"I think the commercialization of the global battery supply chain is critical," says Shawn Reynolds, Portfolio Manager for VanEck’s Global Resource Fund GHAAX and Environmental Sustainability Fund ENVAX, VanEck.
What are the most important trends for investors to keep an eye on in the resource transition? That was one of the many topics discussed during TheStreet's Investor Playbook: The Resource Transition, hosted by Susan McGinnis, which includes an all-star team of portfolio managers and analysts.
- Shawn Reynolds, Portfolio Manager for VanEck’s Global Resource Fund GHAAX and Environmental Sustainability Fund ENVAX, VanEck
- Ammar James, Deputy Portfolio Manager, and Analyst focused on agriculture, paper, and forest, VanEck
- Veronica Zhang, Deputy Portfolio Manager, and Analyst focused on renewable energy, VanEck
- Charl Malan, the Senior Analyst, focused on minerals and metals, VanEck
Editor’s note. The webinar was recorded on December 22, 2021.
Video Transcript Below
Shawn Reynolds: And this really spans, as we've talked about, different ways to express it in some products that we have. It shows up in the Global Resource Fund GHAAX, (it's a) big part of the Environmental Sustainability Fund ENVAX. We have the green metals ETF for pure-play. But it's a very, very big part. And I would have to say that battery is almost a linchpin to all this working. Because you've just seen the problems with intermittency or just lack of supply of wind or solar in the renewable energy space. I really think the next year or two is fantastic for the battery supply chain.
Video Transcript Below
Veronica Zhang: We really, really emphasize diving, or at least the opportunities that really emphasize diving, into battery technologies, as well as how the supply chain is going to be differentiated going forward. So at a very high level currently, there are basically three or four major Asian players that supply the entire global demand of batteries. It's like, 80 plus, 90%. And given the fact that we need a lot more growth and a lot more supply to meet anticipated demand, again, you're seeing, Volkswagen, GM, Ford, Stellantis, all coming out with really, really lofty targets by the next 5 or 10 years.
We need a lot more batteries. The incumbents are doing their job in terms of being able to crank out manufacturing supply and get product onto the end consumer. But I don't think they're growing fast enough. So that gives the opportunity for new entrants. And one of those companies happens to be a Norway-based battery manufacturer that literally just started up about two years ago. But they have been using a type of technology that's patented by MIT and given the green light by Volkswagen that can shorten the production time of a battery by maybe 40-50%.
Veronica Zhang: That's really, really innovative. This is an industry in which things have not really changed that much in terms of a production process. Technology and chemistry have gone through a lot of change and a lot of improvement, but the production itself is still very, very lengthy and hard to change. So a company coming in like this and being nimble, and being able to change the way that something is done is, we think it's going to be something that people talk about in the next couple of years, and they've just kind of started.
Video Highlights | Investor Playbook: The Resource Transition
- 00:07:00 Greenflation Investing Opportunities In 2022
- 00:17:50 What Going Green Means for Companies and Investors
- 00:27:30 3 Key Issues Impacting the Future of Metals and Mining
- 00:35:30 Fossil Fuel, Solar, Wind: Biggest Trends to Watch In the Resource Transition
- 00:39:20 3 Trends Shaping the Future of Farming, Agriculture, and Land Use
- 00:53:45 Why the Next Decade Is Critical for the Recycling Industry
- 00:58:45 Why Batteries Are a Linchpin In the Energy Transition