- Recent global data demonstrates the declining trend in capital raised by junior and intermediate mining companies. This is yet to reverse (see Figure 1 below)
- As expected, there is a clear, lagged relationship to drilling activity, particularly in the golds (see Figure 2 below and detail via link above)
- We do not see an environment conducive to an imminent rebound in capital inflows to junior miners, which suggests the slowdown in drilling activity is likely to extend
- Long-term, it will only exacerbate a period of exploration underinvestment and the dearth of new discoveries, triggering a strong price-led supply side response to unmet demand
- Our bullish long-term view on miners and their service providers is unchanged but tempered for now for companies exposed to the front end of the mining life cycle
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