Despite keeping a lower profile when it comes to commodities consumption than during the last super-cycle, from 2003-11, arguably China will continue to need more commodities than the rest, for traditional infrastructure (roads, bridges, airports, etc.), green projects needing a broad range of electrification/ decarbonization metals, and to feed an expanding, and evolving, manufacturing base.
Building more highways, railways and airports, the traditional “blacktop infrastructure” are seen as a way to stabilize the economy.
But Beijing is also advocating for so-called “new infrastructure”, including 5G, ultra-high-voltage power transmission, big data centers, industrial internet and artificial intelligence.
Not only has China outspent the United States and led the world on infrastructure investments, it has also worked relentlessly over the past decade to lock up the world’s metals with off-take agreements, creating import dependencies for a number of key minerals in the US and other Western countries.
China understands that mining is the lynchpin, that enables an economy to move from low-tech producer of inexpensive goods for export, to high-tech manufacturer of goods and services the future world economy needs. Because they have the raw materials.
It won’t be long before Westerners wake up to the fundamental truth that who controls the resources, controls the world. When the realization sets in, that we’ve been snookered, the mad rush to secure what’s left will surely ignite a fire under metals prices.
Legal Notice / Disclaimer
Ahead of the Herd newsletter, aheadoftheherd.com, hereafter known as AOTH.
Please read the entire Disclaimer carefully before you use this website or read the newsletter. If you do not agree to all the AOTH/Richard Mills Disclaimer, do not access/read this website/newsletter/article, or any of its pages. By reading/using this AOTH/Richard Mills website/newsletter/article, and whether you actually read this Disclaimer, you are deemed to have accepted it.
Any AOTH/Richard Mills document is not, and should not be, construed as an offer to sell or the solicitation of an offer to purchase or subscribe for any investment.
AOTH/Richard Mills has based this document on information obtained from sources he believes to be reliable, but which has not been independently verified.
AOTH/Richard Mills makes no guarantee, representation or warranty and accepts no responsibility or liability as to its accuracy or completeness.
Expressions of opinion are those of AOTH/Richard Mills only and are subject to change without notice.
AOTH/Richard Mills assumes no warranty, liability or guarantee for the current relevance, correctness or completeness of any information provided within this Report and will not be held liable for the consequence of reliance upon any opinion or statement contained herein or any omission.
Furthermore, AOTH/Richard Mills assumes no liability for any direct or indirect loss or damage for lost profit, which you may incur as a result of the use and existence of the information provided within this AOTH/Richard Mills Report.
You agree that by reading AOTH/Richard Mills articles, you are acting at your OWN RISK. In no event should AOTH/Richard Mills liable for any direct or indirect trading losses caused by any information contained in AOTH/Richard Mills articles. Information in AOTH/Richard Mills articles is not an offer to sell or a solicitation of an offer to buy any security. AOTH/Richard Mills is not suggesting the transacting of any financial instruments.
Our publications are not a recommendation to buy or sell a security – no information posted on this site is to be considered investment advice or a recommendation to do anything involving finance or money aside from performing your own due diligence and consulting with your personal registered broker/financial advisor.
AOTH/Richard Mills recommends that before investing in any securities, you consult with a professional financial planner or advisor, and that you should conduct a complete and independent investigation before investing in any security after prudent consideration of all pertinent risks. Ahead of the Herd is not a registered broker, dealer, analyst, or advisor. We hold no investment licenses and may not sell, offer to sell, or offer to buy any security.