Basic Materials

Juniors on Radar: Explorers on the Move Today

Wed 06 Apr 22, 11:20am (AEST)

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Key Points

  • Nickel and aluminium prices edge higher
  • Lithium: Latin Resources and Askari Metals
  • Silver: Thomson Resources
  • Uranium: 92 Energy
  • Graphite: Sovereign Metals

The S&P/ASX 200 Materials Index is the second worst performing sector on Wednesday, down -2.1%.

Materials (ASX Sector) LIVE DATA - Market Index

The local sharemarket and Wall Street have both pulled back sharply following a V-shaped rebound.

Last week's winners have turned to today's losers, with stocks from sectors such as lithium, rare earths, vanadium and uranium trading sharply lower.

Commodities

#1 Nickel

Nickel was one of few commodities to trade noticeably higher overnight, up 2.7% to US$34,125 a tonne.

#2 Aluminium

Aluminium inched 1.2% higher to US$3,488 a tonne, not too far from March highs of US$3,966 a tonne.

Earlier this month, Prime Minister Scott Morrison announced a ban on alumina and aluminium exports to Russia. Australia supplies circa 20% of Russia's alumina, a key ingredient used to produce aluminium.

Company announcements 

#1 Latin Resources

Several positive lithium exploration updates have bumped Latin Resources (ASX: LRS) shares up more than 300% since mid-March.

Latin Resources is now expanding its footprint around the highly prospective Bananal Valley district in eastern Brazil, securing an additional 50-hectare lithium tenement. The company’s stock rallied 18% as the market opened. 

The agreement is an exclusive and binding 12-month option agreement to acquire a 100% interest in the new tenement. 

“Our reconnaissance mapping and outcrop sampling of this area has shown that the grades of surface samples from these pegmatites are as high as those from our early sampling to the west where we are currently drilling,” said Managing Director, Chris Gale. 

If Latin exercises the call option, it shall pay the other party US$240,000 in cash and US$120,000 in shares. A further sum of US$640,000 must be paid within 13 months after the exercise of the call option. 

The company had A$643,000 in cash as at 31 December 2021. Earlier this week, the company’s largest shareholder exercised 100m options for a consideration of $1.2m.

#2 92 Energy 

Uranium hopeful 92 Energy (ASX: 92E) intersected “the highest levels of radioactivity to date” during its Winter-2022 drill program at the Gemini Mineralised Zone (GMZ) in Athabasca, Canada. The company’s stock is up 5% in early-trade.

Elevated radioactivity was intersected in 11 out of 12 drillholes at the GMZ. Drill core samples from the program have been sent for chemical analysis, with results expected in the next 1-2 months. 

“Importantly, the final four drillholes have provided a better understanding of the geological makeup of the GMZ and resulted in the strongest intercepts to-date. We look forward to receipt of the assays and following-up these results during our Summer-2022 drill program, commencing in June,” said Managing Director Siobhan Lancaster. 

#3 Sovereign Metals 

Sovereign Metals (ASX: SVM) is up almost 40% in the last two sessions.

On Tuesday, the explorer updated its Mineral Resource Estimate for its Kasiya Project in Malawi - confirming it as the "world's largest rutile deposit and second largest graphite deposit."

#4 Thomson Resources

Thomson Resources (ASX: TMZ) shares rallied 18% in early trade following high-grade intercepts for silver and base metals at the Webbs Silver Project in NSW.

Though, the company's shares remain down -25% year-to-date.

Management said the company's Mineral Resource Estimate (MRE) is "well advanced".

"What we will end up with is an MRE that we will have a lot of confidence in. Our better understanding of the geological setting again throws up clear target areas for exploration drilling to expand and extend the resource," said Executive Chairman David Williams.

#5 Askari Metals

Lithium hopeful Askari Metals (ASX: AS2) has reported extensive pegmatite outcrops at a previously unexplored area of the Barrow Creek Lithium Project in NT.

Assay results are expected to be announced by June.

"The company has looked forward to getting onto this South-Eastern area of the Barrow Creek Lithium Project for some time and was welcomed by some very large pegmatites over a considerable strike length," said VP of Exploration and Geology, Johan Lambrechts.

The company's stock is up 7.5% in early trade.

Written By

Kerry Sun

Finance Writer & Social Media

Kerry holds a Bachelor of Commerce from Monash University and was Vice President of the University Network for Investing and Trading (UNIT). He is an avid swing trader, and drawn to breakouts and technical set ups. Outside of writing and trading, Kerry is a huge UFC fan, loves poker and bouldering.

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