Member Info for mattlilly

We need to push through 16.50 and beyond...

https://www.kitco.com/news/2022-10-04/The-important-business-reason-behind-ESG-Triple-Flag-Precious-Metals-Shaun-Usmar.html

Despite environmental social governance (ESG) finding less favor with some due to the current energy crunch, good miners will continue to embrace the framework in order to maintain standing in the communities where they operate, said Triple Flags Precious Metals CEO Shaun Usmar.

Environmental social and governance has fallen in favor with some attributing it to higher energy prices due to less investment in oil and gas. Usmar said ESG is partly about a company's ability to maintain its standing.

"For us what it's just good business. I think any serious miner...is focused on sustainability. You have to take care of your communities," said Usmar.

Nice one rcgl...

Well done Lunch.

I share all the research I come across and while I am not looking for a pat on the back, a bit of debate would be great.

I know the two foci on here are takeover or funding and in those matters we are in the hands of 1 outside parties and 2 management.

But whetehr or not Solgold survives as an independent entity, the stuff about gold and copper is highly relevant.

Even if we get taken over there will be the decision as to how to reinvest.

In my own case I will likely either be banking the cash pending the final market correction or, if that has already haopened or things look rosy, will put most if not all into high yielding blue chips of which there are plenty.

If you want to reinvest at least part in copper and/or gold, there's ;plenty to choose from. I was lucky that by the time I had made the big bucks in ATYM somebody on another Board had already tipped me Solgold among others.

Plenty of those were small juniors that I either dabbled in or ignored. The only one I've stuck with is JAY, which I'm temporarily out of but will buy back.

None of this is a recommendation, but merely a discussion of general considerations.

There is a lot of money to be made and a lot to be lost as most of us realise.

The Brent Cook interview below would have you avoiding Juniors in general, even some with a MCap of $1bn (remember those days). He mentions block caving and development periods of even 15/25 years.

So in conclusion my core strategy remains the same:

Focus on copper and gold, ideally Tier 1 projects or established producers, both in stable environments.

And if I'm lucky enough to make the big bucks again, invest for the future in high yielders and not spend most of my days researching, reading and writing posts.

Good luck all and as Lunch says, lets have some more constructive debates rather than petty squabbles...

Well that was pretty dismal mog...not the best way to start my day...the conclusion would be that unless theres a takeover of SOLG I'm better off in ATYM...

Gold hit $1730 overnight...

Copper $3.50...

Next targets" $1746; $3.60...

While we wait for the inevitable, lets have a bit of fun...

Only two requirements:

They must mention Solgold or SOLG

They must 'scan' (no budding McGonagles please...)

Hers one for starters:

I once took a punt on Solgold
That right now seems terribly bold
A takeover bid
Would see me get rid
And make me quite rich when I'm old

Over to you creative posters...

Back in abundance from 15.23 DBW...

Score...40/15...

We're at a turning point IMO...

Capitulation on Thursday...

Bullish Harami on Thursday/Friday...if we close above 16.43 today that will confirm the start of a bullish uptrend...

"Alarm bells are ringing for those holding short positions. We are on the verge of telling an end to the bearish phase in the market and acknowledge the ascendancy of the bulls."

And a 100% SELL on all measures on Barchart....got to be a bottom...?

Part 2

(Laufmann) said with 8Mt of additional copper production needed by 2030, the world was sleepwalking into a situation that would have to incentivise developing new mines.

“There’s no argument from anyone on the general sense of the copper thematic, it’s been pretty straightforward for a long time,” he said.

“It’s like a lot of things that play out in real time; the frog is sitting in the water, and the water is heating up, but he doesn’t realise till he passes out. I think that’s the situation that the world kind of finds itself in here.”

https://stockhead.com.au/resources/goldman-sachs-the-only-way-well-meet-copper-demand-by-2030-is-if-prices-top-us13000/

Goldman has been one of the world’s most noteworthy copper bulls in recent times, suggesting demand for the red metal to cater for the electrification of everything from cars and buses to off-grid electricity will blow supply out of the water by the end of the decade.

In one fantastical swoop, commodities strategist Nicholas Snowdon even suggested prices of US$100,000/t, something that would eclipse last year’s US$10,724/t record nearly 10 times over.

Goldman has not gone that far in a recent note outlining the prospects for the world’s top 50 developing copper projects.

But they have said prices above US$13,000/t would be needed to incentivise the 8Mt of additional annual production needed by 2030 to cater for demand from renewables, power infrastructure and EVs — around eight times that of the world’s biggest copper mine Escondida.

According to Goldman, US$9000/t is the new marginal incentive price for a copper mine today, up 30% on 2018.

According to Goldman, 50% of supply from the world’s top-50 development ready projects will come in unconventional jurisdictions like the Democratic Republic of the Congo, PNG, Botswana, Panama, Zambia and Mongolia.

These projects have higher reserve grades, but are located in jurisdictions with difficult permitting regimes, endemic government corruption and/or a dearth of mining know-how.

“This leads to higher returns/copper prices being required and indicates possible delays in project sanctioning/execution,” Goldman analysts suggest.

All up, an extraordinary US$150 billion of capex needs to be sunk into the ground by 2030 to bring on this 8Mt wave of new supply.

Something has got to budge, and amid the chaos a number of majors, mid-tiers and juniors do have projects worth pursuing that stand to materially increase their production and free cash flows in the coming years.

The belief in the world’s biggest mining companies in copper as a thematic to back has been made clear by decisions from BHP (ASX:BHP) and Rio Tinto (ASX:RIO) to launch ambitious all-cash takeover bids in recent months.

Profound...

Question is...did we have capitulation last week...?

You're very welcome Jezzoo...

Part 2

Globally, supplies are already so tight that producers are trying to squeeze tiny nuggets out of junky waste rocks. In the US, companies are running into permitting roadblocks.

And then there’s this great contradiction when it comes to copper: The metal is essential to a greener world, but digging it out of the earth can be a pretty dirty process. At a time when everyone from local communities to global supply chain managers are heightening their scrutiny of environmental and social issues, getting approvals for new projects is getting much harder.

“The incentive to use cash flows for capital returns rather than for investment in new mines is a key factor leading to a shortage of the raw materials that the world needs to decarbonize," analysts at Jefferies Group LLC said in a report this month.

Even if producers switch gears and suddenly start pouring money into new projects, the long lead time for mines means that the supply outlook is pretty much locked in for the next decade.

“The short-term situation is contributing to the stronger outlook longer term because it's having an impact on supply development," Richard Adkerson, CEO of Freeport-McMoRan, said in an interview. And in the meantime, “the world is becoming more electrified everywhere you look," he said, which inevitably brings “a new era of demand."

https://www.livemint.com/market/commodities/why-copper-prices-can-t-remain-at-historic-low-explained-11663805226402.html

"Goldman Sachs Group Inc. estimates that miners need to spend about $150 billion in the next decade to solve an 8 million-ton deficit, according to a report published this month. "

" To put in perspective just how massive that shortage would be, consider that in 2021 the global deficit came in at 441,000 tons, equivalent to less than 2% of demand for the refined metal, according to the International Copper Study Group. That was enough to send prices jumping about 25% that year. Current worst-case projections from S&P Global show that 2035’s shortfall will be equivalent to about 20% of consumption.

As for what that means for prices?

“It’s going to get extreme," said Mike Jones, who has spent more than three decades in the metal industry..."

"Goldman Sachs forecasts that the benchmark London Metal Exchange price will almost double to an annual average of $15,000 a ton in 2025. On Wednesday, copper settled at $7,690 a ton on the LME."

“All the signs on supply are pointing to a fairly rocky road if producers don’t start building mines," said Piotr Kulas, a senior base metals analysts at CRU Group, a research firm.

"But even a recession will only mean a “delay" for demand, and it won’t “significantly dent" the consumption projections going into 2040"

The physical copper market is already so tight that despite the slump in futures prices, the premiums paid for immediately delivery of the metal have been moving higher.

At mature mines, the quality of ore is deteriorating, meaning output either slips or more rock has to be processed to produce the same amount. And meanwhile the industry’s pipeline of committed projects is running dry. New deposits are getting trickier and pricier to both find and develop.

Soaring inflation is also driving up the cost of production. That means the average incentive price, or the value needed to make mining attractive, is now roughly 30% higher than it was 2018 at about $9,000 a ton, according to Goldman Sachs.

Part 2

"Using the 2008 playbook risks selling commodities at the bottom of a cycle, missing huge potential returns over the coming decade.

That's because, when investing in natural resource equities, the commodity capital cycle is more important than the broader economic cycle."

"The key point is that even if we were to go into another recession, it doesn't necessarily mean that commodity prices will fall in lockstep, as they did in 2008. In fact, they (and resource equities) are likely to hold their own and do quite well, because unlike in 2008, commodities are undervalued...

he radical undervaluation of commodities and commodity related equities is greater now than it was back in 1929, and the level of capital starvation is just as great. History tells us that commodities could again be an excellent place to seek high returns..."

"G&R's Commodity Prices/ Dow Jones Industrial Average chart shows that there hasn't been a better setup for commodities than now, over a time frame spanning 120 years. Especially when you consider the current rout in the stock market and the pummeling juniors are taking.

With the penny juniors in the mining area falling off a cliff on Friday with massive drops across the board, we are starting to see capitulation. While it is painful to watch your investments dropping by double digits daily, this is where wise investors make their fortunes. The market will rocket higher just as soon as those silly investors who used margin finish selling off the last of their investments just to meet a margin call.

These sorts of opportunities only come once in a lifetime. Prepare yourself to rake up the falling fruit. ...

"Weak hands buy at tops and sell at bottoms. Strong hands buy at bottoms and sell at tops. It's vital that investors remember that at every top there are 50 reasons to buy, and at every bottom there are 50 reasons to sell. That's what makes them tops and bottoms."

I personally can't think of a better time to pick up deeply undervalued and high-quality junior mining companies that are poised to capitalize on the decarbonization and electrification trends that are central to the new economy...."

https://www.kitco.com/commentaries/2022-09-29/Strong-hands-buy-at-bottoms-and-sell-at-tops.html

"It's not an exaggeration to say that copper is essential to decarbonization; nothing happens without it. "

"Although the copper price has retreated from a record-high $5.02 a pound, reached in March, the bull market for copper remains fundamentally intact — bolstering the case for investing in companies that mine the orange metal and exploration companies ("copper juniors") that explore for it."

"Again I have to ask, where are we gonna find the copper?

The obvious answer is, mine more, but that is easier said than done.

Bloomberg New Energy Finance (NEF) estimates that in 20 years, the world's copper miners must double the amount of global production — from the current 20 million tonnes annually to 40 million tonnes — just to match the demand for a 30% penetration rate of electric vehicles.

This is a tough ask considering some of the world's largest mines are seeing depleted copper reserves and lower ore grades, so it would be difficult for global production to even maintain a 20-million-tonne-per-year pace."

"Fitch expects growing deficits from 2023 onwards, peaking at 9 million tonnes by the end of the decade, as demand accelerates, "mainly driven by consumption related to the green transition."

The firm also sees steady improvement in prices over the next five years, with the metal returning to its March peaks above $10,000/t in 2027 and $11,500 in 2031 as "a long term structural deficit emerges."

"About 20% of Barrick Gold's production now comes from copper"

As Bristow has said ""Copper is probably the most strategic metal, and it's geologically related to gold," he said. "So if you want to become a world-leading gold company in the fullness of time, you are going to end up producing [copper]."

"The expected shortfall in copper supply and the inability of recycling to fill the gap, measured against robust demand for copper from both traditional and so-called "green" applications (mainly electric vehicles and renewable energy) bodes well for companies exploring for copper. After all, they are the owners of the world's next copper mines."

https://investingnews.com/copper-market-trends-watch/

"“We have moved into a landscape of accelerated copper demand growth, underpinned by the green energy transition,” Piotr Ortonowski, senior market analyst at ERG, said at the event. “In 10 years’ time, 7.6 million to 11.3 million tonnes of new mine capacity will be required to fill the supply gap, but mining companies have been extremely sluggish in responding to this challenge — the recent drop in prices won’t help.”

Copper demand from green end-use sectors is set to more than double between 2020 and 2030."

"Sustainability has become a core discussion for the industry, with the difficult-to-define concept of “green copper” being used more and more often....

“I think it's worth noting how far we've come,” said Georgina Hallett, chief sustainability officer at the London Metal Exchange. “I think now we are committed to understand that even if it's environmentally friendly at the cost of other ESG metrics, that's not okay either. So it's got to be a balance while not getting too broad.”

Furthermore, the lack of investment in new copper projects could see the sector enter a period of shortage right at the time when the metal will be needed the most.

“Near term there is plenty of uncertainty, but longer term (the) requirement for new projects remains,” said Graeme Train, head of metals research at Trafigura. “But adding mining capacity is getting harder and more expensive.”

Is copper breaking out...?

$3.4639...$3.4745 then next target $3.50 on the way to solid technical resistance at $3.6925...

Gold up 6% in three trading days, but silver up 17%...

So why shouldn't copper follow as the dollar is close to breaking down through a two week support level...?

Where it all began...

https://news.metal.com/newscontent/100905605/bhp-billiton-buys-6-per-cent-stake-in-ecuadors-solgold-copper-mine-for-35-million/

How will it all end...?