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Mining Monthly: March Edition

What you need to know:
• Following a long period of consolidation, gold broke out in March, hitting record highs, and continuing to push higher as we enter April.
• Silver and copper also had strong months up 10% and 4%, respectively.
• More notably, we are finally seeing the equities outperform their underlying metal price with the GDX, SIL, and COPX up 22.7%, 21.1% and 19.4%, respectively, significantly outperforming broader markets.
• With precious metals taking the limelight, the rest of the industry was mixed (uranium -17%, lithium +6%, nickel -5%, palladium +8%)

Sentiment Update
Gold had a massive breakout during the month of March following a several-month consolidation period (flat since November). The shiny metal set new all-time highs on several occasions with the most recent being today April 1st at $2,262/oz. Gold was up 9.3% in the month, closing March at $2,233/oz. Silver also rose substantially being up 10.1% to $25.0/oz. On the back of gold breaking out, equities significantly outperformed with the GDX, GDXJ, and SIL up 22.7%, 24.1%, and 21.1%, respectively. This compares to the TSX and S&P500 which were up 3.8% and 3.2%, respectively. Copper also posted a strong month up 4.4% to $4.0/lb but more notably, the copper equities greatly outperformed the metal, being up 19.4% in the month. Other commodities were mixed (see Performance by Commodity section below).

Uranium posted its second straight down month, down 17% to $85.0/lb. We believe this is a healthy period of consolidation as the metal was previously up over 100% in the past year. We remain bullish on uranium and the sector.

Battery metals were mixed with nickel down 5%, lithium up 6%, and cobalt flat. We believe there exists substantial investment opportunity in the lithium space given the recent sell-off however encourage investors to tread carefully as a definitive rebound has yet to be confirmed.