Trump policies spur commodity turmoil as rare earth prices soar on Chinese export cuts
Although yet to take office, US president-elect Donald Trump is already having an impact on global mining and energy commodity markets.
China, reportedly in response to news that Mr Trump intends to create a number of sanctions against it, has responded by cutting back on exports of a number of key minerals.
This, in turn, has sent prices for rare earths and other metals skyrocketing, with antimony – for which China accounts for 48% of global antimony production – surging 40% in one day.
Local miners benefiting
Australian rare earth producers are seeing their share prices surge on the back of cuts in Chinese exports.
China halted exports of gallium, germanium and antimony earlier this week because of their widespread military applications in the United States.
There are also market fears that China may move on other critical minerals such as copper, nickel or cobalt.
Tighter controls
Graphite, a key component in lithium-ion batteries, is also being targeted by China.
China is reportedly planning to tighten end-user and end-use export controls on dual-use items.
The US currently depends on China for the bulk of its natural and synthetic graphite supply, used in the steel and battery industries.
It has not produced natural graphite since 1990.
US LNG impact
Mr Trump is also affecting the global LNG market, with a new study highlighting the potential impact on the global energy balance should he, as indicated, remove the Biden government’s controversial pause on new LNG developments early in his tenure.
A study commissioned by the Asia Natural Gas and Energy Association (ANGEA) has found that coal demand will surge in coming decades unless there is significant new supply of US LNG, the world’s biggest gas exporter.
The study found continued growth in LNG production from the US is essential to balancing global markets and providing emerging Asia with an affordable and available alternative to the high-emitting coal that is currently the region’s dominant electricity source.
Asian demand
ANGEA chief executive officer Paul Everingham said the study forecasts LNG demand from Asia growing from 270 million tonnes per annum in 2024 to 510Mtpa in 2050.
This is expected to fuel economic and population growth across emerging economies and support investment in renewables and a commensurate reduction in greenhouse gas emissions.
The study modelled two scenarios: one where the current halt in US LNG export approvals to non-free trade agreement countries is lifted early in 2025 and another where this ‘pause’ stays in place long term.
“If the pause is lifted and approvals and development of export facilities resume, then US LNG is expected to comprise a third of global supply by 2035,” Mr Everingham said.