producing brownfield project has historical drilling results showing over seven meters of 10.6 gpt gold and 3.4% antimony, with investors likely eyeing the fact that this was historically Canada’s biggest producing antimony mine at one time.

The move to consolidate territory surrounding West Gore—one of the biggest heroes of WWI—is a strategic move that could tie the junior mining company directly to North American defense at a time when prices are skyrocketing.

This is Commodity Warfare, and Antimony is the Latest Ammunition

In July 2023, China targeted rare earth metals Germanium and Gallium–both of which are used in semiconductors–restricting exports to the U.S. On December 1, 2023, China tightened graphite export controls, causing exports to plunge this year.

Now, it is targeting antimony, which is used in semiconductors, batteries, paints, flame-retardant materials, solar, and as an alloy to improve the strength of other metals. For the military, most urgently, it is used for everything for armor-piercing bullets and night vision goggles laser sighting, explosive formulations, nuclear weapons production, infrared sensors to military-grade electronics and a whole laundry list of other military needs.

What Beijing is now taking advantage of is the fact that it controls 48% of the antimony raw material and  about 65% of the refining and processing. Yet, the United States gets over 60% of its antimony from China. On a technical level, the U.S. could refine its own antimony, but it does not have any mines, so it still relies on the supply of third-party raw material.

Even before China implemented antimony restrictions, supply-side troubles were brewing, making Beijing’s decision two-pronged: (1) a shot at the U.S. military-industrial complex; and (2) a failsafe to ensure domestic supply. Russia has also seen disruption to its antimony exports due to Western sanctions, which is a significant disruption when considering the country accounts for 24% of global supply (as of 2023).

“Given we are still at record prices, it’s likely that prices will go even higher with this announcement,” Exiger quoted Chetan Soni, an analyst at London-based consultancy CRU, as saying last month.

The U.S. military is vulnerable on the critical metals battlefield, and the company is hoping to fill some antimony gaps.

Military Metals (MILI.CN; MILIF.QB),  is rushing the antimony playing field, moving at breakneck speed to acquire critical assets at the same time China is tightening the reins on the rarest components of its national defense machine.

In late September, European Defense Commissioner Andrius Kubilius called for a mandatory stockpiling of ammunition and other supplies in preparation for a Russian attack within a few years. That means Europe is much more likely to get its hands on antimony from China or elsewhere, particularly due to the new Chinese restrictions.

This confluence of events and Military Metals strategically timed acquisitions could turn Slovakia into a significant hub for European arms development and national defense, and Washington will likely be eyeing the company’s movements both across the Atlantic and closer to home in Nova Scotia, Canada.

Other companies to keep an eye on:

United States Steel (NYSE: X) is an integrated steel producer with major operations in the United States and Central Europe. As a major supplier of steel to various industries, including the automotive, appliance, construction, and energy sectors, U.S. Steel plays a vital role in supporting the overall health of the U.S. economy. A strong domestic steel industry is essential for maintaining a robust manufacturing base, which in turn contributes to national security by ensuring the ability to produce critical equipment and infrastructure in times of need.

U.S. Steel’s production capacity and its focus on research and development are crucial for meeting the evolving demands of the defense industry. The company’s ability to produce advanced high-strength steels and other specialized steel products is essential for the construction of modern military vehicles, ships, and infrastructure. By providing these critical materials, U.S. Steel contributes to the technological advancement and readiness of the U.S. military.

SQM (NYSE: SQM) is a Chilean chemical company and one of the world’s largest producers of lithium, a critical component in batteries used in electric vehicles, consumer electronics, and increasingly, military applications. From powering advanced communication systems to enabling the operation of unmanned vehicles and drones, lithium-ion batteries are essential to modern military operations. SQM’s production capacity and access to vast lithium reserves in the Atacama Desert make it a strategically important player in the global lithium supply chain.

Securing a reliable and stable supply of lithium is crucial for countries like the United States that are heavily reliant on advanced technology for their defense capabilities. By sourcing lithium from SQM, nations can reduce their dependence on potentially unstable or adversarial nations for this critical material. This reduces supply chain vulnerabilities and ensures that defense industries have the necessary resources to produce the equipment and weapons systems required for national security.

Vale S.A. (NYSE: VALE) is a Brazilian multinational corporation and one of the world’s largest producers of iron ore and nickel. Iron ore is a key ingredient in steelmaking, while nickel is a crucial component in stainless steel and various alloys used in aerospace, defense, and other high-performance applications.

Vale’s commitment to sustainable mining practices and social responsibility is also noteworthy. The company has implemented various initiatives to reduce its environmental impact, promote biodiversity, and support local communities. This commitment is crucial for ensuring the responsible sourcing of critical minerals and minimizing the environmental footprint of mining operations, which is particularly important for national security and the long-term sustainability of the defense industrial base.

Piedmont Lithium (NASDAQ: PLL) is a development-stage company focused on establishing a fully integrated lithium hydroxide business in the United States. Their core operation centers around the Carolina Tin-Spodumene Belt in North Carolina, a region with a history of lithium production. Piedmont aims to be a key supplier of lithium hydroxide, a crucial component in electric vehicle batteries and energy storage systems, to the burgeoning U.S. market.

This company matters because they are addressing a critical need for domestically sourced lithium. The U.S. currently relies heavily on imports for its lithium supply, creating potential vulnerabilities in the supply chain. Piedmont’s operations contribute to a more secure and resilient domestic supply of this essential mineral, which is vital for the production of advanced batteries used in defense applications such as electric vehicles, drones, and communication systems.

Uranium Energy Corp (NYSE American: UEC) is a U.S.-based uranium mining and exploration company with a focus on in-situ recovery (ISR) mining projects in Texas, Wyoming, and New Mexico. ISR mining is a less invasive and more environmentally friendly method of uranium extraction compared to traditional open-pit mining. Uranium Energy Corp has a portfolio of permitted and development-stage ISR projects, positioning them to be a significant contributor to the U.S. uranium supply.

After a period of decline, the U.S. is increasingly recognizing the importance of securing a domestic supply of uranium for both energy security and national security purposes. Uranium Energy Corp’s ISR projects offer a more sustainable and environmentally responsible approach to uranium mining, which is crucial for ensuring the long-term viability of the industry and minimizing the environmental impact of uranium production.

By. Michael Kern

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