Zijin's Investment Unit Seeks Expansion in Strategic Metals Amid Global Demand Surge

Zijin Mining Group, China’s largest gold and copper producer, is looking to expand its strategic metal portfolio by increasing investments in metals such as tungsten and uranium. The company's investment unit, Gold Mountains Asset Management, is managing over $6 billion in assets, with 75% in gold and the remainder in copper, lithium, uranium, and other metals according to Bloomberg.

The decision follows a global increase in demand for critical minerals driven by industrial and defense sectors, with prices for some strategic metals rising sharply this year. Tungsten, used in drilling equipment and armor-piercing weaponry, has seen its value more than double due to Chinese export curbs and increased military demand. Uranium prices have also risen in anticipation of growing nuclear energy use.

Gold remains a key component of Gold Mountains' portfolio, according to Lisa Liu, managing director and portfolio manager. She cited global uncertainties, including conflicts and monetary shifts, as reasons for holding gold as a wealth anchor.

Why Did This Happen?

Zijin's strategic shift is driven by the tightening supply of critical minerals and rising demand from energy and defense sectors. The mining giant is seeking to diversify its holdings into high-growth areas such as rare earths, which are essential for electric vehicles and advanced manufacturing according to Bloomberg.

The company's investment unit has a significant cash buffer and is positioned to quickly acquire stakes in major projects. Liu noted that if a major shareholder seeks to offload a large stake, Gold Mountains could absorb it immediately.

How Did Markets React?

The broader critical minerals market is responding to increased policy and investment support. In the U.S., Project Vault—a $12 billion strategic minerals stockpile—has been announced, with institutions positioning for domestic production and supply chain development according to Global Newswire. Uranium spot prices are projected to rise further as supply constraints tighten.

Meanwhile, companies like EagleOne Metals and Aclara Resources are advancing projects in uranium, rare earths, and copper, aligning with the trend toward securing Western-controlled supply chains. EagleOne recently acquired the Poison Springs Uranium/Rare Earths Project in Utah for $50,000, targeting multiple commodities under the U.S. Critical Minerals list as reported.

What Are Analysts Watching Next?

Analysts are closely watching uranium production and uranium enrichment capacity expansion, especially in the U.S. The Department of Energy has committed $2.7 billion to domestic enrichment, while utilities and tech companies are entering long-term contracts for nuclear power according to Global Newswire.

In addition, the global uranium supply base is seen as fragile, with recent setbacks like the Honeymoon mine in Australia falling short of production expectations. This has raised concerns about whether the supply can keep up with the projected 85% increase in demand by 2040.

Investor demand for physical uranium is also on the rise. The Sprott Physical Uranium Trust (SPUT) has resumed significant purchases in the open market, coinciding with a 45% price increase over seven months.

Zijin's move into strategic metals aligns with a broader industry-wide trend of securing critical supply chains. However, analysts note that the success of such strategies will depend on the availability of quality projects and the ability to execute developments quickly according to Bloomberg.

Global investors are advised to monitor policy developments, particularly in the U.S. and China, as well as supply chain disruptions and technological advancements in alternative materials that could impact the long-term demand for these metals.