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Energy / Iron ore / Met Coal / Gold

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Question asked 12/07/2024

Energy / Iron ore / Met Coal / Gold

Dear MM, Thanks for your excellent service. 1. Energy: Could I please have your thoughts on energy - in particular brent over the short and medium term. (i.e. rest of 2024, and into 2025). If you are bullish energy, could you elaborate how you are playing this? As you don't have exposure to either WDS, STO or BPT in your Active Growth portfolio. I realize PDN is an energy play (but I treat the Uranium market different from the fossil fuels (oil/gas). 2. Iron ore: What's your outlook for iron ore over the rest of calendar 2024, and into 2025. What do you think a catalyst out of its current malaise might be, and rough timing on that? 3. Today BCB got sold off 9% off the back of its sale of 10% of Broadmeadow East mine. Do you feel this was an over-reaction, or fair share price reaction? 4. Could you remind me again why you prefer EVN over NEM / NST for gold exposure, given your bullish sentiment toward gold over the rest of calendar 2024. Thanks and sorry for 4 questions. Would you prefer me in the future to send these as separate queries? Kind regards, Young

Answer

Hi Young,

We are bullish towards energy over the coming years especially with the huge increasing demand courtesy of AI. We are playing this view through coal, uranium, & AGL Energy for the growth portfolio. In the near term, we think global growth slows which creates a muted backdrop for the Oil price, which is probably why WDS continues to plumb new 2-year lows.
As we discussed on Tuesday, we are neutral towards iron ore over the coming years, the catalyst we and the market are watching for is a sustainable turnaround in the Chinese property market. We have a shorter-term play on the go for the upcoming FMG dividend in the Income Portfolio.
Bowen Coal (BCB) has encountered a number of issues over recent years and the sale of the Broadmeadow East mine another excuse investors have used to sell, we are not considering adding to our position in the MM Emerging Companies Portfolio.
We wrote about EVN and NEM on Wednesday, we particularly like the fact that EVN is a true Gold/Copper company, while operationally, they have more to prove (so more to gain).

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LAST UPDATED 10/07/2024 15:41

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