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Impact Minerals Limited (ASX:IPT) is pleased to announce that it has identified 20 moderate to strong conductors in airborne electromagnetic (AEM) data flown over parts of its 100% owned Arkun Project in the emerging mineral province of southwest Western Australia, a Tier One jurisdiction (Figure 1).
- Twenty moderate to strong electromagnetic (EM) conductors identified at the Arkun Battery Metals project in 400 m line-spaced airborne electromagnetic (“AEM”) survey data collected by the XCalibur HELITEM time-domain system.
- Several priority anomalies coincide with magnetic and gravity anomalies and Ni Cu PGM-in-soil anomalies.
- Many other anomalies have yet to be soil sampled, and this work is a priority for the next Quarter with a view to a maiden drill programme in Q1 2024.
- Broken Hill update: Xplor programme completed. IGO withdraws from joint venture over the alkaline intrusions. Data synthesis and interpretation in progress of all data collected during Xplor and by IGO. Both BHP and IGO remain interested in the broader Broken Hill project.
Impact Minerals’ Managing Director, Dr. Mike Jones, said, “These new conductors at Arkun look very promising and significantly increase the potential for the discovery of massive nickel-copper-PGM sulphides. What’s particularly exciting is that some conductors have coincident soil geochemistry anomalies. However, with many of them still yet to be soil sampled, we are confident of generating more targets for follow-up work, which will include drilling. With the recent REE soil anomalies identified throughout the project area, including the standout Horseshoe prospect, Arkun continues to emerge as a major project for a wide range of essential battery and strategic minerals.”
The airborne EM survey was completed over seven priority areas, covering only about 15% of the Arkun project, by XCalibur Multiphysics using the HELITEM system at a line spacing of 400 metres (Figure 2).
The 20 conductors were identified using a combination of interpretation of individual lines of EM data by consultants Resource Potentials and by reprocessing of the survey data by Intrepid Geophysics using their proprietary 2.5D AEM inversion algorithm. The 2.5D inversion process provides conductivity models and can image steeply dipping, deep, and near-surface targets.
Figure 1. Image of regional magnetic data showing the location of the Arkun project along trend from the Julimar/Gonneville Ni-Cu-PGE deposit owned by Chalice Mining Limited (ASX: CHN).
Also shown is ground held by private company Northam Mining Ltd, in which Chalice Mining is now earning an interest via a joint venture, and ground held by Anglo American Corporation, which surrounds the Arkun Project on three sides. The green lines are publicly available regional AEM flight lines flown in 2020, including one line over the Gonneville deposit (Figure 7).
Two of the survey areas contain numerous EM conductors that have broadly coincident strong nickel- copper-PGM soil geochemistry anomalies: these include 5 AEM anomalies at the Three Eagles prospect and 6 AEM anomalies at the Starfish complex (Figures 2 and 3; and ASX Release 9 August 2023).
In addition, the EM conductors are commonly coincident either with magnetically quiet areas and/or gravity- highs in regional geophysical data, which together may represent mafic and ultramafic intrusions that are potential hosts for nickel-copper-PGM mineralisation (Figures 2 and 3).
Figure 2. Image of regional magnetic data showing the location of the 7 AEM survey areas showing priority conductors (white squares). Three survey lines (AEM-1, AEM-2 and AEM-3) are shown in detail in Figures 4, 5 and 6.
Figure 3. Image of regional gravity data showing the location of the 7 AEM survey areas showingpriority conductors (white squares). Note the Starfish Complex is associated with a strong gravity anomaly. Three survey lines (AEM-1, AEM-2 and AEM-3) are detailed in Figures 4, 5 and 6.
THREE PRIORITY CONDUCTORS
Three prominent conductors that are priority areas for follow-up work have been identified in the 2.5D inversions and are shown here as examples.
Click here for the full ASX Release
This article includes content from Impact Minerals, licensed for the purpose of publishing on Investing News Australia. This article does not constitute financial product advice. It is your responsibility to perform proper due diligence before acting upon any information provided here. Please refer to our full disclaimer here.
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Impact Minerals Limited
Overview
Impact Minerals (ASX:IPT) is an exploration and development mining company focused on discovering and developing new resource projects within Australia. Lake Hope, a recent transformational acquisition by the company and its current flagship asset, is a high-purity alumina (HPA) project in Impact’s home territory of Western Australia, a tier-one jurisdiction.
This advanced-stage project allows the company to fast-track the asset toward development, firmly establishing the company on the road to production and increasing shareholder value.
HPA is a high-value product with various uses in several industries that are key to the transition to a low-carbon world. Its main uses are in LED lighting, micro-LED screens, and ceramic-coated separators in lithium-ion batteries. Both these markets are forecast to grow dramatically over the next decade, and a looming supply shortage is predicted for 2026.
HPA is also necessary for producing synthetic sapphire and scratch-resistant glass. With these ever-widening applications for HPA, demand for this resource is expected to grow from US$3.18 billion to US$12.21 billion by 2030 with a compounded annual growth rate of about 20 percent.
Lake Hope is the company’s current focus as it moves towards production, and where a very shallow, high-grade resource of HPA precursor material has been identified in the top two meters of a dry salt lake. The deposit has unique physical and chemical properties that will allow for inexpensive digging and mining, with transportation to a processing facility off-site in an established industrial area. This will accelerate the approvals processes required to get into production.
Impact is currently focused on lodging a mining lease application. The company aims to bring Lake Hope, which contains almost 1 million tons of potential HPA, into production when the forecast average price for 4N HPA (99.99 percent AL203) and related products is about US$20,000 per ton. The ‘4N’ designation indicates the purity grade, making it suitable for high-tech end uses.
Outstanding economics from the latest scoping study released by the company shows Lake Hope’s potential to be the lowest-cost producer of HPA globally by up to 50 percent.
In June 2023, Impact announced a maiden mineral resource estimate (MRE) of 3.5 million tons at 25.1 percent alumina (Al2O3) for a contained 880,000 tons of alumina. The company also received heritage clearances for the entire Lake Hope deposit further de-risking the project and providing another critical component in the company’s application for a mining lease.
Impact completed a bulk sampling and test pits program at the Lake Hope project in December 2023. The company recently announced a key milestone having produced HPA greater than 99.99 percent (4N) purity from the metallurgical processing of lake clays acquired from Lake Hope.
In February 2024, a new proprietary metallurgical process for producing HPA from the lake clays was identified. Impact produced 99.99 percent (4N) Al2O3 from a low-temperature leach (LTL) process. The LTL process may lower the capital and operating costs to produce HPA compared to the sulphate process which underpinned the recent scoping study. The LTL process will be included in the ongoing pre-feasibility study in parallel with the sulphate process at marginal extra cost to determine the best processing route to HPA. The PFS is due to be completed on schedule in late 2024.
A comparison of the LTL process and the sulphate process
The company received a significant research and development refund of $753,000 from its exploration activities completed in the financial year ending June 30th, 2022. The company is well funded to finance the pre-feasibility study at the Lake Hope High Purity Alumina project and exploration activities at the Arkun battery minerals project.
Impact Minerals was also one of the inaugural cohort of seven companies selected to be part of the prestigious BHP Xplor program. BHP Xplor, an accelerator program introduced by BHP in August 2022, is designed to help provide participants with the opportunity to accelerate their growth and the potential to establish a long-term partnership with BHP and its global network of partners.
The BHP Xplor funding was used to identify new target areas for copper and other energy metals around the Broken Hill area in New South Wales, eastern Australia, where Impact has been quietly adding to its ground position for several years.
Additionally, the company is exploring its large Arkun battery metals project, also in Western Australia which covers nearly 2,900 square kilometres. Three new exploration licence applications were submitted recently immediately north of the Arkun project along trend from the recently discovered REE soil geochemistry anomalies at Hyperion, Swordfish and Horseshoe, and the Caligula copper anomaly. These anomalies require drill testing which will occur in 2024 and is an exciting development in the emerging mineral province of southwest WA.
A strong management team with over 50 years of combined industry experience leads the company. With a mining and exploration geology degree, Dr. Mike Jones, managing director, launched a long career consulting and leading mining organizations. Peter Unsworth, the non-executive chairman, has more than 35 years of experience in multiple financial sectors, such as securities industries and wealth management. Paul Ingram, a non-executive director, has led several mining companies since 2003. Impact Minerals has the experience and expertise to lead the company to success.
Company Highlights
- Impact Minerals is an exploration and development mining company focused on rapidly moving its flagship Lake Hope high-purity alumina (HPA) project towards production.
- Lake Hope project has a high-grade maiden mineral resource estimate (MRE) of 3.5 million tonnes at 25.1 percent alumina (Al2O3), for a contained 880,000 tonnes of alumina that can be converted to HPA.
- HPA is used throughout multiple industries, and the overall HPA market is projected to grow by a CAGR of 18.4 percent by 2030.
- A pre-feasibility study is currently in progress, and Impact plans to lodge a mining lease application by Q3 2024 after results of its scoping study indicated that Lake Hope could potentially be one of, if not the lowest-cost producer of HPA globally, possibly by a significant margin of up to 50 percent.
- The company’s project portfolio also includes assets with high-grade mineral deposits of a range of base, critical and precious metals.
- Impact Mineral’s 2,000-square-mile Arkun nickel-copper-PGE project in Western Australia has produced encouraging assays motivating further exploration with maiden drill programmes planned for 2024.
- The company is also exploring its Broken Hill copper project in New South Wales under the auspices of the BHP Xplor program.
- A strong management team leads the company with experience in geology, mining and corporate finance.
Key Projects
Lake Hope HPA Project
Impact Minerals’ Lake Hope HPA project is in Western Australia, a tier-one mining jurisdiction. HPA is a crucial component in many new and emerging technologies, creating ongoing demand for high-grade sources. The Lake Hope project has become the company’s flagship as it moves toward production.
Project Highlights:
- Maiden Mineral Resource Estimate: A maiden mineral resource of 3.5 million tonnes at 25.1 percent alumina (Al2O3) for a contained 880,000 tonnes of alumina has been defined at the Lake Hope HPA Project. About 88 percent of the resource, or 775,000 tonnes of alumina, is in the higher confidence indicated resource category.
- Amenable to Open-pit Mining: The Lake Hope project is a unique HPA asset amenable to shallow, open-pit mining. The deposit is soft and shallow, allowing for cheap digging and minimal infrastructure requirements. This type of deposit also lowers the environmental footprint of the operation.
- Fast-tracked to Production: The company is currently awaiting its Mining Lease Application. Once granted, the company will begin working towards a pre-feasibility study and mini pilot plant. Impact Minerals plans to reach a complete pilot plant by 2026.
- Impressive Results of the 2023 Scoping Study: Outstanding economics show Lake Hope to potentially be the lowest-cost producer of High Purity Alumina (HPA) globally by up to 50 percent. Key outcomes from the scoping study include:
- Annual production of 10,000 tpa of 4N HPA with an initial 25-year mine life
- Annual EBITDA of A$174 million.
- 2 years construction period with 5,000 tonnes of production during the first year, 8,000 tonnes in the second year and 10,000 tonnes of production thereafter.
- US$934 million post-tax NPV8 at an IRR of 55 percent.
The scoping study was underpinned by a sulphuric acid process allowing the company to achieve a new milestone by producing HPA with purity of more than than 99.99 percent (4N) from the metallurgical processing of lake clays acquired from Lake Hope. The company further identified a new proprietary metallurgical process for producing HPA from the lake clays. Known as the low-temperature leach (LTL) process, this also produced 99.99 percent (4N) Al2O3 and has the potential to lower even further the capital and operating costs to produce HPA compared to the sulphate process. The LTL process will be included in the ongoing pre-feasibility study along with the sulphate process to determine the best processing route to HPA. The PFS is due to be completed in late 2024.
Broken Hill Copper Project
The Broken Hill project has a significant land position of 815 square kilometers and hosts multiple targets with the potential for high-grade copper. Broken Hill is located in New South Wales, Australia, an area known for its prolific silver-lead-zinc mining operations and the giant Broken Hill deposit.
Project Highlights:
- Participant in the BHP Xplor Program: Impact was selected for the BHP Xplor program based on its Broken Hill project. The program is designed to allow participants to accelerate growth and establish a long-term partnership with BHP.
- Potential for Additional Minerals and Deposits: As well as copper, the project has significant exploration potential for magmatic nickel-copper-PGE sulphides, and at the time the host rocks were formed, Broken Hill was located close to the world-class nickel-copper-PGE deposit of Jinchuan and the significant Lengquisheng deposit. The project area also has the potential to contain zinc-lead-silver deposits, providing even more value.
Arkun Nickel-Copper-Gold-Lithium-REE Project
The Arkun project is a 2,900-square-kilometer nickel, copper and gold project located in the emerging Ni-Cu-PGE province near the world-class Julimar Ni-Cu-PGE deposit and surrounded by Anglo American Corporation, which secured its ground holding shortly after Impact secured its asset. Anglo-American is one of the world’s top ten mining companies, and their presence in the region brings confidence in the project’s potential.
Project Highlights:
- Additional Exploration Underway: Impact plans follow-up work programs, including drilling, at its priority targets.
- Significant Targets Identified: Recent soil sampling identified two new prospects:
- Hyperion prospect - Located in the northwestern part of the project area returned with rare earth element anomalism of up to 5,880 ppm (0.59 percent) total rare earth oxide (TREO+Y) and neodymium and praseodymium (Nd+Pr) of up to 21 percent.
- Caligula prospect - Initially identified on the roadside, the Caligula prospect is a large and significant target for porphyry copper mineralisation.
- Three New Exploration Licences: Impact applied for three new exploration licences expanding Arkun project along trend from the recently discovered REE soil geochemistry anomalies at Hyperion, Swordfish and Horseshoe as well as the Caligula copper anomaly.
Management Team
Peter Unsworth - Non-executive Chairman
Peter Unsworth, formerly a chartered accountant, has over 35 years of experience in the corporate finance, investment and securities industries and a wealth of management experience with public and private companies. A former executive director with a leading Western Australian stockbroking company, Unsworth has been a director of several public exploration and mining companies. He recently completed a long time serving as chairman of the Western Australian Government-owned Gold Corporation (operator of The Perth Mint). Unsworth is the founding chairman of Impact Minerals.
Dr. Mike Jones - Managing Director
Dr. Mike Jones is the founding managing director of Impact Minerals Limited, which was listed on the Australian Stock Exchange in November 2006. Reporting to the board of directors, he is responsible for the company's performance as it moves towards production at its Lake Hope High Purity Alumina Project and also for implementing strategies to explore and maximize the value of the company's other extensive tenement holdings.
Since listing, he has helped raise more than $60 million to help fund the exploration of Impact’s projects and managed the company through significant adverse events, including the global financial crisis and the Fukushima nuclear disaster, which affected Impact’s considerable investment in the uranium sector, a five-year global downturn in the mining sector and more recently, the COVID-19 pandemic.
Paul Ingram - Non-executive Director
Paul Ingram is a geologist with extensive experience managing major mineral exploration programs for several publicly listed companies and has been involved in the mining sector for over thirty years. He has designed and implemented innovative techniques for exploration in remote areas and has managed projects in countries throughout Australia and East Asia. Ingram has been a director of the following listed companies in the past three years: Polo Resources from January 2008 to January 2011; A-Cap Resources since June 2009; Consolidated Global Investments since September 2006; Caledon Resources from February 2003 to March 2008; and Australian Pacific Coal since March 2011.
Dr Frank Bierlein - Non-executive Director
Dr. Frank Bierlein is a geologist with 30 years of experience as a consultant, researcher, lecturer and industry professional. Bierlein has held exploration and generative geology management positions with QMSD Mining, Qatar Mining, Afmeco Australia and Areva NC, and consulted for, among others, Newmont Gold, Resolute Mining, Goldfields International, Freeport McMoRan, and the International Atomic Energy Agency. He is currently a non-executive director of PNX Metals. He was previously a non-executive director of Gold Australia NL and chaired the advisory board of a Luxembourg-based private equity fund between 2014 and 2021.
Diamond Drilling Program Expanded and High-Grade M1 Intercept Returned
HIGHLIGHTS:
- Drilling activities along the ‘Golden Corridor’ progressing well; current Reverse Circulation (RC) program complete (28 holes for 5,024m) and diamond tails program expanded to 2,500m (approx. 1,900m complete across 19 holes).
- Represents the first diamond drilling undertaken at the 2.3km-long Ricciardo deposit, and the nearby M1 deposit, by any operator in ten years.
- Assay results for the first diamond hole at M1 (infill focus) were significantly higher grade than expected:
- 8.9m @ 8.93 g/t Au from 156m, incl. 2m @ 23.83 g/t from 158.3m
- M1 offers clear high-grade extension potential, which is planned to be a focus of further drilling in H2 2024.
- Diamond holes drilled beneath the Silverstone Central pit (Ricciardo), in an area with no historical drilling, returned:
- 7m @ 2.59 g/t Au from 229m, incl. 1m @ 10.81 g/t Au from 233.7m
- 4.6m @ 1.20 g/t Au from 235m
- Extensional RC drilling under the Eastern Creek pit (Ricciardo) returned:
- 7m @ 2.54 g/t Au from 170m, incl. 1m @ 7.48 g/t from 172m
- 9m @ 1.42 g/t Au from 180m
- Ricciardo and M1 both sit in the 25km-long ‘Golden Corridor’ at Golden Range, which hosts six discrete deposits (18 historic pits) that are all open at depth and possess immediate growth potential.
- Diamond drilling set to be completed in mid-August, with all assays expected by mid-September and update of the Ricciardo MRE targeted for Q4 2024.
- Further growth-focussed drilling of the ‘Golden Corridor’ planned for H2 2024.
The results reported in this release are for a further eight (8) of the diamond holes and the first nine (9) of the RC holes drilled in the current program (representing all outstanding results received to date). Results for the first four (4) diamond holes were previously reported (refer WA8 ASX release dated 3 July 2024). The new results continue to demonstrate the outstanding Mineral Resource Estimate (MRE) growth potential that exists at Ricciardo, M1, and along the broader ‘Golden Corridor’ trend.
Figure 1: The Golden Range and Fields Find Projects. Mines and projects within trucking distance of the Warriedar tenure are shown. The location of the Ricciardo deposit within the 25km-long ‘Golden Corridor’ at Golden Range is annotated.
M1 deposit
The M1 deposit is located 7km north of the Ricciardo deposit, and right alongside the existing processing plant (refer Figure 2); within the 25km long Golden Corridor trend.
Initial results have been returned from diamond tails drilled at the M1 deposit, with significant intersections returned in both holes. The holes were planned to test the existing MRE model,
Figure 2: The Golden Corridor within the Golden Range Project. The M1 deposit is located 7km north of the Ricciardo deposit. The image on the LEFT is gravity over shaded residual magnetic RTP.
potential parallel lodes and gaps within the MRE area. This drilling represents the first time this deposit has been revisited and drilled since 2013.
Hole M1RC191 was drilled in the centre of the modelled resource area and returned significantly higher grade than expected (refer Figure 3). This is an excellent result and aids Warriedar in the larger goal of building high-priority MRE areas for rapid development.
Click here for the full ASX Release
This article includes content from Warriedar Resources Limited, licensed for the purpose of publishing on Investing News Australia. This article does not constitute financial product advice. It is your responsibility to perform proper due diligence before acting upon any information provided here. Please refer to our full disclaimer here.
What Was the Highest Price for Gold? (Updated 2024)
While some have posited that the gold price may break US$3,000 per ounce and carry on as high as US$4,000 or US$5,000, there are those with hopes that US$10,000 gold or even US$40,000 gold could become a reality.
These impressive price predictions have investors asking, what was the highest gold price ever? The answer to that question is revealed below. And by looking at how the gold price has moved historically, it’s possible to understand what that means for the yellow metal in the future.
How is gold traded?
Before discovering what the highest gold price ever was, it’s worth looking at how the precious metal is traded. Knowing the mechanics behind gold's historical moves can help illuminate why and how its price changes.
Gold bullion is traded in dollars and cents per ounce, with activity taking place worldwide at all hours, resulting in a live price for the metal. Investors trade gold in major commodities markets such as New York, London, Tokyo and Hong Kong. London is seen as the center of physical precious metals trading, including for silver. The COMEX division of the New York Mercantile Exchange is home to most paper trading.
There are many popular ways to invest in gold. The first is through purchasing gold bullion products such as bullion bars, bullion coins and rounds. Physical gold is sold on the spot market, meaning that buyers pay a specific price per ounce for the metal and then have it delivered. In some parts of the world, such as India, buying gold in the form of jewelry is the largest and most traditional route to investing in gold.
Another path to gold investment is paper trading, which is done through the gold futures market. Participants enter into gold futures contracts for the delivery of gold in the future at an agreed-upon price. In such contracts, two positions can be taken: a long position under which delivery of the metal is accepted or a short position to provide delivery of the metal. Paper trading as a means to invest in gold can provide investors with the flexibility to liquidate assets that aren’t available to those who possess physical gold bullion.
One significant long-term advantage of trading in the paper market is that investors can benefit from gold’s safe-haven status without needing to store it. Furthermore, gold futures trading can offer more financial leverage in that it requires less capital than trading in the physical market.
Interestingly, investors can also purchase physical gold via the futures market, but the process is complicated and lengthy and comes with a large investment and additional costs.
Aside from those options, market participants can invest in gold through exchange-traded funds (ETFs). Investing in a gold ETF is similar to trading a gold stock on an exchange, and there are numerous gold ETF options to choose from. For instance, some ETFs focus solely on physical gold bullion, while others focus on gold futures contracts. Other gold ETFs center on gold-mining stocks or follow the gold spot price.
It is important to understand that you will not own any physical gold when investing in an ETF — in general, even a gold ETF that tracks physical gold cannot be redeemed for tangible metal.
With regards to the performance of gold versus trading stocks, gold has an interesting relationship with the stock market. The two often move in sync during “risk-on periods” when investors are bullish. On the flip side, they tend to become inversely correlated in times of volatility.
According to the World Gold Council, gold's ability to decouple from the stock market during periods of stress makes it “unique amongst most hedges in the marketplace.” It is often during these times that gold outperforms the stock market. For that reason, it is often used as a portfolio diversifier to hedge against uncertainty.
What was the highest gold price ever?
Gold hit US$2,483.35, its all time highest price at the time of this writing, on July 17, 2024. Gold broke through the important psychological level of US$2,000 per ounce in late 2023 on rising expectations that the US Federal Reserve would begin to reverse course on interest rates, and climbed throughout Q2 to over US$2,450 in May.
While interest rate cuts have yet to materialize as of mid-July, gold climbed to its new all-time high in the wake of July 15 comments by Fed Chair Jerome Powell in which he indicated the central bank would be willing to cut interest rates before inflation reaches its 2 percent target.
Fears of a looming recession — or the strong belief that a recession is already here — are also highly supportive for gold heading as we head deeper into 2024.
Gold price chart, July 17, 2014, to July 18, 2024.
Chart via Quotemedia.
Despite these recent runs, gold has seen its share of both peaks and troughs over the last decade. After remaining rangebound between US$1,100 and US$1,300 from 2014 to early 2019, gold pushed above US$1,500 in the second half of 2019 on a softer US dollar, rising geopolitical issues and a slowdown in economic growth.
Gold’s first breach of the significant US$2,000 price level in mid-2020 was due in large part to economic uncertainty caused by the COVID-19 pandemic. To break through that barrier and reach what was then a record high, the yellow metal added more than US$500, or 32 percent, to its value in the first eight months of 2020.
The gold price neared that level again in early 2022 as Russia's invasion of Ukraine collided with rising inflation around the world, increasing the allure of safe-haven assets. In 2023, continued inflation and subsequent rate hikes from the Fed threatened the possibility of a recession, once again pushing gold above US$2,000 and even putting it in sight of its then all-time high.
The evolving banking crisis in the spring of 2023 and the outbreak of the Israel-Hamas war in October also placed upward pressure on gold, allowing it to test its previous all-time high.
What's next for the gold price?
What's next for the gold price is never an easy call to make. There are many factors that affect the gold price, but some of the most prevalent long-term drivers include economic expansion, market risk, opportunity cost and momentum.
Economic expansion is one of the primary gold price contributors as it facilitates demand growth in several categories, including jewelry, technology and investment. As the World Gold Council explains, “This is particularly true in developing economies where gold is often used as a luxury item and a means to preserve wealth.” Market risk is also a prime catalyst for gold values as investors view the precious metal as the “ultimate safe haven,” and a hedge against currency depreciation, inflation and other systemic risks.
Going forward, in addition to the Fed, inflation and geopolitical events, experts will be looking for cues from factors like supply and demand. In terms of supply, the world’s five top gold producers are China, Australia, Russia, Canada and the US. The consensus in the gold market is that major miners have not spent enough on gold exploration in recent years. Gold mine production has fallen from around 3,200 to 3,300 metric tons each year between 2018 and 2020 to around 3,000 to 3,100 metric tons each year between 2021 and 2023.
On the demand side, China and India are the biggest buyers of physical gold, and are in a perpetual fight for the title of world’s largest gold consumer. That said, it's worth noting that the last few years have brought a big rebound in central bank gold buying, which dropped to a record low in 2020, but reached a 55 year high of 1,136 metric tons in 2022.
The World Gold Council has reported that central bank gold purchases in 2023 came to 1,037 metric tons, marking the second year in a row above 1,000.
"We think that gold has entered into a new phase of this bull market," Adam Rozencwajg, managing partner at Goehring & Rozencwajg, told the Investing News Network (INN) in a June 2023 interview. "It probably started in the third and fourth quarter of last year, and it really revolves around central banks' behavior as much as anything else. I think it's going to propel gold much much higher in this leg of the bull market."
Joe Cavatoni, North American market strategist at the WGC, told INN in an email at the end of Q1, “As central banks continue to be significant buyers and geopolitical risks and global uncertainties drive investors towards the perceived safety of gold, the current environment underscores gold’s importance as a strategic asset for portfolio diversification and risk mitigation. Therefore, while there may have been a perception of western disinterest in gold, recent developments indicate a sustained and broad-based demand for the precious metal.”
At the beginning of Q3, INN spoke with Brien Lundin, editor of Gold Newsletter, at the Rule Symposium in Boca Raton, Florida.
"I think clearing US$2,400 for good — trading a few weeks above that level would be key," Lundin said. "Eventually I think we're going to go much higher. The timing of that is always the hard part. Getting back to where I think we're going to be at the end of this cycle, I think the gold price is going to be somewhere between US$6,000 and US$8,000."
Should you beware of gold price manipulation?
As a final note on the price of gold and buying gold bullion, it’s important for investors to be aware that gold price manipulation is a hot topic in the industry.
In 2011, when gold hit what was then a record high, it dropped swiftly in just a few short years. This decline after three years of impressive gains led many in the gold sector to cry foul and point to manipulation. Early in 2015, 10 banks were hit in a US probe on precious metals manipulation. Evidence provided by Deutsche Bank (NYSE:DB) showed “smoking gun” proof that UBS Group (NYSE:UBS), HSBC Holdings (NYSE:HSBC), the Bank of Nova Scotia (NYSE:BNS) and other firms were involved in rigging gold and silver rates in the market from 2007 to 2013.
Not long after, the long-running London gold fix was replaced by the LBMA gold price in a bid to increase gold price transparency. The twice-a-day process, operated by the ICE Benchmark Administration, still involves a variety of banks collaborating to set the gold price, but the system is now electronic.
Still, manipulation has by no means been eradicated, as a 2020 fine on JPMorgan (NYSE:JPM) shows. The next year, chat logs were released in a spoofing trial for two former precious metals traders from the Bank of America’s (NYSE:BAC) Merrill Lynch unit. They show a trader bragging about how easy it is to manipulate the gold price.
Gold market participants have consistently spoken out about manipulation. In mid-2020, Chris Marcus, founder of Arcadia Economics and author of the book “The Big Silver Short,” said that when gold fell back below the US$2,000 mark after hitting close to US$2,070, he saw similarities to what happened with the gold price in 2011.
Marcus has been following the gold and silver markets with a focus specifically on price manipulation for nearly a decade. His advice? “Trust your gut. I believe we’re witnessing the ultimate ’emperor’s really naked’ moment. This isn’t complex financial analysis. Sometimes I think of it as the greatest hypnotic thought experiment in history.”
Investor takeaway
While we have the answer to what the highest gold price ever is as of now, it remains to be seen how high gold can climb, and if the precious metal can reach as high as US$5,000, US$10,000 or even US$40,000.
Even so, many market participants believe gold is a must have in any investment profile, and there is little doubt investors will continue to see gold price action making headlines this year and beyond.
This is an updated version of an article first published by the Investing News Network in 2020.
Don’t forget to follow us @INN_Resource for real-time updates!
Securities Disclosure: I, Melissa Pistilli, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.
AU$1.50 Valuation for Siren Gold ‘Achievable,’ says Analyst Report
“SNG has continued exploration on its tenement holdings in favourable geological terrains at Reefton and also at the 0.588 Moz Sams Creek porphyry project about 120 km
north of Reefton in 81 percent/19 percent joint venture with OceanaGold (TSX:OGC),” the report said.
The report noted the company’s high-grade, deep gold mine potential with antimony as a co-products at its Reefton goldfield property.
“SNG sees potential for several +million oz gold deposits to be discovered at Reefton along strike and especially down dip at the old mines, and recent work at Lyell and Auld Creek in the north and at Langdons is providing strong evidence for the potential for a large scale aggregated antimony resource,” the report said.
Report highlights:
- SNG has been showing an “active and dynamic” track record since its listing in October 2020.
- SNG has attractive tenements located in the Reefton line of lode within the West Coast Goldfields, with similar geology as the prolific Victorian Goldfields.
- Potential for getting to more than 2 Moz resource, and a two-year target of AU$1.50 is achievable
- Confirmed resources may lead to a quicker pathway to production.
For the full analyst report, click here.
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