WA Index

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WA Index

Issue 201 | September 2021

Welcome to the 201st edition of the Deloitte WA Index, a monthly review of Western Australian stocks and indices.

The market capitalisation of Western Australian listed companies decreased 4% over the month of August 2021, to close at $295.4bn. This trended with commodity prices, particularly iron ore which decreased 14% over the month off some impressive highs.

Download the list of WA’s top 100 listed companies, as of 31 August 2021, explore the sections below and if you do not currently receive our WA Index,  please register to be added to our distribution list.

Highlights:

If you have any questions in relation to the Deloitte WA Index please contact Dave Andrews.

As of 31 August 2021

Commodity review

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  • Lithium Carbonate prices surged throughout the month of August by 42%, reaching new all-time highs and closing out at US$14.1/kg. The continual rise in lithium prices can be attributed to the ever-increasing demand for electric vehicles and clean energy across the globe. August also saw a large increase in production of Chinese lithium iron phosphate batteries in which lithium carbonate is a key component.
  • LNG prices have continued their surge as rising demand in Asia continued. Prices closed out at US$18.20/MMBtu, representing a 23% increase throughout the month of August. This price surge can be attributed to the global economy’s continuing recovery from COVID-19 as well as significant storage restraints being felt throughout Europe.
  • Thermal Coal prices closed out the month of August at a price of US$164.1/MT, hitting a new all-time high during the month. This increase represents a 17% increase on the month and is almost four times the price it was 12 months ago. Rising prices of traditionally cheaper alternatives such as natural gas has played a factor in the increase of demand for thermal coal. Supply side factors such as exporting disruptions to major producers as well as China’s informal ban on Australian coal has also played a part in the recent price moves.
  • Iron Ore experienced a price reduction of 14% throughout the month of August, closing out at US$158.5/T, down from the highs experienced in May of this year. Easing COVID-19 restrictions in Brazil, have seen operations return for the major exporter, following the large supply disruptions seen over the past year. Falling demand in Asia, due to the Chinese government’s restriction on steel output for the year, has also contributed to the price decline.
  • Coking Coal prices have continued their run into August, up 11% and closing at CNY$1,530/MT. China’s unofficial ban on Australian coal imports have meant that the world’s largest coal importer has had to look to other major exporters such as the US and Russia, where they are paying a higher price as the markets adjust.
  • Uranium prices saw a 7% increase throughout the month of August as prices closed at US$34.6/LB, due to continuing supply issues across the globe which means that the market cannot keep up with demand. Major uranium mine closures at the beginning of the year has reduced available supply.

Performance of WA Index and global indices

Performance of WA Index and global indices
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WA Index movement

WA Index movement
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Top performers of the month

Western Australian top performers over the past month by growth in market capitalisation

  • Pilbara Minerals Limited market capitalisation surged by 28% across the month of August. This increase was due to the Tranche 1 issue of shares relating to the Altura acquisition and continued positive news on buoyant lithium markets.
  • Australia Strategic Minerals Ltd upped its market capitalisation by 35% during the month of August. Following an ASX ‘speeding ticket’ the Company reconfirmed its US$250m agreement with a consortium of South Korean investors for a 20% stake in the Dubbo Project as well as securing an offtake partner from the outputs produced at the company’s Korean Metals Plant.
  • Vulcan Energy Resources achieved an impressive 45% increase in its market capitalisation during the month. Early August saw a new strategic partnership with Renault Group. This five-year partnership secures the offtake of roughly 6,000-17,000 metric tonnes of Vulcan’s battery grade lithium chemicals per year. In late August, Vulcan secured a partnership with renowned Formula One driver Nico Rosberg. This partnership sees Vulcan Energy become an official partner of ‘Rosberg X Racing’ and Mr Rosberg becoming a shareholder in Vulcan.

Major index players
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The top Deloitte WA Index Movers and Shakers in August were:

  • Family Zone Cyber Safety Limited (‘Family Zone’) delivered a staggering 107% increase in market capitalisation during the month of August. Mid-August saw Family Zone complete the acquisition of Smoothwall, the leading provider of digital safety solutions to the United Kingdom’s K-12 education system.

    Following completion, Family Zone announced that Smoothwall had been awarded a substantial contract with the Public Sector Broadband Aggregation (‘PSBA’). The PSBA provide broadband services to Wales, in the UK.
  • Seafarms Group Limited upgraded its market capitalisation by 69% during August. This increase in the company’s market capitalisation is a result of its capital raising to be used for the development of Project Sea Dragon (the company’s flagship land-based prawn aquaculture project).
  • Red Hill Iron Limited delivered an impressive 269% increase to its market capitalisation during the month of August. This staggering increase in market capitalisation was off the back of Mineral Resources Limited acquiring Red Hill Iron’s participating interest in the Red Hill Iron Ore Joint Venture in West Pilbara. Red Hill Iron Ltd is due to receive a $400m payment as well as a 0.75% royalty on all iron ore extracted from the acquired tenements.

Top performers of the month
Select above image to enhance the Top performers of the month

If you don’t currently receive our WA Index, you can register to be added to our distribution list.

If you have any questions in relation to the Deloitte WA Index please contact Dave Andrews.

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