Ann: Maiden Ore Reserve - Caravel Copper Project, page-18

This is the first part of an online AFR article today.

“International investors are piling into Australian-listed commodity stocks at the fastest pace in years, according to UBS, as they chase strong returns from the ASX’s booming materials sector and protection from inflation.

Global markets have been rocked by aggressive tightening by central banks and heightened geopolitical risks stemming from the war in Ukraine.

But Australia has been largely insulated from the subsequent volatility due to its heavy exposure to commodities, which have benefited from the rally in metals, bulks and agricultural prices.

This is being increasingly noticed by global investors who are seeking refuge in Australia’s listed resources sector.

“The net buying of commodity stocks by international investors has been at one of the highest levels that we’ve seen in a long time,” said Clinton Wong, co-head of equities at UBS”

This is positive for commodity producers, developers, and advanced explorers. Overseas investors will buy the big companies eg BHP, RIO, NCM, OZL, etc.

I have also noticed some funds management companies recently setup funds targeting resource companies and others (eg Regal) are very bullish on commodities eg commodity super cycle.

However, many small resource companies seem very under valued and not just HCH. If we are really at the start of a commodity super cycle that will change - we will see the SPs of under valued smaller producers spike, then next will be developers SPs will spike and then explorers.

This has happened to the lithium and rare earths market already. My observation is it is yet to happen to many smaller companies in copper, gold, nickel, zinc etc. But it will happen (no idea of timing) which is why I have been buying companies like CVV and many others.