Buy Commodities, Not Equities

If problems like this keep popping up, commodities will do better than many producers because supplies will fall. Or own the lowest-cost miners.

Cyanide maker suspends Europe production as energy costs soar

The world’s largest maker of gold and silver mining material, sodium cyanide, has been forced to suspend production in Europe after Russia’s invasion of Ukraine sent energy prices soaring.

Czech group Draslovka said production of the chemical, which is used in the extraction of precious metals from ore, had become uneconomic in Europe, with gas prices in the region at 12 times the levels in the US, compared with just 1.5 times in 2020.

Shortages of supplies in markets reliant on Europe could be severe, the company said. It has 15 per cent of its production capacity in the region.

“We need to decrease production to a minimum for a temporary period and see what the free economy does,” said chief executive Pavel Bruzek. “The whole of Europe is in a similar situation.”

The entire process of globalization is being thrown in reverse.