Who's Making Money pt5 - Mineral Logistics in the Mining Value Chain

💡What’s New: Mineral Logistics and the Mining Value Chain

🤔 Opinion: Why a permanently navigable Arctic Ocean makes cent$.

🛠️ Tools & Data: Opensource opportunities for better and faster work

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💡What’s new

Last post we looked at licensing and brokerages in the mining industry. This time we discuss how minerals get moved and the startups making money from solving this age-old challenge.

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Logistics

Transportation of goods and equipment in large quantities, often across borders

Example Startups and Business Models

These are representative of opportunities in emerging niches.

• CargoX - automates legal paperwork on a blockchain (e.g., freight contracts and customs forms). Their revenue flows from contracts as well as from smart-contract fees.

• Horizon - combines all logistics data into a single platform for scheduling and tracking. You can monitor cargo and unify logistics data. They make money through contracts with companies that frequently ship a lot of goods.

• Optivo Logistics and Fulfilld - two companies that optimize transit routing using specialized algorithms. Spend less to get the same result. Their revenues are generated through service contracts and software subscriptions.

• D-Orbit - logistics for space-based assets. They get paid by governments and other large orgs through purchase agreements. They may become important to the space-based mining industry if / when it grows.

Why they matter

Mining logistics has a hub-and-spoke structure with large international brokers farming out freight jobs to regional service suppliers (see Crane Worldwide, Lynden, MSC, and Gulf-Log for examples). Significant revenue is possible where legal, technical, and capital barriers to entry are high. This is where startups come in.

In an industry where there is relatively low competition, even simple automations can generate profit. The combination of AI, new energy systems, quantum computing, material engineering, and a global scramble to develop critical mineral supply lines creates opportunity for the formation of new companies that can incorporate technologies to lower costs or open new supply lines.

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Related News Highlights

• The biggest iron mining project in the world has been rebooted.

• An argument for why nations should stockpile critical minerals.

• A useful content-marketing piece on how mineral logistics work.

• A by-the-numbers summary of US mineral commodities.

• Norway makes it legal to mine their deep sea.

• Check out this mineral lab in a shipping container solution.

🤔 Opinion

For a long time European mariners sought a permanently ice-free crossing between the North Atlantic and the Pacific. The economic and political implications were (still are) significant. It was only a dream in the 18th century, but in ours it’s becoming a reality.

As a shift in climate melts the ice, there are more and more days where the Arctic is freely navigable. If you’re investor or supplier working in the northern hemisphere, that is profitable news. The bulk of global manufacturing and consumption takes place in northern latitudes. If refined minerals from Asia could be shipped directly to Europe and the US across this ocean, the majority of freight might be moved at much lower costs.

In my mind, logistics is one of the more interesting opportunities in minerals in the coming decades. Remember that one of the few classes of businesses that weren’t shut down in the global COVID response were ports and shipping (even if they were log-jammed). And don’t forget storage. In down economies where fewer minerals are in demand–but still being produced–they must be warehoused.

🛠️ Tools and Data

Thanks for reading! Want me to look into a particular topic? Email your suggestions and and I will dig.

David