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tbf I think 6p traders sold on last push to over 10p and retrace to 8p. someone got house deposit to pay :)
Ahhh, if only EML was a producer we would all be receiving divi this year. Wonder if Russia can keep on bashing Ukraine for another 3/4 years and give us a chance of producing.
Maybe good business to lock in a 50% uplift from, let’s say, 6p.
I do agree it looks more like individual moves than a market view and, tbh, speaks to where we are; that someone either buying in or going out can move things.
Also work both ways. Some of the 6-9p gains seemed to come in the same way, so was positive from that side.
No idea why someone has continued to jettison their holding this last few days. One chunky buy turns up and soaks up all the stock just like now. Liberium added a bit of anticipation to the environmental permit when it said 'mid year'. But so much going on that EML has kept to itself waiting to pop.
https://www.dtnpf.com/agriculture/web/ag/crops/article/2022/05/04/nutrien-ramps-potash-production-rise
$730 to approx $1000 per ton. But that figure is climbing as the table is a month ago.
More likely inability to get potash due to supply chains leading to thrifting in some regions, creating a perfect storm for more failed crops and higher prices. Week by week commentary is interesting chat but investors will make a decision on current 19 yr LoM, which'll readily extend to 30+. Last quarterly update, EML said pace of work across all fronts had accelerated. Market is looking forward to a new update.
PM guys suggested that demand destruction had taken place, which inevitably will result in smaller crop yields, exacerbating the food shortage problem.
Key customer export markets for Khemisset are Brazil (same for Canada and Russia/Belarus) and West Africa where spot price hit $1,200. No idea what it is now but it'll be volatile. Safe to say, $800 is the new $400. $1,000 as acceptable new basecase? - don't rule it out when 40% of global potash supply disrupted and droughts / heat damaging crops and major grain exporting regions now taken by Russia that signed a deal with China in Feb to receive its wheat exports from all regions. Whatever happens, transport costs aren't coming down and customers across industries want closer, diversified supply chains. Morocco’s geographic advantage over Canadian projects is unassailable, so to its proximity to port and simple mine design. Recall a conversation with Highfield on Muga Project where among interest from equity investors, pension funds were in the mix. This was at $400 3-4 years ago. They're attracted by very long mine life and predictable high margin production that's somewhat inflation protected. As we know, Japan, Peru, Bangladesh among Brazil and West Africa now courting Morocco for fertiliser supply. Don't know what role OCP could play - potentially a strategic investment to solve for the equity. It'll be interesting to see what EML does as its investor presentation referred to that as its "trump card". Personally see potash demand/price going higher because the damage being done today will be felt on a lagging basis, as we saw from the pandemic - food prices were at a record high pre-war in Feb. Cereal crops are vulnerable to attempts to thrift on potash, so we could see widespread failures this year and next for example. Hopefully environmental permit is granted imminently and we get news on conditional financing + other major steps to construction. Muga has its debt now agreed - smaller than Khemisset and lesser NPV but - interesting to see if Israel Chemicals also mining potash in the basin moves to buy the project.
Brazil is plus $800 dollars. Double EML’s previous target of $400.
The lads at PM, did they also say that expect smaller crop yields as farmer won’t buy the same quantity of fertilisers? Least not until they gain from higher food prices.
Once shortages push up costs further at the retail end then we should see potash prices stabilise from return to normal demand. I doubt we have anything to be concerned Russia, isn’t giving up the Black Sea, coast in next few years.
Any price on or near EML’s price prediction is inline with expectations. Anything above that’s a significant rise above $400 is a genuine bonus.
OCP, opening in Brazil, this does indicate they’d prefer Moroccan potash over Canadian MoP. I in no way change my view that EML, will not be selling into the local OCP market.
The Potash price has come off to $1,000 (source Portfolio Matters Youtube presentation 27.05.22 around 27 minutes 40 seconds in).
I'm aware the price has trebled in a year. The latest I have is $1200. Has it gone above that figure now?
Potash price has more than trebled compared to a year ago.Would you not think that
TPTB would get this stuff out of the ground as quickly as possible or are they waiting for the price to increase another 3 fold.