Cobus Loots, CEO of Pan African Resources, on delivering sector-leading returns for shareholders. Watch the video here.
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The Chamber of Mines and Energy in Malawi had an Annual General Meeting yesterday at Ufulu Gardens in Lilongwe. Here are the new Executive Committee Members for the Chamber:
President: Lotus Resources Limited (Theo Keyter), Vice President: Sovereign Metals (Frank Eager).
Council Members: Globe Metals and Mining, Lotus Resources Limited, Lancaster Exploration (Mkango), Bwanje Cement Company, Sovereign Metals Limited, Rukuru Mining Limited.
Congratulations to the new Leadership of the Chamber!
The momentum is well and truly to get away from the dominance that China has over the rest of the world when it comes to rare earths. As a sceptic and someone who tries to look at the big picture I’m sure the Powers that be have realised that before we or any of our partners completely fall out with China, that the west has in place an ability to at least supply the defence industry with the basics. Hence the ‘critical’ minerals review. I believe in a year or two Mkango will be a key player in the race. It’s already got a very good head start. I can only see the market cap steadily increasing as the ‘Funding’ pours in.
GLA
Yep can only help rare earth producers in the west:-
https://www.proactiveinvestors.co.uk/companies/news/1032360/china-tightens-controls-of-rare-earth-exports-1032360.html?viewSource=TwitterUK
'Exporters must report all transactions for next two years
On Tuesday, China’s Ministry of Commerce (MOFCOM) directed exporters of rare earth metals and oxides in the nation to report each transaction for the next two years.
According to the directive, traders must provide real-time reports, including country of shipment, the date the contract was signed, the quantity, the date loaded, as well as ship and port of arrival for customs clearance.
The move is aimed at stabilizing foreign trade, state media reported on Tuesday. It follows earlier restrictions placed on rare earths in 2015 that required exporters to first obtain a license, similar to recently imposed restrictions on graphite. Tuesday’s announcement also builds on earlier announced restrictions on exports of rare earth manufacturing technology from April this year.
At a State Council meeting in the nation on Friday, Premier Li Qiang said China’s industry should coordinate to ensure proper planning for rare earth exploration, development and research.
The meeting also reinforced that Beijing would continue to crack down on illegal mining, bolster breakthroughs in high-end rare earth materials, and drive a green transition of the industry.
Adamas take: Yet more saber rattling from Beijing in its ongoing technology trade war with the U.S. and allies. Despite the latest development, our view remains that a blanket ban on rare earth exports from China is highly unlikely. Rather, should Beijing actually opt to restrict physical flows of rare earths it would likely direct those restrictions at select entities or industries, such as defense.
Moreover, as articulated, the latest restrictions appear to apply to rare earth metals and oxides, which (aside from lanthanum) make up a small percentage of China’s overall exports by both volume and value.
Conversely, NdFeB magnets are the bread-and-butter of China’s rare earth export market and are far more strategically valuable than individual oxides or metals to end-users around the globe. If China’s intent was to inflict maximum pain on trade partners, magnet exports would be the focus.
That said – China opting to restrict NdFeB magnet exports – while painful in the immediate future – would hypercharge efforts to establish alternative mine-to-magnet supply chains outside the nation and almost certainly solidify the resolve of the West to move away from China’s supply chains entirely, where possible.'
https://www.adamasintel.com/china-rattles-rare-earths-export-sabers/
Thanks. A very nice video.
All i can say. They (USA) are taking this damn seriously. They really want to get this sorted!. Any company that can really help could be in a sweet spot.
Thanks for posting - we all get upset about the lack of comms - but building blocks like these make you realise what is going on in the background. Not ramping - as I know we are invested and few people read this board but blimey this could/should be the monster of monsters. Gla
There is no doubt that the trading in london is what drives the stock. trading volume is much lower in canada and liquidity can be an issue when selling. on the positive side shares buy and sell exactly at the posted bid and ask prices. on the aim you never know what price the transaction will go through at. the canadian market is a fine place to buy mkango
After a bit of advice if anyone can help me.
Really excited about the next couple of years with Mkango after doing my research and watching the latest investor presentations etc. About to pull the trigger.
However, I’m not based in the UK and the platform I have access to only has MKA shares listed on the Canadian exchange.
Does anyone see any major negatives with this approach?
Appreciate any comments or info if anyone has experience with this or any other similar situation.
Thanks, Richie
Mkango needs to release a vid like this!
https://twitter.com/60Mins/status/1717458428820705479
:)
meanwhile, Will will be @ Resourcing Tomorrow ... a big conference at the end of Nov
https://resourcingtomorrow.com/speakers/will-dawes
I agree unless you knew you would not know this company is also HyproMag....As far as the market is concerned this is a company waiting for an MDA for an non-financed potential REE mine in Malawi an unknown mining jurisdiction....and nothing else
Sadly the Board continue to fail to communicate what should be easy and exciting story. If you don’t follow the story, you would be oblivious to the fact that we start producing magnets in the next 7 weeks and even if you do follow the story, we have received no guidance whatsoever.
Imagine the contrast if CoTec was in charge, it would be super exciting and you wouldn’t be able to keep Julian quiet. Chalk and cheese sadly.
Anyways to add more substance....
'Developing permanent magnets value chain
Co-organised with SUSMAGPRO, ERMA, REIA,
Japan and the United States
16 November 2023
Le Plaza Hotel Brussels – Versailles room
Bld Adolphe Max 118-126, 1000 Brussels
'Japan and the United States' :))))
https://rawmaterialsweek2023.eu/images/system-files/16112023-Magnets-Events-web_v1.pdf
Sounds like could be an event of signficance
Https://www.investorschronicle.co.uk/news/2023/11/01/what-american-influence-means-for-uk-rare-earth-miners/
I'm surprised at no discussion here about this recent article seeing as it has where we are at relevance and possible likely financing outcomes but also the great disconnect of the MCAP here in comparison with both Pensana and Rainbow whom I know are both at different stages and all UK REE companies having different assets/ investment cases etc but come on which company with a measly £15 mill MCAP is about to be actually producing commercial REE's and their products ... oh that will be Mkango via HyproMag :)
Someone investing in this sector should understand the huge burden of mineral extraction to execute the "green transition" to "net zero". Perfect opportunity to make a few quid, but save the planet... not sure about that.
"It's about keeping the planet habitable"
It really isn't but must..have..inflation..
On a macro level the market has shifted totally away from risk. MKA carries risk, especially with being a non revenue generating (for now) resource company. People can get a guaranteed 4.5% on an easy access saver account with No risk. Wars or not, any company that's pitching itself on "jam tomorrow" is struggling. Not to mention the UK stockmarket taking an absolute battering. This is a market wide issue, not just mka.
Not sure "Africa" - that 11.73 million Square mile area with 54 countries would align in unison with "the east".
The United States Inflation Reduction Act is a big potential boom here. If hypromag goes for a US IPO after generating revenues in Europe then all bets are off.
I had certainly expected the MDA to be in place by now, but here we are.
Additionally The wind market is going through a melt down - a huge driver for Neodymium and other rare earth prices. Costs of building wind farms on contracts agreed at pre-covid levels are having to be abandoned HOWEVER, governments made a rod for their own backs with this green agenda madness So they are stepping in to make wind projects viable again. Once projects get up and running again and electric car demand ramps up higher, and old wind turbines start to be decommissioned for recycling then all of MKAs number will look fantastic. In the meantime, the market is risk off.
Personally, MKA is my biggest holding because the reward can be huge. But, it is certainly not without risk.
Just my two cents. Good luck all
I do wonder if this war(s) is now the determining factor in this investment. If Russia wins, and if Israel gets consumed by the Middle East, and if Africa look toward a new and possibly more powerful east for alignment, this will never fly. Will Africa wait to see who the best allies are? It feels like the whole market will s suffering, but with Mkango especially, are Malawi blatantly using the macro geo political environment to add pressure to the deal? To me it’s starting to feel like the outcome of these wars determines the outcome of my investment. I do hope I’m wrong.
'A company 80-per-cent owned by Mkango, HyProMag, was also named by the Minerals Security Partnership (MSP), a multi-nation group to channel capital into critical mining supply chains, as a key part of the energy transition for its magnet recycling technology. Mkango is also moving forward on a rare earths mine in Malawi and a processing plant in Poland.'
“It's not just about mining, it's about chemistry and processing [as well],” says Mkango Resources' (MKO) chief executive, Will Dawes. “Rare earth deposits are not as straightforward as developing a gold project or a copper project, that's why there are so few.”
China has had a stranglehold on the rare earths mining and processing sectors for some time, and the US and EU want their own supply. The US will require components of electric vehicles to have locally sourced parts to receive tax incentives, creating a two-track auto market. The government is rightly putting cash into the supply chain at the same time.'
https://www.investorschronicle.co.uk/news/2023/11/01/what-american-influence-means-for-uk-rare-earth-miners/
'Magnetic material conditions may also create issues for recycling, causing inconsistent properties in the end materials. The project consortium aims to tackle technology readiness level (TRL) 7-8 upscaling challenges, like impurities, high oxygen content and varied magnet compositions by project end. “End users will soon start realising recycled magnets can match or surpass originals,” notes Burkhardt.'
https://cordis.europa.eu/article/id/446792-a-more-sustainable-value-chain-for-the-sought-after-metal-neodymium-iron-boron
Someone asked about the quality of the recycled magnets the other day -
https://www.linkedin.com/posts/william-dawes-50881352_susmagpro-sustainable-recovery-reprocessing-activity-7125377719697072128-mYsI?utm_source=share&utm_medium=member_android
Quite vague but positive none the less
This is why getting Songwe over the line is so important, IMO.
The last raise was fundamentally about Songwe. We need to see a tangible return on that.
If we are to have another raise (which seems more likely than not I think), then we need the SP to be far higher than it is now, unless the BOD can secure a raise at a big premium (unlikely in this market).
If no further raise is required, irrespective of Songwe, then it largely becomes a moot point.
Although it would still be a credibility hit to the BOD in such a scenario, IMO.
Sort of agree. There's:
1) price of last transaction which is what Cotec currently use in the accounts and what you're referring to
2) what the market values it at. I.e. does the market agree with NAV or does the market apply a discount / premium because of a belief that management has overvalued / undervalued the asset
I would suggest 2 is the most important. Typically for asset managers (which effectively is what Cotec is) you'll see the market applying a discount to NAV. Interestingly the market values Cotec above it's NAV (currently +50% premium vs Jun'23 value of net assets). Clearly Maginito makes up part of that NAV. Don't know how much of the premium (if any) is attributable to Maginito though.
Either way at some stage you'd expect to see Cotec investors interested in MKA given the "cheaper" valuation. I can't see the share price staying at these levels when this all becomes more transparent.
For me one thing which might hold back a re-rate, and very much welcome anyone's view on this, is whether MKA is burning a lot of cash still and will need to raise money again soon. Difficult to know when cash flows from recycling will become positive and cover the corporate costs (and in the first instance if there is significant working capital requirement which will needed to be funded)