TORONTO – PwC Canada has taken its annual look at market capitalization for 100 junior miners and found a 6% increase to $12.9 billion for the 12-month period ending June 30, 2018, compared to a year earlier. Looking at 987 companies in the broader mining sector, PwC saw their collective value increase by 5% to $21.1 billion this year.
First Cobalt (No.24 on PwC’s list of juniors) owns the only fully permitted cobalt refinery capable of producing battery grade material in North America. (Image: First Cobalt)
The gains made by the mining sector are the strongest since 2011, but still fall behind other sectors, such as cannabis and crypto-currencies.
“2018 was a relatively quiet year for the junior mining sector,” said Dean Braunsteiner, national mining leader, PwC Canada. “However, it is clear that we are coming out of the bottom of the economic cycle and there is more optimism as market capitalization rose 6%. We hope to see more of an upswing in 2019.”
The PwC report confirms the trend toward streaming agreements used as a business model. Junior investors appreciate that streaming and royalty arrangements provide a more predictable cash flow, while limiting their exposure to operational risks.
Juniors are also embracing digital technologies as a means of boosting efficiency. They are investing in artificial intelligence, 3D modeling and the digitization of historic data. Using such tools boosts efficiencies, controls long term costs, helps smooth volatile commodity prices.
This is also the first year in a long time that the top five juniors – Cobalt 27 Capital, Novo Resources, Equinox Gold, Atlantic Gold, and Maverix Minerals – were not all gold hunters. Rather they have a focus on lithium, cobalt and nickel, all of which are seen as emergent sectors as electric vehicles grow in popularity.
Click here to read the full report.