A frequent topic of discussion this year for our Consulting division with market participants has been what the key considerations need to be when conducting due diligence on upstream opportunities.

These clients are either businesses looking to finance, or partner with, an upstream project, or businesses assessing procurement or purchasing risks.

In our current volatile environment, combined with tariffs, there are plenty of moving pieces, but the fundamentals of how to think through supply chains haven’t changed.

From a market perspective there are always two key components:

1. Commodity prices, because this drives the financials
2. Availability of upstream supply, because this drives operational survival

Both are important, of course, and our team has done significant work on availability of supply.

Theoretically, a commodity is a commodity is a commodity.

- They should be tradeable and fungible
- A single, defined commodity price
- That everyone has access to online

And because of this, commodity markets are typically modelled on a global basis.

We look at surpluses and deficits, and we talk about demand and supply risks.

All legitimate analysis, and certainly insightful enough for most people who want insight into critical material supply chains.

For our consulting clients, however, some business decisions aren’t being made in this theoretical, commoditized world.

There are technical, commercial, and regulatory nuances that come into play, that can really impact P&L, balance sheets, and valuation.

There are product specifications that can differ between upstream producers, processing sites that can easily switch flow sheets depending on market prices, existing captive supply chains that limit spot volumes to the market, regional trading zones driven by logistics and weather, and finally, scrap and recycled materials that could increasingly fill the gaps.

These are just some examples of the areas we have been digging into this year for our clients on upstream due diligence.

Then, the pricing scenarios we do also end up supporting our clients with their subsequent decisions:

- Are they prepared to provide follow-on funding?
- What should future partnerships look like?

Project Blue's dedicated Consulting division provides bespoke support to companies across more than 30 critical material supply chains to support their specific strategic and investment decisions.

To learn more about how our Consulting team can support your business, please get in touch.

These clients are either businesses looking to finance, or partner with, an upstream project, or businesses assessing procurement or purchasing risks.

In our current volatile environment, combined with tariffs, there are plenty of moving pieces, but the fundamentals of how to think through supply chains haven’t changed.

From a market perspective there are always two key components:

1. Commodity prices, because this drives the financials
2. Availability of upstream supply, because this drives operational survival

Both are important, of course, and our team has done significant work on availability of supply.

Theoretically, a commodity is a commodity is a commodity.

- They should be tradeable and fungible
- A single, defined commodity price
- That everyone has access to online

And because of this, commodity markets are typically modelled on a global basis.

We look at surpluses and deficits, and we talk about demand and supply risks.

All legitimate analysis, and certainly insightful enough for most people who want insight into critical material supply chains.

For our consulting clients, however, some business decisions aren’t being made in this theoretical, commoditized world.

There are technical, commercial, and regulatory nuances that come into play, that can really impact P&L, balance sheets, and valuation.

There are product specifications that can differ between upstream producers, processing sites that can easily switch flow sheets depending on market prices, existing captive supply chains that limit spot volumes to the market, regional trading zones driven by logistics and weather, and finally, scrap and recycled materials that could increasingly fill the gaps.

These are just some examples of the areas we have been digging into this year for our clients on upstream due diligence.

Then, the pricing scenarios we do also end up supporting our clients with their subsequent decisions:

- Are they prepared to provide follow-on funding?
- What should future partnerships look like?

Project Blue's dedicated Consulting division provides bespoke support to companies across more than 30 critical material supply chains to support their specific strategic and investment decisions.

To learn more about how our Consulting team can support your business, please get in touch.