Randy Smallwood's 2025 Playbook: Gold's Macro Shift, a 50% Surge & Industry M&A | Kitco News
Summary
Gold Market Dynamics: Gold is holding above $3,300 an ounce, with significant inflows into gold ETFs, marking the strongest demand in three years despite China's central bank pausing its purchases.
Central Bank Influence: Central banks are increasingly shifting towards gold as a reserve asset, moving away from US treasuries, which is supporting gold prices and indicating a shift in global financial dynamics.
Impact of Tariffs: The highest US tariffs since the 1930s are driving inflation and uncertainty, which could benefit precious metals by increasing their attractiveness as a hedge.
Wheaten Precious Metals Growth: Wheaten Precious Metals is experiencing significant growth with new mines coming online, projecting a 50% increase in production over the next five to six years.
Streaming Model Advantage: Wheaten's streaming model offers reduced risk compared to traditional mining investments, providing defined costs and exposure to commodity prices without the operational risks of mining.
Market Governance Concerns: There are concerns about the governance of the gold market, with calls for more transparency and accountability to prevent systemic risks.
Future Outlook: Wheaten expects continued growth and high share prices due to organic growth and favorable market conditions, with potential for gold and silver prices to rise further.
Transcript
[Music] Welcome back. I'm Jeremy Saffron. Well, gold is holding above $3,300 an ounce. Silver near 37. But the real story is where demand is coming from. In July, investors poured more than 60 tons into gold ETFs. It's the strongest inflow in 3 years, even as China's central bank paused its buying according to their official data. And at the same time, pressure on the Fed is intensifying. President Trump is demanding the resignation of Governor Lisa Cook while pushing for doubbish appointments. ahead of Jackson Hold where of course Jerome Powell will deliver his most important speech of the year. And over in Europe, the ECB is warning that the gold market itself could be a systemic risk dominated by private clearing houses with little oversight. Now you layer on the highest US tariffs since the 1930s with even gold briefly in the crosshairs before the White House stepped back and the stakes for the market have rarely been higher. Now in moments like this, investors want clarity and so did the companies building the next generation of mines. And few people know that balance better than Randy Smallwood. He's a CEO of Wheaten Precious Metals. It's a $40 billion streaming leader that just posted record results and one of the most outspoken voices in the precious metals world. Randy, good to see you. Welcome back, Jeremy. Always a pleasure. Thank you. Now, we got to start on that macro theme here. I had you back on in June and you mentioned gold is the ultimate comfort metal. And obviously with President Trump now openly pushing for new Fed appointees who favor rate cuts and calling on Lisa Cook to resign. Is this the moment where central banks risk kind of losing credibility and and gold becomes the trust anchor? Well, that's why I think we see so many central banks actually shifting towards gold, shifting out of US treasuries and uh and into gold itself. And so so you know uh I think it's just a growing momentum within the space to to try and back away from the reliance on the US dollar as the main reference currency and uh and gold is now climbing as a as a as a reference currency within the central banks. And so this trend is going to continue to grow. And you know you talk about the I mean the ECB data shows gold overtook the euro in 2024 as the second largest global reserve asset. I think it was 19 versus euro 16%. If if central banks themselves are being politicized, does that mean private sector and and ETF demand is now the real marginal driver of gold prices? Well, I no, because I think that politici I mean, you know, what you're talking about is support for gold from policies within the United States. And so I do think that that that political uh activation is actually supporting uh uh gold prices itself. But as that as that moves on, I mean there's there is, you know, sometimes it doesn't look like it, but there's a lot of smart minds behind these central banks. A lot of a lot of thought goes into the uh the decisions that they make and and just the overall trend worldwide from from central banks and sovereign uh sovereign funds to shift into gold as a as a store security. You know, that that has not lost momentum at all. And I I think that's enough support to uh to to you know bring in the institutional and the retail investors themselves. I think that has been one of the leading factors. This this real push in gold did start with central bank purchases uh out of uh the eastern part of this world and and it's really sort of gained momentum all the way through here now into what I would call you know the traditional west uh so to speak. And so so you know I don't I don't see that momentum slowing down at all. If anything I think it's just getting to be a more of a worldwide phenomena. We're still a little bit light on the retail side, but uh but I've seen lots of evidence that that's getting stronger and stronger. Interesting. Okay. So, on the the the equities on the miners itself as opposed to kind of the ETF, the passive accounts, people are getting more into it. There's no doubt there's uh there's there's a bit more support for equities out there. We've seen that just by virtue of the number of financings that we've seen of of late for the mid-tier and and uh and you know, single asset development companies. And so so there is definitely a bit more of a market uh that's building up now. Yeah. You know, US tariffs are now effectively about 18.6%. It's the highest since the depression era. But history tells us, you know, usually tariffs drive costs higher and spark retaliation. But from your vantage points, do do tariffs ultimately, you know, help precious metals by fueling inflation and uncertainty even if they raise costs for miners? There's no doubt it's inflationary and then, you know, you just can't argue with the math. It's simple math that uh you know any type of fees or taxes driving that local you know driving towards del globalization uh will drive costs up. Um to be honest I think it's a positive uh and an overall basis because I do think it makes a lot of countries and a lot of regions around the world sit back and look within themselves as to say you know we we need to be able to stand on our own two feet and and that's something I do think is is needed. You know, for so long now, we've seen Europe uh not very supportive of the mining industry, but they're happy to consume all the products of the mining industry as long as it's mined somewhere else. We're starting to see a real trend uh with this deglobalization towards hm maybe we need to find a way to produce that product ourselves and seeing some broader support for the mining industry. So, I think it's overall it's going to be a net positive. Um uh but it will drive up costs and that's you when I say it's a net positive, it's a net positive for the mining industry and for the gold industry as a whole, right? Yeah, we've discussed the cost of capital before. It was almost unavailable, especially to some of the juniors. I'm curious though, I mean, are you are you already seeing more miners turn to Weeden for capital? Is debt markets tighten under these new tariff pressures? Uh, yeah, we have. I mean, and especially with some of the more recent streams out there that are getting to the point of pretty close to full project financing, uh, you know, some of our more recent transactions have have definitely attracted a lot of interest. And so, you know, we we definitely are seeing some attraction in the space. The one the one area we're not seeing a lot is the big diversifies and, you know, unless they're heavily levered, they uh they tend to have enough internal cash flow. So, it's the mid tier and the single asset development companies that we are seeing that increased demand. You know, most of what we're seeing is uh gold streams on gold mines and maybe a silver stream and a gold mine, but that's where most of the investment is going into. I think what we do need is a bit stronger copper price. And if we ever start to see some movement in the copper space and some big copper investments, you know, the the one difference about the copper space is that mines are generally measured, you know, the capital costs of those mines is generally measured in the, you know,5 to$10 billion range versus the 1 to2 billion range you see for your typical gold mine. That need for capital, we're uh we're quite excited about being prepared to help uh help deliver that that capital to build those copper mines when when uh when the market demands it. Yeah. Yeah. And it's certainly becoming a hot topic. I think even Trump's talking about copper mines right now. Uh I'm going to get to Weaten here in a second. I got to ask you about this story about the gold market kind of governance because obviously Randy, I mean you were the former uh president to the World Gold Council. Uh I just wanted to Yeah, you're right. Chair. Chair. Of course, the chair. I I got to get your your take on this story. This kind of making waves in Europe. Burnernhard Schnelman is a veteran of the refining industry and he just wrote in the Financial Times that the gold market is too important to be left to private clubs. He was pointing to the LBMA and London clearing houses which dominate the global trade but operates with very little accountability. Even the ECB warned that leverage and opacity and you know the concentration could make gold itself kind of a systemic risk here. Do you agree? I mean is the governance of the gold market becoming a weak point in the system? Well, in in a sense that's part of the attraction of gold is that it it is the sort of object of political influence and and and does sort of uh you know trade I would say more freely than a lot of other commodities around the world. Um that that being said, you know, the efforts that that we've got underway to digitalize how you can own gold and and you know, there are ways to digitally own gold now. You can buy an ETF, it's a it's a sharer and uh you you've got a certain amount of liquidity with that. But there is a next step. The World Gold Council is working on that next step and that is a digital gold token that is backed by physical gold stored in a vault somewhere but is freely you know fungeable uh uh you know high level of trust providence behind it that links right back so you know where the gold is that actually backs that and we're not far off of that. the technology exists. It's a matter of working a way through a process that is accepted and not only accepted but embraced by the institutions around the world and and I do think that that increase in liquidity, that increase in transparency, that increase will will help uh reduce those risks. Um and and there's no doubt the technologies there. So, it's only a matter of time until we deliver this. Yeah, it's interesting watching the digital goldfront. Uh certainly a hot topic now. I mean the argument is like if the BIS or another global body took over settlement governance to your point I mean it's kind of gold is all about being private. I mean would that help stabilize the market or or make more regulation choke liquidity in the very market central banks rely on? Well, and you know, and we saw this uh you know, we saw that differentiation just in this last little tariff uh mistake that uh that came up where we saw, you know, immediately a huge differentiation between how gold was trading on the comx versus LBMA and and quite a spread uh that popped up immediately, right? And so so I do think the market's got some capacity to manage risks like that and and work its way through. Uh, you know, that being said, those that that jumped on that uh that little mistake on tariffs, uh, you know, on on the on the concept of the possibility of tariffs on gold, um, you know, they they probably paid a penalty, but the market did adapt to to, you know, to the information that was available at the time. And I do think that, you know, the systems are, you know, survivable, so to speak. Yeah. Yeah. Let's talk about that moment. I mean, was your phone going off? Obviously, earlier this summer, the White House briefly floated that idea. Donald Trump came out, no tariffs on gold. It spooked the market obviously until that personal correction. Uh did that moment concern you? I mean, what would what would it mean if gold itself became a political trade weapon? Well, the the beauty of gold is that it's worldwide. So, it's really tough for someone to actually control it to the point of where it is a political trade weapon. That's that's the attraction of gold is that it's not subject to political influence. It can't be controlled by one politician, by one entity, one party. That's the huge attraction of gold. And so, you know, I don't see that as being an issue. the whole tariff issue, you know, early on, very early on, I could see that it was just a uh uh what looked like an errant decision by a customs um agent uh US customs agent who who'd assigned a wrong account number to uh to a a potential gold shipment and and and it blew up quite rapidly and it just didn't fit with everything that that that you know that we in the industry knew about the so you know I personally wasn't surprised when it got retracted and and backed up. I don't, you know, I think it was a small mistake at a junior level that that blossomed up and got caught by the news agencies and and and rightly so. It had to get corrected fast and and uh and and it did. Uh um so, you know, it's it's that it's that uh that lack of political influence that makes gold so attractive. And so I I don't think one entity can control this. It's it's not set up that way. Well said. Um okay, we got to talk about the the growth strategy. I mean, you told me back in June that four new mines were Wheaten's kind of growth wedge. Since then, Blackwater has hit commercial production. Gooseport its first gold back in June. How much incremental production are you seeing? I mean, how does this shift Wheaton's 2025 26 cash flow profile? Well, I mean, we're starting a a good, you know, sustained growth uh uh profile over the next five six years. We're climbing towards a million gold equivalent ounces of production. from our current our current guidance this year is about 600 to 670,000 gold equivalent ounces and so you know it's a dramatic increase it's a 50% increase uh over the next five six years and so uh you know the these assets are coming on stream as expected uh Blackwater is a very important asset for us and Steven Dean and the team of Artemis have done a fantastic job bringing that online they're already accelerating in terms of expansion plans uh faster than what we have in our long-term schedule so there's some upside in terms of how how rapidly they're going to deliver the phase two of of of Blackwater. It's doing quite well. Goose, you know, the the team uh it's not as much for us. We don't get as much gold from that asset, but uh you know, the team at B2 doing a great job getting that up and running. And as you said, poured gold at the end of uh end of the second quarter. I think it was the very last day. So, they they really had to push hard to get it done, but uh but they delivered on their promises. And uh and as I understand, things are going very well up there. We've got Mineral Park coming on in September. We've got uh of course Plat Reef with Ivanho coming on towards the end of this year in the fourth quarter. And so, you know, four exciting assets. Plat Reef, it's long-term upside. Again, they've updated the schedule uh uh in terms of the expansions, the schedule of expansions. We we haven't even brought that into our guidance on a go forward on a long-term basis yet. We will when we update next year. And so, you know, there's uh everything's just lining up nicely and if not nicely, even better than what we expected. Um, you know, what's particularly exciting, I mean, next year we're going to see some good growth. Uh, but 2027 is going to be the real one. When Kone comes on in Konova with, uh, with Montage Gold and Kermuck comes on with Allied. Those two assets themselves will deliver a substantive bump in our growth and put us up well over 800,000 ounces of gold production by 2027. And so, uh, you know, pretty exciting times over the next few years as these, uh, as these assets come into fruition. Yeah, I mean, it's been wild watching obviously some of the cash flow with the company, too. I mean, obviously you've been asked this before already, but if gold consolidates around 3,300, which it is now, I mean, can these new ounces alone keep Wheaten on a record trajectory? You've been on a wild ride. Yeah, it's uh I mean, I don't think it's going to, you know, I mean, I'm comfortable to see the consolidation at 3,300 because I think it's building up a firmer and firmer base, but I don't think we're finished with respect to gold. Uh, you know, I'm still trying to find some strength indicators on the US dollar, and it's there's just not a lot out there. I see I see a government that actually wants to weaken the US dollar to keep themselves more competitive and uh in that case that's going to bode well for gold and so so you know I'm I I don't think we're stopping at 3,300 but the growth definitely helps uh on that front and so the combination of climbing to a million gold equivalent ounces with whatever the price of gold's going to be four or five years from now. Pretty exciting. uh you know, of course, it gives us a lot of capacity to continue growing our portfolio and uh when we're always out there looking for the right a creative deal, properly structured and properly priced. You looking at a lot right now or how many are you looking? Yeah, I mean we typically always have at least 10 or 12 projects underway uh you know under various stages of review. Um you know there's uh there's some pretty attractive projects out there that we're uh we're diving deep into right now. There's definitely a healthy appetite. As I mentioned earlier on, the the one-stop shop type financing has really attracted a lot of attention. Uh the montage gold type deal that we did on the Kone project. Uh it's it's a unique structure that uh that gives incredible flexibility to them as a as a constructor and as a builder and as an operator. Uh and and yet uh you know gives us good exposure to uh to commodity prices and to uh and to growth at that project. And so, uh, we, you know, a classic win-win situation, which is the only way that Weaten does transactions. Yeah. Yeah. Well said. Hey, Lisa, we talked about M&A before, but Royal Gold announced that three and a half billion dollar all stock takeover of Sandstorm. I mean, you've long argued you'd kind of that rollups don't create real synergies in streaming. Does this prove your discipline was right or does the scale shift the competitive landscape here? I I would just point to the uh the share price performance of uh of the companies to answer that question. I don't think anything else has to be said. It's it's uh you know, it hasn't been a uh a smooth acquisition from that sense. I mean, it hasn't closed yet, obviously, but uh but you know, the market did not respond well to that. It's uh you know when we're making acquisitions at you know one or around one times net asset value buying a a pure streaming company you know albeit smaller or albeit whatever size and maybe slightly lower multiples I I've long taken the perspective that the the multiples that we trade at are a reward for uh for how we've done how how focused we are in terms of making good acquisitions that deliver value to all parties to all stakeholders and the moment we start justifying they're using that that multiple to justify acquisitions, which is what I would argue has happened there. Um, that's when you start losing shareholders confidence. Uh, and uh, and so it's uh, if anything, it's reinforced my uh, my my negativity towards uh, the M&A space within streaming. It it you know, and and there's always unique opportunities. we have acquired in the past uh uh other streaming competitors, but it was because it was priced appropriately versus the you know the value of the assets within and uh and uh and so so we'll continue to watch that space, but it's not something that we find attractive. Yeah. So Weaten's not you know at risk of being outbid for the next generation of deals here. Yeah. You know uh I learned a long time ago if you're winning all the bids you're probably paying too much, right? So, it's a healthy market is a good market and uh and I think as long as we're selective and and uh get the ones that we're really interested in, really excited about uh uh it's paid off for us to date and so I don't see any reason to change that. Yeah, Randy, you've been blunt about the permitting delays often 10 to 15 years. Are the number one bottleneck here? I mean, since we last spoke, and I know it's only been a few months, but uh you just talked about people all of a sudden starting to realize or be open to mining. Have you seen any serious reforms in North America or Canada or the US still face falling behind this resource race? Well, you know, positive noise again, just noise so far out of the White House just yesterday, right? Uh, I believe Mike Henry from BHP was in the White House along with a few other executives in the copper space talking about that and Trump made comments about uh how how frustrating it is to uh particularly in the state of Arizona to try and build copper assets. You know, I believe the license plate says the copper state and uh and and yet uh the number of you know, we're we're partners with Hud Bay on the Copper World project. the, you know, which was originally called the Rosemont project when they applied for their first permit over 20 years ago. Uh, you know, it's a, it's a simple, clean project, no different than the other copper mines that have delivered so much value and wealth to to Arizona historically. And, uh, and yet, you know, uh, and and so was quite happy to see the rhetoric, the noise coming out of the White House yesterday and Trump actually commenting on on how u how embarrassing those delays are, especially when you compare yourself around the world. Um and uh you know and and so you know hopefully there is some changes. Hopefully see some stuff moving forward. You know we we did see a negative court decision a couple of days ago uh down on in Arizona uh you know again further delaying uh moving forward on uh on some of the land swaps on resolution. And so it's just uh it's frustrating and you know especially if you're a a smaller company a single asset development company how do you afford this? How do you keep the doors open uh you know in terms of funding this while you have no cash flow coming from the asset going forward and it just really narrows out the space and and and uh yeah I I just uh again I think uh some of this tariff talk has uh has has has caused jurisdictions to actually think about what they actually produce for themselves and uh and I and I do think there's a there there is a benefit to society out of that. Yeah. I mean, the current prime minister of Canada, Carney, I mean, he kind of he I think he ran on this whole we're going to bring business to Canada. I mean, Canada has lost four tier one discoveries since 2020. I mean, is Canada open for business? Again, rhetoric. Let's see the uh let's see let's see some actual product, right? Uh we hear the right things. Um but at the same time, you know, we're still there's plenty of projects still waiting for permits, still waiting to move forward in Canada. We haven't seen any anything concrete delivered on that front yet. We see motions and uh and suggestions about new uh agencies, you know, new federal government agencies that will accelerate the process and uh etc. Uh but, you know, just I would love to see something concrete. Yeah, it all sounds like bureaucracy. Uh earlier this year, you told me silver had that path to $40. I mean it almost got close. We're now what at 37 ETF inflows are starting to pick up on the silver side. You stand by the call. I mean what are your thoughts on the silver? Oh yeah. No, it's uh you know again uh um you know silver as we pick up more retail interest in precious metals which I do feel like the market has shifted that way. Silver will catch more of a ride with that. Silver always has had uh a bit more a bit broader exposure to the retail space than gold has and so it should outperform as we see that retail interest pick up. We've talked about this to leave it but uh you know from many of our viewers own physical gold as you know or ETFs but some are looking at miners and streamers for the first time from your perspective I mean why why should an investor own a streaming company like wheaten instead of a mining stock or or just the bullion? I would call that a softball, Jeremy. That is a pretty soft ball. And I'm going to try and hit a home run with it. Thank you. But it it's it's open, you know. No, it is. Thank you. Um, you know, look, it it comes down to risk and especially if you're a generalist, right? The the biggest challenge is is uh is cost delivery is the margins that actually come from building and operating a mine. It's always been the biggest risk in any mining investment. And you can do very well if you pick the right companies. But that takes a certain measure of I would say skill and luck. Com combination of skill and luck. That's what what a streaming company delivers to its investors is a dramatic reduction in the risk side of that. Uh our costs are defined. You know what the costs are. The capital costs are defined by the what we pay for the upfront payment. The uh you know the uh the operating costs are defined in the contract. And so there's no surprises on the cost side. You understand that? So you get true authentic levered exposure to the commodity without cost risk and uh and and then you know the growth we get access to that we the expansion potential everything we get the you know it's it's a great way to step into the space it's a great way to to as I say dip your toe into the mining space and I I really do think that we form that perfect hybrid between just buying bullion which has zero growth and to be honest costs you fees you can buy ETFs along the same lines a streaming company gives you that levered exposure even more so than a royalty company. a streaming company gives you levered exposure to the commodity price which is similar to the operators but the you know the cost risk is dramatically increased and that's that's the that's the real uh I'd say kicker in terms of why wheaten is an attractive way to to I've always said wheaten should be the foundation of your precious metals investment um but it's definitely worth uh stepping into the operators they uh you know there are some great opportunities in that space but a company like ours with its low risk profile it should be the foundation of everyone's precious metals investment. Yeah, I mean that was that was the easy one, but I mean we talk about these right there is a valuation premium streamers often trade at higher multiples 20 25 times cash flow compared to the miners. Do you think investors might be overpaying for safety and and if there's a concentration risk I'm just looking at those you know even diversified there's a few core assets usually dominating the cash flow base right yeah I mean you know and I would say have to have a look at those assets uh you know our core flagship asset isobo owned by valet in Brazil valet is a uh a quasi you know I mean it's a very strong Brazilian institution and so very very well supported and and embraced within in uh within Brazil. And so and then the asset itself is a is a is a tier one uh you know first quartile producer that's got all sorts of exploration potential. It's it's really been delivering uh on its uh on its on its production commitments of all time. So so if I was going to have a flagship asset, I think Silobo is the perfect flagship asset to to build a company around. I'm very comfortable with that. Um you know the the other side the the premiums that we trade at I you know again I think it comes down to risk profile. what kind of risk do you want to take? And that's that's the that's the key difference. Uh our risk profiles are are slightly higher than most mining companies and and a lot higher than uh or sorry our trading multiples are are slightly higher than you know some mining companies and and a lot higher than most and it it really comes down to the confidence about what we'll be able to deliver back to our shareholders. So that that com combination of commodity exposure uh resource expiration expansion uh potential levered uh exposure to the commodity price itself I really do think it comes it comes into play. So you know we only look expensive when you look at us like a mining company. We're not a mining company right? Our risk profile is so much lower than that and that's where it starts getting attractive. You know if we're sitting here at the end of Q4 chatting again I mean what's more likely last question. Gold at above 3,800, silver above 40, or wheaten shares at new highs. Well, wheaten I'm confident wheaten shares will be at new highs just because of organic growth. Even if prices stay constant, we will see that uh continued as we continue to deliver on the growth profile. And you know, we've got a couple more exciting projects coming on with Mineral Park and Plat Reef coming on before the end of the year. So, the Q4 call uh you know, I'm confident on the uh on the continued high prices for for for Wheaten uh you know, It wouldn't surprise me to see silver uh have have at least touched 40 whether it's holding it at that point or not. But uh you know I do think that that we are seeing that increase retail pick up and you know it'll it'll be interesting to see there's no doubt that the Fed decisions in terms of rate cuts uh uh and and that that will have an impact on the next step in the precious metal space. And so I I look forward to seeing what happens over the course of the year. There's a there's again a lot of political pressure on uh on that US dollar. So, uh let's see how that uh that plays out. It should play out well for gold and silver. Interesting. And the Fed. Okay. Well, we're watching right here. Randy Smallwood, CEO of Weed and Precious Metals joining us. Always a pleasure to have you. Thanks for making the time, Randy. Enjoy your summer. Appreciate that. Thank you, Jeremy. You, too. Thanks, mate. All right. That's it for us here on Kicko News. Thanks for watching. Hit that subscribe button and we'll see you next time. [Music] Heat. Heat. [Music] I
Randy Smallwood's 2025 Playbook: Gold's Macro Shift, a 50% Surge & Industry M&A | Kitco News
Summary
Transcript
[Music] Welcome back. I'm Jeremy Saffron. Well, gold is holding above $3,300 an ounce. Silver near 37. But the real story is where demand is coming from. In July, investors poured more than 60 tons into gold ETFs. It's the strongest inflow in 3 years, even as China's central bank paused its buying according to their official data. And at the same time, pressure on the Fed is intensifying. President Trump is demanding the resignation of Governor Lisa Cook while pushing for doubbish appointments. ahead of Jackson Hold where of course Jerome Powell will deliver his most important speech of the year. And over in Europe, the ECB is warning that the gold market itself could be a systemic risk dominated by private clearing houses with little oversight. Now you layer on the highest US tariffs since the 1930s with even gold briefly in the crosshairs before the White House stepped back and the stakes for the market have rarely been higher. Now in moments like this, investors want clarity and so did the companies building the next generation of mines. And few people know that balance better than Randy Smallwood. He's a CEO of Wheaten Precious Metals. It's a $40 billion streaming leader that just posted record results and one of the most outspoken voices in the precious metals world. Randy, good to see you. Welcome back, Jeremy. Always a pleasure. Thank you. Now, we got to start on that macro theme here. I had you back on in June and you mentioned gold is the ultimate comfort metal. And obviously with President Trump now openly pushing for new Fed appointees who favor rate cuts and calling on Lisa Cook to resign. Is this the moment where central banks risk kind of losing credibility and and gold becomes the trust anchor? Well, that's why I think we see so many central banks actually shifting towards gold, shifting out of US treasuries and uh and into gold itself. And so so you know uh I think it's just a growing momentum within the space to to try and back away from the reliance on the US dollar as the main reference currency and uh and gold is now climbing as a as a as a reference currency within the central banks. And so this trend is going to continue to grow. And you know you talk about the I mean the ECB data shows gold overtook the euro in 2024 as the second largest global reserve asset. I think it was 19 versus euro 16%. If if central banks themselves are being politicized, does that mean private sector and and ETF demand is now the real marginal driver of gold prices? Well, I no, because I think that politici I mean, you know, what you're talking about is support for gold from policies within the United States. And so I do think that that that political uh activation is actually supporting uh uh gold prices itself. But as that as that moves on, I mean there's there is, you know, sometimes it doesn't look like it, but there's a lot of smart minds behind these central banks. A lot of a lot of thought goes into the uh the decisions that they make and and just the overall trend worldwide from from central banks and sovereign uh sovereign funds to shift into gold as a as a store security. You know, that that has not lost momentum at all. And I I think that's enough support to uh to to you know bring in the institutional and the retail investors themselves. I think that has been one of the leading factors. This this real push in gold did start with central bank purchases uh out of uh the eastern part of this world and and it's really sort of gained momentum all the way through here now into what I would call you know the traditional west uh so to speak. And so so you know I don't I don't see that momentum slowing down at all. If anything I think it's just getting to be a more of a worldwide phenomena. We're still a little bit light on the retail side, but uh but I've seen lots of evidence that that's getting stronger and stronger. Interesting. Okay. So, on the the the equities on the miners itself as opposed to kind of the ETF, the passive accounts, people are getting more into it. There's no doubt there's uh there's there's a bit more support for equities out there. We've seen that just by virtue of the number of financings that we've seen of of late for the mid-tier and and uh and you know, single asset development companies. And so so there is definitely a bit more of a market uh that's building up now. Yeah. You know, US tariffs are now effectively about 18.6%. It's the highest since the depression era. But history tells us, you know, usually tariffs drive costs higher and spark retaliation. But from your vantage points, do do tariffs ultimately, you know, help precious metals by fueling inflation and uncertainty even if they raise costs for miners? There's no doubt it's inflationary and then, you know, you just can't argue with the math. It's simple math that uh you know any type of fees or taxes driving that local you know driving towards del globalization uh will drive costs up. Um to be honest I think it's a positive uh and an overall basis because I do think it makes a lot of countries and a lot of regions around the world sit back and look within themselves as to say you know we we need to be able to stand on our own two feet and and that's something I do think is is needed. You know, for so long now, we've seen Europe uh not very supportive of the mining industry, but they're happy to consume all the products of the mining industry as long as it's mined somewhere else. We're starting to see a real trend uh with this deglobalization towards hm maybe we need to find a way to produce that product ourselves and seeing some broader support for the mining industry. So, I think it's overall it's going to be a net positive. Um uh but it will drive up costs and that's you when I say it's a net positive, it's a net positive for the mining industry and for the gold industry as a whole, right? Yeah, we've discussed the cost of capital before. It was almost unavailable, especially to some of the juniors. I'm curious though, I mean, are you are you already seeing more miners turn to Weeden for capital? Is debt markets tighten under these new tariff pressures? Uh, yeah, we have. I mean, and especially with some of the more recent streams out there that are getting to the point of pretty close to full project financing, uh, you know, some of our more recent transactions have have definitely attracted a lot of interest. And so, you know, we we definitely are seeing some attraction in the space. The one the one area we're not seeing a lot is the big diversifies and, you know, unless they're heavily levered, they uh they tend to have enough internal cash flow. So, it's the mid tier and the single asset development companies that we are seeing that increased demand. You know, most of what we're seeing is uh gold streams on gold mines and maybe a silver stream and a gold mine, but that's where most of the investment is going into. I think what we do need is a bit stronger copper price. And if we ever start to see some movement in the copper space and some big copper investments, you know, the the one difference about the copper space is that mines are generally measured, you know, the capital costs of those mines is generally measured in the, you know,5 to$10 billion range versus the 1 to2 billion range you see for your typical gold mine. That need for capital, we're uh we're quite excited about being prepared to help uh help deliver that that capital to build those copper mines when when uh when the market demands it. Yeah. Yeah. And it's certainly becoming a hot topic. I think even Trump's talking about copper mines right now. Uh I'm going to get to Weaten here in a second. I got to ask you about this story about the gold market kind of governance because obviously Randy, I mean you were the former uh president to the World Gold Council. Uh I just wanted to Yeah, you're right. Chair. Chair. Of course, the chair. I I got to get your your take on this story. This kind of making waves in Europe. Burnernhard Schnelman is a veteran of the refining industry and he just wrote in the Financial Times that the gold market is too important to be left to private clubs. He was pointing to the LBMA and London clearing houses which dominate the global trade but operates with very little accountability. Even the ECB warned that leverage and opacity and you know the concentration could make gold itself kind of a systemic risk here. Do you agree? I mean is the governance of the gold market becoming a weak point in the system? Well, in in a sense that's part of the attraction of gold is that it it is the sort of object of political influence and and and does sort of uh you know trade I would say more freely than a lot of other commodities around the world. Um that that being said, you know, the efforts that that we've got underway to digitalize how you can own gold and and you know, there are ways to digitally own gold now. You can buy an ETF, it's a it's a sharer and uh you you've got a certain amount of liquidity with that. But there is a next step. The World Gold Council is working on that next step and that is a digital gold token that is backed by physical gold stored in a vault somewhere but is freely you know fungeable uh uh you know high level of trust providence behind it that links right back so you know where the gold is that actually backs that and we're not far off of that. the technology exists. It's a matter of working a way through a process that is accepted and not only accepted but embraced by the institutions around the world and and I do think that that increase in liquidity, that increase in transparency, that increase will will help uh reduce those risks. Um and and there's no doubt the technologies there. So, it's only a matter of time until we deliver this. Yeah, it's interesting watching the digital goldfront. Uh certainly a hot topic now. I mean the argument is like if the BIS or another global body took over settlement governance to your point I mean it's kind of gold is all about being private. I mean would that help stabilize the market or or make more regulation choke liquidity in the very market central banks rely on? Well, and you know, and we saw this uh you know, we saw that differentiation just in this last little tariff uh mistake that uh that came up where we saw, you know, immediately a huge differentiation between how gold was trading on the comx versus LBMA and and quite a spread uh that popped up immediately, right? And so so I do think the market's got some capacity to manage risks like that and and work its way through. Uh, you know, that being said, those that that jumped on that uh that little mistake on tariffs, uh, you know, on on the on the concept of the possibility of tariffs on gold, um, you know, they they probably paid a penalty, but the market did adapt to to, you know, to the information that was available at the time. And I do think that, you know, the systems are, you know, survivable, so to speak. Yeah. Yeah. Let's talk about that moment. I mean, was your phone going off? Obviously, earlier this summer, the White House briefly floated that idea. Donald Trump came out, no tariffs on gold. It spooked the market obviously until that personal correction. Uh did that moment concern you? I mean, what would what would it mean if gold itself became a political trade weapon? Well, the the beauty of gold is that it's worldwide. So, it's really tough for someone to actually control it to the point of where it is a political trade weapon. That's that's the attraction of gold is that it's not subject to political influence. It can't be controlled by one politician, by one entity, one party. That's the huge attraction of gold. And so, you know, I don't see that as being an issue. the whole tariff issue, you know, early on, very early on, I could see that it was just a uh uh what looked like an errant decision by a customs um agent uh US customs agent who who'd assigned a wrong account number to uh to a a potential gold shipment and and and it blew up quite rapidly and it just didn't fit with everything that that that you know that we in the industry knew about the so you know I personally wasn't surprised when it got retracted and and backed up. I don't, you know, I think it was a small mistake at a junior level that that blossomed up and got caught by the news agencies and and and rightly so. It had to get corrected fast and and uh and and it did. Uh um so, you know, it's it's that it's that uh that lack of political influence that makes gold so attractive. And so I I don't think one entity can control this. It's it's not set up that way. Well said. Um okay, we got to talk about the the growth strategy. I mean, you told me back in June that four new mines were Wheaten's kind of growth wedge. Since then, Blackwater has hit commercial production. Gooseport its first gold back in June. How much incremental production are you seeing? I mean, how does this shift Wheaton's 2025 26 cash flow profile? Well, I mean, we're starting a a good, you know, sustained growth uh uh profile over the next five six years. We're climbing towards a million gold equivalent ounces of production. from our current our current guidance this year is about 600 to 670,000 gold equivalent ounces and so you know it's a dramatic increase it's a 50% increase uh over the next five six years and so uh you know the these assets are coming on stream as expected uh Blackwater is a very important asset for us and Steven Dean and the team of Artemis have done a fantastic job bringing that online they're already accelerating in terms of expansion plans uh faster than what we have in our long-term schedule so there's some upside in terms of how how rapidly they're going to deliver the phase two of of of Blackwater. It's doing quite well. Goose, you know, the the team uh it's not as much for us. We don't get as much gold from that asset, but uh you know, the team at B2 doing a great job getting that up and running. And as you said, poured gold at the end of uh end of the second quarter. I think it was the very last day. So, they they really had to push hard to get it done, but uh but they delivered on their promises. And uh and as I understand, things are going very well up there. We've got Mineral Park coming on in September. We've got uh of course Plat Reef with Ivanho coming on towards the end of this year in the fourth quarter. And so, you know, four exciting assets. Plat Reef, it's long-term upside. Again, they've updated the schedule uh uh in terms of the expansions, the schedule of expansions. We we haven't even brought that into our guidance on a go forward on a long-term basis yet. We will when we update next year. And so, you know, there's uh everything's just lining up nicely and if not nicely, even better than what we expected. Um, you know, what's particularly exciting, I mean, next year we're going to see some good growth. Uh, but 2027 is going to be the real one. When Kone comes on in Konova with, uh, with Montage Gold and Kermuck comes on with Allied. Those two assets themselves will deliver a substantive bump in our growth and put us up well over 800,000 ounces of gold production by 2027. And so, uh, you know, pretty exciting times over the next few years as these, uh, as these assets come into fruition. Yeah, I mean, it's been wild watching obviously some of the cash flow with the company, too. I mean, obviously you've been asked this before already, but if gold consolidates around 3,300, which it is now, I mean, can these new ounces alone keep Wheaten on a record trajectory? You've been on a wild ride. Yeah, it's uh I mean, I don't think it's going to, you know, I mean, I'm comfortable to see the consolidation at 3,300 because I think it's building up a firmer and firmer base, but I don't think we're finished with respect to gold. Uh, you know, I'm still trying to find some strength indicators on the US dollar, and it's there's just not a lot out there. I see I see a government that actually wants to weaken the US dollar to keep themselves more competitive and uh in that case that's going to bode well for gold and so so you know I'm I I don't think we're stopping at 3,300 but the growth definitely helps uh on that front and so the combination of climbing to a million gold equivalent ounces with whatever the price of gold's going to be four or five years from now. Pretty exciting. uh you know, of course, it gives us a lot of capacity to continue growing our portfolio and uh when we're always out there looking for the right a creative deal, properly structured and properly priced. You looking at a lot right now or how many are you looking? Yeah, I mean we typically always have at least 10 or 12 projects underway uh you know under various stages of review. Um you know there's uh there's some pretty attractive projects out there that we're uh we're diving deep into right now. There's definitely a healthy appetite. As I mentioned earlier on, the the one-stop shop type financing has really attracted a lot of attention. Uh the montage gold type deal that we did on the Kone project. Uh it's it's a unique structure that uh that gives incredible flexibility to them as a as a constructor and as a builder and as an operator. Uh and and yet uh you know gives us good exposure to uh to commodity prices and to uh and to growth at that project. And so, uh, we, you know, a classic win-win situation, which is the only way that Weaten does transactions. Yeah. Yeah. Well said. Hey, Lisa, we talked about M&A before, but Royal Gold announced that three and a half billion dollar all stock takeover of Sandstorm. I mean, you've long argued you'd kind of that rollups don't create real synergies in streaming. Does this prove your discipline was right or does the scale shift the competitive landscape here? I I would just point to the uh the share price performance of uh of the companies to answer that question. I don't think anything else has to be said. It's it's uh you know, it hasn't been a uh a smooth acquisition from that sense. I mean, it hasn't closed yet, obviously, but uh but you know, the market did not respond well to that. It's uh you know when we're making acquisitions at you know one or around one times net asset value buying a a pure streaming company you know albeit smaller or albeit whatever size and maybe slightly lower multiples I I've long taken the perspective that the the multiples that we trade at are a reward for uh for how we've done how how focused we are in terms of making good acquisitions that deliver value to all parties to all stakeholders and the moment we start justifying they're using that that multiple to justify acquisitions, which is what I would argue has happened there. Um, that's when you start losing shareholders confidence. Uh, and uh, and so it's uh, if anything, it's reinforced my uh, my my negativity towards uh, the M&A space within streaming. It it you know, and and there's always unique opportunities. we have acquired in the past uh uh other streaming competitors, but it was because it was priced appropriately versus the you know the value of the assets within and uh and uh and so so we'll continue to watch that space, but it's not something that we find attractive. Yeah. So Weaten's not you know at risk of being outbid for the next generation of deals here. Yeah. You know uh I learned a long time ago if you're winning all the bids you're probably paying too much, right? So, it's a healthy market is a good market and uh and I think as long as we're selective and and uh get the ones that we're really interested in, really excited about uh uh it's paid off for us to date and so I don't see any reason to change that. Yeah, Randy, you've been blunt about the permitting delays often 10 to 15 years. Are the number one bottleneck here? I mean, since we last spoke, and I know it's only been a few months, but uh you just talked about people all of a sudden starting to realize or be open to mining. Have you seen any serious reforms in North America or Canada or the US still face falling behind this resource race? Well, you know, positive noise again, just noise so far out of the White House just yesterday, right? Uh, I believe Mike Henry from BHP was in the White House along with a few other executives in the copper space talking about that and Trump made comments about uh how how frustrating it is to uh particularly in the state of Arizona to try and build copper assets. You know, I believe the license plate says the copper state and uh and and yet uh the number of you know, we're we're partners with Hud Bay on the Copper World project. the, you know, which was originally called the Rosemont project when they applied for their first permit over 20 years ago. Uh, you know, it's a, it's a simple, clean project, no different than the other copper mines that have delivered so much value and wealth to to Arizona historically. And, uh, and yet, you know, uh, and and so was quite happy to see the rhetoric, the noise coming out of the White House yesterday and Trump actually commenting on on how u how embarrassing those delays are, especially when you compare yourself around the world. Um and uh you know and and so you know hopefully there is some changes. Hopefully see some stuff moving forward. You know we we did see a negative court decision a couple of days ago uh down on in Arizona uh you know again further delaying uh moving forward on uh on some of the land swaps on resolution. And so it's just uh it's frustrating and you know especially if you're a a smaller company a single asset development company how do you afford this? How do you keep the doors open uh you know in terms of funding this while you have no cash flow coming from the asset going forward and it just really narrows out the space and and and uh yeah I I just uh again I think uh some of this tariff talk has uh has has has caused jurisdictions to actually think about what they actually produce for themselves and uh and I and I do think there's a there there is a benefit to society out of that. Yeah. I mean, the current prime minister of Canada, Carney, I mean, he kind of he I think he ran on this whole we're going to bring business to Canada. I mean, Canada has lost four tier one discoveries since 2020. I mean, is Canada open for business? Again, rhetoric. Let's see the uh let's see let's see some actual product, right? Uh we hear the right things. Um but at the same time, you know, we're still there's plenty of projects still waiting for permits, still waiting to move forward in Canada. We haven't seen any anything concrete delivered on that front yet. We see motions and uh and suggestions about new uh agencies, you know, new federal government agencies that will accelerate the process and uh etc. Uh but, you know, just I would love to see something concrete. Yeah, it all sounds like bureaucracy. Uh earlier this year, you told me silver had that path to $40. I mean it almost got close. We're now what at 37 ETF inflows are starting to pick up on the silver side. You stand by the call. I mean what are your thoughts on the silver? Oh yeah. No, it's uh you know again uh um you know silver as we pick up more retail interest in precious metals which I do feel like the market has shifted that way. Silver will catch more of a ride with that. Silver always has had uh a bit more a bit broader exposure to the retail space than gold has and so it should outperform as we see that retail interest pick up. We've talked about this to leave it but uh you know from many of our viewers own physical gold as you know or ETFs but some are looking at miners and streamers for the first time from your perspective I mean why why should an investor own a streaming company like wheaten instead of a mining stock or or just the bullion? I would call that a softball, Jeremy. That is a pretty soft ball. And I'm going to try and hit a home run with it. Thank you. But it it's it's open, you know. No, it is. Thank you. Um, you know, look, it it comes down to risk and especially if you're a generalist, right? The the biggest challenge is is uh is cost delivery is the margins that actually come from building and operating a mine. It's always been the biggest risk in any mining investment. And you can do very well if you pick the right companies. But that takes a certain measure of I would say skill and luck. Com combination of skill and luck. That's what what a streaming company delivers to its investors is a dramatic reduction in the risk side of that. Uh our costs are defined. You know what the costs are. The capital costs are defined by the what we pay for the upfront payment. The uh you know the uh the operating costs are defined in the contract. And so there's no surprises on the cost side. You understand that? So you get true authentic levered exposure to the commodity without cost risk and uh and and then you know the growth we get access to that we the expansion potential everything we get the you know it's it's a great way to step into the space it's a great way to to as I say dip your toe into the mining space and I I really do think that we form that perfect hybrid between just buying bullion which has zero growth and to be honest costs you fees you can buy ETFs along the same lines a streaming company gives you that levered exposure even more so than a royalty company. a streaming company gives you levered exposure to the commodity price which is similar to the operators but the you know the cost risk is dramatically increased and that's that's the that's the real uh I'd say kicker in terms of why wheaten is an attractive way to to I've always said wheaten should be the foundation of your precious metals investment um but it's definitely worth uh stepping into the operators they uh you know there are some great opportunities in that space but a company like ours with its low risk profile it should be the foundation of everyone's precious metals investment. Yeah, I mean that was that was the easy one, but I mean we talk about these right there is a valuation premium streamers often trade at higher multiples 20 25 times cash flow compared to the miners. Do you think investors might be overpaying for safety and and if there's a concentration risk I'm just looking at those you know even diversified there's a few core assets usually dominating the cash flow base right yeah I mean you know and I would say have to have a look at those assets uh you know our core flagship asset isobo owned by valet in Brazil valet is a uh a quasi you know I mean it's a very strong Brazilian institution and so very very well supported and and embraced within in uh within Brazil. And so and then the asset itself is a is a is a tier one uh you know first quartile producer that's got all sorts of exploration potential. It's it's really been delivering uh on its uh on its on its production commitments of all time. So so if I was going to have a flagship asset, I think Silobo is the perfect flagship asset to to build a company around. I'm very comfortable with that. Um you know the the other side the the premiums that we trade at I you know again I think it comes down to risk profile. what kind of risk do you want to take? And that's that's the that's the key difference. Uh our risk profiles are are slightly higher than most mining companies and and a lot higher than uh or sorry our trading multiples are are slightly higher than you know some mining companies and and a lot higher than most and it it really comes down to the confidence about what we'll be able to deliver back to our shareholders. So that that com combination of commodity exposure uh resource expiration expansion uh potential levered uh exposure to the commodity price itself I really do think it comes it comes into play. So you know we only look expensive when you look at us like a mining company. We're not a mining company right? Our risk profile is so much lower than that and that's where it starts getting attractive. You know if we're sitting here at the end of Q4 chatting again I mean what's more likely last question. Gold at above 3,800, silver above 40, or wheaten shares at new highs. Well, wheaten I'm confident wheaten shares will be at new highs just because of organic growth. Even if prices stay constant, we will see that uh continued as we continue to deliver on the growth profile. And you know, we've got a couple more exciting projects coming on with Mineral Park and Plat Reef coming on before the end of the year. So, the Q4 call uh you know, I'm confident on the uh on the continued high prices for for for Wheaten uh you know, It wouldn't surprise me to see silver uh have have at least touched 40 whether it's holding it at that point or not. But uh you know I do think that that we are seeing that increase retail pick up and you know it'll it'll be interesting to see there's no doubt that the Fed decisions in terms of rate cuts uh uh and and that that will have an impact on the next step in the precious metal space. And so I I look forward to seeing what happens over the course of the year. There's a there's again a lot of political pressure on uh on that US dollar. So, uh let's see how that uh that plays out. It should play out well for gold and silver. Interesting. And the Fed. Okay. Well, we're watching right here. Randy Smallwood, CEO of Weed and Precious Metals joining us. Always a pleasure to have you. Thanks for making the time, Randy. Enjoy your summer. Appreciate that. Thank you, Jeremy. You, too. Thanks, mate. All right. That's it for us here on Kicko News. Thanks for watching. Hit that subscribe button and we'll see you next time. [Music] Heat. Heat. [Music] I