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The bit that additionally interests me in all this is that traditionally in the "lulls" in commodity pricing like we are seeing now for Vanadium post a big rise and fall. Having tried and failed to see additional volume come into a market to meet demand, there is usually then a period of consolidation that see's the minnows taken out for critical mass by the bigger fish. We may just be peeking at this with both RedT and IRON in their different ways. Don't forget the genius of Fortune and our Board. They bought Vametco at the absolute nadir in the cycle and now off the peak they are acquiring Vanchem. They got Brits for a song in the doldrums too. Our Board are ahead of the pack - that usually shows who is the healthiest...…..Further consolidations in the production space would not surprise me...….
qwertyqwer - oh I think things panned out EXACTLY as Terry Perles expected. 13 months ago he told me that he expected prices would go above 130 USD/Kg V and guess what he was exactly right.
Nobody in their right minds could then predict precisely what would happen after that. It's just like being able to predict that a toppling tower of dominoes is going to fall over but not being able to determine exactly where every single domino will come to rest.
There is a modicum of merit in your hypothesis @Qwertyqwer25 it is the turning an Oil tanker syndrome. When Vanadium prices were sky high, many small expensive projects will have looked viable and some will have achieved funding. It is just like shale oil wells in the US. When oil was sky high they looked profitable and many were sanctioned. As the price turns downwards they become uneconomic and eventually fall by the wayside. The Turning tanker bit, is that period between when they start up and when they die when they are struggling and failing. I suspect in both China and Russia uneconomic transient production has come into the market and will soon expire.
Alfa. My post was not clear. I do believe that demand likely outstrips normal production but due to the high prices I believe other production has been turned on from random by product stockpiles around the world. I can’t imagine these are very profitable at today’s prices and they will turn off at some point but that will be evidenced by a further rise in V prices. If prices don’t rise I look forward to terry Perles view at year end about why things didn’t pan out like he expected.
The vanadium market is notoriously opaque and what is or isnt possible within the production space is not easily understood. Remember that traders have their own self interests, and their own agendas, so not all reports can be taken at face value. Alsp remember that rebar production is increasing by large amounts in many countries, China and India in particular, alongside vrfb uptake this will ensure a constantly growing and string demand for Vanadium. The notion that Expert insinuated, that BMN would not even be able to sell all that it produces, is frankly absurd.
Utter nonsense from all the regular BS artists on here. I am disappointed by you qwertyqwer though.
Have a look at the Vanadium price in the last 20 years. There have been 3 speculative spikes driven by Chinese rebar regulations and taken advantage of Glencore. After the 2008 one the V2O5 price fell to 6 USd/lb and then further fell to sub 3 USD per lb. Today it is above 9 USD per lb. Post 2016 the Vanadium price has shown a strong recovery that is indeed very good evidence of a structural deficit.
Didn't SP Angel's last note still have a 90p target using long term V price of $45? Or it might have been 92p. Anyway good article and nice to have a balance against some of the scattier claims that get bandied around from time to time.
were, indeed Mr Perles got it very wrong. Fact: Vanadium is a notoriously volatile stock. Now 3 rapid spikes since 2000 have rapidly fallen back. And this time around it is no different contrary to being shot down a number of times from the Terry Perles fan club of this BB. No doubt, V prices will rise at some point (as I said above, notoriously volatile). But mass take up of VRFB is not this year or next year. 5 - 10 years is my view. But I am,glad I saw this useful article. it explains a lot.
Interesting indeed. I have thought for a while now that supply of V must be plentiful for such a sustained drop in V prices. Terry Perles got it very wrong but this is good news for VRFB and hopefully prices will remain below $60 for many years to come. Once BMN production increases and costs fall it will be able to deal with lower V prices even better and I hope this also kills off the chances of other V mines getting built around the world. The SP is still undervalued but the near £1 price target by our broker is way out of reality in the short term. I expect the mining business will be worth 50p in the medium term and the VRFB business hopefully worth in the £’s over the coming years.
To be fair to the 'bulletin board experts' as you refer to them, their source of information is industry experts who mainly called for a supply deficit in what is a very opaque trading market. The ability of the Chinese to raise production as well as the, what appears to be, very limited adoption of the rebar standards (look at the increase in rebar production) combined with the higher than expected niobium substitution has taken most industry observers by surprise.
The game is not over, however, as the long term deficit is mainly centred around VRFB adoption. Lower Vanadium prices in the medium term should encourage adoption which should feed through to Vanadium consumption.
The end game is a much higher level of consumption and supply to create a more stable and transparent market. We are very far away from this currently.
A really interesting article which makes sense and clarifies a great deal for me.
chips, very interesting story, primarily for the fact it contradicts the BB forum census that there is a world huge V deficit, aided by the Vanadium expert Terry Perles analysis earlier this year. We have seen 3 huge V price spikes since 2000 (last year obviously the 3rd). Each V spike has resulted in a fast fall back down to nominal levels. however, the BB experts have been telling me this time around (3rd spike) there remains a huge deficit and huge demand. now, this article does not exactly suggest that.