Ten years of explorer reports - spotlight on commodity trends

Ten years of explorer reports - spotlight on commodity trends

The Australian exploration sector is a vital part of the Australian economy and relies heavily on funding to support its ongoing operations. The ability to raise funds depends on many factors, including the company’s commodity focus, the nature of the project, and the overall state of the economy.

For a decade, BDO has analysed the financial health of ASX-listed explorers to identify the trends in commodity markets that indicate investor preferences.

To celebrate, our special 10-year anniversary ‘Spotlight on commodity trends’ edition report takes a deep dive into how a company’s commodity focus can impact its ability to raise funds.

Our analysis is based on our data for ‘Fund Finders’, known within our explorer reports and defined as companies that source $10 million or more of funding within a quarter.

Our quarterly analysis of Fund Finders goes beyond just total funds raised, we also review the purpose for which the funds were raised, the mechanism of raising, and, importantly, the commodity focus.

So, what does our analysis tell us about commodity trends and investor preferences?

  • Climate change has had a critical impact on the market. The accelerated efforts by governments to decarbonise their economies have led lithium and other battery minerals to dominate the Australian exploration space.
  • The COVID-19 pandemic consolidated the dominance of gold, with gold consistently being amongst the top four Fund Finder commodities each quarter.
  • Geopolitical risks impact global trade, driving interest in critical minerals like rare earths. As a result, we expect to see rare earths dominate Australian exploration funding in the future.

Explore historical trends and further insight into our predictions for the commodity sector in our special 10-year anniversary report.