With a market capitalization of approximately C$10 million and no debt, Riverside Resources (TSXV:RRI) has successfully advanced over 80 exploration projects and has completed seven successful spinouts and royalty transactions over its 17-year history. Founded in 2007, the company focuses on precious and base metals, with a unique business model designed to minimize financial risk while maximizing exploration opportunities.

Riverside’s diversified portfolio spans different geographies and commodities, including gold, silver, copper and rare earth elements (REE) in Ontario and British Columbia in Canada, and across Mexico. Riverside is well-capitalized, with over $5 million in cash on hand, no debt, and a well-established royalty portfolio. This strong financial position allows the company to continue exploring new opportunities while reducing operational risks.

Riverside Resources’ Ontario-based gold projects are located in the Western Abitibi region, one of Canada’s most prolific gold-producing areas. The company’s assets are near Equinox Gold’s Greenstone gold mine, which provides significant potential for future development or acquisition. The Greenstone mine is expected to produce more than 390,000 ounces of gold annually for the first five years of its over 15 years of mine life. As this mine nears the end of its life, Riverside’s nearby properties could provide valuable ore, potentially making them attractive targets for acquisition by Equinox or other major players in the region.

Company Highlights

• Riverside Resources has successfully advanced over 80 exploration projects using more than $85 million in partner-funded exploration.
• Riverside’s Ontario gold projects are strategically located near Equinox Gold’s Greenstone Mine, offering significant potential for future development or acquisition.
• The Cecilia gold-silver project in Sonora, Mexico, is advancing through a partner-funded drilling program with Fortuna Silver Mines, offering significant discovery potential.
• With over C$5 million in cash and no debt, Riverside Resources is financially strong, ensuring sustained exploration activity.
• The company has completed seven successful spinouts and royalty transactions over its 17 year history, creating substantial value for shareholders.
• The company’s business model minimizes financial risk by partnering with larger companies, enabling multiple simultaneous exploration projects.

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Investor Insight

With its focused and strategic goals of advancing, expanding and de-risking its highly prospective gold and cobalt resource in Finland, Mawson Finland is well-placed to become a key player in Europe’s growing precious metals and battery markets.

Overview

Mawson Finland (TSXV:MFL) is a relatively new listed exploration-stage mining development company focused on gold-cobalt in northern Finland. The company is advancing its 100 percent owned Rajapalot gold-cobalt project in Finland’s Lapland region. The project covers 18,000 hectares and boasts an inferred resource of 9.8 Mt consisting of 867,000 oz gold at 2.8 g/t and 4,311 tonnes of cobalt at 441 parts per million (ppm). The company aims to de-risk and expand this project, targeting resource growth through drilling. A completed preliminary economic assessment (PEA) estimated a net present value (NPV) of US$211 million and a 27 percent internal rate of return (IRR) based on US$1,700 gold price, with significant upside from greenfield exploration.

Mawson Finland is driven by a highly experienced local management and technical team, and supported by a strong Finnish investor ownership, all committed to rapidly advancing the Rajapalot project. Noora Ahola, the CEO of Mawson Finland, is a seasoned mining professional with over a decade of experience working on the Rajapalot gold-cobalt project. Based in Rovaniemi, Finland, Ahola has played a key role in advancing the project under its previous owner, Mawson Gold, and in bringing in a roster of Finnish investors into the company. Mawson Finland has a tight shareholder structure, with 19 million shares outstanding and no warrants.

Committed to sustainable development, Mawson Finland places a strong emphasis on environmental stewardship and community engagement. The company adheres to Finland’s rigorous environmental regulations, conducting its operations with a focus on minimizing the ecological impact in the area in which it operates. The ethical sourcing of cobalt, a metal critical for electric vehicle batteries, aligns the project well with current global efforts to ensure responsible supply chains for green energy technologies.

Company Highlights

• Mawson Finland is a newly listed exploration company focused on advancing its gold-cobalt project in the Lapland Region of Finland, a tier 1 mining jurisdiction.
• The project hosts multiple high-grade zones, which have been the focus of extensive exploration activities.
• Cobalt, a key by-product of the Rajapalot project, is crucial for the manufacturing of electric vehicle (EV) batteries and renewable energy storage solutions.

Key Project

Rajapalot Gold-Cobalt Project

The Rajapalot gold-cobalt project is the cornerstone asset of Mawson Finland, situated in the Lapland region of northern Finland, a tier 1 location. Covering approximately 18,000 hectares, the project is distinguished by its significant gold and cobalt mineralization, making it one of the notable dual-commodity projects in Europe.

The project hosts multiple high-grade gold-cobalt zones, including Palokas, South Palokas, Raja and Rumajärvi. These zones have been the focus of extensive exploration activities, leading to the delineation of a substantial inferred mineral resource. The resource estimates indicate the presence of both gold and cobalt, with gold grades and cobalt credits enhancing the overall economic potential of the project. The mineralization remains open at depth and along strike, suggesting considerable upside from resource expansion through further drilling.

Rajapalot is characterised by its favourable geology within the Paleoproterozoic Peräpohja Belt. The mineralization is associated with metamorphosed volcanic and sedimentary rocks. Anomalous gold is known to correlate with elevated levels of cobalt, bismuth, and other minerals. The area’s geological similarities to other significant mining districts add to the Project’s prospectivity.

Mawson Finland has undertaken comprehensive exploration programs, including diamond drilling, geophysical surveys, and geological mapping. These efforts have not only expanded the known mineralized zones, but have also identified new targets for future exploration. The company’s strategy focuses on both increasing the resource base and advancing the project towards a feasibility study.

Mawson Finland has completed and reported on its 2024 drill results. The company’s goal remains increasing its gold and cobalt resources at the Rajapalot project. The upcoming results will focus on expanding known high-grade zones and testing new exploration targets, with the goal of boosting both the gold and cobalt resources. These efforts are part of the company’s broader strategy to demonstrate the full potential of the project and to continue growing the resource.

Management Team

Neil MacRae – Executive Chairman

Neil MacRae is a capital markets professional with 29 years of experience in investor relations, commodities trading and corporate development within the global mining industry. MacRae holds a Bachelor of Arts degree from the University of Calgary and started his career in 1994 with Mitsui & Co. (Canada). Over the years, he has held various management and investor relations roles with companies such as First Majestic Silver, Sherwood Copper (merged with Capstone in 2008), Farallon Mining (sold to Nyrstar in 2011), NovaGold Resources, and Santacruz Silver Mining. MacRae was previously a director of Mawson Gold.

Noora Ahola – President, CEO and Director

Noora Ahola is a forestry engineer with a masters degree in natural resources and Landscape Management. She has developed strong experience within the Finnish environmental administration, applying environmental and other land-use legislation for nature protection and other purposes. Her most recent roles include managing director of Mawson Oy and interim CEO and environmental director of Mawson Gold. She also worked at The Centre for Economic Development, Transport and the Environment for Lapland (ELY-Centre) in the nature protection unit as a manager for a program based on developing biodiversity and ecological connections between Natura 2000 sites. As environmental director at Mawson Gold, Ahola set environmental policy, and was responsible for permitting, environmental monitoring and management and research plans. She was responsible also for identifying and managing key environmental risks associated with Mawson Gold’s projects and for ensuring all ESG factors are effectively addressed and managed. Ahola continues to represent Mawson Oy as a director in the Lapland Chamber of Commerce and Finnish Mining Association boards. She is also a member of the national Chamber of Commerce delegation.

Nick DeMare – Chief Financial Officer

Nick DeMare, a chartered professional accountant, has been president of Chase Management since 1991, providing accounting, management, securities regulatory compliance and corporate secretarial services to private and public-listed companies. DeMare also serves as an officer and/or director of a number of public-listed companies. He holds a Bachelor of Commerce degree from the University of British Columbia and is a member in good standing of the Institute of Chartered Accountants of British Columbia.

1. Australia

Usable iron ore: 960 million metric tons
Iron content: 590 million metric tons

Australia is the largest iron producing country by far, with usable iron ore production of 960 million metric tons in 2023. Australia’s leading iron ore producer is BHP (ASX:BHP,LSE:BHP,NYSE:BHP), but Rio Tinto (ASX:RIO,LSE:RIO,NYSE:RIO) and Fortescue Metals Group (ASX:FMG,OTCQX:FSUMF) are also large producers.

The Pilbara region is the most notable iron ore jurisdiction in Australia, if not the world. In fact, Rio Tinto calls its Pilbara Blend ‘the world’s most recognised brand of iron ore.’ One of the company’s iron producing operations in the region is Hope Downs iron ore complex, a 50/50 joint venture with Gina Rinehart’s Hancock Prospecting. The complex hosts four open-pit mines with an annual production capacity of 47 million tonnes.

As for BHP, the major iron miner’s Western Australia Iron Operations joint venture comprise five mining hubs and four processing hubs. One such hub is Area C, which hosts eight open-cut mining areas alone. The company also has an operating 85 percent interest in the Newman iron operations.

2. Brazil

Usable iron ore: 440 million metric tons
Iron content: 280 million metric tons

In Brazil, iron production came to 440 million metric tons of usable iron ore production in 2023.

The largest iron ore districts in the country are the states of Pará and Minas Gerais, which together account for 98 percent of Brazil’s annual iron ore output. Pará is home to the largest iron ore mine in the world, Vale’s (NYSE:VALE) Carajas mine. Headquartered in Rio de Janeiro, Vale is the world’s biggest producer of iron ore pellets.

“In 2023, supply ramp up will be led by Brazil and India, while Australian shipments will stay largely rangebound,” said David Cachot, research director for steel and raw materials at Wood Mackenzie. Indeed, Brazilian iron ore exports were on the rise in 2023. That trend has continued well into 2024.

3. China

Usable iron ore: 280 million metric tons
Iron content: 170 million metric tons

China’s iron production amounted to 280 million metric tons of usable iron ore in 2023. The Asian nation is the world’s largest consumer of iron ore, despite being only the third largest iron-producing country.

China’s top producing iron ore mine is the Dataigou iron mine in Laioning province, with production of 9.07 million MT in 2023. The underground mine is owned by Glory Harvest Group Holdings.

With China being the world’s largest producer of stainless steel, its domestic supply is not enough to meet demand. The country imports over 70 percent of global seaborne iron ore.

4. India

Usable iron ore: 270 million metric tons
Iron content: 170 million metric tons

India’s iron production for 2023 totaled 270 million metric tons of usable iron ore, climbing from the previous year’s total of 251 million metric tons. Its iron content production rose from 156 million metric tons to 170 million metric tons.

India’s largest iron ore miner, NMDC, hit a production milestone in 2021 of 40 million MT per year, the first such company to do so in the country. NMDC is targeting an annual production rate of 60 million MT by 2027. The company operates the Bailadila mining complexes in Chhattisgarh state, and the Donimalai and Kumaraswamy mines in Karnataka state.

5. Russia

Usable iron ore: 88 million metric tons
Iron content: 58 million metric tons

Russia’s iron ore production came in at 88 million metric tons for 2023, making comes it the fifth largest iron-producing country in the world.

The region of Belgorod Oblast is home to two of the country’s biggest iron ore producing mines: Metalloinvest MC’s Lebedinsky GOK, which in 2023 produced an estimated 22.05 million metric tons per annum of iron ore; and Novolipetsk Steel’s Stoilensky GOK, which last year produced an estimated 19.56 million metric tons per annum of iron ore.

In response to serious economic sanctions on the country over its aggressive war against Ukraine, Russia’s iron ore exports fell dramatically in 2022 to 84.2 million metric tons from 96 million metric tons in the previous year. Together, these two countries previously accounted for 36 percent of global iron or non-alloy steel exports. The European Union has restricted imports of Russian iron ore.

6. Iran

Usable iron ore: 77 million metric tons
Iron content: 50 million metric tons

Iran amassed 77 million metric tons in iron production in the form of usable iron ore in 2023. The country’s iron output has been on the rise in recent years — it was the eighth highest iron producer in 2022 and the 10th in 2021. One of the most important iron ore mines in the country is Gol-e-Gohar in Kerman province.

The Iranian government is targeting production of 55 million MT of steel per annum by 2025 to 2026. To reach this goal, the country’s iron ore industry will need to produce 160 million MT of iron ore. To better meet the requirements of domestic steel producers, Iran began levying a 25 percent duty on iron ore exports in September 2019. This has changed multiple times since, and in February 2024 the country cut duties on these products significantly.

7. Canada

Usable iron ore: 70 million MT
Iron content: 42 million metric tons

Canada’s iron production totaled 70 million metric tons of usable iron ore and 42 million metric tons of iron content in 2023.

Champion Iron (TSX:CIA,OTC Pink:CHPRF) is one company producing iron ore in the country. It owns and operates the Bloom Lake complex in Québec. Champion ships iron concentrate from the Bloom Lake open pit by rail, initially on the Bloom Lake Railway, to a ship loading port in Sept-Îles, Québec. A Phase 2 expansion, which entered commercial production in December 2022, has increased annual capacity from 7.4 million MT to 15 million MT of 66.2 percent iron ore concentrate.

In 2024, Champion is upgrading half of its Bloom Lake mine capacity to a direct reduction quality pellet feed iron ore with up to 69 percent iron.

8. South Africa

Usable iron ore: 61 million metric tons
Iron content: 39 million metric tons

South Africa’s iron production was 61 million metric tons of usable iron ore and 39 million metric tons of iron content in 2023. The country’s output has declined significantly in the past few years, down from 73.1 million MT and 46.5 million MT two years earlier. South Africa’s mining industry is grappling with transport and logistics issues, most notably due to railway maintenance challenges.

Kumba Iron Ore (OTC Pink:KUMBF,JSE:KIO) is Africa’s largest iron ore producer. The company has three main iron ore production assets in the country, including its flagship mine, Sishen, which accounts for a large majority of Kumba’s total iron ore output. Anglo American (LSE:AAL,OTCQX:AAUKF) owns a 69.7 percent share of the company.

9. Kazakhstan

Usable iron ore: 53 million metric tons
Iron content: 8.8 million metric tons

Kazakhstan’s iron production came in at 53 million metric tons of usable iron ore in 2023. It has also slipped in recent years.

Kazakhstan has several iron ore mines in operation, with four of the top five owned by Eurasian Resources Group. The largest of these iron ore mines is the Sokolovsky surface and underground mine located in Kostanay. Last year, it produced an estimated 7.52 million tonnes per annum of iron ore.

The Sokolov-Sarybai Mining Production Association (SMPA) in Northern Kazakhstan was the main supplier of iron ore to Russia’s Magnitogorsk Iron and Steelworks prior to the country’s invasion of Ukraine. Since then, the SMPA has halted iron ore shipments to Magnitogorsk.

10. Sweden

Usable iron ore: 38 million metric tons
Iron content: 27 million metric tons

Sweden’s iron production for 2023 was 38 million metric tons of usable iron ore. Iron ore production in the country has been increasing over the last decade and a half.

The country’s largest iron ore mine is state-owned Luossavaara-Kiirunavaara’s (LKAB) Kiruna mine, which has been in operation for more than 100 years. Kiruna is also the world’s largest underground iron ore mine. According to Mining Data Online, Kiruna’s iron ore pellets and fines production totaled 13 million metric tons in addition to 0.6 million metric tons of lump ore used in the blast furnace ironmaking process.

1. Australia

Usable iron ore: 960 million metric tons
Iron content: 590 million metric tons

Australia is the largest iron producing country by far, with usable iron ore production of 960 million metric tons in 2023. Australia’s leading iron ore producer is BHP (ASX:BHP,LSE:BHP,NYSE:BHP), but Rio Tinto (ASX:RIO,LSE:RIO,NYSE:RIO) and Fortescue Metals Group (ASX:FMG,OTCQX:FSUMF) are also large producers.

The Pilbara region is the most notable iron ore jurisdiction in Australia, if not the world. In fact, Rio Tinto calls its Pilbara Blend ‘the world’s most recognised brand of iron ore.’ One of the company’s iron producing operations in the region is Hope Downs iron ore complex, a 50/50 joint venture with Gina Rinehart’s Hancock Prospecting. The complex hosts four open-pit mines with an annual production capacity of 47 million tonnes.

As for BHP, the major iron miner’s Western Australia Iron Operations joint venture comprise five mining hubs and four processing hubs. One such hub is Area C, which hosts eight open-cut mining areas alone. The company also has an operating 85 percent interest in the Newman iron operations.

2. Brazil

Usable iron ore: 440 million metric tons
Iron content: 280 million metric tons

In Brazil, iron production came to 440 million metric tons of usable iron ore production in 2023.

The largest iron ore districts in the country are the states of Pará and Minas Gerais, which together account for 98 percent of Brazil’s annual iron ore output. Pará is home to the largest iron ore mine in the world, Vale’s (NYSE:VALE) Carajas mine. Headquartered in Rio de Janeiro, Vale is the world’s biggest producer of iron ore pellets.

“In 2023, supply ramp up will be led by Brazil and India, while Australian shipments will stay largely rangebound,” said David Cachot, research director for steel and raw materials at Wood Mackenzie. Indeed, Brazilian iron ore exports were on the rise in 2023. That trend has continued well into 2024.

3. China

Usable iron ore: 280 million metric tons
Iron content: 170 million metric tons

China’s iron production amounted to 280 million metric tons of usable iron ore in 2023. The Asian nation is the world’s largest consumer of iron ore, despite being only the third largest iron-producing country.

China’s top producing iron ore mine is the Dataigou iron mine in Laioning province, with production of 9.07 million MT in 2023. The underground mine is owned by Glory Harvest Group Holdings.

With China being the world’s largest producer of stainless steel, its domestic supply is not enough to meet demand. The country imports over 70 percent of global seaborne iron ore.

4. India

Usable iron ore: 270 million metric tons
Iron content: 170 million metric tons

India’s iron production for 2023 totaled 270 million metric tons of usable iron ore, climbing from the previous year’s total of 251 million metric tons. Its iron content production rose from 156 million metric tons to 170 million metric tons.

India’s largest iron ore miner, NMDC, hit a production milestone in 2021 of 40 million MT per year, the first such company to do so in the country. NMDC is targeting an annual production rate of 60 million MT by 2027. The company operates the Bailadila mining complexes in Chhattisgarh state, and the Donimalai and Kumaraswamy mines in Karnataka state.

5. Russia

Usable iron ore: 88 million metric tons
Iron content: 58 million metric tons

Russia’s iron ore production came in at 88 million metric tons for 2023, making comes it the fifth largest iron-producing country in the world.

The region of Belgorod Oblast is home to two of the country’s biggest iron ore producing mines: Metalloinvest MC’s Lebedinsky GOK, which in 2023 produced an estimated 22.05 million metric tons per annum of iron ore; and Novolipetsk Steel’s Stoilensky GOK, which last year produced an estimated 19.56 million metric tons per annum of iron ore.

In response to serious economic sanctions on the country over its aggressive war against Ukraine, Russia’s iron ore exports fell dramatically in 2022 to 84.2 million metric tons from 96 million metric tons in the previous year. Together, these two countries previously accounted for 36 percent of global iron or non-alloy steel exports. The European Union has restricted imports of Russian iron ore.

6. Iran

Usable iron ore: 77 million metric tons
Iron content: 50 million metric tons

Iran amassed 77 million metric tons in iron production in the form of usable iron ore in 2023. The country’s iron output has been on the rise in recent years — it was the eighth highest iron producer in 2022 and the 10th in 2021. One of the most important iron ore mines in the country is Gol-e-Gohar in Kerman province.

The Iranian government is targeting production of 55 million MT of steel per annum by 2025 to 2026. To reach this goal, the country’s iron ore industry will need to produce 160 million MT of iron ore. To better meet the requirements of domestic steel producers, Iran began levying a 25 percent duty on iron ore exports in September 2019. This has changed multiple times since, and in February 2024 the country cut duties on these products significantly.

7. Canada

Usable iron ore: 70 million MT
Iron content: 42 million metric tons

Canada’s iron production totaled 70 million metric tons of usable iron ore and 42 million metric tons of iron content in 2023.

Champion Iron (TSX:CIA,OTC Pink:CHPRF) is one company producing iron ore in the country. It owns and operates the Bloom Lake complex in Québec. Champion ships iron concentrate from the Bloom Lake open pit by rail, initially on the Bloom Lake Railway, to a ship loading port in Sept-Îles, Québec. A Phase 2 expansion, which entered commercial production in December 2022, has increased annual capacity from 7.4 million MT to 15 million MT of 66.2 percent iron ore concentrate.

In 2024, Champion is upgrading half of its Bloom Lake mine capacity to a direct reduction quality pellet feed iron ore with up to 69 percent iron.

8. South Africa

Usable iron ore: 61 million metric tons
Iron content: 39 million metric tons

South Africa’s iron production was 61 million metric tons of usable iron ore and 39 million metric tons of iron content in 2023. The country’s output has declined significantly in the past few years, down from 73.1 million MT and 46.5 million MT two years earlier. South Africa’s mining industry is grappling with transport and logistics issues, most notably due to railway maintenance challenges.

Kumba Iron Ore (OTC Pink:KUMBF,JSE:KIO) is Africa’s largest iron ore producer. The company has three main iron ore production assets in the country, including its flagship mine, Sishen, which accounts for a large majority of Kumba’s total iron ore output. Anglo American (LSE:AAL,OTCQX:AAUKF) owns a 69.7 percent share of the company.

9. Kazakhstan

Usable iron ore: 53 million metric tons
Iron content: 8.8 million metric tons

Kazakhstan’s iron production came in at 53 million metric tons of usable iron ore in 2023. It has also slipped in recent years.

Kazakhstan has several iron ore mines in operation, with four of the top five owned by Eurasian Resources Group. The largest of these iron ore mines is the Sokolovsky surface and underground mine located in Kostanay. Last year, it produced an estimated 7.52 million tonnes per annum of iron ore.

The Sokolov-Sarybai Mining Production Association (SMPA) in Northern Kazakhstan was the main supplier of iron ore to Russia’s Magnitogorsk Iron and Steelworks prior to the country’s invasion of Ukraine. Since then, the SMPA has halted iron ore shipments to Magnitogorsk.

10. Sweden

Usable iron ore: 38 million metric tons
Iron content: 27 million metric tons

Sweden’s iron production for 2023 was 38 million metric tons of usable iron ore. Iron ore production in the country has been increasing over the last decade and a half.

The country’s largest iron ore mine is state-owned Luossavaara-Kiirunavaara’s (LKAB) Kiruna mine, which has been in operation for more than 100 years. Kiruna is also the world’s largest underground iron ore mine. According to Mining Data Online, Kiruna’s iron ore pellets and fines production totaled 13 million metric tons in addition to 0.6 million metric tons of lump ore used in the blast furnace ironmaking process.

Cobalt metal price chart, Q3 2024.

Chart via Trading Economics.

“Prices for cobalt metal approached US$10 per pound, and cobalt hydroxide, a feedstock for cobalt metal and battery chemicals, approached US$6 per pound due to weak buyer interest and bearish market outlook,” he said.

“Cobalt sulfate prices had initially held a floor of RMB 27,500 per MT (US$3,857.23),’ continued Aubry.

‘However, as the quarter came to an end, cheap recycled cobalt sulfate in China undercut prices from the virgin market and has led to a further decrease in prices.”

Cobalt demand in the doldrums

The cobalt price pressure seen during the third quarter was largely due to a combination of oversupply and weakening demand, particularly from the electric vehicle (EV) battery sector.

The market is grappling with the effects of cobalt’s diminishing role in battery chemistries as manufacturers increasingly turn to lithium-iron-phosphate (LFP) batteries, which contain no cobalt, or opt for nickel-based alternatives with lower cobalt content. This shift has been fueled by efforts to mitigate the environmental and ethical issues associated with cobalt mining in the Democratic Republic of Congo (DRC), the largest cobalt-producing nation.

Additionally, as cobalt production capacity expands in countries like Australia and Angola, oversupply pressures are expected to persist, keeping prices relatively low in the near term.

Industry experts predict that unless there is a significant surge in demand from emerging technologies or battery innovations, cobalt prices will remain suppressed, reflecting a structural change in market dynamics.

“The supply of cobalt has proven to exceed what the market has been able to absorb, and weak buyer interest and full stocks have led to prices being incapable of recovering,” noted Aubry. “Overall, a bearish market is expected through 2025 as participants speculate on what is the lowest price cobalt can fall to.”

Swelling cobalt supply prevents price growth

For Project Blue’s Jack Bedder, the most prevalent trend weighing on the cobalt market in Q3 was oversupply.

“(London Metal Exchange) off-warrant stockpiled cobalt metal has been rising, and trade data indicated an increase in China’s cobalt metal exports to the European market,’ the expert added.

Bedder, who is the co-founder and director of the critical metals consultancy, also pointed to higher output in the DRC and Indonesia as a headwind to cobalt price growth.

“Oversupply of cobalt intermediate continues, underpinned by increased production from the DRC’s cobalt hydroxide and Indonesian Ni-Co MHP (nickel-cobalt mixed hydroxide precipitate),” he said.

While Bedder explained that declining prices have caused companies to reschedule production plans and reduce their production guidance, there is still promise on the development side.

In mid-August, Electra Battery Materials (TSXV:ELBM,NASDAQ:ELBM) received a US$20 million grant from the US Department of Defense to support its cobalt refinery project in Ontario, which it says is set to be North America’s first producer of battery-grade cobalt sulfate. Located in Temiskaming Shores, the C$250 million facility aims to strengthen the EV supply chain and reduce US reliance on foreign sources for critical minerals.

The funding aligns with the US’ strategy of securing essential minerals for defense and technology sectors.

Less than a month later, the company garnered another funding infusion.

“Electra received ample financial backing from the US government to develop its cobalt sulfate refinery in Canada,” said Bedder. “The company has received a total of US$40 million in Q3 2024.”

Electra’s Department of Defense funding wasn’t the only news on the development side.

In late June, Nth Cycle commissioned a 21,000 square foot facility designed to refine metal scrap, e-waste and refinery waste into high-purity critical metals like nickel and cobalt.

US and Canada boost EV tariffs

In addition to building domestic cobalt mining and refining capacity, the US and Canada are working to reduce purchases of Chinese EVs. Both countries have implemented steep tariffs on EVs originating in China.

At the end of August, the Canadian government levied a 100 percent tariff on Chinese EVs. The heightened tariff followed a similar announcement out of the US in May. America also added smaller tariffs on strategic goods necessary for EV production, such as solar cells, semiconductors and lithium batteries.

While the spirit of the new EV taxes aims to spur on domestic production and EV sales, both Aubry and Bedder said they don’t see the tariffs supporting cobalt price growth.

“It is unlikely to have any effect in the short term, as Chinese EVs still remain much cheaper than their western counterparts, even with the tariffs in place, so there is limited incentive for North American producers to build domestic capacity as they are not cost competitive,” said Aubry.

China adds to cobalt-refining capacity

As North America looks to bolster ex-China supply, the Asian nation continues to build its cobalt presence.

“In August, GEM (SZSE:002340) commenced commercial production of a 10,000 MT per year refinery in Hubei province, China. The refinery will be using recycled material to produce standard-grade cobalt metal 99.8 percent,” Bedder said.

He also noted that Tengyuan Cobalt (SZSE:301219) has announced plans to build a new nickel-cobalt refinery in Ganzhou province, China. Commercial production is planned for the fourth quarter of 2025.

“Last year, the company produced 15,400 MT of cobalt metal after completing expansions in December 2022,” he said.

Some of that increased output could be earmarked for China’s strategic cobalt reserve. In late May, reports surfaced that the country’s State Reserve Bureau planned on purchasing 15,000 MT from domestic producers.

“Although this purchase was significantly bigger than previous years, the increased tonnage of the purchase is largely believed to have been a measure taken by the Chinese State Reserve Bureau to offset the significant ramp up in Chinese cobalt metal production capacity,” he said. “As a result, it did not have the strengthening effect that many hoped it would, as Chinese metal production still exceeds what the market is able to absorb.”

Investor Insight

Adisyn’s innovative products and services leveraging a multi-billion-dollar Australian defence market and focusing on the underserved, high-potential SME market, provide a compelling investment case for technology investors.

Overview

Adisyn (ASX:AI1) is an ASX-listed company offering a comprehensive suite of products and services to SMEs operating in the fast-growing Australian defence industry supply chain. The company’s service offerings revolve around data protection, management and security. Adisyn has been focusing on cybersecurity and AI as the two key growth areas, confident these two verticals will offer significant growth opportunities as the data centre and cloud markets evolve.

The Australian Government plans to inject an extra $5.7 billion into its defence capability by 2027-28, with an additional $50.3 billion allocated for the following decade until 2033-34, surpassing previous projections. This funding surge will escalate the defence budget to approximately $100 billion by 2033-34, totaling $765 billion over the decade. Moreover, the government will earmark $15 billion to $20 billion specifically to bolster cyber domain capabilities during this period.

The surge in Australian defence spending is fueling demand for SMEs that operate in the defence supply chain. SMEs are ill-equipped to handle cybersecurity threats and need a trusted partner who specializes in cyber threat protection, regulatory compliance, and IT security infrastructure management. Adisyn is dedicated to becoming the go-to partner for SMEs aiming to enhance their sovereign data and security practices, particularly in sectors where national security concerns necessitate rigorous data protection measures.

To achieve this, Adisyn has laid out a four-phased strategic plan. The first phase, completed in 2023, focused on business restructuring, rebranding and bringing new management. The second phase, ongoing in 2024, focuses on the expansion of the advisory board, IP development, strategic technology partnerships, and business development. The company has commenced the expansion of the advisory board with the appointment of Harry Karelis in February 2024. Karelis will focus on identifying and securing strategic partnerships and assisting with investor relations and general business development activities.

In July 2024, Adisyn announced a collaboration agreement with 2D Generation, an international semi-conductor IP business. The two companies leverage artificial intelligence to advance the development of high-performance, energy-efficient semiconductor solutions crucial for AI and data centres.

The company anticipates the announcement of several key strategic partnerships that will significantly expand its current suite of cyber capabilities and distinctly set Adisyn apart in the marketplace.

During its third and final phase, scheduled from 2025 to 2026 and beyond, the company will aim for Australia wide expansion and acquisitions and strive to establish itself as a preferred service provider to SMEs operating in the defence supply chain.

Company Highlights

• Adisyn is an ASX-listed technology company focused on Australia’s defence industry supply chain.
• Adisyn is aiming to become a preferred supplier to SMEs in the Australian defence industry supply chain, offering a range of solutions, particularly in the cybersecurity and AI domains.
• Australia’s defence budget is expanding, as led by the AUKUS security deal. Western Australia is leading the charge, with the state government aiming to double the value of its defence industry to $6 billion by 2030.
• SMEs involved in critical national security and defence projects do not have sufficient technological capabilities around AI and cybersecurity. Adisyn, with its vast experience in cyber threat protection and IT infrastructure management, is well-equipped to help these SMEs meet their technology and security obligations.
• Adisyn has launched a four-phased strategy to become the leading service provider in the defence supply chain market by 2026. Phase 1, which included business restructuring, rebranding, and new management, has been successfully completed. Phase 2, which is ongoing, will see the expansion of the advisory board, IP development, strategic technology partnerships, and business development.
• The company offers investors an attractive way to gain exposure to the fast-growing Australian defence industry supply chain.

Key Services

Cybersecurity and Advisory

Adisyn offers end-to-end cybersecurity solutions designed specifically to suit individual needs. The company is persistently advancing a range of new cybersecurity services tailored to help businesses navigate their responsibilities regarding handling personal data under the recently enacted Privacy Legislation Amendment (Enforcement and Other Measures) Act 2022. These services encompass threat intelligence, contextual security operations, and an AI-driven personally identifiable information de-identification tool.

The company plans to focus on expanding the services offered under the new cybersecurity division through new partnership agreements. Separately, Adisyn plans to begin developing new cybersecurity-focused AI-powered microservices.

IT Managed Services

Adisyn’s complete IT managed service offering covers all aspects of the IT environment. It ensures that its clients’ IT infrastructure runs smoothly and promises minimal downtime for their IT systems.

Secure Private Cloud

The offering aims to secure clients’ data, ensuring business continuity and disaster recovery.

Management Team

Shane Wee – Non-Executive Chairman

Shane Wee has spent the last 30 years in the financial services industry. He was the founding director of Alto Capital until his retirement in June 2021. During his career, he held various corporate and advisory roles with several ASX entities, building an extensive network of contacts across Australia and Southeast Asia.

Blake Burton – Managing Director

Blake Burton has been the managing director of Adisyn since July 2022. With considerable expertise in the IT sector, he established his own web hosting company, which he later successfully sold in a trade deal to Australia’s largest privately owned web host.

Justin Thomas – Non-executive Director

Justin Thomas brings over 20 years of experience in the IT industry. In 2007, he founded a real estate software business, which he sold to RP Data. In 2012, he built and sold a data centre to Amcom, now known as Vocus.

Paul Arch – Chief Operating Officer

Paul Arch brings extensive technology expertise, having been involved in numerous successful ventures in the Australian technology space. He is the founder of Datamate Backup Services and DC West Data Centre in Perth and played a pivotal role in their establishment.

Jesper Sentow – Chief Financial Officer

Jasper Sentow has over 25 years of experience serving as a chief financial officer and company secretary for public and private Australian and international companies spanning Europe, India and Southeast Asia. Sentow brings expertise in corporate financial management, strategic planning, corporate governance and commercial enhancement.

Harry Karelis – Chair of the Advisory Board

Harry Karelis boasts over 30 years of experience in capital markets and holds a master’s degree in cybersecurity operations from the Australian defence Force Academy/UNSW. His areas of specialization encompass financial analysis, funds management, and private equity. Additionally, Harry possesses a robust background in technology startups, with a particular emphasis on cybersecurity, AI and defence sectors.

Jesse Gane – Chief Technology Officer

Jesse Gane is currently the director of space, cyber and federal government services at Downer Group. Gane is highly experienced in managing critical contracts with national responsibilities and fostering strong partnerships between organisations, government entities, and industry partners. He worked in the Australian Navy as a submariner with specialist communication and cybersecurity skills. His efforts in system architecture and product delivery have left an enduring mark on naval operations, earning accolades for his commitment to excellence and innovation. Gane has unique insights into the interactions between commerce and government, as well as the unique challenges facing small and growing companies seeking to bolster their internal systems.