For the past five years, investors in Rare Strategic Metals (RSMs) have earned a strong and steady growth in the technology, aviation, energy, defense and construction industries without buying a share of stock or underwriting corporate debt.
Significant shortages in RSMs, and subsequent price appreciation, are not far-fetched. Given the recent changes in Chinese and U.S. stockpiling policy, alongside continued industrial innovations, they are actually quite possible.
Not only are RSMs vital to emerging technologies and green energy, but as National Geographic reports, RSMs are “the secret ingredient in almost everything.”
The products for which RSMs are necessary include cell phones, air travel, lasers, computers, medicines, cosmetics and even clothing. As well as so much more.
Governments are already preparing for a looming crisis.
- In 2011, Korea placed Indium on their ‘critical substances’ list to protect Samsung and LG.
- In 2011, the U.S. passed the RESTART ACT to stockpile RSMs and prevent shortages for military projects.
- In 2010, Chinese set policy to monopolize their supplies and restrict exports.
There are serious shortages to come.
A good example is rhenium, which like most RSMs, is a by-product of mining other metals. In rhenium’s case, it is the by-product of mining copper and molybdenum. It takes a massive 120 metric tons of copper ore (or the weight of 44 Cadillac Escalade SUVs!), to produce one ounce of rhenium, equal to the weight of five U.S. quarters.
Rhenium is of growing strategic necessity as we make advancements in green energy, digital health, and computer chip technology. It is essential for aviation, both military and commercial.
China is about to develop and launch the largest commercial airline fleet in history, challenging rhenium supply like never before. Consequently, rhenium is currently one of the ten most expensive metals in the world.
As an example of how rare strategic metals can really boost your portfolio, during a rhenium shortage in 2006-2008, prices jumped from just over $3,000 to over $12,000 in a 18-24 month span.
These shortages come in cycles, and supply and demand dictates the pricing. Demand is assured due to extreme and growing demand from many industries. For example, the main demand right now is for aircraft engines. This market is exploding and the only thing not assured is supply, so the next shortage is due and coming up.
Serious shortages will mean serious profits; but, do not confuse RSMs with ‘rare earth metals,’ for which no shortage is likely to occur.
Unfortunately, the similarity in nomenclature has caused some investors and even experts to bypass RSMs in the mistaken belief they are the same, or similar to, ‘rare earth metals.’
First off, most of the 17 rare earth metals are not rare. While at one time they were hard to find and identify, today they are much less difficult to procure. Second, they are not all metals! Rare earth metals are categorized together because they are substances with similar chemical and molecular compositions.
Rare strategic metals differ from rare earth metals in the fact that they are mostly by-products of mining other metals and are required for the manufacturing of products.
Until now, owning these metals wasn’t available to individuals.
With the growing demand and limited supply, these metals are now assets you can add to your portfolio. Click here for more information on rare strategic metals and how to add them to your investment portfolio today.