U.S. Just Make This Asset 'Critical'; Price Explosion Next? | Ian Harris
Summary
Copper Thesis: Structural supply deficits, low inventories, and concentration of output at a few large mines underpin a bullish multi-year outlook as copper increasingly functions as the economy’s electrical backbone.
Policy Tailwinds: The U.S. added copper to its critical minerals list and imposed a 30% tariff on semi-finished products to incentivize domestic smelting/refining and reduce reliance on China.
AI and Data Centers: An ongoing arms race in AI and hyperscale data centers is seen as an unstoppable demand driver for copper-intensive infrastructure despite valuation concerns.
Macro Dynamics: Copper’s divergence from oil is attributed to supply constraints; correlations with inflation and cross-asset moves suggest fundamentals will dominate as inventories tighten.
Copper Giant (CGNT): The guest pitched CGNT, highlighting a major resource update to over 1 billion tonnes near-surface in Colombia, improved grades, and a path to a PEA aligned with upcoming political windows.
Freeport-McMoRan (FCX): FCX was discussed as facing tight smelting/refining margins due to China’s overcapacity yet benefiting from U.S. market dynamics and poised to do well as copper pricing strengthens.
Electrification: The buildout of power grids, EV components, and motors reinforces copper as the “new oil,” central to modern electrified economies and defense applications.
Colombia Opportunity: The guest emphasized Colombia as a friendshoring destination with election-driven catalysts, improving perceptions, and strategic alignment with U.S. supply-chain goals.
Transcript
We need 24 projects of that size of scale over just the next 10 years and then the next 10 years and then the next 10 years. Problem is so big now that even those little impacts that might pull it back a couple percent are nowhere close to the the deficits that we'll be facing in supply. The smelting and refining capacity in China is actually way too big. Right? There's too much refining and smelting capacity. How can you compete with that as a in a in a capitalist society? Right. I'm pleased to welcome back to the show Ian Harris, CEO of Copper Giant. That's CG NT, ticker CG NT, and we'll be talking about his views on not just the metal itself, but the broader economy and what the move of the metal signals for the economy and for investors. Is this going to be the next oil? We'll find out. Welcome back to the show. Good to see you again, Ian. >> Always exciting to be here. It seems like the story just keeps getting more and more interesting as each time we talk. >> That's right. A couple weeks ago, you're on and after right after that, the Trump administration just a week and a half ago added copper to its critical minerals list. That's pretty key and I'll read you a few statements from uh the White House uh from earlier in the summer kind of frontr running or foreshadowing this move. But uh we'll talk about that in just a minute. I want to get your broader outlook on uh the metals complex right now. Copper keeps going up. It's uh now squarely higher than where we were a couple of months ago. So, let me just let me just get uh my chart ready here and we can talk about what's going on in the market here. So, copper has run up from August to um we we already talked about uh what happened here, this arbitrage and the copper tariffs. Uh people can check out our last interviews with Ian down below where we discussed that in detail. But um it's up about 14% uh since its August lows and uh it is now almost at new all-time highs once more uh barring the price that we had earlier in March. Now there's this bigger fear out there that the AI bubble is popping and as you know data centers and hyperscalers need a lot of copper and so I'm not saying that it's going to pop. I'm just saying that maybe we as metal investors or people at least interested in the metal space should be watching for the tech companies and seeing if those valuations are sustainable because if not potentially that means lower carbon demand going forward. I don't know. Can you comment on that? >> No, I just think that there's going to be a shifting of what the capitalization of companies look for. I mean it should be not in the chip manufacturer but in the companies that have to construct these gigantic data centers. I strongly believe that this is not a something you can slow down, right? It is a existential race between nations, right? And I think that is also what leads to seeing copper as now a strategic metal. I almost believe that copper is the I mean I'm biased obviously but copper is the most important metal of all and all this other tariff back and forth antimony tungsten d is are the skirmishes but the real battle is is copper because it's the metal that drives all electricity we have uh anticipated supply deficits the United States is dependent on the concentration of copper in China and really it is the future of the future of economies it's called the new oil for a reason, but part of that reason is we're dependent upon uh not just AI, but the but information and data are what drives the new world's economies. And so therefore, it's not a race the United States can lose. Um, and I think it's also the elephant in the room. I sometimes call it the the assassin's mace of China itself. I have here the uh copper chart overlaid now with oil. So, two very key commodities pretty much indispensable for our economy. Now what you see here is that over time the relationship has been pretty much stable. There have been periods where they've diverged but most often than not that divergence was quickly rectified in the marketplace. That's not the case this year. Take a look at the copper price which is the bar chart and the blue line is oil. And pretty much ever since May which is six months ago now for half the year the prices have been diverging. Is there a fundamental reason for this? You know, I would like to say, oh, because copper is the new oil, we're letting go of oil and copper is now the requirement, but I don't think that's what's going on in this case. I think that what's happening is you have a structure a structural problem in supply in copper. At the same time, you have an increased growth. Um, so it's harder to turn the tap on it. You know, you know, it's you could just open up the valve oil. I know that is a super exaggeration but to build a new mine and at the same time we've had production issues in some of the biggest mines in the world at Grassburg for example we have production reduction uh and they now say that's going to continue into even next year uh we've had the problems in Congo and Cobra Panama continues offline so the you know these are big projects that can supply 2 three 4% of the world's the world's copper right it's concentrated into a few projects which is a part of the problem moving forward too Um, so we're having problem adding additional supply at a time of growth, but it is to me this copper price should have already taken off even more, but it seems that the short-term traders have more control over pricing than the long-term fundamentals. It's but it is slowly pulling higher. If you take away that weird arbitrage, it's getting back to historical real, you know, you're we're looking at the comics, but if you look at the LME chart, which you know, you don't have this arbitrage in it due to the That's right. >> to to the the assumption of um tariffs, we're getting back to historical highs again. And the other thing, if you look at the inventory of the LME, it is slowly going lower and lower and lower. And if you look back, you know, back in the 2006 time period when copper really launched uh the first time, right, we're lower inventories than what created that catalyst back in 2006. So, all this is kind of playing out all playing out. >> I love this next chart that I'm showing on my screen. Uh I don't think this gets talked about a lot. We talk about on my show how inflation is correlated with the money supply, how it's correlated with economic growth, um how it's correlated with the dollar and perhaps even the 10-year break even uh 10-year uh Treasury yield. But look at this copper versus the inflation rate pretty much perfect correlation all throughout most of history going back to well this chart goes back to the late 90s. That's as far as it goes. And I I just wonder >> Yeah, go ahead. I mean it they're both taking >> I think you're seeing the exact same thing. you're seeing a structural, you know, when you have this divergent like you saw in oil where oil is continuing to follow that line and and a little bit closer, a little better correlation. Um, you're it does break down a little bit and it's because the structural problem and supply that's happening and behind the scenes that's slowly ekking out, you know, it's pulling away on a, you know, a percentage point or two more percentage compared to the growth, right? So, it's it's all playing out together. Does copper get affected by overall CPI or was it the other way around where copper prices go up, input prices go up for construction and then everything else kind of trickles down into prices because you could make an argument for both, right? What have you observed? >> I think >> Yeah, go ahead. >> Yeah, obviously uh mining is very cost intensive especially labor, fuel, steel, iron, you know, these kind of consumables that go into these projects on not just in capital but in in operational cost. So you can't have copper price way you know when it gets lower than uh you know the price to produce it then you know things shut down. Um but at the same time it's a a critical component in the world's economies right it's in anything that has electrons traveling through it almost all of it is copper and we are definitely more an electronic electricitybased economy as we move into the future and so obviously it's uh it's a it's a one-two step >> and you're the CEO of a copper company and we'll talk about some of your recent developments you have a very important uh announcement to make uh we'll get to that in just a minute so uh people who are interested in your company should really stay tuned for this. But we we need to talk about uh what you as a CEO have encountered this year when it comes to costs and cost inflation. Um have you noticed anything with your operations uh that's maybe different than the year ago before the tariffs were implemented or maybe just cost overall notwithstanding tariffs? Have you have you noticed any cost increases? >> So my focus is on the expiration and development side still and then you start looking at the cost of the anticipated cost of what a project would look like. And I'm also involved in multiple and assist many other companies in developing that. And it's strange. We really haven't seen a dramatic uh inflation in cost and capital prices yet. And because but mostly it's because there's not many projects still being built, right? Despite $4,000 gold, despite five $50 silver, despite $5 per pound copper, we don't see a lot of spur in construction or even expansions because that really what drives our cost. It's either driven because you have an unavailability of new equipment, whether that's yellow metal, uh you know, rolling stock, you know, the big those big trucks that run down the road, or it's through the big mills. The others is obviously fuel and labor. And we really haven't seen a big up an an abnormal uptick in the the effects of inflation yet. You know, that's a big yet because again because we haven't building it only makes the problem worse and it's only going to spur on even more, you know, need into the future and it could be really really a little chaotic. I think that's might be the way that the best way to say it. >> Chaotic in what sense? Well, in the past when we had the last super cycle, which I'm unfortunately old enough to remember, right? Um there was a time where it took three years to be able to get some of the larger sag mills or getting your uh there was time that used trucks cost more uh than uh brand new ones because of the time to actually get them and to be able to get projects actually built. there was a surge and and I think we're going to go through it again because it's not like we're rolling out ball mills and sagmills and big trucks right now because they're just not building new mines and as that surge all comes it can get very uh you know the the the advantage goes to who starts first right but if you're in the middle of that curve and what normally happens is because you get a glut of new projects you get a peak in price uh it goes through and then all these new projects come online and and guess what they come online just at the same time the projects are dropping so it's timing is critically important in mining too, but we're still a ways away. We're we're hopefully 5 6 7 8 9 10 years away from that point, right? These super cycles having a tendency to last, you know, a 10 year time period. >> That is a critical question for this critical mineral. What uh what is happening in the metal space, copper, particularly when it comes to projects, developments, M&A, uh let's talk about timing right now because that tells us a lot about where we where we are, not just in the mining cycle, but also the economic cycle. >> So, you know, the the it continues to be dangerous. said it continues to be consolidation between producing companies, right? Um I think you know you look back in history at the end of that last super cycle, you know, between the 2008 and 2015 time period where you could argue it really started in 2013 the bare the bare market in the in the equities mining equity space. We lost a lot of CEOs. A lot of CEOs got fired uh either from bringing on projects that couldn't be built, overspending on capital, or just cost overruns growth at any cost. Um, and so there I think there's basically the new guy coming in goes, I don't want to get fired for the same reason the last guy got fired, so I'm going to I'm going to keep it low risk. So they're just acquiring each other and saying our growth is going to come through um the price increase. But you're seeing it now at the board levels. You see it now going, but where's your where is it coming from next? Right? What have you done for me lately? And you're already seeing them going, where is your growth going to come from next? They've already acquired each other. They've already done the most consolidation they can do. So it's hard now they need to start looking at projects um again uh and that really hasn't started in earnest yet where we see a lot of mergers and acquisitions to acquire projects right but it has to happen right uh the growth continues the the demand continues and the new supply is not coming there um so that dynamic is really playing out and at a time especially in the copper space there's no projects right I I I do I do a graph in my presentation that talks about over the last six year uh Over the last 10 years, we only built about six big mines and actually two of them, one and a half of them are, you know, one's not running and the other one is having problems right now. Uh, and we only added about 250,000 tons per year. And we need to add, according to BHP, a million tons per year. We need to do four times as that. We need 24 projects of that size of scale over just the next 10 years. And then the next 10 years, and then the next 10 years. Um, and we brought out some important news and and and I maybe I'll just wait until to be able to talk about the news that we have to explain how that dynamic could possibly pay out. >> Okay. And then the final chart I want to show you before we move on to um uh what the Trump administration is doing with copper right now is uh this chart that I have on my screen. Let me just pull this up. Um it seems to me we're entering an era where a lot of assets are correlated together. So I'm going to show you Nvidia now correlated with copper. These are two companies that on paper have nothing to do sorry two assets that have nothing to do with each other on paper. And yet when you start to look back the correlation became a little more uh robust starting around 2018 2016. Before then not not so much. Um and and that that that this this pattern could be could be replicated with other assets and other stocks by the way but tech stocks like Nvidia and semiconductor companies in particular. How do you explain this? >> Uh, I'm not going to touch that one with the 10-ft pole because you might to be on to something very interesting that it basically is >> it's not the if you if you're a gold bug, it means there's just more there's more the value of the dollar is going down and really the there's no real growth is what is, you know, is a potential reply to it. But I'm not saying that is the reply. But there's uh you know that's a very interesting graph that I've never seen before and I'm going to not touch it for that reason cuz I think that we could get into uh uh some you know some very interesting discussions on that chart. Accident gold guy. >> I think there's probably not an accident here. We we can think about it some more and talk about it another time. But uh I mean same thing with gold. I mean maybe you have a different answer. Gold and copper, right? They're they're fundamentally different use cases. Um and and yet look at this. Look at this pattern just move together. actually bring in they bring this up to me about 2 years ago or a year or a year or two years ago >> how they do move in and it a lot of it has to do with the amount of money that is in supply and the actual value of money right um there would be many argue that you shouldn't put things in the US dollar you should put it versus gold as the real uh underlying value but there could be a second part of this right you've had a rotation of capital into the biggest stocks in the market while if you look at everybody except for the big five there's actually been a reduction and there could be a rotation of money that's also going into commodities. So while there's a risk on it's also the the the you know the balance to that risk is to put it also into commodities right you're already building your safety net right you're already saying when this crashes I already I'm already building a portfolio and something that should go off off afterwards right so there's it is very normal that in in a crash you know this what's very interesting about this cycle is that gold has taken off before the catalysts have actually happened right it's anticipation of those catalysts that has actually driven the co uh this the this the gold price. I as a mining engineer see it as a completely different perspective. It is the fundamental problems in supply have been so long and going on so long the fracks are finally happening right you say why is copper going up if the world is worrying about the world economy Dr. copper and it's because the problem is so big now that even those little impacts that might pull it back a couple percent are nowhere close to the the deficits that we'll be suffacing in supply. So there's some really it's a very interesting time. I think a lot of models are going to break um as this plays out and we get back to just fundamentals or the you know you we need copper to continue to move and there's not enough copper so copper price must go up. I mean it's going to get back to a lot of those fundamentals and maybe watching the the implosion of Bitcoin at the same time is that is that come back to reality type uh mentality is building in. We can take a look at what the Trump administration has done this year with copper and maybe speculate as to what they may or may not do next. So, uh, like I mentioned in the introduction, copper joins, uh, the US critical mineral list. This particular author on Reuters says there's already plenty copper in the US. You can evaluate that statement, true or false. Um, but importantly here, Trump on Thursday added 10 minerals to a list it deems essential for the US economy and national security, including copper, vital to electric vehicles, power grids, and data centers. I think the people in the industry have been waiting for this for quite some time now. We've always talked about copper as unofficially critical, but now it's officially critical per the government. US copper output is less profitable. Copper is used widely across the global economy in power generation, electronics, and construction. Free Brook Memorial, the largest US copper producer with seven mines and controls one of the largest uh two smelters in the country said this year it could generate more than $500 million annually and tax credits alone from this new um new legislation. And I want to bring up one more thing. So this is the announcement that the White House made back on July 30th right before the tariffs were officially implemented. So in light of these findings, the secretary recommended recommended a range of actions to adjust the imports of copper so that copper imports would not threaten to impair the national security. The secretary recommended an immediate universal 30% tariff on semi-finish copper products. That's what happened. And the reasoning for this is um the secretary found that the co that copper is essential to the manufacturing foundation on which the United States national and economic security depend. Copper is the second most widely used material by the Department of Defense. It's necessary input in a range of defense systems including aircraft, ground vehicles, ships, submarines, missiles, and ammunition. So, they're justifying why this is a matter of national security. They're also saying that um uh basically in the opening paragraph here because of the way that copper has been imported based on the facts considered in the investigation the secretary founded advised to me of his opinion that copper is being imported into the United States in such quantities and under such circumstances as to threaten to impair the national security of the United States. Now I'm going to later on I'll get you to react to this but I'm going to later on show a graph of where copper in the US actually comes from. I pulled that out from the USGO. Uh but just looking at this in retrospect, doesn't that seem a little ironic to you that the US declared this a matter of national security and then applied a 30% tariff to limit the supply? Like how does that what are they doing? >> I made a bold statement at the beginning saying that copper is the most strategic of all metals because so much relies on it. Um right, you know, it is it's a basis for defense. It's the basis for the economy. It's the basis for electrification. It's for AI. It's for our new sustainable energy growth. Blah blah blah blah. There's so many reasons and it and it's not really easily replaceable. Um so I started with that statement. So you ask why is it only now that it's becoming a critical mental and I think for many many many reasons the United States didn't want to admit it had a problem, right? Because it is such a big problem. I say I call it China's uh assassin's maze for a reason. you don't want. You're playing a game of chicken. You're playing a game of poker. We're not worried about that. Even though the little skirmishes over antimony and tungsten and other metals are going on at the same time, these are so the cracks are forming. So now they're like, "Okay, we got to play our card." Now now because this has been a problem for a a long time. I would also agree there are significant resources within the United States, but you have to build them, right? You have to have them. But there's something very interesting and it's something we've talked about in the past. Why would you put a tariff on semi-produced goods, okay? Uh to incentivize more copper production in your country. And that is the most fundamental question because it also puts a 2-year reprieve, I think would be the correct word, uh on refined copper import, but only two years. What is it saying? is saying you can continue to import copper, but I will put a tariff on secondary things such as cable, right? Which would be a secondary product of copper, right? Bringing in and cable would be a great example of something we use all the time. Everybody has the wiring that goes through our house because I want you to produce more wiring in our house. but you also give you a get out of jail free card for two years because I want to incentivize smelting and refining capacity in the United States. In that same article that came out very interesting, Freeport Macaran is is complaining despite $5 uh copper price the margins are tighter. Why are the margin tighter? because they're really talking about um the the the smelting and refining capacity in China is actually way too big, right? There's too much refining and smelting capacity. So, the margins that they're willing to pay are sometimes even negative or zeros. They're basically paying to smelt your concentrate. How can you compete with that as a in a in a capitalist society, right? they're basically um providing uh you know they're sustaining a oversized refining capacity so they could basically beat out any competitors. So re Mcmaran is saying we need help because to be able to compete with that if you want production change in this country we are actually going to be creating even more smelting and refining capacity in the United States to ensure because that is the critical link right it's not necessarily the mining it's the smelting and refining capacity and making sure you have enough concentrate because the concentrate business right now is extremely competitive and you're like listen man I want to go to you Freeport Macaran but China smelter is literally going to pay me to to buy my concentrate. Um, and so that says we need this to be incentivized to make sure it's a fair fight because once you have the refined copper, you have the wire, you have the electric motor, you have everything. Because I mean, if I was Tesla and I was sitting and I was like, man, hey, China, we need some copper to make some electric motors. And they're going to go, nope, sorry, no more. Uh, I'll sell you, okay, well, at least sell me the electric motor. Nope, not going to do that either. Here, buy this car. It's called a BYD, right? I mean, because if they have control of the production chain, if you cannot build an electric motor, you cannot build an electric vehicle and you're toast, right? So, that is the game that's going on right now. And so, you might argue, well, forget it. We'll just keep using our our our gasoline powered engines. But the game you cannot lose is AI and data centers. >> Okay? >> And that is a big one. >> Try to understand this. So when when the administration says or has said universal 30% import tariff on semifinish copper product yeah an intensive copper derivative product is not raw ores. So they're incentivizing production >> still domestically. That's what they're trying to do. >> Never and and never raw ore. So not the concentrates and it gives you a two-year reprieve on copper import. So if you're really importing pure copper, >> but it's saying only for 2 years, meaning in the future, we want you to make that copper pure copper here because that is the real beginning of the production chain is at the smelting and refining side. So that then this chart makes a little more sense. Well, not a chart, but co uh table. This is from the uh uh USGS. Uh we have here a uh a table showing where the copper in the US comes from. So I mean I'm going to skip this first table here because you go to this import sources 2020 to 2023. China is not actually on this list here. Copper content of blister and anodes Finland 92 copper of content of matte ash and precipitates. Uh Canada is actually the biggest country 48% Canada 99% copper content of ore and concentrates ore and concentrates 99% of that comes from Canada when you're talking about imports. Um so net imports of copper uh reliance as a percentage this this is the crucial line net import reliance as a percentage of apparent consumption is was 45% almost half of the US consumption of copper according to this government source came from imports and depending on what type of copper you're looking at 99% of that is coming from Canada. So, this isn't about China at all until you get to this next table where you show that China produces um a fifth of the production volume of Chile in terms of mine production, but they have the world dominant uh position in refinery production. Let's let's just comment on that. How did that happen? And you know, maybe this is about refined products after all. >> Well, the number anode is interesting, but anode has to go to a refinery to be refined. Concentrates have to go to a smelter to get smelted. And the real one you're looking for and I didn't see it there was our importation of cathode copper. How much cathode copper are we importing? because that really represents and to be fair it doesn't really represent if you're not making electric motors in the United States you're not importing copper but you are importing electric motors right so I really don't think it really grasps because it's in so many of the fine products but if you go keep you know you follow that thread and go all the way back you find out you need that cathode copper which comes smelting refining and produces that cathode copper and then it gets extruded into wire which then becomes an electric motor and so when you're going uh-oh now They're not going to sell me copper wire. They're not going to sell me electric motors. Now they're only going to sell me the electric vehicle. We need to build more electric vehicles. And you go back down the same thing. You go, uh-oh, we need copper. And so I think this is even dramatically understating the dependence that is on copper because we are still importing not just to manu because we really have gone away from a manufacturing based economy. A lot of those products are just being imported and assembled in the United States. So if you really want the production chain, you got to go all the way back to the beginning. And China has already put those in place. That is their copper m that is their assassin's mace. They control over today it's about 60% I thought of the world smelting and refining capacity, right? They have they have that beginning of that that production chain which is obviously electrification which is the big one. uh you know obviously electric motors and then of this that same wiring that's required in data centers and AI. >> So this goes back to uh the main question of how this impacts the mining industry. Let's just take your company as an example here. So your projects are based in Latin America specifically Makoa in Colombia. you're not in the US and so you know the Trump kind of diversification away from China and uh its reliance on imports it's not just China why they want to diversify and to have multiple lines of imports and eventually produce themselves and so or produce more themselves rather um I was reading the article just now uh the same article that I was quoting you and it says that um the US just doesn't have the same level of grade as elsewhere so where where does that leave where do you come in? >> So a combination of things. First I want to say there's the concept of nearshoring. Remember I mentioned you want that smelting and refining capacity as much as possible to be in the United States. So if you have the smelter, you need to feed that smelter. But the rest because you want it to be called French shoring, right? You could argue that China and maybe even Europe dominates uh Africa which is one of the largest producers and they put a lot of investment. But China is also I mean I was personally a part of a sale for the first industrial scale mine in the history of Ecuador for $690 million to two Chinese S so S so S so S so S so S so S so S so S so S so SOES to supply uh concentrate so America is scrambling to nearshore right they're scrambling to friendshore uh those those those chains um I personally have been invited to give an update to the US government uh which has never happened in my entire career in mining despite having a US passport uh and that is happening now um So Colombia is a major non-NATO ally of the United States. It's the same as Australia. It's the same as Japan. It is a true ally. And they're like, we need to make sure that that is the advantage. And that's why I'm very bullish on this product. This is very good potential news for us that it it's it's getting at least it's in the limelight and it's and it's and it's raising an importance. Um another metal that was added in 2022 to the critical mental risk is is malibdinum. And we are also the third largest meloden project that I know of in the world too. Uh so that that's uh that's also bodess very very well. So how does it all work out >> and I'm if I'm allowed to if you give me permission I'll share some of the news because it ties into what I think >> please go ahead. Yeah. >> You know to today we put out really big news. We put out an updated resource that showed a growth of about 70% in resource uh to over a billion tons of inferred resource and our metal content doubled. We doubled the amount of metal that was contained in the deposit. Remember it's a copper malibdinum deposit and it now is over.51% copper equivalent. You mentioned something important. Grade is important, right? grade is really important because not only is the United States getting to lower grades but the cost is also more expensive because these are highly cost intensive and labor is a big part of that right so um that is huge for us and why is that important because it is a nearsurface project and I only know of five other projects in the world that are over a billion tons in near surface and not already with a major mining company and so it is positioned now it's like in the past I used to go oh we love your project but it's a little small and we're like I'm getting it's getting bigger. Come on guys, you this is not the whole thing. So now it's kind of a light bulb goes off. It's a massive catalyst for us and should be you know really really really bullish and get the company to where it should be properly valued. We have a lot of conversations that are about strategy. We've applied this strategy. We've delivered over the last 12 months and now it's our chance to be able to shine a little bit and get our valuation to where it should properly be. Having a resource over a billion tons and being near service is important, right? Grade is important and it's and be jurisdiction is important. So seeing we're in Colombia, we're near surface, we're near infrastructure, it means that it could be also built quickly and be an efficient supply of new supply because if you already have all this smelting and refining capacity and you need to build more to secure your national security, you also then need to secure the supply. And so uh you know those type of projects projects like Makoa are going to be extremely coveted uh in in the future. I mean we're based on our our valuation where we are today where we should be right. I always act like I don't care what we're valued. I do care what we're valued today. It's it's it's not just what we're valued today. It's what I know we should be valued and we treat it that way. We treat it like the B billion dollar baby that we know Makoa should be. >> Okay. Um I have a few follow-up questions on that, but uh let's just go back to your resource here. So this new announcement or your new resource just for the ge for the non-geeologists watching this show we want to understand this from a finance and uh a corporate finance perspective what uh what is the core difference between now versus a few months ago when we first spoke not first spoke but we spoke a couple times the last couple months but let's just take September when we were both in Colorado remember the beef for creek conference so uh we were there how has your company progressed since then based on these resource findings >> so let's take and then small chunks. Resources are based because you drill them. You drill them, you touch them and you say I there are resources and then it's a mathematical calculation of volumes and grade to be able to calculate how much copper and malibdinum is in within that deposit and that is called a resource. So that is the resource. So we've been drilling for 12 months and we've already had an original resource. So we added additional drilling. We added about 10,000 more meters of drilling. And then based on that new drilling, we did an update to a new calculation in that resource. So we went from about 600 million tons to over a billion about 1 billion uh tons. Um and at the same time, the grade went up. So that grade is how much metal is within each ton of material. So as grade goes up, it means there's more metal per ton. So that's why we went up about 70% in tons, 15% in uh grade which almost doubled the metal contained within the project and that is based on an update of that exploration that we've been doing over the last year. Right? So from time to time the company update we updated it because we wanted to say I mean this is a massive super important catalyst and and a super important hurdle for the company to be able to uh to pass. I I try to explain it I tried to explain it today. um you know in terms of total metal cont No, I won't even get into that but copper projects are really big right where gold you can have lots of little individual and little companies there's lots of gold mining companies but there's very few copper project copper companies out there so scale is very important because they don't want to build a lot of small mines they want to build really big mines to actually impact their balance sheet so getting across that line has been critically important for us >> what's next then so you've already accomplished uh this massive uh drill result. Um what other results can we look forward to in the coming quarter? >> Well, we will continue and and so if you look at individual copper companies that are now in a development stage, so they're past a resource and moving towards trying to build a mine, the resource is very important because it's the basis for your valuation. It is how market says how much are you worth? So be able to double that number obviously bodess very well for what our valuation should be reflecting. Now the next stage is we will continue to put out drilling. But the next big stage for me is in May we have elections in Colombia. Presidents can only run one term for four years in Colombia. So we will have a new president. So in May is the first round. If there's a second round will be June and by August we'll have a new president. And by then I want to be able to be finalizing either before or immediately afterwards our preliminary economic assessment, our PA. It's the first economic study around that resource. Why? Because I believe that the next president's going to come in and he's going to say, "I need to attract investment. I need to create jobs. The kind of guy left me the keys. He, you know, the economy was smashed against a wall and I need to stimulate the economy. Who's got good projects?" And I want to be able to at least say this is a real project. This is this is what it's starting to look like. And at the same time, he's going to say, "Well, how does the how's your relationship with the community?" Like, "Oh, wow. You guys, they really like you. They're really supportive of you." Oh, what does the nation think of? Wow, you have an amazing reputation in this country. This is great. I get it. All right. So, without the, you know, without creating a big political c using a lot of political capital, you know, there's a very attractive project. So I talk about these windows a lot of times when I and when I present and we see a window that's developing in Colombia and what's going on both in the United States both in Colombia election periods our project and it's all about trying to navigate all those things at the same time. So we're very bullish on where this project will grow over in in the very near period right a lot I think a lot of eyes will be opening up I think a part of our valuation is based on a perception of Colombia and that is going to be changing extremely quickly. Well, you say that uh the valuation is not where it needs to be. So, the obvious follow-up question I have is why is the market not realizing the true NAV right now? >> I think it's a combination of things is that a we do have a little bit of momentum in the equity space. It's been mostly focused on uh copper and silver. So, for those of you that missed out 250% gains in in stocks, you know, I think the next one is obviously going to be in the copper space. It's kind of poised. It's already getting to historical levels. you're going to see probably some consolidation and you're going to see more money coming into the equity space into mining and copper as a natural destination. So that is required really to create a a a what I call a graduation moment not just a slow increase in valuation but a dramatic increase in valuation to get re-evaluated. I think that's part and the other part has been a perception of a Colombia but that perception is changing because we're right around the corner. coming up and market will start pricing in that that expected change in Colombia uh as the world is waking up to it. So I think it's and then maybe the third is yeah it's big but it's not big enough but you hit a billion tons and now you're big enough. So I think we're checking so many boxes that should be supply a very solid launching pad. Um our next closest guys have a valuation based on pounds per the ground at least five times higher than us. So we have a lot of room to to grow dramatically. >> The other thing is uh maybe this is more applicable for the gold space but it may be applicable for uh the copper space as well but for gold companies what we've seen is uh the GDX or the large caps have moved up first before the smaller caps and so that usually signals the beginning or now middle of the bull cycle. So maybe that's what's happening now. The larger companies are taking more presidents when for investors and gaining more attention first. But how would you compete just for um just for attention sake? How would you how would you compete for capital? Uh how would you differentiate yourself differently from let's say uh Freeport McMoran? >> Well, we a we don't have to right they are the big producers but when people as you say trickle down and go okay the producer wow why are they making so much money right that already happened in the gold space but now it's going to be happening in the in the copper space. Um Freeport Macaran was crying in that one but that little arbitrage in the comics they made a fortune because of that uh that that that price differential in the United States. they're going to do very very very well. So when you start seeing the performance of these companies, money starts trickling in, then they go, okay, what's next? How can I really leverage now that people are getting a deeper understanding that that funding trickles in now while there is probably a 100 different gold projects on the planet, right? There are very few copper projects and because they have to be so big and I as I mentioned it, there are only four five projects that I know of in the world besides our own that have over a billion tons are near surface. So the list gets really short. Um so I think that we are really good when at least the eyeball comes back and go okay how can I take advantage of the supply demand deficit the the improvement in uh commodity prices and knowing these big companies are going to need growth and so that's when uh and I think we're there like I think it's happening right in front of our eyes I think that the shine in gold took away a little bit of the tension but I think most people like me they're like I love copper but they haven't started that investment that The narrative is there for Copper, but the investment hasn't started yet, but I think that FOMO will kick in the second it does. >> Well, let's keep tabs on your developments. Uh, exciting things happening for your company, I'm sure. So, where can we learn more about you and your company? >> So, the obvious is coppergiant.co, uh, is our website. Um, and our ticker is CG&T on the Toronto Venture Exchange. And I always invite anyone if they have any questions because I'm right now in Monaco. I'm always I'm right now on a on a 3-week European trip telling this story every single day to make sure everybody knows about it uh what's going on with the company. Um but always if you want send me a WhatsApp message at plus13039562944. It's more effective than an email or anything else but my email is harris@ coppergiant.co. But again plus13039562944. I love to talk with investors, our shareholders, ex, etc., and share the exciting developments. I love this project. I love this company, and I look forward to to to taking it to much higher places. >> All right, feel free to text Ian number down below. Ask him all your questions directly. Ian, you're just opening up yourself a whole can of worms, but my investor audience are friendly. Um, they'll have good questions for you. So, Ian, um, actually, just on that note, you're in Europe. I'm just curious, how do European investors see the mining space right now? Is it different from the North American crowd? >> Uh yes. Uh the Europeans overall, I mean this is very broad brush, but they are more long-term strategic uh buyers, right? Um they obviously got a lot of attention in in the precious metal space. They obviously definitely believe in the in the you know the the reasons to own gold. Um but they're more long-term investors. So they're they're very bullish on copper. they just really haven't started the investment like well yeah I want to but now you know my it's and they're actually thinking about rotation now that they're up 250% on some of their gold stocks are like now what you know I should be now is the time to start rotating to copper but there is definitely a much longer term focus you see a much shorter term focus uh in where it seems United States investors uh follow the trend more than try to actually sniper out uh individual opportunities and are are are in out a little bit quicker. Um, but that, you know, that's very broad brush. Obviously, you meet very long-term investors in the United States, too, and the same is the opposite, but that seems more of the perception here. They're more of a disciplined long-term approach. >> Well, I'd love to get your take on um on investors from other areas. If you ever go to the Middle East, I know there's a huge pickup in interest in the Middle East uh for precious metals and critical minerals. Uh Saudi Arabia and Trump just made a deal. Um I just pull this up here actually. So this is nothing to do with the copper giant in particular, but since we're talking about it, I'm just just to close off here. Trump MBS agreed to develop rare earth refinery in Saudi Arabia. This was just last week. This week, today. This week. So um and this is the yeah US reliance on imports of key critical minerals. Uh gallium Chinese, arsenic, Chinese, rare earths overall 95% from China. So yeah, Trump has very much an incentive to diversify away from this. Um so that interest in the Middle East is going to be huge. I'm curious what you think uh or what you encounter if you ever go to Asia because the resource sector isn't so big there as compared to Canada but um you know there's some curious investors but uh always good to get your take in >> I will say the reason that uh Frank Gustra is the largest shareholder of copper giant was based on a trip to Saudi Arabia where they want to build that same smelting and refining capacity but obviously don't have the natural resources it's very sim similar to China you know 12,000 tons tons per year in capacity to only 1,000 in production. Um, and so one of the things they look forward to is securing future copper supply. And so he saw there's a writing on the wall that there's going to be a battle over copper and that's why he he he wanted to be part of co and actually put his name on it. Copper giant is is Frank's name and that was because of that trip to Saudi. >> That makes a lot of sense now that you're explaining that way. Okay, good. Let's follow up. Curious to hear more about that story. So uh if you have any questions, please submit uh emails or texts to Ian. Feel free. Um, and um, let us know what you want to ask Ian next time he's on the show. So, um, you know, he's a regular and, uh, if you do have questions that you want me to ask, just shoot them our way. Thank you very much, Ian. We'll see you next time. >> Thanks, David. I love our conversations. Appreciate it. >> Yeah, me as well. And thank you for watching. Don't forget to like, subscribe, and uh, follow us down below.
U.S. Just Make This Asset 'Critical'; Price Explosion Next? | Ian Harris
Summary
Transcript
We need 24 projects of that size of scale over just the next 10 years and then the next 10 years and then the next 10 years. Problem is so big now that even those little impacts that might pull it back a couple percent are nowhere close to the the deficits that we'll be facing in supply. The smelting and refining capacity in China is actually way too big. Right? There's too much refining and smelting capacity. How can you compete with that as a in a in a capitalist society? Right. I'm pleased to welcome back to the show Ian Harris, CEO of Copper Giant. That's CG NT, ticker CG NT, and we'll be talking about his views on not just the metal itself, but the broader economy and what the move of the metal signals for the economy and for investors. Is this going to be the next oil? We'll find out. Welcome back to the show. Good to see you again, Ian. >> Always exciting to be here. It seems like the story just keeps getting more and more interesting as each time we talk. >> That's right. A couple weeks ago, you're on and after right after that, the Trump administration just a week and a half ago added copper to its critical minerals list. That's pretty key and I'll read you a few statements from uh the White House uh from earlier in the summer kind of frontr running or foreshadowing this move. But uh we'll talk about that in just a minute. I want to get your broader outlook on uh the metals complex right now. Copper keeps going up. It's uh now squarely higher than where we were a couple of months ago. So, let me just let me just get uh my chart ready here and we can talk about what's going on in the market here. So, copper has run up from August to um we we already talked about uh what happened here, this arbitrage and the copper tariffs. Uh people can check out our last interviews with Ian down below where we discussed that in detail. But um it's up about 14% uh since its August lows and uh it is now almost at new all-time highs once more uh barring the price that we had earlier in March. Now there's this bigger fear out there that the AI bubble is popping and as you know data centers and hyperscalers need a lot of copper and so I'm not saying that it's going to pop. I'm just saying that maybe we as metal investors or people at least interested in the metal space should be watching for the tech companies and seeing if those valuations are sustainable because if not potentially that means lower carbon demand going forward. I don't know. Can you comment on that? >> No, I just think that there's going to be a shifting of what the capitalization of companies look for. I mean it should be not in the chip manufacturer but in the companies that have to construct these gigantic data centers. I strongly believe that this is not a something you can slow down, right? It is a existential race between nations, right? And I think that is also what leads to seeing copper as now a strategic metal. I almost believe that copper is the I mean I'm biased obviously but copper is the most important metal of all and all this other tariff back and forth antimony tungsten d is are the skirmishes but the real battle is is copper because it's the metal that drives all electricity we have uh anticipated supply deficits the United States is dependent on the concentration of copper in China and really it is the future of the future of economies it's called the new oil for a reason, but part of that reason is we're dependent upon uh not just AI, but the but information and data are what drives the new world's economies. And so therefore, it's not a race the United States can lose. Um, and I think it's also the elephant in the room. I sometimes call it the the assassin's mace of China itself. I have here the uh copper chart overlaid now with oil. So, two very key commodities pretty much indispensable for our economy. Now what you see here is that over time the relationship has been pretty much stable. There have been periods where they've diverged but most often than not that divergence was quickly rectified in the marketplace. That's not the case this year. Take a look at the copper price which is the bar chart and the blue line is oil. And pretty much ever since May which is six months ago now for half the year the prices have been diverging. Is there a fundamental reason for this? You know, I would like to say, oh, because copper is the new oil, we're letting go of oil and copper is now the requirement, but I don't think that's what's going on in this case. I think that what's happening is you have a structure a structural problem in supply in copper. At the same time, you have an increased growth. Um, so it's harder to turn the tap on it. You know, you know, it's you could just open up the valve oil. I know that is a super exaggeration but to build a new mine and at the same time we've had production issues in some of the biggest mines in the world at Grassburg for example we have production reduction uh and they now say that's going to continue into even next year uh we've had the problems in Congo and Cobra Panama continues offline so the you know these are big projects that can supply 2 three 4% of the world's the world's copper right it's concentrated into a few projects which is a part of the problem moving forward too Um, so we're having problem adding additional supply at a time of growth, but it is to me this copper price should have already taken off even more, but it seems that the short-term traders have more control over pricing than the long-term fundamentals. It's but it is slowly pulling higher. If you take away that weird arbitrage, it's getting back to historical real, you know, you're we're looking at the comics, but if you look at the LME chart, which you know, you don't have this arbitrage in it due to the That's right. >> to to the the assumption of um tariffs, we're getting back to historical highs again. And the other thing, if you look at the inventory of the LME, it is slowly going lower and lower and lower. And if you look back, you know, back in the 2006 time period when copper really launched uh the first time, right, we're lower inventories than what created that catalyst back in 2006. So, all this is kind of playing out all playing out. >> I love this next chart that I'm showing on my screen. Uh I don't think this gets talked about a lot. We talk about on my show how inflation is correlated with the money supply, how it's correlated with economic growth, um how it's correlated with the dollar and perhaps even the 10-year break even uh 10-year uh Treasury yield. But look at this copper versus the inflation rate pretty much perfect correlation all throughout most of history going back to well this chart goes back to the late 90s. That's as far as it goes. And I I just wonder >> Yeah, go ahead. I mean it they're both taking >> I think you're seeing the exact same thing. you're seeing a structural, you know, when you have this divergent like you saw in oil where oil is continuing to follow that line and and a little bit closer, a little better correlation. Um, you're it does break down a little bit and it's because the structural problem and supply that's happening and behind the scenes that's slowly ekking out, you know, it's pulling away on a, you know, a percentage point or two more percentage compared to the growth, right? So, it's it's all playing out together. Does copper get affected by overall CPI or was it the other way around where copper prices go up, input prices go up for construction and then everything else kind of trickles down into prices because you could make an argument for both, right? What have you observed? >> I think >> Yeah, go ahead. >> Yeah, obviously uh mining is very cost intensive especially labor, fuel, steel, iron, you know, these kind of consumables that go into these projects on not just in capital but in in operational cost. So you can't have copper price way you know when it gets lower than uh you know the price to produce it then you know things shut down. Um but at the same time it's a a critical component in the world's economies right it's in anything that has electrons traveling through it almost all of it is copper and we are definitely more an electronic electricitybased economy as we move into the future and so obviously it's uh it's a it's a one-two step >> and you're the CEO of a copper company and we'll talk about some of your recent developments you have a very important uh announcement to make uh we'll get to that in just a minute so uh people who are interested in your company should really stay tuned for this. But we we need to talk about uh what you as a CEO have encountered this year when it comes to costs and cost inflation. Um have you noticed anything with your operations uh that's maybe different than the year ago before the tariffs were implemented or maybe just cost overall notwithstanding tariffs? Have you have you noticed any cost increases? >> So my focus is on the expiration and development side still and then you start looking at the cost of the anticipated cost of what a project would look like. And I'm also involved in multiple and assist many other companies in developing that. And it's strange. We really haven't seen a dramatic uh inflation in cost and capital prices yet. And because but mostly it's because there's not many projects still being built, right? Despite $4,000 gold, despite five $50 silver, despite $5 per pound copper, we don't see a lot of spur in construction or even expansions because that really what drives our cost. It's either driven because you have an unavailability of new equipment, whether that's yellow metal, uh you know, rolling stock, you know, the big those big trucks that run down the road, or it's through the big mills. The others is obviously fuel and labor. And we really haven't seen a big up an an abnormal uptick in the the effects of inflation yet. You know, that's a big yet because again because we haven't building it only makes the problem worse and it's only going to spur on even more, you know, need into the future and it could be really really a little chaotic. I think that's might be the way that the best way to say it. >> Chaotic in what sense? Well, in the past when we had the last super cycle, which I'm unfortunately old enough to remember, right? Um there was a time where it took three years to be able to get some of the larger sag mills or getting your uh there was time that used trucks cost more uh than uh brand new ones because of the time to actually get them and to be able to get projects actually built. there was a surge and and I think we're going to go through it again because it's not like we're rolling out ball mills and sagmills and big trucks right now because they're just not building new mines and as that surge all comes it can get very uh you know the the the advantage goes to who starts first right but if you're in the middle of that curve and what normally happens is because you get a glut of new projects you get a peak in price uh it goes through and then all these new projects come online and and guess what they come online just at the same time the projects are dropping so it's timing is critically important in mining too, but we're still a ways away. We're we're hopefully 5 6 7 8 9 10 years away from that point, right? These super cycles having a tendency to last, you know, a 10 year time period. >> That is a critical question for this critical mineral. What uh what is happening in the metal space, copper, particularly when it comes to projects, developments, M&A, uh let's talk about timing right now because that tells us a lot about where we where we are, not just in the mining cycle, but also the economic cycle. >> So, you know, the the it continues to be dangerous. said it continues to be consolidation between producing companies, right? Um I think you know you look back in history at the end of that last super cycle, you know, between the 2008 and 2015 time period where you could argue it really started in 2013 the bare the bare market in the in the equities mining equity space. We lost a lot of CEOs. A lot of CEOs got fired uh either from bringing on projects that couldn't be built, overspending on capital, or just cost overruns growth at any cost. Um, and so there I think there's basically the new guy coming in goes, I don't want to get fired for the same reason the last guy got fired, so I'm going to I'm going to keep it low risk. So they're just acquiring each other and saying our growth is going to come through um the price increase. But you're seeing it now at the board levels. You see it now going, but where's your where is it coming from next? Right? What have you done for me lately? And you're already seeing them going, where is your growth going to come from next? They've already acquired each other. They've already done the most consolidation they can do. So it's hard now they need to start looking at projects um again uh and that really hasn't started in earnest yet where we see a lot of mergers and acquisitions to acquire projects right but it has to happen right uh the growth continues the the demand continues and the new supply is not coming there um so that dynamic is really playing out and at a time especially in the copper space there's no projects right I I I do I do a graph in my presentation that talks about over the last six year uh Over the last 10 years, we only built about six big mines and actually two of them, one and a half of them are, you know, one's not running and the other one is having problems right now. Uh, and we only added about 250,000 tons per year. And we need to add, according to BHP, a million tons per year. We need to do four times as that. We need 24 projects of that size of scale over just the next 10 years. And then the next 10 years, and then the next 10 years. Um, and we brought out some important news and and and I maybe I'll just wait until to be able to talk about the news that we have to explain how that dynamic could possibly pay out. >> Okay. And then the final chart I want to show you before we move on to um uh what the Trump administration is doing with copper right now is uh this chart that I have on my screen. Let me just pull this up. Um it seems to me we're entering an era where a lot of assets are correlated together. So I'm going to show you Nvidia now correlated with copper. These are two companies that on paper have nothing to do sorry two assets that have nothing to do with each other on paper. And yet when you start to look back the correlation became a little more uh robust starting around 2018 2016. Before then not not so much. Um and and that that that this this pattern could be could be replicated with other assets and other stocks by the way but tech stocks like Nvidia and semiconductor companies in particular. How do you explain this? >> Uh, I'm not going to touch that one with the 10-ft pole because you might to be on to something very interesting that it basically is >> it's not the if you if you're a gold bug, it means there's just more there's more the value of the dollar is going down and really the there's no real growth is what is, you know, is a potential reply to it. But I'm not saying that is the reply. But there's uh you know that's a very interesting graph that I've never seen before and I'm going to not touch it for that reason cuz I think that we could get into uh uh some you know some very interesting discussions on that chart. Accident gold guy. >> I think there's probably not an accident here. We we can think about it some more and talk about it another time. But uh I mean same thing with gold. I mean maybe you have a different answer. Gold and copper, right? They're they're fundamentally different use cases. Um and and yet look at this. Look at this pattern just move together. actually bring in they bring this up to me about 2 years ago or a year or a year or two years ago >> how they do move in and it a lot of it has to do with the amount of money that is in supply and the actual value of money right um there would be many argue that you shouldn't put things in the US dollar you should put it versus gold as the real uh underlying value but there could be a second part of this right you've had a rotation of capital into the biggest stocks in the market while if you look at everybody except for the big five there's actually been a reduction and there could be a rotation of money that's also going into commodities. So while there's a risk on it's also the the the you know the balance to that risk is to put it also into commodities right you're already building your safety net right you're already saying when this crashes I already I'm already building a portfolio and something that should go off off afterwards right so there's it is very normal that in in a crash you know this what's very interesting about this cycle is that gold has taken off before the catalysts have actually happened right it's anticipation of those catalysts that has actually driven the co uh this the this the gold price. I as a mining engineer see it as a completely different perspective. It is the fundamental problems in supply have been so long and going on so long the fracks are finally happening right you say why is copper going up if the world is worrying about the world economy Dr. copper and it's because the problem is so big now that even those little impacts that might pull it back a couple percent are nowhere close to the the deficits that we'll be suffacing in supply. So there's some really it's a very interesting time. I think a lot of models are going to break um as this plays out and we get back to just fundamentals or the you know you we need copper to continue to move and there's not enough copper so copper price must go up. I mean it's going to get back to a lot of those fundamentals and maybe watching the the implosion of Bitcoin at the same time is that is that come back to reality type uh mentality is building in. We can take a look at what the Trump administration has done this year with copper and maybe speculate as to what they may or may not do next. So, uh, like I mentioned in the introduction, copper joins, uh, the US critical mineral list. This particular author on Reuters says there's already plenty copper in the US. You can evaluate that statement, true or false. Um, but importantly here, Trump on Thursday added 10 minerals to a list it deems essential for the US economy and national security, including copper, vital to electric vehicles, power grids, and data centers. I think the people in the industry have been waiting for this for quite some time now. We've always talked about copper as unofficially critical, but now it's officially critical per the government. US copper output is less profitable. Copper is used widely across the global economy in power generation, electronics, and construction. Free Brook Memorial, the largest US copper producer with seven mines and controls one of the largest uh two smelters in the country said this year it could generate more than $500 million annually and tax credits alone from this new um new legislation. And I want to bring up one more thing. So this is the announcement that the White House made back on July 30th right before the tariffs were officially implemented. So in light of these findings, the secretary recommended recommended a range of actions to adjust the imports of copper so that copper imports would not threaten to impair the national security. The secretary recommended an immediate universal 30% tariff on semi-finish copper products. That's what happened. And the reasoning for this is um the secretary found that the co that copper is essential to the manufacturing foundation on which the United States national and economic security depend. Copper is the second most widely used material by the Department of Defense. It's necessary input in a range of defense systems including aircraft, ground vehicles, ships, submarines, missiles, and ammunition. So, they're justifying why this is a matter of national security. They're also saying that um uh basically in the opening paragraph here because of the way that copper has been imported based on the facts considered in the investigation the secretary founded advised to me of his opinion that copper is being imported into the United States in such quantities and under such circumstances as to threaten to impair the national security of the United States. Now I'm going to later on I'll get you to react to this but I'm going to later on show a graph of where copper in the US actually comes from. I pulled that out from the USGO. Uh but just looking at this in retrospect, doesn't that seem a little ironic to you that the US declared this a matter of national security and then applied a 30% tariff to limit the supply? Like how does that what are they doing? >> I made a bold statement at the beginning saying that copper is the most strategic of all metals because so much relies on it. Um right, you know, it is it's a basis for defense. It's the basis for the economy. It's the basis for electrification. It's for AI. It's for our new sustainable energy growth. Blah blah blah blah. There's so many reasons and it and it's not really easily replaceable. Um so I started with that statement. So you ask why is it only now that it's becoming a critical mental and I think for many many many reasons the United States didn't want to admit it had a problem, right? Because it is such a big problem. I say I call it China's uh assassin's maze for a reason. you don't want. You're playing a game of chicken. You're playing a game of poker. We're not worried about that. Even though the little skirmishes over antimony and tungsten and other metals are going on at the same time, these are so the cracks are forming. So now they're like, "Okay, we got to play our card." Now now because this has been a problem for a a long time. I would also agree there are significant resources within the United States, but you have to build them, right? You have to have them. But there's something very interesting and it's something we've talked about in the past. Why would you put a tariff on semi-produced goods, okay? Uh to incentivize more copper production in your country. And that is the most fundamental question because it also puts a 2-year reprieve, I think would be the correct word, uh on refined copper import, but only two years. What is it saying? is saying you can continue to import copper, but I will put a tariff on secondary things such as cable, right? Which would be a secondary product of copper, right? Bringing in and cable would be a great example of something we use all the time. Everybody has the wiring that goes through our house because I want you to produce more wiring in our house. but you also give you a get out of jail free card for two years because I want to incentivize smelting and refining capacity in the United States. In that same article that came out very interesting, Freeport Macaran is is complaining despite $5 uh copper price the margins are tighter. Why are the margin tighter? because they're really talking about um the the the smelting and refining capacity in China is actually way too big, right? There's too much refining and smelting capacity. So, the margins that they're willing to pay are sometimes even negative or zeros. They're basically paying to smelt your concentrate. How can you compete with that as a in a in a capitalist society, right? they're basically um providing uh you know they're sustaining a oversized refining capacity so they could basically beat out any competitors. So re Mcmaran is saying we need help because to be able to compete with that if you want production change in this country we are actually going to be creating even more smelting and refining capacity in the United States to ensure because that is the critical link right it's not necessarily the mining it's the smelting and refining capacity and making sure you have enough concentrate because the concentrate business right now is extremely competitive and you're like listen man I want to go to you Freeport Macaran but China smelter is literally going to pay me to to buy my concentrate. Um, and so that says we need this to be incentivized to make sure it's a fair fight because once you have the refined copper, you have the wire, you have the electric motor, you have everything. Because I mean, if I was Tesla and I was sitting and I was like, man, hey, China, we need some copper to make some electric motors. And they're going to go, nope, sorry, no more. Uh, I'll sell you, okay, well, at least sell me the electric motor. Nope, not going to do that either. Here, buy this car. It's called a BYD, right? I mean, because if they have control of the production chain, if you cannot build an electric motor, you cannot build an electric vehicle and you're toast, right? So, that is the game that's going on right now. And so, you might argue, well, forget it. We'll just keep using our our our gasoline powered engines. But the game you cannot lose is AI and data centers. >> Okay? >> And that is a big one. >> Try to understand this. So when when the administration says or has said universal 30% import tariff on semifinish copper product yeah an intensive copper derivative product is not raw ores. So they're incentivizing production >> still domestically. That's what they're trying to do. >> Never and and never raw ore. So not the concentrates and it gives you a two-year reprieve on copper import. So if you're really importing pure copper, >> but it's saying only for 2 years, meaning in the future, we want you to make that copper pure copper here because that is the real beginning of the production chain is at the smelting and refining side. So that then this chart makes a little more sense. Well, not a chart, but co uh table. This is from the uh uh USGS. Uh we have here a uh a table showing where the copper in the US comes from. So I mean I'm going to skip this first table here because you go to this import sources 2020 to 2023. China is not actually on this list here. Copper content of blister and anodes Finland 92 copper of content of matte ash and precipitates. Uh Canada is actually the biggest country 48% Canada 99% copper content of ore and concentrates ore and concentrates 99% of that comes from Canada when you're talking about imports. Um so net imports of copper uh reliance as a percentage this this is the crucial line net import reliance as a percentage of apparent consumption is was 45% almost half of the US consumption of copper according to this government source came from imports and depending on what type of copper you're looking at 99% of that is coming from Canada. So, this isn't about China at all until you get to this next table where you show that China produces um a fifth of the production volume of Chile in terms of mine production, but they have the world dominant uh position in refinery production. Let's let's just comment on that. How did that happen? And you know, maybe this is about refined products after all. >> Well, the number anode is interesting, but anode has to go to a refinery to be refined. Concentrates have to go to a smelter to get smelted. And the real one you're looking for and I didn't see it there was our importation of cathode copper. How much cathode copper are we importing? because that really represents and to be fair it doesn't really represent if you're not making electric motors in the United States you're not importing copper but you are importing electric motors right so I really don't think it really grasps because it's in so many of the fine products but if you go keep you know you follow that thread and go all the way back you find out you need that cathode copper which comes smelting refining and produces that cathode copper and then it gets extruded into wire which then becomes an electric motor and so when you're going uh-oh now They're not going to sell me copper wire. They're not going to sell me electric motors. Now they're only going to sell me the electric vehicle. We need to build more electric vehicles. And you go back down the same thing. You go, uh-oh, we need copper. And so I think this is even dramatically understating the dependence that is on copper because we are still importing not just to manu because we really have gone away from a manufacturing based economy. A lot of those products are just being imported and assembled in the United States. So if you really want the production chain, you got to go all the way back to the beginning. And China has already put those in place. That is their copper m that is their assassin's mace. They control over today it's about 60% I thought of the world smelting and refining capacity, right? They have they have that beginning of that that production chain which is obviously electrification which is the big one. uh you know obviously electric motors and then of this that same wiring that's required in data centers and AI. >> So this goes back to uh the main question of how this impacts the mining industry. Let's just take your company as an example here. So your projects are based in Latin America specifically Makoa in Colombia. you're not in the US and so you know the Trump kind of diversification away from China and uh its reliance on imports it's not just China why they want to diversify and to have multiple lines of imports and eventually produce themselves and so or produce more themselves rather um I was reading the article just now uh the same article that I was quoting you and it says that um the US just doesn't have the same level of grade as elsewhere so where where does that leave where do you come in? >> So a combination of things. First I want to say there's the concept of nearshoring. Remember I mentioned you want that smelting and refining capacity as much as possible to be in the United States. So if you have the smelter, you need to feed that smelter. But the rest because you want it to be called French shoring, right? You could argue that China and maybe even Europe dominates uh Africa which is one of the largest producers and they put a lot of investment. But China is also I mean I was personally a part of a sale for the first industrial scale mine in the history of Ecuador for $690 million to two Chinese S so S so S so S so S so S so S so S so S so S so SOES to supply uh concentrate so America is scrambling to nearshore right they're scrambling to friendshore uh those those those chains um I personally have been invited to give an update to the US government uh which has never happened in my entire career in mining despite having a US passport uh and that is happening now um So Colombia is a major non-NATO ally of the United States. It's the same as Australia. It's the same as Japan. It is a true ally. And they're like, we need to make sure that that is the advantage. And that's why I'm very bullish on this product. This is very good potential news for us that it it's it's getting at least it's in the limelight and it's and it's and it's raising an importance. Um another metal that was added in 2022 to the critical mental risk is is malibdinum. And we are also the third largest meloden project that I know of in the world too. Uh so that that's uh that's also bodess very very well. So how does it all work out >> and I'm if I'm allowed to if you give me permission I'll share some of the news because it ties into what I think >> please go ahead. Yeah. >> You know to today we put out really big news. We put out an updated resource that showed a growth of about 70% in resource uh to over a billion tons of inferred resource and our metal content doubled. We doubled the amount of metal that was contained in the deposit. Remember it's a copper malibdinum deposit and it now is over.51% copper equivalent. You mentioned something important. Grade is important, right? grade is really important because not only is the United States getting to lower grades but the cost is also more expensive because these are highly cost intensive and labor is a big part of that right so um that is huge for us and why is that important because it is a nearsurface project and I only know of five other projects in the world that are over a billion tons in near surface and not already with a major mining company and so it is positioned now it's like in the past I used to go oh we love your project but it's a little small and we're like I'm getting it's getting bigger. Come on guys, you this is not the whole thing. So now it's kind of a light bulb goes off. It's a massive catalyst for us and should be you know really really really bullish and get the company to where it should be properly valued. We have a lot of conversations that are about strategy. We've applied this strategy. We've delivered over the last 12 months and now it's our chance to be able to shine a little bit and get our valuation to where it should properly be. Having a resource over a billion tons and being near service is important, right? Grade is important and it's and be jurisdiction is important. So seeing we're in Colombia, we're near surface, we're near infrastructure, it means that it could be also built quickly and be an efficient supply of new supply because if you already have all this smelting and refining capacity and you need to build more to secure your national security, you also then need to secure the supply. And so uh you know those type of projects projects like Makoa are going to be extremely coveted uh in in the future. I mean we're based on our our valuation where we are today where we should be right. I always act like I don't care what we're valued. I do care what we're valued today. It's it's it's not just what we're valued today. It's what I know we should be valued and we treat it that way. We treat it like the B billion dollar baby that we know Makoa should be. >> Okay. Um I have a few follow-up questions on that, but uh let's just go back to your resource here. So this new announcement or your new resource just for the ge for the non-geeologists watching this show we want to understand this from a finance and uh a corporate finance perspective what uh what is the core difference between now versus a few months ago when we first spoke not first spoke but we spoke a couple times the last couple months but let's just take September when we were both in Colorado remember the beef for creek conference so uh we were there how has your company progressed since then based on these resource findings >> so let's take and then small chunks. Resources are based because you drill them. You drill them, you touch them and you say I there are resources and then it's a mathematical calculation of volumes and grade to be able to calculate how much copper and malibdinum is in within that deposit and that is called a resource. So that is the resource. So we've been drilling for 12 months and we've already had an original resource. So we added additional drilling. We added about 10,000 more meters of drilling. And then based on that new drilling, we did an update to a new calculation in that resource. So we went from about 600 million tons to over a billion about 1 billion uh tons. Um and at the same time, the grade went up. So that grade is how much metal is within each ton of material. So as grade goes up, it means there's more metal per ton. So that's why we went up about 70% in tons, 15% in uh grade which almost doubled the metal contained within the project and that is based on an update of that exploration that we've been doing over the last year. Right? So from time to time the company update we updated it because we wanted to say I mean this is a massive super important catalyst and and a super important hurdle for the company to be able to uh to pass. I I try to explain it I tried to explain it today. um you know in terms of total metal cont No, I won't even get into that but copper projects are really big right where gold you can have lots of little individual and little companies there's lots of gold mining companies but there's very few copper project copper companies out there so scale is very important because they don't want to build a lot of small mines they want to build really big mines to actually impact their balance sheet so getting across that line has been critically important for us >> what's next then so you've already accomplished uh this massive uh drill result. Um what other results can we look forward to in the coming quarter? >> Well, we will continue and and so if you look at individual copper companies that are now in a development stage, so they're past a resource and moving towards trying to build a mine, the resource is very important because it's the basis for your valuation. It is how market says how much are you worth? So be able to double that number obviously bodess very well for what our valuation should be reflecting. Now the next stage is we will continue to put out drilling. But the next big stage for me is in May we have elections in Colombia. Presidents can only run one term for four years in Colombia. So we will have a new president. So in May is the first round. If there's a second round will be June and by August we'll have a new president. And by then I want to be able to be finalizing either before or immediately afterwards our preliminary economic assessment, our PA. It's the first economic study around that resource. Why? Because I believe that the next president's going to come in and he's going to say, "I need to attract investment. I need to create jobs. The kind of guy left me the keys. He, you know, the economy was smashed against a wall and I need to stimulate the economy. Who's got good projects?" And I want to be able to at least say this is a real project. This is this is what it's starting to look like. And at the same time, he's going to say, "Well, how does the how's your relationship with the community?" Like, "Oh, wow. You guys, they really like you. They're really supportive of you." Oh, what does the nation think of? Wow, you have an amazing reputation in this country. This is great. I get it. All right. So, without the, you know, without creating a big political c using a lot of political capital, you know, there's a very attractive project. So I talk about these windows a lot of times when I and when I present and we see a window that's developing in Colombia and what's going on both in the United States both in Colombia election periods our project and it's all about trying to navigate all those things at the same time. So we're very bullish on where this project will grow over in in the very near period right a lot I think a lot of eyes will be opening up I think a part of our valuation is based on a perception of Colombia and that is going to be changing extremely quickly. Well, you say that uh the valuation is not where it needs to be. So, the obvious follow-up question I have is why is the market not realizing the true NAV right now? >> I think it's a combination of things is that a we do have a little bit of momentum in the equity space. It's been mostly focused on uh copper and silver. So, for those of you that missed out 250% gains in in stocks, you know, I think the next one is obviously going to be in the copper space. It's kind of poised. It's already getting to historical levels. you're going to see probably some consolidation and you're going to see more money coming into the equity space into mining and copper as a natural destination. So that is required really to create a a a what I call a graduation moment not just a slow increase in valuation but a dramatic increase in valuation to get re-evaluated. I think that's part and the other part has been a perception of a Colombia but that perception is changing because we're right around the corner. coming up and market will start pricing in that that expected change in Colombia uh as the world is waking up to it. So I think it's and then maybe the third is yeah it's big but it's not big enough but you hit a billion tons and now you're big enough. So I think we're checking so many boxes that should be supply a very solid launching pad. Um our next closest guys have a valuation based on pounds per the ground at least five times higher than us. So we have a lot of room to to grow dramatically. >> The other thing is uh maybe this is more applicable for the gold space but it may be applicable for uh the copper space as well but for gold companies what we've seen is uh the GDX or the large caps have moved up first before the smaller caps and so that usually signals the beginning or now middle of the bull cycle. So maybe that's what's happening now. The larger companies are taking more presidents when for investors and gaining more attention first. But how would you compete just for um just for attention sake? How would you how would you compete for capital? Uh how would you differentiate yourself differently from let's say uh Freeport McMoran? >> Well, we a we don't have to right they are the big producers but when people as you say trickle down and go okay the producer wow why are they making so much money right that already happened in the gold space but now it's going to be happening in the in the copper space. Um Freeport Macaran was crying in that one but that little arbitrage in the comics they made a fortune because of that uh that that that price differential in the United States. they're going to do very very very well. So when you start seeing the performance of these companies, money starts trickling in, then they go, okay, what's next? How can I really leverage now that people are getting a deeper understanding that that funding trickles in now while there is probably a 100 different gold projects on the planet, right? There are very few copper projects and because they have to be so big and I as I mentioned it, there are only four five projects that I know of in the world besides our own that have over a billion tons are near surface. So the list gets really short. Um so I think that we are really good when at least the eyeball comes back and go okay how can I take advantage of the supply demand deficit the the improvement in uh commodity prices and knowing these big companies are going to need growth and so that's when uh and I think we're there like I think it's happening right in front of our eyes I think that the shine in gold took away a little bit of the tension but I think most people like me they're like I love copper but they haven't started that investment that The narrative is there for Copper, but the investment hasn't started yet, but I think that FOMO will kick in the second it does. >> Well, let's keep tabs on your developments. Uh, exciting things happening for your company, I'm sure. So, where can we learn more about you and your company? >> So, the obvious is coppergiant.co, uh, is our website. Um, and our ticker is CG&T on the Toronto Venture Exchange. And I always invite anyone if they have any questions because I'm right now in Monaco. I'm always I'm right now on a on a 3-week European trip telling this story every single day to make sure everybody knows about it uh what's going on with the company. Um but always if you want send me a WhatsApp message at plus13039562944. It's more effective than an email or anything else but my email is harris@ coppergiant.co. But again plus13039562944. I love to talk with investors, our shareholders, ex, etc., and share the exciting developments. I love this project. I love this company, and I look forward to to to taking it to much higher places. >> All right, feel free to text Ian number down below. Ask him all your questions directly. Ian, you're just opening up yourself a whole can of worms, but my investor audience are friendly. Um, they'll have good questions for you. So, Ian, um, actually, just on that note, you're in Europe. I'm just curious, how do European investors see the mining space right now? Is it different from the North American crowd? >> Uh yes. Uh the Europeans overall, I mean this is very broad brush, but they are more long-term strategic uh buyers, right? Um they obviously got a lot of attention in in the precious metal space. They obviously definitely believe in the in the you know the the reasons to own gold. Um but they're more long-term investors. So they're they're very bullish on copper. they just really haven't started the investment like well yeah I want to but now you know my it's and they're actually thinking about rotation now that they're up 250% on some of their gold stocks are like now what you know I should be now is the time to start rotating to copper but there is definitely a much longer term focus you see a much shorter term focus uh in where it seems United States investors uh follow the trend more than try to actually sniper out uh individual opportunities and are are are in out a little bit quicker. Um, but that, you know, that's very broad brush. Obviously, you meet very long-term investors in the United States, too, and the same is the opposite, but that seems more of the perception here. They're more of a disciplined long-term approach. >> Well, I'd love to get your take on um on investors from other areas. If you ever go to the Middle East, I know there's a huge pickup in interest in the Middle East uh for precious metals and critical minerals. Uh Saudi Arabia and Trump just made a deal. Um I just pull this up here actually. So this is nothing to do with the copper giant in particular, but since we're talking about it, I'm just just to close off here. Trump MBS agreed to develop rare earth refinery in Saudi Arabia. This was just last week. This week, today. This week. So um and this is the yeah US reliance on imports of key critical minerals. Uh gallium Chinese, arsenic, Chinese, rare earths overall 95% from China. So yeah, Trump has very much an incentive to diversify away from this. Um so that interest in the Middle East is going to be huge. I'm curious what you think uh or what you encounter if you ever go to Asia because the resource sector isn't so big there as compared to Canada but um you know there's some curious investors but uh always good to get your take in >> I will say the reason that uh Frank Gustra is the largest shareholder of copper giant was based on a trip to Saudi Arabia where they want to build that same smelting and refining capacity but obviously don't have the natural resources it's very sim similar to China you know 12,000 tons tons per year in capacity to only 1,000 in production. Um, and so one of the things they look forward to is securing future copper supply. And so he saw there's a writing on the wall that there's going to be a battle over copper and that's why he he he wanted to be part of co and actually put his name on it. Copper giant is is Frank's name and that was because of that trip to Saudi. >> That makes a lot of sense now that you're explaining that way. Okay, good. Let's follow up. Curious to hear more about that story. So uh if you have any questions, please submit uh emails or texts to Ian. Feel free. Um, and um, let us know what you want to ask Ian next time he's on the show. So, um, you know, he's a regular and, uh, if you do have questions that you want me to ask, just shoot them our way. Thank you very much, Ian. We'll see you next time. >> Thanks, David. I love our conversations. Appreciate it. >> Yeah, me as well. And thank you for watching. Don't forget to like, subscribe, and uh, follow us down below.