Daily Brief Energy/Materials: Gold, Crude Oil, American Resources , Epigral, Algoma Steel Group, Southern Copper, Base Oil, Pilbara Minerals, Getchell Gold and more

• After a 9 weeks rally, Gold (GOLD COMDTY) started to pullback, last week, and the pullback continued into this week.
• Some market watchers argue US retail investors piled into Gold ETFs following the Fed’s late-August shift to rate cuts, potentially fueling the metal’s recent upside exhaustion.
• If Gold (GOLD COMDTY) was fueled by retail buying and is now correcting, retail investors will likely chase the dip—a textbook example of herd behavior, potentially driving a rebound.

• US sanctions now target all four of Russia’s largest oil companies, affecting 70% of production and exports
• EU also imposes new sanctions on Russia’s energy revenues
• Russia shifts to alternative currencies for oil trade to evade US dollar restrictions, leading to higher transaction costs and reputational risks

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

• The EMC spin-off aims to surface hidden asset value by separating AREC’s high-growth battery-recycling unit, allowing EMC to attract a pure-play electrification multiple and investors clearer sum-of-the-parts visibility.
• The separation positions AREC as an asset-light critical-materials holding company, retaining minority stakes in ReElement, Novusterra, and Royalty Management while enabling EMC to independently pursue commercialization and partnerships.
• EMC gains dedicated access to growth capital and strategic investors, while AREC enhances financial optionality and valuation clarity across its diversified clean-energy and infrastructure holdings.

• Epigral is strategically shifting its business mix towards higher-margin derivatives and specialty chemicals, which constituted 56% of revenue in H1 FY25, up from 25% in FY22. This transition is expected to enhance profitability and provide more stable growth.
• The company is in a significant capital expenditure phase, aiming to double its production capacity for CPVC Resin and Epichlorohydrin. These expansions position Epigral to capitalize on growing domestic and international demand, driven by initiatives like ‘Make in India’.
• While demonstrating strong top-line growth, the company faces risks associated with the cyclical nature of the chemical industry, volatility in raw material prices, and execution risks related to its large-scale expansion projects.

This content is AI-generated and displayed for general informational purposes only. Please verify independently before use.

• Crude oil futures were moving sideways Monday amid uncertainty around trade talks and enforcement of Russian sanctions.
• Front-month Dec25 ICE Brent futures were trading at 65.67/b (1950 BST) versus Friday’s settle of $65.94/b, while Dec25 NYMEX WTI was at $61.34/b against a previous close of $61.50/b.
• Benchmarks had opened Monday higher before giving up ground that was recovered to leave the market flat from Friday.

• Algoma Steel is undertaking a transformative, high-risk, high-reward strategic shift from traditional blast furnace steelmaking to Electric Arc Furnace (EAF) technology. This C$825-C$875 million project is expected to reduce carbon emissions by approximately 70% and increase production capacity, positioning Algoma as a potential leader in ‘green steel’.
• The company’s financial performance has been highly volatile, swinging from substantial profitability in fiscal 2022 (net income of C$857.7M) to significant losses in fiscal 2024 (net loss of C$222.7M). This reflects the cyclical nature of the steel industry, fluctuating commodity prices, and operational challenges.
• Algoma faces considerable market headwinds, including intense competition from imports in the Canadian market and the constant threat of trade protectionism, such as U.S. tariffs, which can dramatically impact its export-oriented business. The success of its EAF transition and ability to navigate these external pressures will be critical to its future.

This content is AI-generated and displayed for general informational purposes only. Please verify independently before use.

• In our previous insight Copper To End The Year with Seasonal Strength: Onward To 12,000 USD/Ton, we elaborated on the supply issues with copper production. 
• Antofagasta PLC (ANTO LN) has now guided production down to the lower end of the 660-700k range (we assume a midpoint of 680k), or 3%.
• FY26 guidance was also soft (-4-5% from our expectations). We are seeing a spate of guidedowns and will need to monitor them to better understand the deficit situation. 

• US base oils demand likely to stay muted amid expectations of waning end-user consumption and improving supply in coming weeks.
• US base oils demand typically falls in month of November from October.
• Prospect of slowdown in demand would coincide with rise in supply following expected completion of plant-maintenance in H1 Nov 2025.

• The US-Australia critical minerals investment agreement has driven lithium miner Pilbara Minerals’ share price on sentiment, well above fundamentals, on most assessments.
• US-Australia critical minerals deal sends miner share prices surging Pilbara Minerals posts solid September quarter beat Lithium prices remain below new production threshold Most brokers see Pilbara Minerals as overvalued

• What you need to know: • Getchell Gold is the 100% owner of the Fondaway Canyon Gold Project in Nevada, which hosts a 2.3Moz resource (Indicated & Inferred) and a robust PEA outlining a 10.5-year mine life, published in Q1/25.
• • The PEA defined an after-tax base case NPV10% of $474M, an IRR of 47% (at just $2,250/oz Au) and at a low capex of just $227M.
• • At $3,300/oz Au, the NPV10% rises dramatically to ~$1B (at a conservative 10% discount rate).