Global demand for strategic minerals is rapidly increasing, including high-purity silica, where demand is creating a potential $120 billion by 2033 from today’s value of about $50.15 billion, as noted by Emergen Research. That’s because silica is a crucial component of the global materials industry, including construction, manufacturing, electronics, automotive, and consumer goods – multi-billion-dollar industries that must have silica supply. All of which is also creating massive opportunity for silica-related stocks, such as Troy Minerals Inc. (CSE: TROY) (OTCQB: TROYF), Ferroglobe (NASDAQ: GSM), Ecolab (NYSE: ECL), Evonik Industries (OTC: EVKIY) and Ecovyst (NYSE: ECVT).
But just as the world is seeing rapidly increasing growth in demand for strategic minerals such as silica, there’s a problem. Most of the market is largely being controlled by China, which accounts for roughly 70% of global production. Given the importance of critical minerals such as silica, the Western world is moving quickly to establish new sources of supply and break free from China’s near-monopoly. For example, the U.S. government recently announced significant investments in silica to bolster domestic production of solar panels and semiconductors.
This push to move away from reliance on Chinese supply means that those companies who show the potential for bringing new supplies online in the near-term could generate a significant amount of attention and potentially see swift increases in valuation.
Look at Troy Minerals Inc. (CSE: TROY) (OTCQB: TROYF), For Example
Troy Minerals Inc. just announced the submission via its subsidiary company Grand Samsara Consulting LLC of its mining license application to the Ministry of Industry and Mineral Resources of Mongolia for the Tsagaan Zalaa Silica Project. This key milestone underscores the Company’s commitment to advancing the project towards production and transforming Troy into a cash-flowing entity.
Located in southern Mongolia, 200 kilometres from the Mongolia-China border, the Tsagaan Zalaa Silica Project is strategically positioned to serve the growing regional and global demand for high-purity quartz silica. The submission of the mining license application represents a critical step in unlocking the project’s potential and advancing Troy’s broader strategy of establishing itself as a key player in the HPQ market.
Yannis Tsitos, President of Troy Minerals, commented, “Submitting the mining license application for Tsagaan Zalaa to the Mongolian authorities is a significant achievement for Troy and its subsidiaries. This milestone reflects our relentless focus on progressing our two main silica projects, Tsagaan Zalaa in Mongolia and Table Mountain in British Columbia, and sets the stage for the Company’s main objective: to transform itself into a potential producer with cash flow generation serving both Central-East Asia and North America. We are confident that Tsagaan Zalaa will deliver long-term value for our shareholders and position Troy as an important new entrant in this critical mineral sector.”
Strategic Importance of Tsagaan Zalaa:
– Favorable Location: Proximity to some of the most established and “hungry” silica markets and off-takers, in addition, established road and rail infrastructure provide a strategic advantage. The 1,670-hectare (4,127-acre) Project is located near a Japanese high-purity quartz quarry and refiner producing and directly exporting HPQ to Japan.
– High-Quality Resource: Previous bulk sample analysis (a 10-tonne bulk sample was sold to a Chinese off-taker in 2023) demonstrated silica purity of up to 99.98% after beneficiation, underscoring the project’s viability for industrial and technological applications. Massive high-purity quartz veins up to 5 metres in width hosted by Upper-Middle Devonian sediments are exposed on surface over the Project
– Simplicity in Production & Sustainable Growth: Selling raw high-purity silica is the initial target of the company; simplicity in the surficial quarrying/mining process and no need for a processing plant at this first phase, make the “Blast-Scoop-Load” motto Troy’s flag at Tsagaan Zalaa. The project’s development aligns with Troy’s commitment to sustainable mining practices, support of the local communities in Southern Mongolia and ultimately delivering growth value to Troy’s shareholders.
Next Steps
With the mining license application submitted, Troy will focus on finalizing a Preliminary Economic Assessment (PEA) study, securing financing, and advancing discussions with offtake partners. Subject to the approval of the Company’s Mining License Application in coming months by the Mongolian authorities, Troy remains on track to target initiation of production at Tsagaan Zalaa in 2025, and cash flow generation from HPQ sales.
Other related developments from around the markets include:
Ferroglobe, a leading producer globally of silicon metal, silicon-based and manganese-based specialty alloys, recently posted financial results for the third quarter of 2024. Dr. Marco Levi, Ferroglobe’s Chief Executive Officer, commented, “Despite the market headwinds, third quarter results were in line with our expectations with adjusted EBITDA of $60 million, slightly higher than in the second quarter, while volumes were impacted by soft demand. We are taking appropriate actions to reduce production in response to current demand trends. We are optimistic that demand will improve in 2025 as the year progresses. “We see significant potential in 2025 in the U.S. ferrosilicon market. The US Department of Commerce has imposed final anti-dumping and countervailing duties of 283% and 748%, respectively, on all Russian ferrosilicon imports. On November 1, the U.S. Department of Commerce announced preliminary anti-dumping duties on Brazil, Kazakhstan, and Malaysia, ranging from 1% to 22%. In addition, preliminary countervailing duties ranging from 2.4% to 61.7% were announced in September against Brazil, Kazakhstan and Malaysia.”
Ecolab Inc. Chairman and CEO Christophe Beck recently noted, ““We had another excellent quarter with broad-based performance throughout our business. Organic sales grew across all of our segments and our operating income margin continued to expand to drive 19% growth in adjusted diluted earnings per share. Strong new business wins and breakthrough innovation helped accelerate our volume growth back to 2%. Our unique ability to deliver significant total customer value has resulted in continued strong value pricing that remains in our targeted 2-3% range despite favorable carry-over pricing benefits now behind us. In a world that remains hard to predict, our innovative solutions are more essential now than ever to our customers as they drive productivity while also reducing water and energy consumption. Our primary focus remains on fueling our positive growth trajectory and continuing to execute on our 20% operating income margin target. Our One Ecolab initiative supports these objectives by leveraging our breakthrough innovation, digital technologies, and global service expertise to deliver best-in-class customer performance in their global operations to keep fueling our growth and margin expansion. With this, we expect a strong finish to the year and with continued good momentum, we look to drive 12-15% growth in adjusted diluted earnings per share in 2025 and beyond.”
Evonik Industries just noted that, “Effective January 1, 2025, Evonik has launched Smart Effects, a new entity counting 3,500 employees worldwide, born from the strategic merger of its Silica and Silanes business lines that will be part of ‘Advanced Technologies’ within the new company organization. This merger leverages the expertise of both business lines to deliver innovative solutions that benefit both customers and the planet. “The new business line is a strategic step by Evonik to strengthen the financing power of our complementary Silanes, precipitated and fumed Silica technology platforms,” stated Lauren Kjeldsen, President of Smart Materials Division at Evonik. “By combining our expertise in molecular silane chemistry and silica particle design, we can deliver differentiated solutions that add value to our customers with a tailored portfolio approach.”
Ecovyst Inc., a leading integrated and innovative global provider of advanced materials, specialty catalysts, sulfuric acid and regeneration services, today announced that its Board of Directors has initiated a strategic review process for its Advanced Materials & Catalysts business. This announcement is an extension of the Board’s ongoing evaluation and review of the business, aimed at maximizing shareholder value. AM&C is comprised of two business units. Advanced Silicas is an internationally leading provider of silica-based advanced materials and catalysts, essential for the production of polyethylene, biocatalysts, and functional chemicals. Zeolyst International, a joint venture with Shell, is a world-leading supplier of zeolite-based advanced materials and catalysts. These are crucial for the production of distillate and sustainable fuels, including renewable diesel and sustainable aviation fuels.
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