Boris Eykher on Using AI and Strategy to Secure Critical Mineral Supply Chains

Thank you very much, Adam. It's a real pleasure to be here and thank you for having me.

Yes, I was a panelist at LA's Milken Global Conference. Amazing event. I want to say huge kudos to the organizers of Milken's events because they are able to bring a great quality of people together and to have candid, real conversation with a real call for action. So, you know, majority of the global conferences tend to have a lot of people saying correct phrases that we have heard thousands of times that mean absolutely nothing. And the difference is at Milken, a significant percentage of the people, I would say absolute majority, comes from the business side. And so the conversation actually becomes: how can we improve something? How can we do something better? It's super challenging. It's not about the beautiful story. None of the simple, easy, beautiful words solve them. It's about actually facing real problems and calling things what they are. And that's what I love about Milken. It's a very, very pragmatic approach. And of course, Milken was able to build up an amazing network throughout his career where he's super well-respected in the financial and the business community. So, the caliber of people that you have participating at the events is just unparalleled. Just to give you an example, I still have not posted the picture where I had Elon Musk literally speaking one meter away from me. And nowhere else you would have that, where you're approaching the VIP guys, the head of the World Bank, who casually stopped by our desk after his speech to catch up with somebody and stay for a 15-minute conversation. You just don't have it anywhere else. So, it's amazing the quality. And of course, because you have people of that quality, they actually speak — they're surrounded by business community. So they speak much more about pragmatic solutions. And they're being very, very modest. You're sitting there, you realize how successful they are. There is no question about that. And they have humility. They speak about their errors, what they tried, what failed, and it's just a real, candid, normal conversation. So that's super, super impressive and amazing. Kudos to the whole team for putting that together.

Basically, on top of the global events that take place in Singapore, Los Angeles, Abu Dhabi, a couple other places around the world, there are also some smaller private events where the members frequently host at their houses — small get-togethers. And so the conversation is as candid as it basically gets, because in the setting of their private house, people get together to really solve issues. They have no reason — they're super successful, they have nothing to gain. They actually want to have the community help solving the biggest issues. So depending on what they're passionate about — it's about business issues that come up, it's about longevity, it's about health. For example, cancer is always one of the big topics, education, doing real initiatives to help other people as well. So what people are really passionate about, they get together and invite people who might have similar ideas or similar passion, and combine efforts basically.

Sure. What we are is basically a commodity trading platform. So we have created an IT solution for trading mineral raw materials. And once we built it up, we actually learned that the platform, how we envisioned it originally, was not working. So we failed at our first approach, but we knew the market is highly inefficient, right? And we were trying to understand what the participants from the industry are used to receiving. It's not just the IT solution that you need. They are used to receiving from the traders financing, the risk management, and easy logistics solution where the trader is basically handling everything. And so what we added on top of our platform is the full trading service. So you can think about that in two different ways: you can think of us as the 21st-century trader that is using all the IT possible in order to make things more efficient, or as a platform with the full physical trading service in order to solve all the issues and have a one-stop solution for the miners and the smelters.

After business school I was with Glencore for eight years, and now for more than eight years with Open Mineral. So 16 years in there. And prior to that I was in private equity.

It's a great question. And you know, coming back to the conference — if you read the articles, a lot of the governments around the world are trying to solve it by introducing some kind of tariffs. What they do not understand is what is being produced at the end is basically a commodity. And if the commodity somewhere else around the world is much cheaper, it does not matter all the barriers that you're going to put on any particular country — they'll still slip in one way or another. And so if you're producing at much higher cost, you're just not competitive in the long run under all circumstances. Something will change. Something will change in the policy, people will adapt, will move the material with other countries and so on. So the way to think about that is you actually have to be able to secure the raw materials. Basically, what the game is about is who has access to the raw materials so they could produce things more efficiently. And if they do not have the access to the raw materials and are not able to secure them, then they have to secure the refined metals and have stockpiles in the country if they want to have the security for their production.

Of course. So instead of actually wasting money on the tariffs where you do not achieve much — you're just increasing the prices internally, right? And by that you're trying to make your industry competitive, but it's not going to be competitive because, for example, the Chinese are producing at absolutely huge volume. So you're not comparable on the unit cost, and it's not possible to achieve that. What is a much, much more intelligent way is to address the issues that the miners have around the world. So for example, where majority of the production is going to be coming, of course, from emerging markets. There is no new copper mine that is going to be located in New York City — they don't exist. Anything that was simple to extract in good jurisdictions, of course, has been extracted by that point. So what do you end up with? More complex mines in harder jurisdictions around the world. A lot of them are small and medium-sized guys. So for example, DRC has one of the largest copper mines that recently came online. Of course, it's super hard to get any financing flowing. It's super, super hard to get the financing for the development of the mine and to move the materials across the world because there are a lot of perceived and real risks that exist in Africa. So what is the easiest way to do that? It's actually to help the guys on the ground build up or secure and move the materials around the world. That way you secure the raw materials that are necessary for your economy, and you help the emerging markets to develop there. And this becomes — you are being part of the whole economic ecosystem. So you are fully with the market prices. So the change in policy does not affect you. You're actually becoming part owner of either the mine or the offtake for many years, securing raw materials.

Absolutely. So when we are trying to come up with a set of tools to help miners be more efficient, one of the things that we were providing them from the start is the ability to hedge the prices. So that way they can lock up the prices — basically derisking the project or derisking the trade or making sure that their budget is being fulfilled, whatever the goal that they have. And of course everybody was always asking what do you expect the price to be, and it's very, very hard to predict the price. If we were that intelligent, we would not be doing anything else. And so we were constantly trying to think about, with all the data that we have — because the fact that we have digital DNA, we started as a platform, we collected the biggest data lake in the industry — but we were constantly asking ourselves: what is the edge? How can we help people and ourselves make better decisions? And so instead — at the beginning we were a little bit naive, or too ambitious maybe is a better way to say it — where we were trying to ask the question: how can technology solve everything? And then we changed that and just started asking: can technology help solve part of the issue? And so the way we are using machine learning is actually fascinating. We started first with the correlations. Does the price depend on some other variable? For example, if the Federal Reserve releases more liquidity into the system, does that mean that metal prices or commodity prices overall will go up? And so we started running with multiple, multiple different hypotheses. And then what machine learning is basically allowing you to do is combine a lot of those different signals — we call them alphas — into a portfolio predicting the metal prices. And so once you start running those machine learning models with many hundreds, thousands of signals, it's actually phenomenally good. It beats every single person I have seen, including our head of hedging, myself, and so on. Because the system can take into account so many more variables, and each one of them is small, but as a combination, of course, it's remarkably better than any one of us on the team in predicting the price. And so we are sharing that with the producers, being able to take a slightly better position and being slightly more right than the average — and that's a huge competitive edge. Same thing on AI. Instead of just saying how does LLM help in the real world — it's super hard to find those solutions — but we started basically optimizing first: how can AI help us make slightly better decisions? For example, what customers to focus on. So we are running multiple parameters on what to focus, or how can we make certain operations more efficient for ourselves and the counterparty by sharing the data, by combining the data. How can we predict what is the most likely result that will come out of there based on the whole history that we have? How can we help sign the contract and put together the contract in a more efficient way by first picking up all the details from the previous contracts between these counterparties and then also giving the most useful suggestions that add the most value to the contract, and so on and so on. So basically we are constantly asking ourselves the question: can technology give a small edge? None of that changes the game, but cumulatively it creates a significant edge.

And I'll tell you a funny story. We basically — you know, I've been running Open Mineral for two years and some established trader came at one of the conferences, introduced himself, said, 'I've been watching you for two years. You were supposed to be dead a year ago. You're still alive. You must be doing something right. Tell me exactly what do you do.' Come on.

www.openmineral.com — openmineral.com — and we have all the information there, guys. Happy to catch up with anybody who's interested in our space or having some security over critical minerals going forward.

Perfect. Thank you so much, Adam, for having me.